The role of local news in constructing media legitimacy: how news media frames the sociopolitical efforts of multinational corporations in host countries

Abstract

Purpose

For corporate communications, it is crucial to know how news media outlets report and frame the sociopolitical activities of multinational corporations (MNCs), including their corporate diplomacy, that affect perceptions of their legitimacy. Therefore, this study aims to identify how local news media frame corporate diplomacy in a host country and, in turn, benefit the media legitimacy of MNCs.

Design/methodology/approach

To identify media frames in the host country, a quantitative content analysis involving factor and cluster analyses of 385 articles published in newspapers in the United Arab Emirates from 2014 to 2019 addressing the corporate diplomacy of large European MNCs operating in the country was conducted.

Findings

This study identified three media frames, two of which establish moral and pragmatic media legitimacy. Results suggest that media legitimacy grows when news media emphasise institutional relationships between MNCs and local, established organisations and corporate diplomacy's benefits for society.

Practical implications

Findings provide insights into how corporate communications can contribute to legitimacy building by emphasising corporations' relationships with institutional actors in host countries and the benefits of corporate activities for local communities.

Originality/value

To the best of the authors’ knowledge, this study was the first in corporate communications to empirically investigate news media's role in corporate diplomacy and how media frames contribute to the media legitimacy of MNCs at the moral, pragmatic, regulative and cognitive levels.

Citation

Marschlich, S. and Ingenhoff, D. (2023), "The role of local news in constructing media legitimacy: how news media frames the sociopolitical efforts of multinational corporations in host countries", Corporate Communications: An International Journal, Vol. 28 No. 7, pp. 1-18. https://doi.org/10.1108/CCIJ-05-2022-0050

Introduction

In recent years, numerous corporations, particularly, ones operating in different countries, have been involved or implicated in conflicts and scandals entailing financial wrongdoing, greenwashing, human rights violations and other offenses, all of which threaten their legitimacy as organisations (Scherer and Palazzo, 2011). As a result, multinational corporations (MNCs) are increasingly under critical scrutiny by news media outlets attempting to uncover corporate misconduct. In response, building legitimacy has become critical but also challenging for MNCs, particularly in host countries, where foreign MNCs are usually more scrutinised than local companies (Kostova and Zaheer, 1999). In that context, corporate diplomacy has increasingly been proposed as an effective communication strategy that MNCs can use to secure their legitimacy in host countries (Ingenhoff and Marschlich, 2019; Kochhar, 2018; Westermann-Behaylo et al., 2015). In line with the literature (e.g. Ingenhoff and Marschlich, 2019; Westermann-Behaylo et al., 2015), we conceive corporate diplomacy as MNCs' activities through which they communicatively engage with stakeholders in host countries as a means to contribute to sociopolitical issues and, in turn, gain organisational legitimacy. In that sense, organisational legitimacy refers to the perception of organisational behaviour as “desirable, proper or appropriate within some socially constructed systems of norms, values, beliefs and definitions” (Suchman, 1995, p. 574).

Because news media, by way of framing events, exert significant influence on how companies and their activities are perceived in the public sphere (Entman, 1993), in our study, we examined the role of news media in constituting MNCs' legitimacy by covering their acts of corporate diplomacy. Previous research on news media's coverage of corporations and their organisational legitimacy has shown mixed results. Whereas some scholars have detected a positive tone in news coverage about companies' social initiatives (e.g. Byun and Oh, 2018), others have observed predominantly negative news coverage (Vogler and Eisenegger, 2021), which can be expected to threaten companies media legitimacy, meaning the legitimacy of organisations rendered by media (Bitekine, 2011). Thus, it remains unclear whether the news about MNCs and their sociopolitical efforts contributes to enhancing or decreasing their media legitimacy. Moreover, prior scholarship has largely ignored which aspects of a company and its efforts have been emphasised in the news and in which contexts those aspects are situated – that is, how they are framed. Likewise, it remains unclear to what extent corporate diplomacy enhances the (media) legitimacy building of MNCs. Against that background, we sought to partly fill those gaps in the literature by exploring how and the extent to which media frames concerning corporate diplomacy help to foster MNCs' media legitimacy at the moral, pragmatic, regulative and cognitive levels.

To that end, we conducted a quantitative content analysis of news articles published by major news media outlets in the United Arab Emirates (UAE), a popular host country for MNCs, covering the corporate diplomacy of large European MNCs operating within its borders. By analysing how corporate diplomacy is framed in the local news of a common host country for MNCs, our research offers significant insights into news media's role in organisational legitimation that have implications for strategic corporate communication about corporate diplomacy.

Conceptual framework

Corporate diplomacy and legitimacy

In recent years, corporate diplomacy has received increased attention from researchers in several fields, including business ethics, general management, public diplomacy and public relations. One research stream considers corporate diplomacy at a general level to be a strategic instrument of MNCs in the international sphere (e.g. Ordeix-Rigo and Duarte, 2009; Westermann-Behaylo et al., 2015). Ordeix-Rigo and Duarte (2009), for example, have conceived corporate diplomacy as the capability of MNCs to develop corporate initiatives in the international arena as a means to gain social power and legitimacy. Other scholars have conceived corporate diplomacy as a communication strategy by which MNCs engage with stakeholders in host countries (e.g. Ingenhoff and Marschlich, 2019; Kochhar, 2018; Mogensen, 2017). Adopting that perspective, Mogensen (2017) has defined corporate diplomacy as the “activities which transnational corporations engage in, when they perceive an opportunity or a problem in a host country” (p. 608). Along similar lines, Kochhar (2018) has defined the concept as a process that “looks into effectively and strategically engaging stakeholders […] to enhance understanding and alignment between companies and their stakeholders” (pp. 349–350). Meanwhile, Ingenhoff and Marschlich (2019) have defined corporate diplomacy as the “activities of multinational companies, which are directed at the host country's key stakeholders and aimed at participating in decision-making processes on relevant sociopolitical issues and building relationships” (p. 358). Although such conceptualisations of corporate diplomacy have varied from study to study, what most conceptualisations share is the claim that corporate diplomacy enables MNCs to gain legitimacy in host countries (Ingenhoff and Marschlich, 2019; Mogensen, 2017; Ordeix-Rigo and Duarte, 2009; Westermann-Behaylo et al., 2015). In also making that claim, in our study, we defined corporate diplomacy as MNCs' communication through which they engage with stakeholders in host countries with the aim of influencing sociopolitical trends and, in that way, gaining legitimacy.

