According to the agency theory, each of the parties (management group and shareholders) pursues their personal interests. Hence, agency relationship leads to problems that Based on agency theory imposes costs on shareholders . So, Shareholders to reduce agency costs , evaluate the performance of their managers . Therefore, this study aims to answer to this question: Is there a significant relationship between agency costs and performance assessment criteria? To answer this question, the relationship between agency costs and performance assessment criteria by using structural equation modeling approach has been investigated. Observed variables such as firm size, assets utilization ratio, discretionary expenses ratio, free cash flow ratio and leverage ratio are considered as agency costs proxies. In addition earnings of per share, retune on assets, market value added and Tobin’s q ratio are entered to the model as depends variables. The study sample consists of firms listed in Tehran Stock Exchange during the years 2003 to 2012. The result shows that agency costs have a significantly positive impact on performance assessment criteria .