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Unit 5: Activity 8 - Coggle Diagram
Unit 5: Activity 8
Agency Theory Model
Description
It posits that the primary stakeholders in a corporation are the principals (shareholders) and the agents (managers). The agents have a fiduciary duty to act in the best interests of the principals, who own the company.
Stakeholders
Shareholders
Owners of the company, who have a right to a share of the profits and control over the company's direction.
Executives
Top-level managers who are responsible for making strategic decisions and overseeing the day-to-day operations of the company.
Board of Directors
Top-level managers who are responsible for making strategic decisions and overseeing the day-to-day operations of the company.
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Stakeholder Theory Model
Description
It recognizes that a corporation has multiple stakeholders who have a legitimate interest in the company's performance. This model emphasizes the importance of balancing the interests of various stakeholders to achieve long-term sustainability.
Stakeholders
Shareholders
Owners of the company, who have a right to a share of the profits and control over the company's direction.
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Community
Local residents, governments, and other organizations that are affected by the company's operations.
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Stewardship Theory Model
Description
This Model views a corporation as a social institution that exists for the benefit of society as a whole. This model emphasizes the importance of responsible management and a long-term perspective in decision-making.
Stakeholders
Shareholders
Owners of the company, who have a right to a share of the profits and control over the company's direction.
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Community
Local residents, governments, and other organizations that are affected by the company's operations.
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