Our conceptualisation of corporate diplomacy maintains that practices of corporate diplomacy overlap with practices of corporate social responsibility (CSR) and environmental, social and governance (ESG) practices. Indeed, some authors have argued that companies engage in (political) CSR and ESG practices to gain moral legitimacy (e.g. Oncioiu et al., 2020; Seele and Lock, 2015) – that is, to show that they adhere to societal values by acting in sustainable, socially committed ways. Moreover, concepts of social responsibility and conceptualisations of corporate diplomacy share a focus on efforts that serve society. However, the chief difference between corporate diplomacy and CSR practices is the former's focus on relationship-building with institutional actors in host countries (Marschlich and Ingenhoff, 2022; White, 2020). Thus, corporate diplomacy focuses far more on public relations and engaging stakeholders in the non-business environment in host countries than CSR and ESG. Even so, as White (2020) has explained, corporate diplomacy can be implemented via CSR activities, meaning that some practices of corporate diplomacy may fall within broader understandings of CSR and/or ESG practices.

Media legitimacy and framing

In our study, we focused on the roles of news media and media frames in cultivating the legitimacy of MNCs – that is, their media legitimacy (Bitekine, 2011; Deephouse, 1996; Vergne, 2011) – by providing news coverage of acts of corporate diplomacy. News media outlets represent some of the most powerful institutions in the environment of MNCs, “somewhere between specific legitimacy-granting authorities and society-at-large as a source of legitimacy” (Deephouse and Suchman, 2008, p. 55). In particular, as various researchers have shown, media coverage and media frame significantly affect companies' tangible and intangible assets (Etter and Vestergaard, 2015; Lee, 2016; Strauss and Smith, 2019; Strauss and van der Meer, 2017). Therefore, analysing the creation and dissemination of evaluations of organisations in news media is a suitable approach to assessing the legitimacy of organisations (cf. Etter et al., 2018; Vergne, 2011). In general, organisational legitimacy can be defined as the “perceptions of an organization, […] rendered by media [and other actors] […], who perceive an organization's processes, structures, and outcomes of its activity, its leaders, and its linkages with other social actors […] [and] the evaluating actor supports, remains neutral, or sanctions the organisation depending on whether the organisation provides the benefit(s) prescribed by the prevailing norms and regulations” (Bitekine, 2011, p. 159). Within that general concept, the legitimacy of organisations rendered by media is referred to as media legitimacy (Bitekine, 2011; Pérez, 2017) and has been conceived as media presentations of judgements of the legitimacy of organisations, actors, and activities (Aerts and Cormier, 2009; Pérez, 2017). Building on that understanding, in our study, we conceived an MNC's media legitimacy as being media presentations about the MNC that portray the processes, structures and outcomes of its behaviour as well as its linkages with other social actors in order to assess the benefits of the MNC's behaviour as being appropriate and/or desirable given existing norms and regulations.

News media construct legitimacy by providing positive coverage of actors and issues, including companies and their activities, and by endorsing them (cf. Deephouse and Suchman, 2008). However, the media legitimacy of MNCs is not related only to the tone used in the news but also to the specific way in which certain aspects and actions of a corporation are presented and linked – that is, how news media frame a company and its activities, including corporate diplomacy efforts. According to Entman (1993), media framing can be defined as the process in which media outlets “select some aspects of a perceived reality and make them more salient in a communicating text, in such a way as to promote a particular problem definition, causal interpretation, moral evaluation, and/or treatment recommendation” (p. 52). In that way, news media make issues and events more salient by determining which actor(s) do what (i.e. problem definition), including the corporate diplomacy initiatives of particular organisations and other actors involved. Moreover, media frames include what and who is responsible for or associated with specific issues or events and thereby facilitate causal interpretation. Media frames also include judgements regarding the actors involved and their activities by making positive, neutral and negative moral evaluations. Last, media frames suggest ways of handling issues and events, including calls for or against an organisation's actions (i.e. treatment recommendations). By selecting, interpreting and evaluating the activities of organisations, media frames can create and disseminate evaluations that promote media legitimacy. As a result, news media have become some of “the most salient and prominent sources of societal legitimacy perceptions” (Aerts and Comier, 2009, p. 2).

To date, research explicitly analysing media legitimacy has been rare, focused mostly on the salience of companies in the news, and measured legitimacy as the amount of news coverage about an organisation (Kennedy, 2008). Others have analysed the endorsement and/or questioning of an organisation by media outlets (Deephouse, 1996; Etter et al., 2018), studied the tone (i.e. positive, negative, or neutral) of the news (Lee and Carroll, 2011) and analysed the use of specific words indicating illegitimate organisational behaviour (Vergne, 2011) or legitimising accounts (Lamertz and Baum, 1998), all to assess the legitimacy of organisations in the media. While some studies have revealed that the social activities of corporations are largely portrayed in a positive light (Byun and Oh, 2018), others have revealed a primarily negative tone in news about the social efforts of companies or their CSR (Lee and Carroll, 2011; Vogler and Eisenegger, 2021), a tone that could threaten the media legitimacy of MNCs. Altogether, prior research has focused on the tone and visibility of corporations in the news only when it comes to media legitimacy. As a consequence, scholars exploring media legitimacy in the context of framing have not focused on corporations but on public institutions (Pérez, 2017) or non-governmental organisations (de Souza, 2010; Marberg et al., 2016). However, we argue that investigating media frames beyond the simple measurement of positive or endorsing evaluations in news media can generate specific insights into how media legitimacy is formed.

