AGENCY PROBLEM OF KFC SUBMITTED TO: BINDU KHANAL (FACULTY‚ APEX MBA) SUBMITTED BY: ASHMITA LAMICHHANE NAMRATA MAINALI SMRITI GAUTAM (PARYA) Introduction to agency problem Agency Problem is an economic‚ political‚ legal and corporate governance concept that aims to explain the difficulties in motivating one party (the agent) to act in the best interests of another party (the principal) instead of in his own interest. A conflict of interest inherent in any relationship
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The Effectiveness of Pro-market Reforms‚ Ownership Structure and The Institutional framework at Addressing the Agency Problem and how Different Types of Firms in Transition Economies are affected by these measures. As economies grow‚ in order for businesses to retain market shares‚ they can no longer rely on organic growth‚ many seek external finance either through initial public offerings or through banks‚ mutual funds and insurance companies. Although there are many side benefits of pursuing
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Objective of study The objective is to investigate how principle-principle agency conflicts impact on the quality and effectiveness of corporate governance in European listed companies. Motivation for study Most of corporate governance research only reveals that corporate governance can solute the agency conflicts between management and shareholders which fails to identify principle-principle agency conflicts and their influences on corporate governance. Research question Whether
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to maximize the shareholders’ wealth. As a good instrument tool of measuring the firm value or the operation condition of a company‚ the share price indicates the stock market value of the company’s shares. Shareholders always expect to maximize the share price by corporate governance‚ however‚ managers in company always link their attitude to the their own interest‚ and they would not to try their best to achieve shareholder’s goal. Due to different interests in shareholders and managers‚ the
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A review of techniques to analyze the environment and an assessment of their suitability The analysis of the environment in which the business operates is very important. It is very crucial for the business to ensure survival‚ differentiation and competitive advantage. There are three levels in which the environment of the business can be broken which are as follows: The Macro environment The model that is most commonly used to analyze the macro environment of the business is called PESTLE
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employee-to-sales ratios and tells restaurants to cut staffing when the sales have dropped below a certain range at any hour. This has agency problem written all over it. Maybe not so much along the lines of managers acting for the best interest of shareholders but definitely managers acting in their own interests and not in the employee’s best interests. This agency problem is arising from the
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Qus 2. Marginal analysis and the goal of the firm Ken Allen‚ capital budgeting analyst for Bally Gears‚ Inc.‚ has been asked to evaluate a proposal. The manager of the automotive division believes that replacing the robotics used on the heavy truck gear line will produce total benefits of $560‚000 (in today’s dollars) over the next 5 years. The existing robotics would produce benefits of $400‚000 (also in today’s dollars) over that same time period. An initial cash investment of $220‚000 would be
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Challenging boundaries and beyond February 19‚ 2006 Unilever Unilever House‚ Blackfriars London EC4P 4BQ‚ United Kingdom Sent Via Electronic Mail RE: Strategy Analysis Ladies and Gentlemen: At the request of the Board of Directors of Unilever‚ we provide herein our analysis of the Personal Products Industry and a strategy analysis of both Unilever and its biggest competitor‚ Procter & Gamble. The enclosed analysis also provides recommendations for Unilever to improve its competitive advantage. Respectfully
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serious lapse in Agency-relationship problem. You are one of the board members of a public listed company. Discuss how‚ you would implement the necessary safeguards to prevent such instances happening in your company. 1.0 Suggestions to resolve Agency relationship problems. An agency relationship arises whenever individuals‚ known as principals‚ hire individuals‚ known as agents‚ to perform services and delegate decision-making authority to the agents. The primary agency relationships in
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Agency problem and its solutions Introduction Principal-agent relationship occurs when a principal contracts an agent. The principal hires the agent to perform a service for him or to act on his behalf. For example‚ in a large corporation‚ shareholders would hire managers to help them to organize the company in dairy business. However‚ agency problems may arise because of the conflict interest and asymmetry information between principals and agents‚ which lead to agency costs. In this essay‚
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