MEDIA

CSR Connection: This issue analyzes the role of the media in an

increasingly wired world that allows NGOs and
nonprofit organizations to expose corporate actions
they feel to be socially irresponsible. What is the role
of the media in terms of CSR?173 To what extent do
the media have a responsibility to hold firms
accountable for their actions?
Stakeholders: Media/Journalists, NGOs.

Issue
The expansion of global media conglomerates and the spread of TV into
every corner of the world are radically changing the way we consume news
and information. In other words, the media “simply is—everywhere and all
the time”:174

Before the second world war, radio reached a mere 10% of the
population, the print media no more than 20%. Now papers and TV
both reach 90% of adults, and radio around 98%. The power of the
media has effected a sea change in the development of public attitudes.
As the raw material of politics, public opinion has become a mere
reflection of the messages put out by the system, the producers of
which insist unconvincingly that they follow what, in fact, they are
creating . . . Without noticing it, we are abandoning representative
democracy and marching towards opinion-led democracy.175

The Internet magnifies this trend, threatening traditional media

(newspapers, in particular, but also TV)176 and decreasing the time it takes
for information to reach us:

We watch 60-second television commercials that have been sped up to

fit into 30-second spots, even as we multitask our way through e-mails,
 text messages and tweets. . . . Changes that used to take generations . . .
now unfurl in a span of years. Since 2000, we have experienced three
economic bubbles (dot-com, real estate, and credit), three market
crashes, a devastating terrorist attack, two wars and a global influenza
pandemic.177

Life is lived today at a hectic pace. And, when a newsworthy event

occurs, we know about it almost instantly. When a US Airways plane
crash-landed in the Hudson River in New York on January 15, 2009, for
example, a passenger on the ferry that went to the rescue of the plane’s
passengers took a photo of the plane with his cellphone
(http://twitpic.com/135xa) and uploaded it instantly with the following
message to Twitter, “There’s a plane in the Hudson. I’m on the ferry going
to pick up the people. Crazy.”178 This trend is important for news stations
because the channel that breaks the story tends to hold the viewers. And for
the media today, bad news is good news is entertainment:

This obsession with speed creates problems—we report rumors, with

caveats, but mistakes are made . . . It’s a complicated world. The media
have a lot to say and not much time to say it. They also have to win
audiences, so they sensationalize and simplify. Stalin said that every
death is a tragedy; the death of a million, a mere statistic. That’s how
the media, albeit with different motives, work as well.179

Not only is news spreading more quickly, but how it is interpreted

depends on the context. Activities around the world are viewed and judged
by the standards where the news is absorbed, not where it occurred. When
Al-Jazeera reports on U.S. actions in the Middle East, for example, it does
so for an Arab audience. In spite of President Obama giving his first
interview with a foreign media outlet as president to Al-Jazeera’s English
channel,180 the U.S. has little control over the way the country and its
foreign policy is portrayed and interpreted in the streets and cafes of
Baghdad or Lebanon. As an ad for Al Jazeera in The New York Times
states:
 Bold and fearless journalism that doesn’t shy away from the truth. We
put the human being at the center of our news agenda and take you to
the heart of the story. Exploring events that are often years, decades and
even centuries in the making. Located at the center of the most
complicated region in the world—get the real picture, every angle,
every side. Al Jazeera.181

The speed at which news travels today and how it is ultimately

interpreted should also be a point of both interest and concern for global
corporations, who are already portrayed in a negative light in the media. 182
Firms can no longer trust they can control the flow of information (see
Figure 4.5). No actions can be hidden and, if anything goes wrong, the
whole world knows about it very quickly. When two employees from
Domino’s Pizza decided to film a prank video in the kitchen where they
worked and upload it to YouTube, for example, the consequences were
swift, both for the employees and for Domino’s:183

In a few days, thanks to the power of social media, [the two employees]
ended up with felony charges, more than a million disgusted viewers,
and a major company facing a public relations crisis. . . . By
Wednesday afternoon, the video had been viewed more than a million
times on YouTube. References to it were in five of the 12 results on the
first page of Google search for “Dominos,” and discussions about
Domino’s had spread throughout Twitter.184

Today, a firm needs to strive to maintain positive ties with a broad array
of stakeholders, both internal and external. The internet and global media
conglomerates make it relatively easy for individuals or NGOs to mobilize
and spread their message to multiple audiences before firms even know a
problem exists. The growth in importance of global brands, twinned with
the rise of media conglomerates, leaves companies exposed to any
consumer backlash against activities perceived to be unacceptable or
running counter to the image a company’s brand portrays.
Case Study: CNBC
“Four hostile newspapers are more to be feared than 10,000 bayonets.”

