TY - JOUR

T1 - Mutualistic symbiosis?

T2 - Combining theories of agency and stewardship through behavioral characteristics

AU - Obermann, Jörn

AU - Velte, Patrick

AU - Gerwanski, Jannik

AU - Kordsachia, Othar

PY - 2020/6/18

Y1 - 2020/6/18

N2 - Purpose: Although principal–agent theory has gained a prominent place in research, its negative image of self-serving managers is frequently criticized. Thus, the purpose of this paper is to examine how existing theories of agency and stewardship can be combined by using behavioral characteristics. Design/methodology/approach: This study reviewed articles on the behavior of agents and stewards from the domains of finance, economics, management, corporate governance and organizational research. Additional theoretical and meta-analytical empirical literature from the fields of psychology and sociology was used to account for general patterns of human behavior. Findings: The results indicate that goal congruency and the perception of fairness can serve as moderators distinguishing agency theory and stewardship theory. Goal congruency can be achieved by stipulating psychological ownership. The perception of distributive and procedural fairness is demonstrated by two major corporate governance mechanisms: performance-based compensation and board monitoring. The results are summarized in six hypotheses that allow a situational, customized corporate governance. These hypotheses can be tested in future research. Originality/value: Prior work either focused on the merits of principal-agent theory or advocates the utilization of positive management theories, such as stewardship theory. However, little work has been done on bridging the gap between both constructs and develop a more extensive view of management theory.

AB - Purpose: Although principal–agent theory has gained a prominent place in research, its negative image of self-serving managers is frequently criticized. Thus, the purpose of this paper is to examine how existing theories of agency and stewardship can be combined by using behavioral characteristics. Design/methodology/approach: This study reviewed articles on the behavior of agents and stewards from the domains of finance, economics, management, corporate governance and organizational research. Additional theoretical and meta-analytical empirical literature from the fields of psychology and sociology was used to account for general patterns of human behavior. Findings: The results indicate that goal congruency and the perception of fairness can serve as moderators distinguishing agency theory and stewardship theory. Goal congruency can be achieved by stipulating psychological ownership. The perception of distributive and procedural fairness is demonstrated by two major corporate governance mechanisms: performance-based compensation and board monitoring. The results are summarized in six hypotheses that allow a situational, customized corporate governance. These hypotheses can be tested in future research. Originality/value: Prior work either focused on the merits of principal-agent theory or advocates the utilization of positive management theories, such as stewardship theory. However, little work has been done on bridging the gap between both constructs and develop a more extensive view of management theory.

KW - Management studies

KW - Principal Agent Theory

KW - Stewardship Theory

KW - Bounded self-interest theory

KW - behavioral agency theory

KW - corporate goverannce

UR - http://www.scopus.com/inward/record.url?scp=85086637521&partnerID=8YFLogxK

U2 - 10.1108/MRR-07-2019-0317

DO - 10.1108/MRR-07-2019-0317

M3 - Scientific review articles

VL - 43

SP - 989

EP - 1011

JO - Management Research Review

JF - Management Research Review

SN - 2040-8269

IS - 8

ER -