Agency conflict in cooperative organizations: a theoretical approach

Abstract

The corporative governance is one of the most discussed subjects in recent years, specially due to its importance for the reduction of agency conflicts. Although the focus of great part of these studies is big corporations, this phenomenon also can be observed in cooperative organizations that possess an established management design based on ideological and doctrinaire grounding and have specific legislation. This theoretical approach aims to discuss the potential conflicts of agency provoked by the organizational structure of the cooperatives, as well as the main critical points of this organizational arrangement, that favors the emergency of conflicts. It was also discussed the importance of good corporate governance practices to prevent this kind of conflict. Considering the main internal actors of a cooperative organization, the key focus able to generate agency conflicts occurs between cooperated and the administrative council and less intensively between cooperated and fiscal council, and between cooperated and managers. The adoption of good practices of corporative governance by the cooperative organization can help to soften or prevent these conflicts, mainly between the administrative council and the cooperated.