—Napoleon Bonaparte185

The media is an essential part of the democratic society in which we

live. Its role is to inform the public and hold those in power accountable to
those they are supposed to serve. In an age of information overload and
advertising revenue driven by viewer numbers, however, what information
to present and how to present it is central to the integrity of the industry.
The temptation to condense in order to capture people’s attention soon
leads to the need to entertain to keep them watching. Today, the news of
the world is conveyed in 30-minute segments, squeezed between the
weather, sports, and personal finance programs. CNN Headline News,
without blushing, manages to fit the day’s major news from around the
world into a segment that used to be called “The Global Minute”! The news
media often simplify the message and repeat news handed to them by PR
departments. As Nick Davies writes in his book, Flat Earth News:

In the end, the researchers found that only 12 percent of stories [in the
five national UK newspapers—The Times, the Guardian, The
Independent, the Daily Telegraph, and the Daily Mail] were based on
material generated entirely by the papers’ own reporters.186

The twenty-four-hour news cycle today is a CNN world of voyeurism

and reality TV, where a firm’s difficulties or ethical transgressions are
everyone else’s fascinating tidbits:

Fear of embarrassment at the hands of NGOs and the media has given
business ethics an even bigger push. Companies have learnt the hard
way that they live in a CNN world, in which bad behavior in one
country can be seized on by local campaigners and beamed on the
evening television news to customers back home.187
 CNN, launched in June 1980, came to prominence in the living rooms
of the world and North America, in particular, during the first Gulf War.
The station’s willingness to push the envelope in what is expected of a 24
hour cable news channel’s frontline reporters enabled them to carry on
presenting after the competition had evacuated to safety:

CNN had been a failing venture until the 1991 Gulf War, when it provided
the only television coverage from inside Baghdad. That exclusive was
possible only because every other network had pulled its correspondents to
protect their lives. Tom Johnson, CNN’s president at the time, wanted to do
the same, but [Ted] Turner told him: “I will take on myself the
responsibility for anybody who is killed. I’ll take it off of you if it’s on
your conscience.” No one was killed, but Mr. Turner’s roll of the dice with
other men’s lives is no less jarring.188

The role CNN plays in conveying information to the public is now a

legitimate consideration for the U.S. government when selecting military
bombing targets during a war. This is particularly so when the targets are
located in civilian or urban areas. As in all aspects of society today, rapidly
developing technology allows more things to be done in a much shorter
time frame. In a war, the information field commanders receive has
multiplied exponentially, as has the speed in which they must decide what
to do. When the wrong decision or a mistake is made, CNN is there to tell
the world about it:

When missiles do go awry, as happened when the United States

accidentally struck the Chinese Embassy in Belgrade in May 1999 . . .
there is alarm worldwide.189

The CNN Test is the assessment military commanders make when

choosing potential targets for bombing during warfare today. This issue
was the focus of a number of news items in the lead up to the second Iraq
war (2003-2011):190
 Military commanders have long had legal advisers. But more than ever,
attorneys are in the teams that choose the strategies, the targets and
even the weapons to be used. . . . And legal issues aren’t the only
factors . . . Commanders must also worry about “the CNN test.” Is the
target worth all the loss of innocent life—and the inevitable outcry?191