Types of media legitimacy: moral, pragmatic, regulative and cognitive legitimacy

Considering the different types of legitimacy in the literature (cf. Bitekine, 2011), we focused on pragmatic, moral, regulative and cognitive legitimacy in our study (Suchman, 1995; Zimmerman and Zeitz, 2002) and applied them to media legitimacy. All of those types of legitimacy refer to a generalised perception by a group or institution (e.g. news media) that organisational behaviour is desirable and/or appropriate (Suchman, 1995). However, moral, pragmatic and regulative legitimacy differ in terms of whose interests or norms serve as the foundation for the evaluation of legitimacy and which evaluative dynamics are associated with them.

To begin, pragmatic legitimacy rests upon the individual, self-interested calculations of an organisation's most immediate audiences that assess the outcomes of corporate behaviour (Suchman, 1995). As Bitekine (2011) has emphasised, pragmatic legitimacy captures “the degree to which an organization represents its constituents' self-interests or provides them with favorable exchanges, relative to alternative forms or structures” (p. 158). Because pragmatic legitimacy rests upon the self-interested calculations of an organisation's most immediate audiences (Bitekine, 2011; Suchman, 1995), pragmatic media legitimacy occurs when news coverage emphasises the benefits of corporate diplomacy-related activities for individual actors and even groups within society at large.

By contrast, moral legitimacy is granted when evaluators perceive a company's activities as going beyond individual interests and thus being valuable for society at large (Bitekine, 2011; Suchman, 1995). Moral legitimacy judgements “reflect beliefs about whether the activity effectively promotes societal welfare, as defined by the audience's socially constructed value system” (Suchman, 1995, p. 579). Thus, moral media legitimacy is created when media outlets present companies and their efforts in corporate diplomacy as pursuing social values, being accepted by society and/or going beyond individual interests.

Last, regulative legitimacy concerns an organisation's compliance with the law and its alignment with governmental expectations (Zimmerman and Zeitz, 2002). Regulative legitimacy builds on the assumption that organisations are regulated by local, national and/or transnational institutions, particularly, governments, that set policies, laws and rules and may sanction organisations for non-compliance (Zimmerman and Zeitz, 2002). By extension, regulative media legitimacy occurs when the news portrays the congruence of activities of corporate diplomacy with governmental rules and expectations (cf. Bitekine, 2011; Kostova and Zaheer, 1999; Zimmerman and Zeitz, 2002).

Types of legitimacy may overlap and be interdependent (Deephouse and Suchman, 2008). For instance, moral legitimacy, which builds on social norms and values, may be affected by or affect regulative institutions. In that way, moral legitimacy is related to regulative legitimacy. Moreover, because moral, pragmatic and regulative legitimacy reflect perceptions of congruence between organisational behaviour and societal norms, values and rules, they can be summarised as sociopolitical legitimacy.

Unlike pragmatic, moral and regulative legitimacy, each of which is determined by evaluating an organisation's observable features, structures, processes and outcomes (Bitekine, 2011), cognitive legitimacy is based on the recognition and visibility of an organisation (Scott, 1995). Cognitive legitimacy, in resting on “widely held beliefs and taken-for-granted assumptions” (Scott, 1995, p. 81), relates to an organisation's public visibility and the public's familiarity with the organisation (cf. Scott, 1995). Thus, cognitive media legitimacy occurs when news media confer knowledge about and familiarity with an MNC and its efforts in corporate diplomacy and is related to the frequency of news coverage about the MNC. Cognitive media legitimacy increases when organisational representatives are quoted and when the company's name is frequently mentioned in a news article or its title (Lamertz and Baum, 1998). Because cognitive legitimacy relates to the recognition and visibility of organisations, it can coincide with other types of legitimacy, namely, pragmatic, moral and regulative legitimacy (cf. Bitekine, 2011; Scott, 1995; Suchman, 1995).

Thus far, scholarship has only marginally examined different types of legitimacy in the news. Humphreys and Latour (2013), for instance, have investigated how news media legitimise online gambling at the cognitive and moral levels. More recently, Marberg et al. (2016) have postulated that media frame nongovernmental organisations (NGOs) and their activities by categorising and labelling them, which facilitates cognitive recognition and, in turn, can confer the cognitive legitimacy of NGOs in media and the public. Focusing on moral legitimacy in the public sector, Pérez (2017) has found that media chiefly focus on aspects that affect the procedural media legitimacy of organisations (e.g. the appropriateness of management processes). Despite such research, studies on particular or different types of media legitimacy are significantly lacking. In response, in our study, we sought to advance research on media legitimacy by examining media frames about companies and their corporate diplomacy practices in relation to different types of media legitimacy. That approach allowed for a more granular exploration of media legitimacy.

Corporate diplomacy in the United Arab Emirates

Researchers have outlined several factors that affect organisational practices in international settings, including political, media, economic and cultural systems (Sriramesh and Verčič, 2019). Although the UAE's economy is only developing, it is one of the fastest-growing worldwide (Anadol et al., 2015), which makes it immensely attractive to MNCs (Katsioloudes and Brodtkorb, 2007). Among the UAE's other unique features, expatriates form 80–90% of the population. Half of all Emirati nationals are less than 20 years old (Federal Competitiveness and Statistics Authority, 2017), and most of them work in the public sector. However, for economic reasons, the country has continued to restructure its public and private sectors to increase the proportion of private companies. Facing widespread unemployment among Emirati youth and a high employment rate in the public sector, the UAE's government has launched several initiatives, including the Emiratisation programme, which promotes work in the private sector among Emirati nationals and encourages private companies to develop an Emirati workforce (cf. Duthler et al., 2015). In parallel, the UAE government has sought to improve the quality of life of all UAE citizens by offering first-class healthcare and education (UAE Government, 2018). To achieve that same goal, the UAE government has consistently encouraged private companies to participate in and contribute to the local community's well-being (Tilt, 2016). All those trends suggest that corporate diplomacy plays a vital role in the UAE.

