Niloufer Manzur, His Wife, and Father Sir Syed Nasim Ali About
Niloufer Manzur, His Wife, and Father Sir Syed Nasim Ali About
Niloufer Manzur, His Wife, and Father Sir Syed Nasim Ali About
Disadvantage of Apex
1. when we have corporate governance and try to involve shareholders in each meetings
and decisions this will raise administrative cost for arranging the meetings which would
lead to unnecessary rise in costs of apex group
2. because of this wastage of time occurs as management cant take a decision on their
own and need to take approval from all the shareholders for even small decisions.
3. there will be delay in decision making when any decision is needed to be approved from
every shareholder so this will lead to delay in taking decisions which will ultimately lead
to inefficiency
4. principal agent problem - shareholders are the principle and management is an agent so
in many cases conflict arises when shareholder feels that management is not taking
decisions in their best interest and this conflicts disrupts the smooth performance in the
apex group
5. Shift from major business . when the management of apex group starts focussing on
taking care and be liable to shareholder for each decision then their focus gets shifted
from maximising opearions to make shareholder happy and better informed.
6. inefficiency -this governance and shift will lead to major inefficiencies in operation of
business and hence can lead to downfall of apex
7. legal cost and charges -there will be additional legal cost and charges to complete all the
paper work and this will lower the retained profits of the apex group