Public opinion greatly influences a country’s foreign policy (which,

after all, is determined by politicians who need to be re-elected). And the
media today plays a central role in shaping that public opinion. People react
much more strongly to pictures that they see than to words that they read.
With words, they have to use their own imagination, which requires effort;
pictures are spoon-fed to the public via TV and, increasingly, the Internet.
And, when the pictures are riveting, they’re played over and over again
until they become ingrained in the public conscience— known as the
“CNN effect.”192 From Vietnam to the fall of the Berlin Wall, from the
World Trade Center towers in New York to the Fukushima tsunami to the
Arab Spring, TV footage personalizes the story, introduces emotions, and
removes the larger context within which foreign policy decisions must be
made. As such, the story that the news media convey is not always
complete or accurate, but can be thought of more as entertainment that is
“packaged for ease of dissemination and consumption.”193
Nevertheless, CNN’s successes have caused their competitors to
respond in order to make their product more competitive. From BBC World
to Al-Jazeera to
Fox News,194 cable news channels have re-shaped the way we watch TV
and receive our knowledge about the world. It is perhaps not surprising,
therefore, that, in the same way that the first Iraq war enabled CNN to
establish itself in the ultracompetitive media market, the Financial Crisis
enabled another cable network,
CNBC, to find its identity:195

Partisanship aside, this is CNBC’s equivalent of a war. Just as the first

cable news channel, CNN, rose to prominence during the gulf war in
1991, and another one, the Fox News Channel, became a ratings leader
 in the period before the Iraq war in 2002 and 2003, CNBC is on a war
footing. . . . the network’s home audience started to surge in August
2007 as the upheaval began in the credit markets. They peaked in
March 2008 when Bear Stearns was sold to JP Morgan Chase . . . After
hitting a plateau that spring, the ratings soared [in fall 2008] when other
investment banks collapsed, setting records for the network.196

The increased viewers the channel attracted in the aftermath of the

Financial Crisis also helped its parent company, NBC, dominate the
network news ratings in the U.S. at the time, 197 while securing “its fourth
year of double-digit growth in operating profits” 198 in 2010. CNBC was
successful because it was relevant—“It was news being made, all the time,
in real time.”199 The role played by the station in reporting the crisis (both
before and after it occurred), however, was not without its critics:

A showdown between a comedian who has become one of America’s

most challenging news commentators and a news commentator known
for his comedic antics has shone the brightest spotlight on the media
market’s coverage since the financial crisis began.200

CSR Newsletters: CNBC

For those who missed Jon Stewart’s lambasting of CNBC on The Daily
Show in March 2009, his three part interview of Jim Cramer (host of Mad
Money)
is compelling TV:

http://www.thedailyshow.com/watch/thu-march-12-2009/jim-
cramer--pt–1

As usual, Stewart employs comedy to great effect. In addition,

however, he confronts Cramer with an honesty and directness that
you rarely see on current affairs TV in the U.S. Stewart articulates
succinctly the behavior of Wall Street that led directly to the Financial
Crisis, but also skewers Cramer (and CNBC) for becoming part of the
 problem, rather than being the journalists they purport to be. As a
result, the interview is both entertaining and uncomfortable to watch
because Stewart so completely undermines what it is that must get
Cramer out of bed every morning to do his show.

Stewart’s analysis was all the more compelling because it challenged

what it means to be a modern journalist in a democratic society. Beyond
merely castigating CNBC (and, by implication, the business media as an
industry) for failing to perform their role of oversight more effectively,
Stewart accuses CNBC of complicity—knowing what was going on, but
being overly concerned with their status as insiders, rather than maintaining
their journalistic integrity. To what extent is journalism part of the
establishment and to what extent do journalists have a civic responsibility
to hold the great social institutions (e.g., politics and businesses)
accountable for their actions? It is hard to do both:

The problem here is not individuals but attitudes, including a media

culture that causes some people, particularly in the entertainment-
driven medium of television, to blur the line between entertainment,
good journalism and sound analysis. . . . As long as everyone was
making money, nobody wanted to hear the bad news.201

Jon Stewart advocates for impartiality and criticizes the partisan

journalists who he believes fail to hold politicians to account:

The problem with the media today is they are too wrapped up in the
strategy of the Beltway. . . . They are worried about their connections
within that world when what they need to be worrying about is their
connection to us outside of that world. . . . We are the ones that they
need to protect from this cynical game of right and left that is being
perpetrated.202
 As indicated by other commentators, the media, with all its flaws, is only
capable of writing “a flawed first draft of history” as it unfolds.203 It is
debatable, however, whether creating an historical account is even given
lip-service by today’s media, which others have argued “doesn’t exist to
deliver programs to viewers; it exists solely to deliver audiences to
advertisers.”204 This service is packaged in an increasingly partisan
message that leaves channels like CNN, who at least claim to be objective,
without a strong base of core viewers:

