IDEAS home Printed from https://ideas.repec.org/a/wly/buseth/v32y2023i1p94-107.html

Media visibility and corporate social responsibility investment evidence in Spain

Author

Listed:
  • Carolina Bona‐Sánchez
  • Jerónimo Pérez‐Alemán
  • Domingo Javier Santana‐Martín

Abstract

Despite the extensive research in both the determinants and the results of corporate social responsibility (CSR), relatively few studies have considered extra‐legal institutions as potential determinants of CSR. Our work fills this gap by looking at how media attention affects CSR over a long‐term period in a continental European setting. Our results show that media coverage positively affects CSR. Additional scrutiny triggered by media coverage encourages dominant owners to signal their commitment to limiting self‐dealing transactions and their orientation toward stakeholders' needs through CSR investments. Additionally, our results reveal that this signaling device offers greater benefits and lower costs in firms where controlling owners show a voting‐cash flow wedge. Our results are relevant to different actors such as investors, auditors, and policy makers as they provide solid evidence that media coverage is an important driver of CSR orientation in a continental European setting.

Suggested Citation

  • Carolina Bona‐Sánchez & Jerónimo Pérez‐Alemán & Domingo Javier Santana‐Martín, 2023. "Media visibility and corporate social responsibility investment evidence in Spain," Business Ethics, the Environment & Responsibility, John Wiley & Sons, Ltd., vol. 32(1), pages 94-107, January.
    • Handle: RePEc:wly:buseth:v:32:y:2023:i:1:p:94-107
    DOI: 10.1111/beer.12488
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/beer.12488
    Download Restriction: no
    File URL: https://libkey.io/10.1111/beer.12488?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Andrew J. Hoffman & William Ocasio, 2001. "Not All Events Are Attended Equally: Toward a Middle-Range Theory of Industry Attention to External Events," Organization Science, INFORMS, vol. 12(4), pages 414-434, August.
    2. Anderson, Ronald C. & Duru, Augustine & Reeb, David M., 2009. "Founders, heirs, and corporate opacity in the United States," Journal of Financial Economics, Elsevier, vol. 92(2), pages 205-222, May.
    3. Borghesi, Richard & Houston, Joel F. & Naranjo, Andy, 2014. "Corporate socially responsible investments: CEO altruism, reputation, and shareholder interests," Journal of Corporate Finance, Elsevier, vol. 26(C), pages 164-181.
    4. Fan, Joseph P. H. & Wong, T. J., 2002. "Corporate ownership structure and the informativeness of accounting earnings in East Asia," Journal of Accounting and Economics, Elsevier, vol. 33(3), pages 401-425, August.
    5. Francis, Jennifer & Schipper, Katherine & Vincent, Linda, 2005. "Earnings and dividend informativeness when cash flow rights are separated from voting rights," Journal of Accounting and Economics, Elsevier, vol. 39(2), pages 329-360, June.
    6. Jong-Seo Choi & Young-Min Kwak & Chongwoo Choe, 2010. "Corporate social responsibility and corporate financial performance: Evidence from Korea," Australian Journal of Management, Australian School of Business, vol. 35(3), pages 291-311, December.
    7. Rafael La Porta & Florencio Lopez‐De‐Silanes & Andrei Shleifer, 1999. "Corporate Ownership Around the World," Journal of Finance, American Finance Association, vol. 54(2), pages 471-517, April.
    8. Scott D. Dyreng & Jeffrey L. Hoopes & Jaron H. Wilde, 2016. "Public Pressure and Corporate Tax Behavior," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 54(1), pages 147-186, March.
    9. Brian J. Bushee & John E. Core & Wayne Guay & Sophia J.W. Hamm, 2010. "The Role of the Business Press as an Information Intermediary," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 48(1), pages 1-19, March.
    10. Zyglidopoulos, Stelios C. & Georgiadis, Andreas P. & Carroll, Craig E. & Siegel, Donald S., 2012. "Does media attention drive corporate social responsibility?," Journal of Business Research, Elsevier, vol. 65(11), pages 1622-1627.
    11. Liu, Baixiao & McConnell, John J., 2013. "The role of the media in corporate governance: Do the media influence managers' capital allocation decisions?," Journal of Financial Economics, Elsevier, vol. 110(1), pages 1-17.
    12. Klein, Benjamin & Leffler, Keith B, 1981. "The Role of Market Forces in Assuring Contractual Performance," Journal of Political Economy, University of Chicago Press, vol. 89(4), pages 615-641, August.
    13. Allen, Arthur & Francis, Bill B. & Wu, Qiang & Zhao, Yijiang, 2016. "Analyst coverage and corporate tax aggressiveness," Journal of Banking & Finance, Elsevier, vol. 73(C), pages 84-98.
    14. Wong, Jilnaught, 1988. "Political costs and an intraperiod accounting choice for export tax credits," Journal of Accounting and Economics, Elsevier, vol. 10(1), pages 37-51, January.