Regarding its political system, the UAE is a federal constitutional monarchy with seven emirates, each ruled by a sheikh, one of whom is elected as prime minister of the country (Katsioloudes and Brodtkorb, 2007). However, the UAE does not represent a democracy with public opinion actively drawn from all citizens. To a great extent, the significant institutional power of the UAE's government thus affects the country's media system. In the UAE, many media outlets, including newspapers, are owned or controlled by governmental institutions, which has promoted a media agenda that favours “nation-building at the expense of investigative journalism and the adoption of an adversarial role toward the government” (Kirat, 2005, p. 64). Therefore, it can be assumed that news coverage about corporate diplomacy predominantly focuses on topics related to corporate diplomacy that are relevant to governmental actors and associated with governmental institutions.

Concerning culture, the UAE is an Islamic country whose society has increasingly embraced Western neoliberal values (Katsioloudes and Brodtkorb, 2007). In a study on the topic, Al-Kandari and Gaither (2011) identified multiple social and cultural values mostly inherent in Arab culture that can significantly affect efforts of corporate communication. Two such values are devotion to one's group and the acknowledgement of legislative authorities and hierarchies (Al-Kandari and Gaither, 2011). In turn, those values might also be reflected in media portrayals of corporate diplomacy.

Although corporate diplomacy has been studied for more than two decades (Ingenhoff and Marschlich, 2019), empirical research has been rare. Fitzpatrick et al. (2020), in their recent investigation into the corporate diplomacy practices of US.-based MNCs, concluded that foreign corporations intentionally use corporate diplomacy to build relationships with critical actors in host countries, including other corporations and host governments. Others have explored corporate perspectives on corporate diplomacy practices and found that MNCs use corporate diplomacy as a communication strategy to develop various intangible assets, including legitimacy (Marschlich and Ingenhoff, 2021). The study revealed that news media actors rank among the most important institutional actors in a host country that MNCs seek to communicate and engage with (Marschlich and Ingenhoff, 2021). However, which role media play in influencing MNCs' legitimacy has not yet been examined, which prompted us to develop two research questions for our study:

RQ1.

How, if at all, do news media frame corporate diplomacy?

RQ2.

How, if at all, do media frames presenting corporate diplomacy contribute to the media legitimacy of MNCs at moral, pragmatic, regulative and cognitive levels?

Method

We conducted a manual quantitative content analysis to explore how media frames regarding corporate diplomacy construct media legitimacy at moral, pragmatic, regulative and cognitive levels. For each article in our sample, we coded categories reflecting Entman's (1993) frame elements (Table 1), because we did not measure media frames entirely but as a combination of different elements, as Matthes and Kohring (2008) have similarly done. We also coded categories to measure cognitive media legitimacy and, from those categories, created a new variable corresponding to a cognitive media legitimacy score for each article. Afterwards, we grouped the categories reflecting frame elements based on the results of exploratory factor analysis and cluster analysis to identify media frames used to present corporate diplomacy. Last, we conducted an analysis of variance (ANOVA) to examine the extent to which the three identified media frames differed in their scores for cognitive legitimacy.

Sample and data collection

We took several steps to identify relevant companies and newspaper articles covering activities related to corporate diplomacy. Firstly, we identified the European countries with the highest investment volumes in the UAE from 2003 to 2015: the UK, France, Germany, Switzerland and the Netherlands (Arab Investment and Export Credit Guarantee Corporation, 2016). We chose to focus on MNCs based in Europe because, in recent years, the largest foreign investments in the UAE have most often originated from European countries (Santander Trade, 2020). Moreover, because the UAE was a British protectorate until 1971, its lingering connections with the UK as well as other European countries remain potent.

Secondly, we identified the 30 largest MNCs based in each of those five countries in terms of market capitalisation, and for each MNC, we determined whether it operates in the UAE – that is, whether it has a local management hub with a communications department. Thus, if an MNC either does not operate in the UAE or has only a branch or a retail store there, we did not consider it in our analysis. We next consulted the company's website – whenever possible, the website specific to the UAE or the Middle East – and gathered information about its presence in the UAE in order to learn more about its operations there. If the website did not indicate whether a local hub with a communications department existed in the UAE, then we contacted the global head of communications of the company's headquarters in its origin country for clarification. The procedure resulted in 83 companies that we considered in the analysis.

Thirdly, for news media outlets, we identified Gulf News and Khaleej Times as being the two daily English-language newspapers with the most extensive readership in the UAE (Dubai Media City, 2016). English is the primary language in the UAE, used most frequently in businesses and government institutions (Dorsey, 2018), which justifies the analysis of English-speaking newspapers in the UAE. The chosen newspapers can be regarded as major media outlets and thus able to reflect and influence perceptions of legitimacy (Deephouse and Suchman, 2008).

To populate our sample, we first searched for news articles reporting on the MNCs operating in the UAE. We used the online database LexisNexis and searched for print and online articles published in Gulf News and Khaleej Times between January 2014 and December 2019 containing the names of the 83 European MNCs as keywords. The procedure yielded 8,563 articles covering at least one of the MNCs. Secondly, we read all articles that could be retrieved in order to determine whether they referred to a company and its corporate diplomacy or, for instance, merely mentioned its name and referred to other activities. To identify articles referring to the MNCs' efforts in corporate diplomacy, we referred to two characteristics of such diplomacy outlined in the literature and reflected in our conceptualisation. On the one hand, corporate diplomacy had to concern an MNC's engagement in sociopolitical issues relevant to the host country's society (Mogensen, 2017). On the other, corporate diplomacy had to address the non-economic environment (Kochhar, 2018) – for instance, the local or national government, authorities, local media actors, local community representatives, local NGOs and other established MNCs in the host country. Thus, we included only articles that met both of those criteria of corporate diplomacy, which we determined by reading all articles in full. As a result, we identified 385 articles published from 2014 to 2019 covering the corporate diplomacy of the 83 largest European MNCs operating in the UAE during that period [1].

Categories and coding procedure

We analysed all 385 articles using a coding scheme that consisted of formal categories (newspaper, year and company name) and content categories. To develop the categories, we adopted an inductive–deductive approach. Because moral, pragmatic and regulative media legitimacy reflect endorsing, positive evaluations in news articles, we applied them as frame elements. By contrast, we did not measure cognitive media legitimacy as part of media frames because it depends on familiarity with an organisation and is thus independent of specific evaluations.

