Media reputation represents the portrayal of a corporation presented in the media; it does not represent the reputation of the media—that is, what others think of the media. The concept emerged as an alternative to Fortune’s survey of “America’s Most Admired Corporations,” which was the predominant measure of reputation in the 1990s. The initial formulation of media reputation was heavily influenced by mass communication theory, with the dual assumption that the media record and influence public knowledge about corporations. The increasing availability of media reports led to greater use of media reputation. Some scholars regard media reputation measures as reasonable surrogate measures of corporate reputation.
This entry first discusses the Fortune survey as a predecessor of media reputation. It then discusses media reporting and public opinion and how media reputation is measured. It concludes by looking at how media reputation is changing in the digital age.
The Fortune Survey as a Predecessor of Media Reputation
Fortune began publishing its ratings of “America’s Most Admired Corporations” in 1982 and still continues to do so, although the amount of information published on each company has shrunk and the sample has expanded to rate the “World’s Most Admired Companies.” This survey was one of the first corporate beauty pageants, and these ratings were created as a way to generate interest in and sales of Fortune. The sample of respondents originally was made up of executives, directors, and securities analysts, and it has remained so up to the 2015 survey. Researchers gravitated toward the Fortune ratings initially because they were the only measure available and their annual publication enabled the use of large-sample panel data research.
The Fortune ratings have been criticized for many reasons. The first is their high correlation with financial performance. The second is the focus on very large companies. The third is that the ratings are not theoretically informed. The fourth is that the properties of the respondent sample have never been subjected to scientific scrutiny. The fifth is the reliance on one stakeholder group, business elites, rather than society as a whole. However, the Fortune ratings are a viable indicator of corporate reputation for the executives, directors, and securities analysts constituting this stakeholder group. Given these criticisms, scholars sought to develop alternative measures that were theoretically justified and scientifically replicable. These included improved and more transparent survey measures and the focus of this entry, media reputation.
Media Reporting and Public Opinion
A bedrock dualistic assumption underlying media reputation is that the media record public knowledge and opinions about corporations and the media influence public knowledge and opinions about corporations. This dualistic assumption is grounded in communication research. Surveillance, informing the public about the world, is a central role of the media. Providing accurate, fair, and balanced information is a journalistic norm. Journalists and the media organizations they work for want to avoid charges of bias and not telling the truth. The media also influence public knowledge and opinions, as studies of news, propaganda, and advertising show; people would not know much about what else is going on in the world outside their spheres of activity unless they are told by other people or specialized communicators such as the media.
Much research on media reputation is intimately linked to agenda-setting theory, a prominent communication theory applied to corporate reputation. A core tenet of agenda-setting theory is that media reporting and public knowledge and opinion are closely correlated. The first level of agenda setting applied to organizations highlights which organizations are portrayed in the news and are salient in the minds of readers and the public. Large corporations are often portrayed in the news because their size tends to make them more newsworthy. The second level of agenda setting highlights the attributes of these organizations. For instance, the media have reported on many specific corporate attributes, such as new products, employment conditions, and corporate environmental performance. Moreover, these substantive attributes may also have positive or negative evaluations associated with them. Scholars have advanced this view by arguing that a corporation has a substantive media reputation and an evaluative media reputation; furthermore, corporations in a strategic group also share these two types of reputations.
Agenda-setting theory in the context of organizations around the world was addressed in 13 developed countries and 11 emerging and frontier countries. Empirical findings were mixed across the countries for both first-level and second-level agenda setting. The set of possible contingent conditions were summarized into four categories: (1) country characteristics, (2) the influence of global media systems, (3) multiple reputations of multinational corporations, and (4) corporate characteristics.
Because corporations do different things at different times and the media report on corporations differently, an individual corporation develops its own unique media reputation. This unique reputation can be a strategic resource for the corporation that helps it achieve its objectives. Nevertheless, a corporation’s reputation can be influenced by the reputation of comparable corporations, such as similarly sized corporations in a community or corporations in the same industry.
