# Principal

The person or organisation on whose behalf software acts — whose authority, funds and obligations sit behind the action.

Source: https://aecon.ai/glossary/principal
Updated: 2026-09-15

## In practice

An employee asks an agent to order a data extract. The employing company is the principal: it holds the budget, carries the contract and answers for the purchase.

## The distinction

An agent is not the principal merely because it acts on a principal's behalf. The person who requests the work may also differ from the one who pays for it, benefits from it or is entitled to accept the result.

## Why the word carries weight

An agent has no legal existence, no assets, no licence and nothing of its own to lose. Every permission it holds was lent to it by someone who does have those things.

Naming the principal is therefore not paperwork. It is what connects an action to an entity that can be identified, invoiced, sued, insured or asked to fix something.

## Four roles that are often the same person, and often not

| Role | What they hold |
| --- | --- |
| **Principal** | The authority, funds and obligations behind the action |
| **User** | The person who requested the work |
| **Beneficiary** | The party who receives the value |
| **Acceptance owner** | The person or rule entitled to judge the result complete |

In a small firm one person may fill all four. In an enterprise chain they are routinely different, and an incident that cannot tell them apart collapses into "the agent did it".

## At every hand-off

Record five facts: who authorised the action, which system is the source of truth, who receives money, who bears the failure cost, and who can reverse or revoke the action.

Those five questions survive changes in protocol, vendor and rail, which is why they are worth writing down before any of those choices are made.

## Sources & context

- [Identity and Authority of Software Agents](https://www.nist.gov/news-events/news/2026/02/new-concept-paper-identity-and-authority-software-agents) — NIST, February 2026. Treats software-agent identity and authority as an active design problem spanning identification, authorisation, audit and controls against delegated misuse. Checked 2026-09-13.
- [RFC 8693: OAuth 2.0 Token Exchange](https://datatracker.ietf.org/doc/html/rfc8693) — IETF, 2020. Distinguishes the subject of a token from an actor acting on that subject's behalf — a distinction implementations must preserve across each hop rather than flattening. Checked 2026-09-13.

## Related reading

- [Authority](https://aecon.ai/glossary#authority)
- [Delegation](https://aecon.ai/glossary#delegation)
- [Delegated work](https://aecon.ai/glossary/delegated-work)
- [Agent harness](https://aecon.ai/glossary/agent-harness)