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The codes of corporate governance for every country are framed to solve agency problems with good monitoring techniques and mechanisms. Monitoring mechanisms are an important tool for aligning the interest of principals and agents. This research study focuses on the link between managerial ownership and agency costs. This research paper also reviews agency theory and its shortcomings. The result findings depict that there is a positive link between the remuneration of directors, large firms, old firms, and asset-utilization ratio but no impact of managerial ownership is found on reducing agency cost. [ABSTRACT FROM AUTHOR]

Managers' pay, and the way it is determined, can have an important impact on the success of firms, and even of whole economies. While there is a rich literature exploring these issues in the for-profit sector, managerial pay at nonprofit firms has received little attention. Yet nonprofit organizations suffer from agency problems that are similar to, or perhaps even more severe than, those observed at for-profit companies. Accordingly, this Article explores the implications for nonprofit governance of a world in which "managerial power" can affect nonprofit pay setting. This Article develops the theory and provides support in the form of original empirical evidence based on data from a large panel of colleges and universities collected across a ten-year period. Our findings support the hypothesis that donors with less leverage suffer from significant agency costs in setting president pay. For example, we find for the first time evidence of an otherwise counterintuitive negative association between the fraction of university revenue provided by current donations and president compensation, which we suggest shows that schools that are less dependent on donors are freer to set high pay. We discuss the implications of these findings for the regulation of nonprofits and for a broader understanding of the pay-setting process at for-profit as well as nonprofit organizations. [ABSTRACT FROM AUTHOR]

We apply the paradigm of the firm as a nexus of contracts to the debate on regulatory competition vs. unification of law as an alternative way of regulating the business corporation. This approach views the business corporation as a set of coordinated contracts among different parties. Agency problems and related agency costs are the result of this interaction. The economic analysis of corporate law, securities regulation and bankruptcy law identifies law as a means to minimise such agency costs. In this paper, we develop a model where companies are heterogeneous in their preferences about the legal regulation of contractual relationships. We then compare a regime of regulatory competition with one of single supply of regulation and we analyse their relative costs and benefits. [ABSTRACT FROM AUTHOR]