The Agency-Stewardship Framework of the Principle-Agent Relationship

This paper incorporates stewardship theory into the corporate governance models developed in previous agency theory research. The underlying assumptions of agency theory (moral hazard, risk and loss aversion, information asymmetry, and incentives) are used as a foundation for three agent types (unprincipled, principled, and steward). The utility of the framework is shown by through its ability to explain how different types of agents manage firm stakeholders.