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What Can Be Learned from the Lehman Brothers Case Through the Lens of Principal Agent and Stewardship Theory?
What Can Be Learned from the Lehman Brothers Case Through the Lens of Principal Agent and Stewardship Theory?
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Description
One of the key findings of this thesis is that the self-interest postulated by the Principal Agency Theory is arguably too short-sighted. However, given that the firm failed to fulfil the principles of the Stewardship Theory, it can also be argued that this theory is similarly untenable. The application of principal-agency theory to the firm's actors demonstrates the complex nature of the crisis and the extent to which almost every actor was involved in its ultimate outcome. A multiplicity of actors, including the board, management, employees, auditors, and state actors, were involved, rendering it inappropriate to ascribe culpability to any single entity.
The primary causes of the demise of Lehman Brothers can be attributed to a combination of greed and deficiencies in corporate governance structures, compounded by an unfavourable macroeconomic environment. A confluence of macroeconomic factors, an organisational culture of excessive risk-taking and an inadequately constituted board of directors, all linked by a CEO who had been rewarded for excessive risk-taking in the past, resulted in the collapse of Lehman Brothers.
Product details
- Binding:
- Paperback
- Edition:
- 1
- Number of Pages:
- 52
- Release Date:
- 2025-07-29
- Publication Date:
- 2025-07-29
- Publisher:
- GRIN Verlag
- Languages:
- Original: English
- ISBN10:
- 3389145494
- ISBN13:
- 9783389145494
- Weight:
- 90 g
- Height:
- 148 cm
- Width:
- 210 cm
- Thickness:
- 5 cm
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