Working Paper: NBER ID: w9309
Authors: Alexander Dyck; Luigi Zingales
Abstract: In this paper we discuss the role of the media in pressuring corporate managers and directors to behave in ways that are 'socially acceptable'. Sometimes this coincides with shareholders' value maximization, others not. We provide both anecdotal and systematic evidence that media affect companies' policy toward the environment and the amount of corporate resources that are diverted to the sole advantage of controlling shareholders. Our results have important consequences for the focus of the corporate governance debate and for the feasibility of reforms aimed at improving corporate governance around the world.
Keywords: Corporate Governance; Media Influence; Environmental Policy
JEL Codes: G30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| media attention (L82) | corporate managers act in ways that align with societal norms (M14) |
| media pressure (D79) | increased shareholder value (G34) |
| media influence (L82) | commitment to dolphin-safe tuna (Q22) |
| media presence (L82) | corporate policy changes (G38) |
| newspaper circulation (L96) | environmental responsiveness (Q56) |