Corporate Reputation and the News Media

Agenda-setting within Business News Coverage in Developed, Emerging, and Frontier Markets

Craig Carroll

• Publisher: Routledge
• Year: 2010
• Print ISBN: 9780415871525
• eBook ISBN: 9781135252434
• Topic: Business
• Subtopic: Media & Communications Industry
• Index: Business

This volume examines agenda-setting theory as it applies to the news media's influence on corporate reputation. It presents interdisciplinary, international, and empirical investigations examining the relationship between corporate reputation and the news media throughout the world. Providing coverage of more than twenty-five countries, contributors write about their local media and business communities, representing developed, emerging, and frontier markets – including Argentina, Brazil, Chile, China, Germany, Greece, Japan, Nigeria, Spain, and Turkey, among others. The chapters present primary and secondary research on various geo-political issues, the nature of the news media, the practice of public relations, and the role of public relations agencies in each of the various countries.

Each chapter is structured to consider two to three hypotheses in the country under discussion, including:

• the impact of media visibility on organizational prominence, top-of-mind awareness and brand-name recognition
• the impact of media favorability on the public's organizational images of these firms
• how media coverage of specific public issues and news topics relates to the associations people form of specific firms.

Contributors contextualize their findings in light of the geopolitical environment of their home countries, the nature of their media systems, and the relationship between business and the news media within their countries' borders.

Incorporating scholarship from a broad range of disciplines, including advertising, strategic management, business, political communication, and sociology, this volume has much to offer scholars and students examining business and the news media.

Part I
Introduction

1
International Perspectives on Agenda-Setting Theory Applied to Business News

Craig E. Carroll

Introduction

For more than 40 years, the agenda-setting hypothesis—“While the news media may not be successful in telling the public what to think, they are quite successful in telling the public what to think about”—has been a cornerstone of political and mass communication research. The goal of this research has been to understand the news media’s role in shaping public opinion (McCombs, 2004; McCombs & Shaw, 1972). In an examination of major milestones within the field of mass communication, Lowery and DeFleur (1995) noted that agendasetting theory “has now become a well-trodden path in the research territory of the communication scholar” (p. 787). Dearing and Rogers (1996) noted that by the mid-1990s the agenda-setting research program had produced 350 scholarly publications. Slightly before the 40th anniversary of this program of research, McCombs (2004) listed over 400 empirical investigations that had been published using agenda setting as the framework for mass media and public opinion.

What is somewhat surprising is that for all of the research conducted during the first 30 years of the life of the agenda-setting program of research, many scholars missed a fundamental shift in the media’s aggregate agenda: the rise of business news. With the creation of the Internet, and with average citizens becoming more savvy about investing in the stock market—and then losing their savings in economic crises—business news, in its many forms, has come to be an increasingly significant part of the media and public agenda.

The primary focus of agenda-setting theory applied to business news has been in the domain of corporate reputation (Carroll & McCombs, 2003), although considerable research has focused on the connection between media coverage and stock price or the general financial performance of firms (e.g., Deephouse, 2000). Corporate reputation is a concept with at least three dimensions. These dimensions include a firm’s public prominence, its public esteem, and the series of qualities or attributes for which a firm is known. Corporate reputation has been a subject of considerable interest among scholars and practitioners because it is related to being able to increase market share, lower market costs, lower distribution costs, charge a premium, avoid overregulation, weather bad times, align employees, attract and retain talent, attract investors, gain access to new global markets, and have more favorable news coverage (Dowling, 2001; Jeffries-Fox Associates, 2000).

Global Interest in Corporate Reputation and the News Media

The present volume reflects the global spike of attention that agenda-setting theory applied to organizations has received from scholars around the world, particularly in the area of corporate reputation. The purpose of this edited volume is to examine three agenda-setting hypotheses in the context of the news media’s influence on corporate reputation in developed, emerging, and frontier markets. Depending upon the level of research development in each country, each team of contributors is testing (or considering) two, or all three, of the following hypotheses in their home countries:

1. The impact of firms’ media salience on organizational prominence, top-ofmind awareness, or brand-name recognition. For firms to acquire reputation, the public must first think about them (Carroll & McCombs, 2003). Adapting Cohen’s (1963) well-known dictum about the media and politics to the study of firms, Carroll and McCombs argued that, while the news media may not be successful in telling the public what to think about a specific firm, they often succeed in telling the public which firms to think about. This level of “thinking about” is a firm’s public prominence (Stocking, 1984).

2. The impact of firms’ media favorability on the public’s images of or esteem for such firms. A firm’s public esteem is the degree to which the public likes, trusts, admires, and respects it. Without a base level of trust, admiration, and respect, individuals lack sufficient incentives to consider having a relationship with an organization, whether through employment, investing, product consumption, or social causes.

3. The impact of issue coverage, news topics, or company attributes on the attributes people associate with firms. Cognitive or substantive attributes are the series of qualities that a firm possesses or that are ascribed to it either implicitly or explicitly, constituting the third dimension of reputation.

The question becomes not what is thought about these cognitive attributes, but which cognitive attributes are thought about at all.

The contributors then contextualize their findings in light of the geopolitical environment of their home countries, the nature of their media systems, and the relationship between business and the news media in their particular societies.

