Research On The Impact Of Media Attention And Environmental Uncertainty On Corporate Value

In recent years,most of the research on the factors influencing enterprise value has focused on the internal factors of enterprises,but ignored the influence of the external factors of enterprises such as media attention,environmental uncertainty and so on.With the advent of the information age,the media plays an important role in spreading information and has become an important part of people’s daily life.The media not only conveys information,but also has great influence on the operation of enterprises as an essential external governance mechanism.Firstly,the media can effectively reduce the degree of information asymmetry between managements and stakeholders by disseminating information.With the degree of information asymmetry between managements and shareholders narrowing down,shareholders are able to supervise the behaviors of managements in more detail,reduce the undue behaviors of managements such as seeking private interests,and urge managements to take their responsibilities,which will strengthen the corporate governance and increase the enterprise value.Secondly,based on the reputation theory,the media coverage of managers and corporations have an impact on managers’ reputation and corporate reputation.Therefore,under the supervision of the media,managements will avoid improper behaviors with considering their reputation,and actively improve the corporate governance of corporations,which can help enhance the value of enterprises.Good reputation of enterprises can transmit a positive signal to the investors,creditors and other stakeholders in the capital market,which is conducive to conducting operation activities,improving the performance of enterprises,and thus enhancing the value of the enterprises.Thirdly,the media is able to promote the development of the corporate governance through the involvement of regulatory authorities,the media reports about quoted companies will help regulatory authorities to supervise corporations more efficiently,and discover the problems of corporations as early as possible.Thus,regulatory authorities will take timely measures to reduce the violations of managements and corporations,and promote the optimization of the corporate governance.Nowadays,China is in the process of economic transformation.With the economic globalization,the mutual economic influence between countries has been deepening.Both of these aggravate the environmental instability of the enterprises inour country.Under the circumstance,the increase of environmental uncertainty will not only make it more difficult for managements to make reasonable economic decisions and formulate strategic plans,but also increase the operating risk of the companies.What’s more,it will increases the degree of information asymmetry,and provides an opportunity for managers to carry out improper behavior such as seeking private interests,which is more likely to have a negative impact on companies’ performance and reduce the value of enterprises.Therefore,whether the environmental uncertainty will have a significant negative impact on the value of the enterprise deserves the deep reflection and study from scholars,investors,asset appraisal practitioners and other relevant groups.In addition,considering that environmental uncertainty decreases the accuracy and timeliness of information transmission,media’s function of information transmission and supervision will be weakened when the enterprise is in a complex and unstable environment.Therefore,environmental uncertainty has a negative effect on the governance effect of the media on the company.However,there is no research that has been done on the impact of environmental uncertainty on the relationship between media attention and enterprise value as a moderating variable.According to the above analysis,this paper combines theoretical analysis and empirical research to study the above problems.In the part of theoretical analysis,firstly,this paper reviews and summarizes the relevant research literature of enterprise value,environmental uncertainty,and the relationship between media attention and enterprise value.Secondly,this paper defines media attention,environmental uncertainty and enterprise value,and systematically clarifies the relationship among enterprise value,media attention and environmental uncertainty according to media governance theory,information asymmetry theory,enterprise value appraisal theory,principal-agent theory,reputation theory and environmental uncertainty theory.On this basis,the paper analyzes the influence mechanism of the media attention on the enterprise value,the correlation between environmental uncertainty and enterprise value,and the influence that environmental uncertainty has on the relationship between media attention and enterprise value.In the part of empirical research,the Shanghai and Shenzhen A-share listed companies from 2013 to 2017 are selected as the research sample in this paper.This paper firstly makes descriptive statistics and correlation analysis on enterprise value,media attention and environmental uncertainty and other variables.Secondly,according to the results of F test andHausman test,the most suitable regression model is determined.In this paper,the fixed effect panel regression model is used to analyze the correlation between media attention and enterprise value,the correlation between environmental uncertainty and enterprise value,and the effect of environmental uncertainty on media attention and enterprise value.Finally,this paper draws the research conclusion according to the regression results,and puts forward corresponding suggestions for enterprises,media,government and asset appraisal practitioners.This paper finds that:(1)media attention has a positive affect on enterprise value;(2)there is a significant negative correlation between environmental uncertainty and enterprise value;(3)the increase of environmental uncertainty will weaken the positive correlation between media attention and enterprise value.This paper adopts the two-stage least square method to eliminate the possible endogenous problems,and replaces the enterprise value measurement index for robust test.Moreover,further studies finds that both positive and negative media reports have an positive influence on enterprise value,and media attention has a stronger positive impact on the value of non-state-owned enterprises compared with state-owned enterprises.Based on the results of this paper,the following suggestions are put forward.First,enterprises should pay full attention to the voice of the media in reality and establish a reasonable risk assessment mechanism.Second,for the media,the objectivity of the content of the report and the professionalism of the practitioners should be improved.Third,the government regulatory authorities should support the development of media supervision power and rational use.Fourth,asset appraisal practitioners should broaden the thinking of enterprise value evaluation.When using the market method to evaluate enterprise value,asset appraisal practitioners may consider screening companies with similar media attention and environmental uncertainty to reduce the deviation of evaluation results.