The Corporate Governance Role of the Media: Evidence from Russia

Isaac Dyck, Natalya Volchkova () and Luigi Zingales

No 12525, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study the effect of media coverage on corporate governance by focusing on Russia in the period 1999-2002. This setting offers us three ideal conditions for such a study: plenty of corporate governance violations, no alternative mechanisms to address them, and the presence of an investment fund (the Hermitage) that actively lobbies the international press to shame companies perpetrating those violations. We find that Hermitage’s lobbying is effective in increasing the coverage of corporate governance violations in the Anglo-American press. We also find that coverage in the Anglo-American press increases the probability that a corporate governance violation is reversed. This effect is present even when we instrument coverage with an exogenous determinant, i.e. the Hermitage’s portfolio composition at the beginning of the period. The Hermitage’s strategy seems to work in part by impacting Russian companies’ reputation abroad and in part by forcing regulators into action.

JEL-codes: G3 O16 (search for similar items in EconPapers)
Date: 2006-09
New Economics Papers: this item is included in nep-cis, nep-fin and nep-tra
Note: CF
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Published as Alexander Dyck & Natalya Volchkova & Luigi Zingales, 2008. "The Corporate Governance Role of the Media: Evidence from Russia," Journal of Finance, American Finance Association, vol. 63(3), pages 1093-1135, 06.

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Related works:
Journal Article: The Corporate Governance Role of the Media: Evidence from Russia (2008)
Working Paper: The Corporate Governance Role of the Media: Evidence from Russia (2007)
Working Paper: The Corporate Governance Role of the Media: Evidence from Russia (2005)
Working Paper: The Corporate Governance Role of the Media: Evidence from Russia (2005)
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