In the coding procedure, we first coded the company's name, its sector and its origin country. Second, we coded several categories and variables reflecting four frame elements: problem definition, causal interpretation, moral evaluation and treatment recommendation (Entman, 1993). We derived all variables, comprehensively detailed in Table 1, by building on an initial coding of 20% of the data.

Firstly, the frame element of the problem definition indicates a text's principal topic and who the actors are (cf. Entman, 1993). In our analysis, the problem definition, comprising the issue of corporate diplomacy, measured the broader topic or field addressed by corporate diplomacy – for instance, public health or education and youth. Therein, the category of “institutional linkages” was coded as linkages that contribute to the MNC's moral, pragmatic or regulative legitimacy (de Souza, 2010). Institutional linkages reflect “any explicit reference to or association with state institutions (government, judiciary, law enforcement), international institutions (global institutions and international governments), and/or economic institutions (for-profit institutions)” (de Souza, 2010, p. 482). Along with the institutions mentioned in de Souza's (2010) definition, we added other variables that we derived deductively.

After that, we coded categories falling into the media frame element of causal interpretation. Causal interpretation measures how a specific outcome (e.g. success or failure) is attributed to an actor or their behaviour (cf. Entman, 1993). Following Matthes and Kohring (2008), we coded the ascription of legitimacy as endorsing legitimacy, challenging legitimacy or neutral. When the corporate diplomacy initiative or its (potential) outcomes were presented as successful or praised, we coded the article as “endorsing legitimacy”. When the initiative was criticised, however, or when the outcome was presented as a failure, we coded it as “challenging legitimacy”. Otherwise, when the articles remained on a descriptive, value-free level, we coded them as “neutral”. Moreover, we coded the category of the type of legitimacy by differentiating between moral, pragmatic and/or regulative media legitimacy, which is a common distinction of levels of legitimacy (e.g. Bitekine, 2011; Suchman, 1995). When an article viewed the MNC and its corporate diplomacy initiative as either contributing to a social group or the general local community or following common social values and expectations (cf. Suchman, 1995), we coded it as “moral media legitimacy”. By contrast, we coded articles as “pragmatic media legitimacy” when they described the activity as being useful for particular individuals or collective actors (e.g. the government) because pragmatic legitimacy rests on the expectations and interests of an organisation's most immediate stakeholders and primarily involves economic and political interdependencies (Suchman, 1995). By further contrast, we coded articles as “regulative media legitimacy” when they emphasised that the activity aligned with governmental expectations or was consistent with specific policies (Bitekine, 2011).

Thirdly, for the frame element of moral evaluation, we coded articles as showcasing “benefit attribution” to assess who benefited from the corporate diplomacy (e.g. UAE society or the government) according to the article.

Fourth and last, we analysed the frame element of treatment recommendation to identify any judgement concerning the corporate diplomacy initiative – for instance, a call for or against it or a positive or negative prognosis for the activity. We coded treatment recommendation as “suggestion” if any judgement concerning corporate diplomacy appeared in the article; it was coded as either “supporting” the corporate diplomacy initiative (e.g. a call for participation) or “criticising” it (e.g. a pessimistic prognosis for the activity).

Because cognitive media legitimacy depends on familiarity with an organisation and is thus independent of specific evaluation, we did not measure it as part of the media frame elements. Instead, we followed Kennedy (2008) by including categories that measure an MNC's visibility in order to assess cognitive media legitimacy. We first coded the position of the MNC's name in the article (i.e. title, subtitle and first third, second third and/or last third of the text). Because an MNC could be mentioned in multiple parts of an article, we separately coded each part as “1” when the MNC was mentioned in the respective part and “0” if otherwise. In the same way, we coded the position of any quotations, which can also contribute to cognitive legitimacy (Lamertz and Baum, 1998).

One coder analysed the content of all the articles. To measure intra-coder reliability, we randomly selected and recoded 10% of the articles and calculated Cohen's kappa coefficient for each variable. The analysis achieved medium to high Cohen's kappa values, ranging between 0.64 and 1.0, and an average coefficient of 0.82, which indicates high intra-coder agreement and good-to-high intra-coder reliability (Neuendorf, 2009).

Data analysis

The overall aim of our content analysis was twofold: to uncover structures (i.e. media frames) within news coverage addressing corporate diplomacy and to examine the extent to which those structures contribute to the ascription of moral, pragmatic, regulative and cognitive media legitimacy to MNCs. In line with Matthes and Kohring (2008), we conceived media frames as patterns in the text, measured as variables that aggregated the four frame elements – that is, problem definition, causal interpretation, moral evaluation and treatment recommendation (Entman, 1993). We performed an exploratory factor analysis involving the principal component analysis and varimax rotation coupled with cluster analysis in SPSS version 26 (cf. Baumann et al., 2003; Semetko and Valkenburg, 2000). The exploratory factor analysis allowed us to investigate whether the variables reflected their underlying dimensions, while cluster analysis enabled us to test the factor solution and increase our procedure's validity (Semetko and Valkenburg, 2000).

We coded all variables reflecting parts of the media frame as dichotomous variables (i.e. “1” if applicable and “0” otherwise). That approach was useful because it permitted multiple codes for a few variables; for example, in the category of “type of legitimacy”, several types of legitimacy could apply in one article. For statistical reasons, we merged variables to have a frequency greater than 10% for each variable included in the principal component analysis. We merged the variables of “Emiratisation” and “employees' well-being” because both relate to labour, and we merged the variables of “national NGOs” and “international NGOs” as both relate to NGOs. The procedure generated 19 variables that we included in our principal component analysis [2]. Using the elbow criterion, the analysis yielded a factor solution in which three factors explained 41.0% of the variance among the frame elements.

To verify the factor solution and determine the extent to which each variable contributed to each factor, we conducted a hierarchical cluster analysis (cf. Semetko and Valkenburg, 2000) using Ward's method and the squared Euclidean distance as measures of heterogeneity. In determining the ideal cluster solution, we considered the cluster's heterogeneity together with the dendrogram and the interpretability of other solutions, which generated a three-cluster solution that mostly verified the three-factor solution from the principal component analysis. Overall, the procedure revealed three media frames for corporate diplomacy that shared the same categories within the frame elements (Matthes and Kohring, 2008).

