Coffee Companies: DoesPress Reporting of Socially Conscious Initiatives ImpactStock Valuations?
Journal Title: International Journal of Business and Management Invention - Year 2018, Vol 7, Issue 9
Abstract
https://journals.indexcopernicus.com/representative/article/create?issueId=Shareholders invest billions of dollars in the purchase of corporate coffee stock. By contrast the harvesters of coffee beans, in the developing world, often live in poverty. Yet corporate managers may have an opportunity to raise their companies’ share price and profile though the publicizing of social change initiatives. Little research on the influence of such initiatives exists in the coffee sector and possibly none concentrating on newspaper publicity. If a relationship does exist between newspaper articles publicizing socially conscious initiatives and stock investments, then managers could justify to shareholders the funding of these initiatives. This quantitative study used a five day pre- and post-event study involving t-tests and ANOVAs.In total, it tracked 76articles,published between 2011 and 2015. The dependent variable was the stock price changes of individual coffee companies. The main independent variable was timeframe, with two levels: the periods five days before publication, and five days after publication.The study found limited support for its hypothesis, that newspaper articles relating to coffee companies’ socially conscious initiatives have an impact on share price. It was only the case with Starbucks, and the impact on its share price was negative. Further research could use different time periods or media outlets. Similar findings would reinforce the point that companies must be careful how they communicate new initiatives to the press. In particular, they must make sure that their publicity departments emphasize shareholder value.
Authors and Affiliations
Glenn Thomas Smith PhD, Steven Tippins PhD
Keywords
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