The Value of Names - Civil Society, Information, and Governing Multinationals on the Global Periphery

66 Pages Posted: 28 Feb 2021 Last revised: 12 Aug 2021

See all articles by David Kreitmeir

David Kreitmeir

Monash University

Nathan Lane

Nathaniel Lane; University of Oxford, Department of Economics

Paul Raschky

Monash University - Department of Economics

Date Written: December 24, 2020

Abstract

Civil society plays a crucial role in governance where laws and authority are weak. Increasingly, multinationals operate in these complex environments. We study how a key strategy of international civil society--disseminating information about human rights abuse--impacts multinationals. To do so, we focus on trends at the center of international campaigns: the assassination of activists, and collect 20 years of murders related to the global mining sector. Using event study methodology, we estimate the impact of human rights reporting on the stock price of firms connected to events. We find that the effect of the human rights spotlight is substantial. Firms named in assassination coverage have large, negative abnormal returns following assassinations. Our estimates imply a median loss in market capitalisation of 100 million USD. We show the media plays a crucial role in these effects: the negative impact of assassinations is strongest when they coincide with calm news cycles versus peak news cycles, when news may be crowded out by large, international stories. In addition, we argue our results are driven by events where companies are explicitly named in the reporting. Last, we show activist assassinations are positively related to the royalties paid by mining projects to domestic governments.

Keywords: Event Study, Civil Society, Governance, Human Rights, Conflict

JEL Classification: O16, O17, D74, G3, G14, L82

Suggested Citation

Kreitmeir, David and Lane, Nathaniel and Raschky, Paul, The Value of Names - Civil Society, Information, and Governing Multinationals on the Global Periphery (December 24, 2020). Available at SSRN: https://ssrn.com/abstract=3751162 or http://dx.doi.org/10.2139/ssrn.3751162

David Kreitmeir

Monash University ( email )

29 Ancora Impala, Clayton Campus, Building 6, Offi
Clayton, Victoria 3800
Australia

Nathaniel Lane

Nathaniel Lane ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

HOME PAGE: http://https://www.economics.ox.ac.uk/people/nathaniel-lane#/

University of Oxford, Department of Economics ( email )

10 Manor Rd
Oxford, OX1 3UQ
United Kingdom

Paul Raschky (Contact Author)

Monash University - Department of Economics ( email )

Wellington Road
Clayton, Victoria 3
Australia

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