Next, to examine the extent to which the identified media frames contributed to cognitive media legitimacy, we calculated cognitive legitimacy scores based on the position of the company's name and any quotations. The more prominent the company's name and the quotation and the more frequently that both appeared, the higher the score. Last, we performed a one-way ANOVA to determine whether any differences existed between the ascriptions of organisational legitimacy across the factors identified in the media frames.

Results

News coverage of corporate diplomacy

From January 2014 to December 2019, 385 articles out of 8,563 in the Emirati newspapers Gulf News and Khaleej Times addressing the 83 European MNCs examined in our study mentioned the corporate diplomacy of the MNCs. Thus, 4.5% of all news coverage about the examined MNCs concerned their corporate diplomacy [3]. Across the 6-year period, most articles appeared in Gulf News (n = 275, 71.5%), and the news coverage ranged from 35 to 85 articles per year.

Regarding the topics addressing corporate diplomacy that we covered, cultural initiatives dominated the news in the UAE. In fact, more than two-thirds of the articles addressed corporate diplomacy-oriented efforts comprising cultural engagement (n = 154, 36.2%), including sports and arts events. Other major topics related to corporate diplomacy included engagement in education and youth activities (n = 60, 14.1%). Articles about public health (n = 54, 12.7%) were also numerous, especially concerning awareness and information campaigns about diabetes and healthy nutrition, which are major health problems in the UAE. The rest of the analysed news coverage addressed corporate diplomacy-related initiatives for women's empowerment (n = 34, 8.8%), environmental protection, Emiratisation (N = 24, 5.6%), employees' well-being (N = 27, 6.4%), helping people in need (n = 16, 3.8%), safety (n = 14, 3.3%) and Ramadan activities (n = 12, 2.8%). Concerning actors related to companies and their corporate diplomacy (i.e. institutional linkages), news coverage mostly linked MNCs with local government entities (n = 133, 25.6%), including ministries, authorities and individual politicians. At the same time, MNCs were often linked to social actors (n = 112, 21.5%), including celebrities such as athletes. The newspapers sometimes created institutional linkages between MNCs and other local (n = 86, 16.5%) and international companies (n = 81, 15.6%). Occasionally, the corporations and their activities of corporate diplomacy were linked to national (n = 26, 5.0%) and international NGOs (n = 14, 2.7%) or educational institutions (n = 19, 3.7%). In 35 articles (6.5%), efforts in corporate diplomacy were covered without linkages to other actors.

Media frames for corporate diplomacy and their links to media legitimacy

Building on the results of the exploratory factor analysis and cluster analysis, we found three clusters that could be interpreted as media frames for corporate diplomacy. Table 2 presents the mean values of each variable for every cluster; the mean values could have values between 0 and 1. To interpret the clusters, we considered variables with the highest mean values within each cluster and compared each variable's mean value across the three clusters to determine in which cluster(s) a variable had its highest mean value. Thus, small mean values that were moderate or high relative to other variables were considered to be potentially revealing (Matthes and Kohring, 2008).

Because we aimed to investigate how corporate diplomacy is framed in the news and whether media frames contribute to media legitimacy at different levels, we had a specific look at the cluster results regarding the variables of “legitimacy ascriptions” and “legitimacy type” (Table 2). As outlined, sociopolitical legitimacy includes moral, pragmatic and regulative legitimacy (Bitekine, 2011) and is based on social norms, values and interests (Suchman, 1995). Our analysis indicated three media frames and showed that two of the three identified media frames ascribed media legitimacy to the MNCs being reported on either at the moral legitimacy level (Cluster 1) or the pragmatic legitimacy level (Cluster 2, Table 2). However, no media frame was found that attributed regulative media legitimacy to the MNCs. Beyond that, we identified a media frame that presented corporate diplomacy in a neutral, value-free manner (i.e. without evaluation or endorsement), not attributing sociopolitical media legitimacy to the MNCs in question (Cluster 3).

Accounting for the link between the corporate diplomacy frame and media legitimacy, we referred to the frames according to the level of media legitimacy ascribed. Following that, we labelled the first cluster as the “moral corporate diplomacy frame” because our analysis showed that news about corporate diplomacy in that cluster, compared to the other two clusters, was presented as contributing to moral media legitimacy most (M = 0.95; SD = 0.23; Table 2). The second cluster was labelled as “pragmatic corporate diplomacy frame” because news about corporate diplomacy in that cluster, compared to the other two clusters, was portrayed as contributing to pragmatic media legitimacy most (M = 0.90; SD = 0.30). Finally, we labelled the third cluster as “value-free corporate diplomacy frame”, as the news articles falling into that cluster reported neutrally on corporate diplomacy and did not contribute to sociopolitical media legitimacy (i.e. moral, pragmatic or regulative legitimacy) as reflected in the means indicated in Table 2 (legitimacy type: moral: M = 0.00; SD = 0.00; legitimacy type: pragmatic: M = 0.00; SD = 0.00) [4].

The results of the ANOVA with cognitive legitimacy scores as the dependent variable and the three-cluster solution as a factor revealed significant between-group differences in means (F(2,382) = 7.77, p < 0.001; Table 3). Post hoc tests using the Bonferroni correction revealed that only Clusters 1 and 3 differed significantly (p < 0.05) in their means of cognitive legitimacy. By contrast, Clusters 1 and 2, as well as Clusters 2 and 3, did not differ significantly (p > 0.05) in their means (M_C1 = 4.25, M_C2 = 3.71, M_C3 = 2.87). Therefore, the results of ANOVA revealed that companies covered within the moral corporate diplomacy frame were mentioned and cited significantly more often than in the value-free corporate diplomacy frame. That result implies that the moral corporate diplomacy frame attributed significantly more cognitive media legitimacy than the value-free corporate diplomacy frame.

