Corporate Social Irresponsibility Under the Media Spotlight and Firm Market Value
- Garrido Martinez, Elisabet 1
- Gomez, Jaime 2
- Maicas-Lopez, Juan Pablo 1
- Orcos, Raquel 2
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1
Universidad de Zaragoza
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2
Universidad de La Rioja
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ISSN: 0065-0668, 2151-6561
Year of publication: 2023
Volume: 2023
Issue: 1
Type: Article
More publications in: Academy of Management Proceedings
Abstract
This research aims to expand our understanding of how media coverage of corporate social irresponsibility (CSI) negatively affects a firm's market value. Drawing on attribution theory, we contend that three features of CSI controversies reported by the media – i.e. the type of stakeholder involved, the scope of controversies, and the persistence of controversies - determine what stakeholders consider to be the drivers under firms’ misconduct, shaping their reaction and, therefore, the negative impact of CSI on firm market value. The results, based on an international sample of 535 firms and 2,502 observations along the period 2002-2020, show that the scope and persistence of CSI controversies are detrimental for firm market value.