Icelandic media firms viewed from the perspective of agency theory

Guðbjörg Hildur Kolbeins


It has previously been proposed that agency theory (principal-agent approach) might be applied to media organizations to understand how media owners make sure that their companies are managed according to their wishes. Thus, the purpose of the present study was to investigate: a) whether agency theory is applicable to three Icelandic media companies, and b) how the theory manifests itself in the management practices of these companies. The media companies that were examined were: the Icelandic National Broadcasting Service (RÚV ohf.), 365 miðlar ehf. and Árvakur hf. Qualitative interviews were conducted with three editors-in-chief, two CEOs/publishers, the director general of RÚV and the news director of RÚV in May of 2012. Two of the interviewees were also part- owners of the media companies.
The results indicated that it is, indeed, possible to analyze management practices of media organizations from the perspective of agency theory. However, it varies how much the companies are driven by profit maximization, for instance – on which agency theory places an optimum emphasis. The media house 365 miðlar ehf. turned out to be the best example of how the underlying constructs of agency theory are incorporated into the management practices of a media organization.


Agency theory; stakeholder theory; media organizations; media management

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Published by the Institute of Public Administration and Politics of the Faculty of Political Science, University of Iceland.

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