The moral corporate diplomacy frame (i.e. Cluster 1) applied to 43% of the news articles examined (n = 166). As shown in Table 2, news on corporate diplomacy in that frame could vary in terms of the issue reported on, and the coverage comprised initiatives concerning public health, education and youth, and, sometimes, cultural issues and activities geared towards Emiratisation and employees' well-being. News coverage within that frame clearly emphasised corporate diplomacy's relationship with the UAE government. Beyond that, the news endorsed the MNCs and their activities in corporate diplomacy at the level of moral media legitimacy. Compared with the other two frames, the moral corporate diplomacy frame seemed to be the most endorsing and supportive one. In the moral corporate diplomacy frame, the news presented corporate diplomacy as being beneficial to the Emirati community and showed support for corporate diplomacy – for instance, by calling for participants for a corporate diplomacy initiative to attend an event related to corporate diplomacy.

Meanwhile, the pragmatic corporate diplomacy frame (29%, n = 112) mostly encompassed news about initiatives geared towards cultural corporate diplomacy. In contrast to news articles falling into the moral corporate diplomacy frame, the ones that used the pragmatic corporate diplomacy frame did not emphasise any particular actor linked to the corporate activity. All activities oriented towards corporate diplomacy were related to national companies and the government, although international companies and social actors represented institutional linkages of similar relevance. Moreover, the articles highly endorsed and supported the MNCs and their initiatives. News in the pragmatic corporate diplomacy frame mostly demonstrated the value of corporate diplomacy for the UAE's economic progress – for example, by depicting corporate diplomacy as contributing to the country's goals to strengthen its position and competitiveness. In that regard, the news portrayed corporate diplomacy as serving the individual interests of the UAE government and the country, thereby building pragmatic media legitimacy.

Last, in the value-free corporate diplomacy frame (n = 107, 28%), the news reported on cultural activities of corporate diplomacy linked to social actors, including celebrities, athletes and community members who promoted or participated in initiatives or events focused on corporate diplomacy. Coverage in that frame portrayed corporate diplomacy neutrally by not relating it to any specific level of sociopolitical media legitimacy. Compared with the other frames, the value-free corporate diplomacy frame, living up to its name, seemed less supportive of the corporate diplomacy initiatives portrayed.

Discussion and implications

In our study, we sought to identify media frames used in news coverage of MNCs' corporate diplomacy in a host country and how they contributed to media legitimacy at different levels. From our factor and cluster analyses, we derived three media frames: the moral corporate diplomacy frame, the pragmatic corporate diplomacy frame and the value-free corporate diplomacy frame. Our findings show that nearly three of every four articles (72%) addressing MNCs' corporate diplomacy ascribed either moral or pragmatic media legitimacy to the MNCs indicate that news coverage of corporate diplomacy is highly valuable for MNCs and can support their attempts to gain media legitimacy within a host country's society. The finding also corroborates earlier results indicating corporate diplomacy's role in gaining legitimacy (Mogensen, 2017; Ordeix-Rigo and Duarte, 2009). Among our other findings, the moral corporate diplomacy frame was the most visible, familiar frame and thus likely contributes most to building cognitive legitimacy, the most powerful form of organisational legitimacy. Cognitive legitimacy imparts familiarity and popularity to companies and provides essential resources such as goodwill, employees and financial assets (Suchman, 1995). By comparison, moral media legitimacy, as shown in our study, supports past observations that moral legitimacy “becomes the decisive source of societal acceptance, especially for those companies that operate globally” (Palazzo and Scherer, 2006, p. 74).

However, our findings also imply that regulative media legitimacy hardly plays any role in the news about corporate diplomacy. Although the UAE government exercises significant power over local mass media (Kirat, 2005) and although corporate activities have been found to align with the government's agenda (Duthler et al., 2015; Marschlich and Ingenhoff, 2021), the news articles that we analysed hardly addressed corporate diplomacy initiatives with governmental expectations. Nevertheless, the institutional linkage between the MNCs and the government (e.g. MNC–government collaborations) was obvious across all three frames, particularly, in the moral corporate diplomacy frame. As outlined by previous scholarship, institutional linkages with legitimate and powerful actors can enhance the construction of organisational legitimacy (Lamertz and Baum, 1998). As our study has confirmed for news media coverage, relationships between an MNC and the local government are portrayed quite often and usually in positive, endorsing ways, which together contribute to media legitimacy. That result aligns with the results of studies that have identified the role of the host country's government and public–private partnerships in corporate diplomacy practices (Fitzpatrick et al., 2020; Mogensen, 2017).

Our work has several implications for research and practice. Above all, it stands to contribute significantly to the measurement of media legitimacy in its application of a substantiated research instrument tested in an international setting that can be used in future studies. Although empirical research on media legitimacy has increased (e.g. Etter et al., 2018; Vergne, 2011), legitimacy has continued to be primarily assessed by analysing the salience of companies in the news and the tone of such news. Our study, by contrast, has showcased an innovative approach to analysing media legitimacy, one that affords specific insights into how corporate diplomacy and corporations are evaluated in media in terms other than salience or tone. In addition, our operationalisation of media legitimacy, as demonstrated in our study, allows measuring the construct on four levels (i.e. moral, pragmatic, regulative and cognitive) and thereby achieving a more granular measurement of media legitimacy. Furthermore, in contribution to the rather scant empirical literature on corporate diplomacy (Fitzpatrick et al., 2020), this article emphasises the role of news media in creating and disseminating evaluations of corporate diplomacy and MNCs that promote companies' media legitimacy.

From another angle, our results offer insights into practices of corporate diplomacy and may, therefore, be of significant interest to MNCs worldwide. In particular, they imply that companies can benefit from communicating their corporate diplomacy by emphasising their institutional relationships (e.g. public–private partnerships) in the host country. They also demonstrate the contribution of corporate diplomacy to local community. According to our findings, local new media frequently cast corporate diplomacy initiatives in a positive light and employed critical parts of media frames able to foster moral and pragmatic media legitimacy.

At the same time, those findings seem very context-dependent, for a host country's culture and political system necessarily influence practices of corporate diplomacy and their coverage in the news. In the UAE, a non-democratic country where the government exercises significant power over society and media outlets, positive governmental relations highlighted in corporate communication seem to be valuable. In democratic countries, by contrast, such relations may cloud how companies are perceived. As such, our results imply that understanding and adapting to the political and cultural systems of a host country are critical in corporate diplomacy initiatives aimed at gaining media legitimacy.