Fox News assures conservative viewers that Democrats’ gaffes

[represent bad intentions], and Republicans’ [represent a
misunderstanding]. MSNBC, vice versa. CNN tries to be fair. Viewers
hate that. Its ratings in America are sliding, while Fox and MSNBC are
doing well.205

This shift towards partisan ideology and ratings maximization is

precisely why the media continues to value attention-seeking anchors such
as Jim Cramer, who demand the limelight with elaborate (and often
misleading) bold pronouncements:

There is only one Jim Cramer, host of CNBC’s popular finance show
Mad Money. His latest notable outburst came [in April, 2009]: “Right
now, right here, on this show—I am announcing the depression [is]
over!” He is going too far again.206

As the line between news and entertainment blurs, so the way that we
understand world events and consume the news has also changed:

Today’s satirists are a substantial part of one of the great powers in free
societies—the media—and, since the latter part of the 20th century,
have substituted themselves for news. . . . In the US, programmes such
as The Daily Show with Jon Stewart and The Colbert Report have
displaced news and documentary as the main way in which young
viewers learn about current events.207
 This discussion does not diminish the concern firms should have about
their loss of control over the free flow of information. If anything, it should
heighten it because, today, the truth and facts are increasingly subjective
points of disagreement that are spun to fit a specific agenda, rather than
reflect reality. As we become increasingly interconnected and words and
images are shared more freely, the ability to assert control is lost and it is
not coming back. The Internet is anarchic at heart. As a result, firms need
to do all they can to ensure relations with their myriad of stakeholders are
as positive as possible, to ensure they do not become the next victim of this
communication medium.
CEO Perspective
Rupert Murdoch (News Corporation)

The world is changing very fast. Big will not beat small anymore. It will be
the fast beating the slow.208

Online Resources
10 × 10, http://tenbyten.org/10x10.html
Accuracy in Media, http://www.aim.org/
BBC World News, http://www.bbcworldnews.com/
Business & Media Institute, http://www.businessandmedia.org/
CNBC, http://www.cnbc.com/
CNN, http://www.cnn.com/
Independent Media Center,
http://www.indymedia.org/ Mad Money,
http://www.cnbc.com/id/15838459
mediachannel.org,
http://www.mediachannel.org/
Media CSR Forum, http://www.mediacsrforum.org/
The Daily Show with Jon Stewart, http://www.thedailyshow.com/
Pro/Con Debate

Pro/Con Debate: The media today plays a valuable role holding the
important institutions of our society (businesses,
government, etc.) to account.
Questions for Discussion and Review
1. Do the media today report the news or distort the news? Do we watch
news or entertainment? What do you think CNN’s role, or the BBC’s,
should be? What about Al-Jazeera? Is news reporting today objective
or is it necessarily culturally biased?
2. Should the armed services have to answer to CNN or any other news
organization? Isn’t that the responsibility of the civilian planners and
politicians that shape the strategies that the armed services implement?
Should
the media’s powers be restricted during wartime? Have embedded
journalists helped the reporting of war or just upped the entertainment
level closer to Hollywood special-effects levels?
3. What is the correct role of a media channel in a democratic society?
Are they there to police society’s institutions and hold them
accountable based on their own biases and political agendas? Or, are
they there to report the news objectively without taking sides? From
what you know of CNBC, did they perform well or badly in terms of
reporting before, during, and after the Financial Crisis?
4. Watch the three parts of Jon Stewart’s interview of Jim Cramer from
CNBC’s Mad Money (http://www.thedailyshow.com/watch/thu-
march-12-2009/jimcramer--pt–1). Do you think Stewart’s questions
are fair? What do you think about Cramer’s answers? As a result of
the interview, do you trust Cramer’s stock advice more or less? Why?
5. What is your response to the following quote?
In reality, news is entertainment. And, despite the public’s acceptance of
journalistic ideologies, most of the public watch or read news not to be
informed or to learn the ‘truth,’ but precisely to be entertained.