    15. Lammertjan Dam & Bert Scholtens, 2013. "Ownership Concentration and CSR Policy of European Multinational Enterprises," Journal of Business Ethics, Springer, vol. 118(1), pages 117-126, November.
    16. Gregory S. Miller, 2006. "The Press as a Watchdog for Accounting Fraud," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 44(5), pages 1001-1033, December.
    17. Frank Li & Taylor Morris & Brian Young, 2019. "The Effect of Corporate Visibility on Corporate Social Responsibility," Sustainability, MDPI, vol. 11(13), pages 1-16, July.
    18. Core, John E. & Guay, Wayne & Larcker, David F., 2008. "The power of the pen and executive compensation," Journal of Financial Economics, Elsevier, vol. 88(1), pages 1-25, April.
    19. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 2000. "Investor protection and corporate governance," Journal of Financial Economics, Elsevier, vol. 58(1-2), pages 3-27.
    20. Kerstin Lopatta & Reemda Jaeschke & Chen Chen, 2017. "Stakeholder Engagement and Corporate Social Responsibility (CSR) Performance: International Evidence," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 24(3), pages 199-209, May.
    21. Borochin, Paul & Cu, Wei Hua, 2018. "Alternative corporate governance: Domestic media coverage of mergers and acquisitions in China," Journal of Banking & Finance, Elsevier, vol. 87(C), pages 1-25.
    22. Kenneth R. Ahern & Denis Sosyura, 2014. "Who Writes the News? Corporate Press Releases during Merger Negotiations," Journal of Finance, American Finance Association, vol. 69(1), pages 241-291, February.
    23. Lili Dai & Jerry T. Parwada & Bohui Zhang, 2015. "The Governance Effect of the Media's News Dissemination Role: Evidence from Insider Trading," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 53(2), pages 331-366, May.
    24. Karen Maas, 2018. "Do Corporate Social Performance Targets in Executive Compensation Contribute to Corporate Social Performance?," Journal of Business Ethics, Springer, vol. 148(3), pages 573-585, March.
    25. Won Oh & Young Chang & Aleksey Martynov, 2011. "The Effect of Ownership Structure on Corporate Social Responsibility: Empirical Evidence from Korea," Journal of Business Ethics, Springer, vol. 104(2), pages 283-297, December.
    26. Faccio, Mara & Lang, Larry H. P., 2002. "The ultimate ownership of Western European corporations," Journal of Financial Economics, Elsevier, vol. 65(3), pages 365-395, September.
    27. Heitor V. Almeida & Daniel Wolfenzon, 2006. "A Theory of Pyramidal Ownership and Family Business Groups," Journal of Finance, American Finance Association, vol. 61(6), pages 2637-2680, December.
    28. Johnson, Simon & Mitton, Todd, 2003. "Cronyism and capital controls: evidence from Malaysia," Journal of Financial Economics, Elsevier, vol. 67(2), pages 351-382, February.
    29. Maretno Harjoto & Hoje Jo, 2011. "Corporate Governance and CSR Nexus," Journal of Business Ethics, Springer, vol. 100(1), pages 45-67, April.
    30. Alexander Dyck & Natalya Volchkova & Luigi Zingales, 2008. "The Corporate Governance Role of the Media: Evidence from Russia," Journal of Finance, American Finance Association, vol. 63(3), pages 1093-1135, June.
    31. Claessens, Stijn & Djankov, Simeon & Lang, Larry H. P., 2000. "The separation of ownership and control in East Asian Corporations," Journal of Financial Economics, Elsevier, vol. 58(1-2), pages 81-112.
    32. Larry H. P. Lang & Mara Faccio & Leslie Young, 2001. "Dividends and Expropriation," American Economic Review, American Economic Association, vol. 91(1), pages 54-78, March.
    33. David P. Baron, 2005. "Competing for the Public Through the News Media," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 14(2), pages 339-376, June.
    34. Nooraisah Katmon & Zam Zuriyati Mohamad & Norlia Mat Norwani & Omar Al Farooque, 2019. "Comprehensive Board Diversity and Quality of Corporate Social Responsibility Disclosure: Evidence from an Emerging Market," Journal of Business Ethics, Springer, vol. 157(2), pages 447-481, June.
    35. Constantin Belu & Cristiana Manescu, 2013. "Strategic corporate social responsibility and economic performance," Applied Economics, Taylor & Francis Journals, vol. 45(19), pages 2751-2764, July.
    36. Yongtao Hong & Margaret Andersen, 2011. "The Relationship Between Corporate Social Responsibility and Earnings Management: An Exploratory Study," Journal of Business Ethics, Springer, vol. 104(4), pages 461-471, December.
    37. Farrell, Kathleen A. & Whidbee, David A., 2002. "Monitoring by the financial press and forced CEO turnover," Journal of Banking & Finance, Elsevier, vol. 26(12), pages 2249-2276.
    38. Alvaro Cuervo, 2002. "Corporate Governance Mechanisms: a plea for less code of good governance and more market control," Corporate Governance: An International Review, Wiley Blackwell, vol. 10(2), pages 84-93, April.
