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the first video focused on the the issue of the agency problem in in public companies where owners and managers are separated in the second video we will now discuss the various mechanisms that shareholders can use to make sure that managers pursue shareholder interests and how they oversee the firm there are two broad categories of corporate governance mechanisms the first set of mechanisms are internal mechanisms and these are specific structures involved within the firm that help oversee managers youll note here it says proxy statement and parentheses all of these internal mechanisms are theres a goal to be transparent by the Securities and Exchange Commission or the SEC and so each year prior to the annual meeting a public company must file a file whats called a proxy statement and you can find information about these three mechanisms within that proxy statement so that you can see how the oversight of firms is occurring the second set of mechanisms are external mechanisms or me