This paper investigates whether and how financial and administrative controllers of the Ministry of Social Affairs and Labor (MOSAL) decrease agency costs in consumer cooperative societies (co-ops) in Kuwait. It hypothesizes that MOSAL controllers are effective monitors in reducing agency costs. The study employs a multivariate regression model and calculates the t-values using Roger’s robust standard errors, correcting for co-op clusters due to the potential cross-sectional correlation and autocorrelation of the error terms to test a sample of 929 observations for 59 consumer cooperative societies from 2000–2018. The empirical results support the hypothesis. Further tests show that low-performing co-ops have lower agency costs. However, the presence of the financial and administrative controllers has no effect on agency costs in high-performing co-ops. Also, the effect that MOSAL controllers have on agency costs varies among co-ops. This study complements a line of research on co-op governance and adds to the empirical evidence on the association of corporate governance and agency costs. It also helps understand how regulators influence management and board discretion to safeguard co-op shareholder rights. Further, it explores an important sector and analyzes a unique, comprehensive, and rarely tested dataset.

本文调查了社会事务和劳工部（MOSAL）的财务和行政控制人员是否以及如何降低科威特消费者合作社（co-ops）中的代理成本。它假设MOSAL控制器是降低代理成本的有效监控器。该研究采用多元回归模型并计算t使用罗杰（Roger）强大的标准误差的值，对潜在误差的横截面相关性和自相关性进行校正，从而对合作社集群进行校正，以测试2000-2018年间59个消费者合作社的929个观察值的样本。实证结果支持该假设。进一步的测试表明，绩效较低的合作社的中介费用较低。但是，在高性能合作社中，财务和行政控制人员的存在对代理成本没有影响。此外，MOSAL控制器对代理成本的影响在合作社之间也有所不同。该研究补充了关于合作社治理的研究范围，并增加了关于公司治理与代理成本之间关系的经验证据。它还有助于了解监管机构如何影响管理层和董事会酌情权以维护合作社股东权益。