Media, Partisan Ideology, and Corporate Social Responsibility

54 Pages Posted: 4 Aug 2020 Last revised: 21 Apr 2021

See all articles by Mahsa Kaviani

Mahsa Kaviani

University of Delaware

Lily Li

Villanova University

Hosein Maleki

Florida State University - College of Business

Date Written: March 1, 2021

Abstract

We study the effect of conservative media on corporate social responsibility (CSR) ratings of firms using the staggered expansion of Sinclair Broadcast Group: the largest conservative network in the U.S. local TV markets. The entry of Sinclair to a region is not driven by local economic or ideological factors. In a difference-in-differences setting, we find that CSR ratings of exposed firms decline significantly in all three dimensions: environmental, social, and governance. We provide evidence suggesting that change in local ideology is an important driver of the results. The effect is larger for firms in sin (alcohol, tobacco, and gambling) industries, with a history of federal prosecution, in conservative counties, with younger CEOs, and with lower institutional ownership. Exposure to Sinclair has a negative impact on local firms' Tobin's Q and stock returns.

Keywords: corporate social responsibility, partisan media, political ideology

JEL Classification: G34, D72, L82, M14

Suggested Citation

Kaviani, Mahsa and Li, Lily Yuanzhi and Maleki, Hosein, Media, Partisan Ideology, and Corporate Social Responsibility (March 1, 2021). Available at SSRN: https://ssrn.com/abstract=3658502 or http://dx.doi.org/10.2139/ssrn.3658502

Mahsa Kaviani

University of Delaware ( email )

20 Orchard Rd, Newark, DE
Newark, DE 19716
United States

Lily Yuanzhi Li

Villanova University ( email )

United States

Hosein Maleki (Contact Author)

Florida State University - College of Business ( email )

423 Rovetta Business Building
Tallahassee, FL 32306-1110
United States

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