... contributes to the theoretical understanding of performance-based contracts, designed to mitigate agency problems by aligning managerial and shareholder interests, even though they may inadvertently heighten managers' risk-seeking tendencies and impact shareholders' interests at critical junctures. Dachen...

... 04 2022 © Emerald Publishing Limited 2022 Emerald Publishing Limited Licensed re-use rights only ISIS era Agency problem Corporate governance Cost of equity capital The conflict of interests between managers and shareholders leads to a review of several priorities governing...

.... In terms of the mechanism, while underinvesting decisions are caused mainly by financial constraints, overinvesting behaviour primarily resulted from agency problems, typically in the form of principal-principal conflicts. Interestingly, under the impact of negative cash flow observations, financial...