Private Politics, Dynamics of Negative Media Exposure and Firm Strategy
Negative media exposure is one of the most troubling challenges to social evaluations of companies and an underlying mechanism in the Private Politics and Social Movements literatures. Drawing on insights from Communication studies, we suggest that media effects are dynamic: negative news at one point in time regarding environmental issues increase the negative exposure of firms over time, thereby threatening their reputation beyond the immediate. At the same time, companies might also manage to prevent this negative spiral by nurturing positive environmental exposure and by issuing press releases on their environmental progress. We test our predictions using a unique 20-year panel-dataset of newspaper articles on environmental issues of the 30 largest US-companies. Our results suggest that news media are indeed driven by dynamic negativity but also demonstrate that companies’ press releases and positive exposure represent a potential remedy. We discuss the implications of these results for our understanding of the firm-media dyad, in particular in the context of the Private Politics and the Social Movement literatures.