    39. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    40. Jonathan L. Johnson & Alan E. Ellstrand & Dan R. Dalton & Catherine M. Dalton, 2005. "The influence of the financial press on stockholder wealth: the case of corporate governance," Strategic Management Journal, Wiley Blackwell, vol. 26(5), pages 461-471, May.
    41. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Devora Peña‐Martel & Jerónimo Pérez‐Alemán & Domingo J. Santana‐Martín, 2022. "Media visibility and board gender diversity," Business Ethics, the Environment & Responsibility, John Wiley & Sons, Ltd., vol. 31(1), pages 192-208, January.
    2. Peña-Martel, Devora & Díaz-Díaz, Nieves L. & Pérez-Alemán, Jerónimo & Santana-Martín, Domingo J., 2024. "Are the media drivers of R&D?," Technology in Society, Elsevier, vol. 78(C).
    3. Borochin, Paul & Cu, Wei Hua, 2018. "Alternative corporate governance: Domestic media coverage of mergers and acquisitions in China," Journal of Banking & Finance, Elsevier, vol. 87(C), pages 1-25.
    4. Bona-Sánchez, Carolina & Pérez-Alemán, Jerónimo & Santana-Martin, Domingo J., 2017. "Sustainability disclosure, dominant owners and earnings informativeness," Research in International Business and Finance, Elsevier, vol. 39(PA), pages 625-639.
    5. Jiang, Li & Kim, Jeong-Bon & Pang, Lei, 2011. "Control-ownership wedge and investment sensitivity to stock price," Journal of Banking & Finance, Elsevier, vol. 35(11), pages 2856-2867, November.
    6. El Ghoul, Sadok & Guedhami, Omrane & Wang, He & Kwok, Chuck C.Y., 2016. "Family control and corporate social responsibility," Journal of Banking & Finance, Elsevier, vol. 73(C), pages 131-146.
    7. Gao, Xin & Xu, Weidong & Li, Donghui, 2022. "Media coverage and corporate risk-taking: International evidence," Journal of Multinational Financial Management, Elsevier, vol. 65(C).
    8. Sadok El Ghoul & Omrane Guedhami & Robert Nash & Ajay Patel, 2019. "New Evidence on the Role of the Media in Corporate Social Responsibility," Journal of Business Ethics, Springer, vol. 154(4), pages 1051-1079, February.
    9. Dang, Tung Lam & Dang, Viet Anh & Moshirian, Fariborz & Nguyen, Lily & Zhang, Bohui, 2019. "News media coverage and corporate leverage adjustments," Journal of Banking & Finance, Elsevier, vol. 109(C).
    10. Li, Xuelian & Dong, Liang & Kot, Hung Wan & Liu, Ming, 2024. "Regulatory investigations, media coverage, and audit opinions," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 54(C).
    11. Gao, Xin & Xu, Weidong & Li, Donghui, 2025. "Media coverage and managerial investment learning from stock markets: International evidence," Research in International Business and Finance, Elsevier, vol. 76(C).
    12. Yusen Dong & Pengcheng Ma & Lanzhu Sun & Daniel Han Ming Chng, 2024. "Goodwill Hunting: Why and When Ultimate Controlling Owners Affect Their Firms’ Corporate Social Responsibility Performance," Journal of Business Ethics, Springer, vol. 193(3), pages 535-553, September.
    13. Yang, Shuai & Wu, Chao, 2021. "Do Chinese managers listen to the media?: Evidence from mergers and acquisitions," Research in International Business and Finance, Elsevier, vol. 58(C).
    14. Liu, Mingzhi & Tang, Songlian & Wu, Zhenyu & Zeng, Rong, 2023. "The impact of foreign ownership on the media’s role in curbing insider trading around private meetings," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 88(C).
    15. Lee, Cheng-Hsun & Bose, Sudipta, 2021. "Do family firms engage in less tax avoidance than non-family firms? The corporate opacity perspective," Journal of Contemporary Accounting and Economics, Elsevier, vol. 17(2).
    16. Attig, Najah & Chen, Ruiyuan & El Ghoul, Sadok & Guedhami, Omrane & Kwok, Chuck & Pittman, Jeffrey, 2020. "Are insiders equal? Evidence from earnings management in closely held East Asian firms," Research in International Business and Finance, Elsevier, vol. 54(C).
    17. Han, Hongwen & Hu, Rui & Tang, Jiali Jenna & Fu, Qing, 2026. "Media coverage and goodwill impairment," Emerging Markets Review, Elsevier, vol. 70(C).
    18. Jing Zhou & Silin Ye & Wei Lan & Yunwen Jiang, 2021. "The effect of social media on corporate violations: Evidence from Weibo posts in China," International Review of Finance, International Review of Finance Ltd., vol. 21(3), pages 966-988, September.
    19. Sun, Kunpeng & Wang, Dan & Xiao, Xing, 2022. "Another victory of retail investors: Social media's monitoring role on firms' earnings management," International Review of Financial Analysis, Elsevier, vol. 82(C).
    20. Vivek Astvansh & Yen‐Yao Wang & Wei Shi, 2022. "The effects of the news media on a firm's voluntary product recalls," Production and Operations Management, Production and Operations Management Society, vol. 31(11), pages 4223-4244, November.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:buseth:v:32:y:2023:i:1:p:94-107. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://onlinelibrary.wiley.com/journal/26946424 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.