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Abstract
This study draws upon media agenda-setting theory to investigate the relationship between negative media coverage around environmental, social, and governance (ESG) issues and the quality of integrated reporting (IR). In particular, we examine the top 100 South African listed companies in the 2013–2018 timeframe for 317 firm-year observations. Our results reveal that IR quality is positively related to negative ESG media coverage. Thus, a company exposed to more media pressure issues higher-quality IR consistent with its need to face scrutiny and potential reputational damage and to restore or maintain its legitimacy. Results are robust to different measures of negative ESG media coverage, controlling for ESG disclosures, and are confirmed by analyses aimed at addressing endogeneity (instrumental variable approach, firm-fixed effects, and matched samples). Subsample analyses show that financial sector reputational concerns do not impact our results. Additional tests show no long-term effects of negative media coverage on IR quality and that sustainability embeddedness alleviates a company’s response to negative ESG news in terms of enhanced reporting.
Original language | English |
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Article number | https://doi.org/10.1111/jifm.12216 |
Journal | Journal of International Financial Management & Accounting |
Volume | 35 |
Issue number | 3 |
Pages (from-to) | 833-866 |
Number of pages | 34 |
ISSN | 1467-646X |
DOIs | |
Publication status | Published - Oct 2024 |
Keywords
- ESG
- Integrated Reporting
- South Africa
- negative media coverage
- reporting quality
- reputational risk
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Dive into the research topics of 'Integrated reporting quality and negative ESG media coverage: Empirical evidence from South Africa'. Together they form a unique fingerprint.Activities
- 1 Conference presentations
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XIII Financial Reporting Workshop
Crovini, C. (Lecturer)
6 Jul 2023 → 7 Jul 2023Activity: Talks and presentations › Conference presentations