Revisiting the Principal–Agent Framework in the Context of Projects: Drawing Parallels with Corporate Governance

Abstract

This article examines the principal–agent framework in the context of projects and contrasts it with its corporate governance roots. Drawing on the theory of the firm as a nexus of contracts, it conceptualizes organizations and projects as nexuses of multilevel, intra- and interorganizational, principal–principal, and principal–agent relationships. Subsequently, the characteristics of the nexus of relationships in corporations are contrasted with those in three project archetypes, and the implications for project governance are discussed. This article highlights that the principal–agent framework offers fertile avenues for further research and advocates for a concerted effort to indigenize the framework to the project context.