Take a few minutes and read my post below and respond to it in a few sentences.

In the realm of M&A, it is not uncommon for corporations to overpay for acquisitions, and there are several reasons for this. One example involves the agency problem between executive compensation and the board of directors. Acquisitions need shareholder and board approval. However, boards lack independence from management, and mutual funds and ETFs that hold large positions in public companies seldom vote against the board. Thus, when an acquisition appears to offer executives large bonuses, they would encourage the board to propose and approve the deal, consequently persuading shareholders to vote in favor of the deal. This is the opposite of what should happen. Influence should flow from the shareholders to the board of directors, then to executives like the CEO, not the other way around.