The volume of reporting about corporations and the positioning of corporations in the media can be distinguished. Likewise, so can distinctions be made between focal and peripheral media favorability. Focal media favorability reflects what is directly reported about a corporation. Peripheral media favorability reflects the overall evaluative tone of news articles where a company appears but is independent of how the company appears. Peripheral media favorability recognizes that reporting about a particular corporation often appears within the context of reports about other subjects, such as environmental issues; local, national, or even global political issues; and other corporations, particularly those in the same community, strategic group, or industry. Thus, peripheral media favorability has a stronger relationship with audiences having little to no knowledge of companies. Focal media favorability has a stronger influence on public esteem for audiences having more knowledge than for audiences with less knowledge.
Measuring Media Reputation
The increasing prevalence and availability of media data make media reputation a common surrogate for measuring corporate reputation. Before digital archives became common and widely distributed, researchers used a relatively limited set of media sources to measure reputation, such as hand coding from microfilm. Electronic repositories of media data are expanding to include more media outlets. Moreover, many news items from before the digital age have been copied into more accessible digital formats so that sample periods can extend backward in time. However, not all media or reports have been digitally archived, so samples remain imperfect. The emergence of digital archives has been accompanied by the emergence of tools for collecting and analyzing media reports, leading to the emergence of studies of media reputation using big-data techniques. However, such studies must still ensure that the underlying data are accurate and error free as well as appropriate for the scholarly or practical question being asked.
The measurement of media reputation is also influenced by the different methods for coding and aggregating media data. Coding can be done at many different levels, such as the sentence, paragraph, or article.
Once a media report is coded, it is often aggregated to create a measure of media reputation over a period of time. This can be done in several ways. One way is to calculate the ratio of positive plus neutral articles to total articles. A second way uses the Janis-Fadner coefficient of imbalance. The coefficient measures the relative proportion of articles that have a favorable tone versus an unfavorable tone each year. The coefficient has a number of properties. These include (1) a meaningful zero point when a firm has an equal number of favorable (f) and unfavorable (u) articles, (2) a decrease in the coefficient when the total number of articles (t) increases, and (3) an increase (or decrease) in the coefficient when the number of favorable (unfavorable) articles increases. The coefficient of media imbalance is thus as follows:
Other alternatives include the number of positive articles and the number of negative articles and the percentages of positive and negative articles relative to the total.
The Future of Media Reputation
Media reputation reflects the knowledge and opinions of specific audiences, and these audiences can be large for mass media or small for specialized media. The media are changing rapidly due to technological changes, most prominently digital communications transmitted on the Internet. Many large media outlets have reduced news coverage as they struggle to adapt their business models to the increasing use of the Internet, while at the same time new technologies have made it easier for individuals and smaller organizations to produce and distribute media. These changes have led to a proliferation of specialized media outlets using a variety of channels, including the web, broadcast, and print. It seems that every interest group has its own media channel that addresses issues of concern to the group, although that media channel may be just a website or a profile on a social network. Individuals can create temporary or permanent interest groups through posts on a personal website or Facebook page, and these posts can set the agenda for a small group of people or in some cases a large group. Corporations are often a concern for these interest groups and individuals. Thus, these websites can be regarded as media sources for analyzing media reputation with different stakeholders and the social systems in which the stakeholders are embedded. This holds the potential to help practitioners and researchers understand the reputation of a corporation for particular stakeholders and for particular attributes.
Media reputation is the evaluation of a corporation from the news media’s perspective. It is a useful type of reputation because media reporting is closely linked to audience opinion and because media reports from the past are becoming widely accessible in the digital age. Moreover, the types of media reports available for study and the sources producing these reports are also proliferating. Furthermore, many new tools have been developed to analyze digital data. Thus, media reputation will continue to be a valuable proxy for the reputation of corporations among the stakeholders and the social systems that media outlets serve.
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