Media Attention to Corporate Scandals over Time

Abstract

Corporate reputation is widely seen as a valuable if intangible asset for most companies. In turn, a company’s reputation is shaped in significant ways by the attention it receives in the mass media. Hence this paper explores media attention to large-scale corporate scandals. Building on the literature on both agenda setting and corporate reputation, we examine quality newspaper coverage of a sample of 123 major corporate scandals between 1990 and 2016. Whilst previous studies typically examined specific corporate scandals in isolation, we focus on the interplay of different scandals as well as on changes in media attention over time, which are not least due to the rise of social media. With regard to the interplay of scandals, we observe crowding-in processes between scandals of different types, accompanied by routinization effects where repeated scandals are of the same type. We also find substantial changes in media agenda-setting, where more recent scandals have attracted significantly higher peaks of attention followed by a much steeper decline. Our findings have important consequences for a company’s choice of an optimal crisis response strategy. At a societal level, our findings have implications for private governance mechanisms that operate through societal scrutiny based on critical media coverage.