Agency, Externality and Corporate Governance

Corporate governance is generally defined as an area that seeks to create a structure to make managers accountable to stakeholders and to generate incentive-compatibility for 'proper' decisions to be taken by managers in a transparent manner. But even here it is not clear what 'proper' is and who the stakeholders are, as they can be viewed narrowly or broadly. Since the objectives of corporate governance are not clear in all cases, it can easily create second level agency problems such as those between a company and society at large.