The parent company of an MNC can prevent dealer management problems with proper management. It must be clearly communicated objectives for each subsidiary to ensure that all subsidiary focused on maximizing value rather than the value of MNC subsidiaries of the same minh.Vi parent can monitor the decisions subsidiaries to check the management subsidiaries to meet the objectives of the MNC. The parent company can also implement compensation plans reward managers who subsidiary meets the objectives set out by the MNC. A common motive is to provide managers with shares of MNC and will be part of their compensation to their direct benefit from a higher share price when they make a decision five enhance the value of the MNC.
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