- Title
- Why Bad News Can Be Good News: The Signaling Feedback Effect of Negative Media Coverage of Corporate Irresponsibility
- Creator
- Fu, Limin
- Relation
- Organization & Environment Vol. 36, Issue 1, p. 98-125
- Publisher Link
- http://dx.doi.org/10.1177/10860266221108704
- Publisher
- Sage
- Resource Type
- journal article
- Date
- 2022
- Description
- Can bad news also be good news? In this study, I explicate why bad news about firms’ corporate social irresponsibility (CSiR) can be good news for firms. Specifically, I address the role of negative media coverage of CSiR in firms’ corporate social performance (CSP). Drawing on signaling theory, I propose that negative media coverage of CSiR is a form of costly yet effective external feedback to firms’ current social signaling. It, therefore, propels firms to undertake organizational changes to send positive response signals through improved CSP. Furthermore, I argue that this effect is augmented by organizational innovation search, which influences firms’ learning capacity required to improve firms’ CSP. Using a multicountry sample of 1,049 firms between 2007 and 2016, I find that negative media coverage of CSiR induces firms to enhance CSP, and this effect is moderated by organizational innovation search.
- Subject
- corporate social performance (CSP); corporate social responsibility (CSR); innovation search; nonfinancial disclosure; R&D; signaling theory; SDG 12; Sustainable Development Goals
- Identifier
- http://hdl.handle.net/1959.13/1476347
- Identifier
- uon:49802
- Identifier
- ISSN:1086-0266
- Language
- eng
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Goal 12: Responsible Consumption and Production
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