Limitations and directions for future research

Our findings have limitations, predominantly related to our chosen case of the UAE and the particularities of its political and media systems that doubtlessly affect corporate diplomacy initiatives and media coverage. Such particularities, especially in the UAE's media system, may lower the overall credibility of media outlets in the country and, in turn, affect evaluations of legitimacy (Finch et al., 2015). In view of that limitation, it would be fruitful to compare our results with findings from other country-specific cases representing different media and political systems and therein explore the role of mass media in corporate diplomacy and legitimacy evaluations. Added to that, our sample was limited because we analysed only two media outlets and focused exclusively on English-language media articles. Even so, along with Arabic, English is a primary language in the UAE, and given the high number of expatriates there, it seemed reasonable to analyse English-language news articles to gain insight into local news media in general. Last, our findings imply that cultivating media relations may help MNCs to promote corporate diplomacy. For that reason, future research on how MNCs communicate their corporate diplomacy initiatives should compare such communication with media coverage to gauge the potential influence of MNCs on media portrayals of their corporate diplomacy.

Table 1

Operationalisation of the frame elements (cf. Entman, 1993)

Category	Variables
Frame element: problem definition
Corporate diplomacy issue	Public health, education and youth, environment, culture, women's empowerment, Emiratisation, Ramadan, safety, employees' well-being, people in need, other
Institutional linkages	Governmental institutions, national NPOs, international NPOs, national companies, international companies, educational institutions, individuals of the community, other actor(s)
Frame element: causal interpretation
Ascriptions of legitimacy	Endorsing, challenging, neutral
Legitimacy type	Moral, pragmatic, regulative
Frame element: moral evaluation
Benefit attribution	Society/community, government/political agenda, company itself, employees, economy of the country, corporate partners, others
Frame element: treatment recommendation
Suggestion	Supportive, critical

Table 2

Means of the dichotomous variable per cluster

Variable	Cluster 1 MORAL CD* FRAME N = 166 M (SD)	Cluster 2 PRAGMATIC CD FRAME N = 112 M (SD)	Cluster 3 VALUE-FREE CD FRAME N = 107 M (SD)
CD issue: public health	0.23 (0.43)	0.08 (0.27)	0.06 (0.23)
CD issue: education and youth	0.22 (0.42)	0.10 (0.30)	0.11 (0.32)
CD issue: culture	0.16 (0.37)	0.51 (0.50)	0.65 (0.48)
CD issue: Emiratisation and employees' well-being	0.13 (0.34)	0.19 (0.39)	0.07 (0.26)
Institutional linkage: government	0.43 (0.50)	0.31 (0.47)	0.24 (0.43)
Institutional linkage: national and international NGOs	0.15 (0.36)	0.05 (0.23)	0.07 (0.25)
Institutional linkage: national company	0.19 (0.39)	0.34 (0.48)	0.16 (0.37)
Institutional linkage: international company	0.22 (0.42)	0.26 (0.44)	0.14 (0.35)
Institutional linkage: social actors	0.22 (0.42)	0.24 (0.43)	0.45 (0.50)
Legitimacy ascriptions: endorsing	0.99 (0.11)	0.98 (0.13)	0.00 (0.00)
Legitimacy ascriptions: neutral	0.01 (0.11)	0.03 (0.16)	0.84 (0.37)
Legitimacy type: moral	0.95 (0.23)	0.10 (0.30)	0.00 (0.00)
Legitimacy type: pragmatic	0.16 (0.37)	0.90 (0.30)	0.00 (0.00)
Benefit: community	0.91 (0.29)	0.17 (0.38)	0.37 (0.49)
Benefit: government	0.16 (0.37)	0.20 (0.40)	0.06 (0.23)
Benefit: employees	0.05 (0.22)	0.15 (0.36)	0.02 (0.14)
Benefit: country	0.05 (0.23)	0.21 (0.41)	0.03 (0.17)
Suggestion: supportive	0.53 (0.50)	0.40 (0.49)	0.20 (0.40)

Note(s): *CD=Corporate Diplomacy

Table 3

One-way analysis of variance for the effects of the three clusters on cognitive media legitimacy

	Moral CD frame		Pragmatic CD frame		Value-free CD frame
Variable	M	SD	M	SD	M	SD	F(2,382)	p	η2
Cognitive media legitimacy	4.25	3.25	3.71	2.69	2.87	2.14	7.77	<0.001	0.04

Note(s): CD=Corporate Diplomacy

Notes

1. During the study period, the number of articles on corporate diplomacy per MNC varied between 1 and 44. However, because our study was concerned with the relevance of corporate diplomacy in media coverage and its relation to the media legitimacy of the identified MNCs, our analysis did not address the level of individual MNCs but considered all articles on corporate diplomacy in the UAE.

2. The Kaiser–Meyer–Olkin (KMO) measure of sampling adequacy (KMO = 0.606) was mediocre but greater than the suggested minimum value of 0.5 (Field, 2013). Meanwhile, Bartlett's test of sphericity (χ² = 2277.6, df = 153, p < 0.001) showed that the correlations between the items were large enough (Glaser, 2006), thereby implying that the 18 variables were suitable for the principal component analysis.

3. The result indicates that the vast majority of articles about the MNCs examined did not cover corporate diplomacy. That finding is unsurprising, given research showing that corporate reporting is primarily about functional, economic aspects, mostly corporate profits and losses (Bybee et al., 2021) or negative events such as crises or corporate misconduct (Vliegenthart et al., 2021). Only a small share of the aggregate coverage of companies stems from the MNCs' social activities, as shown in a recent study (Vogler and Eisenegger, 2021).

4. The variable measuring regulative media legitimacy is not included in Table 2 as it was excluded from the principal component analysis as the content analysis showed that this variable is almost absent in the sample (cf. section “Method”).

Disclosure of potential conflicts of interest: The authors declare that they have no competing interests.