Within a top management team (TMT), subgroups may emerge based on faultlines, i.e., the convergence of multiple demographic attributes of top managers. While most faultlines studies consider faultlines as a destructive social force that can impair team performance due to conflicts and miscommunication between subgroups, we propose that faultlines can facilitate mutual monitoring between subgroups of top managers as they engage in social competition for managerial professionalism. As a result, agency behaviors of the TMT (such as perk consumption) may be substantially mitigated. Moreover, such mutual monitoring effects can be enhanced by separation of CEO and chair positions and by board independence as these factors affect the power dynamics between TMT subgroups. Empirical results based on Chinese listed companies support our arguments.