This edited volume contains interdisciplinary, international, and empirical investigations examining the relationship between corporate reputation and the news media throughout the world. Over 20 teams of researchers have been assembled to examine how companies are portrayed through their local (national) press. These countries represent developed, emerging, and frontier markets. The developed markets included in this volume are Denmark, Finland, France, Germany, Greece, Italy, Japan, the Netherlands, Norway, Spain, Sweden, Switzer land, and the United States. The emerging markets are Argentina, Brazil, Chile, China, Russia, and South Korea, and the frontier markets are Turkey, Nigeria, Slovenia, and the United Arab Emirates. The research presented in this volume will enhance national and international bodies of knowledge about the relationship between business and the news media. The chapters present additional primary and secondary research dealing with a variety of geopolitical issues, the nature of the news media, the practice of public relations, and the role of public relations agencies in each of the various countries.

Significance of This Volume

This volume is significant for a number of accomplishments:

First, the project blends theory, research, and practice, providing case studies and empirical investigations. We use agenda-setting theory to investigate the effects of the news media on public opinion (specifically, on corporate reputation). We also engage in historical and comparative work in order to contextualize these findings in light of structural and cultural differences in the practices of journalism and public relations in the different countries examined.

Second, the project is interdisciplinary, incorporating scholars from the fields of journalism, public relations, communication, advertising, strategic management, business ethics, business and society, political communication, and sociology.

Third, the project is global and international in scope, including empirical investigations on the practice of media relations in 24 countries around the world. Only five of our contributors are native English speakers. The book includes a number of “first” investigations of corporate reputation and media relations in various countries, including Chile, China, and Nigeria, among others. Other authors are seminal scholars in their home countries who review and translate knowledge published in their home countries for use by a much wider audience.

Then, finally, the chapters provide the state-of-the-art on research that examines the influence of the news media on corporate reputation. The data, methodologies, and findings vary from country to country depending on the level of research for that country. The methodologies in the chapters vary from literature reviews and secondary analysis of public opinion polls to the collection of original data, including interviews, focus groups, and surveys. Each chapter considers the application of agenda-setting theory from political communication to business communication.

Agenda-Setting Research Applied to Business News in Developed Markets

The first section of the book deals with agenda-setting research applied to organizations in developed markets. Table 1.1 provides a comparative overview of the data and methods used for each chapter.

In chapter 2, Peter Kjaer and Mette Morsing examine the first level and both dimensions of the second level of agenda setting applied to firms in Denmark.

Table 1.1 Data and Methods Used in Aeenda-Settine Studies within Developed Markets

They look at 140 firms ranked in the “Gold Image Study” as “Denmark’s most prominent firms.” The survey results are based on the evaluations of Danish business managers, who evaluate the firms on nine dimensions: responsibility, financial strength, innovation, communication, quality, leadership and management, employees, credibility, and competitiveness.

In chapter 3, Vilma Luoma-aho, Turo Uskali, Jouni Heinonen, and Antti Ainamo examine the first level and both dimensions of the second level of agenda setting applied to firms in Finland. They look at the status of 347 firms in 2006— the firms analyzed appeared in an average of 5 years of the general reputation ranking of the 100 biggest publicly traded Finnish firms.

In chapter 4, Roei Davidson and Nicolas Chazaud examine the first level of agenda setting applied to firms in France. They look at the 40 firms listed on the CAC index of large companies traded on the Paris stock exchange.

In chapter 5, Sabine Einwiller, Günter Bentele, and Christine Landmeier examine the first and the affective dimension of the second level of agenda setting applied to firms in Germany. They provide a descriptive study using data reported on by the Media Tenor Institute, which examined all companies that appeared in the politics and business sections of 15 media outlets. Einwiller et al. examine the agenda-setting hypothesis for the 10 best and the 10 worst cases, assuming that in these cases the agenda-setting effects would be most striking.

In chapter 6, Eva Goutzamani, Stelios Zyglidopoulos, and Philemon Bantimaroudis examine the first level of agenda setting applied to firms in Greece. They look at the 30 firms appearing in the Reputation Institute’s Global RQ Project in Greece (see van Riel & Fombrun, 2002).

In chapter 7, Elena Dalpiaz and Davide Ravasi examine the first level of agenda setting applied to firms in Italy. They focus on the 33 firms appearing in the Reputation Institute’s Global RQ Project in Italy (Ravasi, 2002).

In chapter 8, Kenichi Ishii and Toshio Takeshita examine the first level and both dimensions of the second level of agenda setting applied to firms in Japan. They also investigate corporate agenda setting through the use of advertising. Moreover, for the first level of agenda setting, they examine not only awareness of firms, but the amount of buzz generated through the number of messages posted to electronic bulletin boards about the company. They use corporate image data from the Nikkei Corporate Image rankings, which derive from a random sample of Japanese metropolitan areas. For the substantive attributes, they examine two: perceptions of managers and research and development activities.

In chapter 9, May-May Meijer examines the cognitive dimension of the second level of agenda setting. She looks at a variety of Dutch industries, including two firms each from the oil industry, the banking industry, the retail trade food industry, the transportation industry (the railways and the Amsterdam Schiphol Airport), and two professional sectors, the Dutch police and Dutch agriculture. Sh...

Table of contents

• Communication Series
• Contents
• Foreword
• Preface
• Part I Introduction
• Part II Corporate Reputation and the News Media in Developed Markets
• Part III Corporate Reputation and the News Media in Emerging and Frontier Markets
• Part IV Summary and Conclusions
• Contributors
• Index