This study addresses how agency costs influence the sustainability of different types of corporate governance. The luxury fashion brand could spend large sums of money on maintenance of magnificent brand image, thereby increasing the agency cost. On the contrary, the brand may hold down wasteful spending to report a gaudily financial achievement. Agency costs are defined either to vertical costs arising from the relationship between stockholders and managers, or to horizontal costs associated with the potential conflicts between majority and minority stockholders. Agency costs are measured by the value of the principal component. The study conducted regression analysis of each agency cost index, luxury fashion brand dummy and a set of control variables. The findings show that the agency costs of the firms with luxury fashion brand exceed those of control group.

• Kyung-Tae Gong(Jeonju University, Republic of Korea)
• Juran Kim(Jeonju University, Republic of Korea)