Tag Archives: companies

The Image of FHFA Lawsuit Against 17 Banks

Posted on by • Posted in Companies, Corp - Bank of America, Rep Issue - Newspapers • Tagged , , , , , , , , , , , , , • 5 Comments

(Note: as Bank of America is in the news for additional mortgage related lawsuits, we put in the frontline this analysis posted before)

The precedent post showed which banks are more present in the media in relation with the multibillion lawsuit of the US Federal Housing Finance Agency (FHFA) against 17 major American and international banks.

Now we show results about the images portrayed by the media when covering the FHFA lawsuit.

This is a new tool of analysis that we present in this blog. It has been developped at our research center MRI Universidad de Navarra, and it has been applied to other studies.

Image analysis show striking results for media reputation analysis. All analysis presented in this reputation crisis blog is entirely based in news content analysis from newspapers. Image analysis is also based in newspapers articles. What we do here is to identify all photos used by the journalists to illustrate the news published about any kind of issue or event.

We collect all available photos used, and we regroup them into relevant categories. The final step is to present the results. We can show the numerical results or a graphical representation of it. The reputation collage is the resulting image emerging from all photos chosen by journalists.

This tool is probably very relevant in terms of reputation analysis. Appearing in the news in a reputation crisis may damage the media perception of the affected people, company or institution. This damage increases substantially if the news appearence is not recluded into the body of the article, but appears in the headlines. But it is probably even more damaging if the indicted actor appears in the photo illustrating the news article.

News photos are many times the result of a hard work of media professionals, as they are picked as means to show the “soul of the article”. In many cases, especially when dealing with reputation crisis or scandals, the image chosen come as a result of a journal editorial decision. The impact of a photo is many times stronger than the impact of the content of the text.

We present the result concerning images showed to explain the FHFA lawsuit. As explained in the precedent post, the case we analyze here is ver nice in terms of reputation analysis, as it concerns as much as 17 different companies. The journalist or the editor needs to take a choice if she wants to show the image of a particular bank. As explained, the bank appearing in the photo of news about the FHFA pays a hard price in terms of loss of media reputation, as it creates an association with misleading business behavior, linked to the present economic crisis suffered by many right now.

First reputation collage refers to photos used in news from US newspapers about FHFA lawsuit, published between September 1 and 7.

Main image reference is a picture of a bank. We have shown a unspecified bank image, but they refer all to specific companies. The next collage will show the details of which banks are chosen as examples in the news. Second image reference in importance are photos about the stock markets, normally showing distress and images of falling stock indexes. They are concentrated in news from Monday September 5, when sued banks suffered substantial losses in European markets (Labor Day in the United States). Third and fourth images used to explain the core of the news are images about housing foreclosures and about Fannie Mae and Freddie Mac. We find also image references to experts/analysts, money, the justice and President Obama.

As announced, we show in the following reputation collage the images concerning the names of banks used in the photo news. This result is the key element concerning the measurement of the reputational impact of the current legal crisis experienced by sued banks. It also answers to the question of which among all banks is paying the reputation bill.

Our empirical answer is quite clear: the crisis is up to now being strongly associated to Bank of America, as it is by far the reference picked by journalists or newspaper’s editor to illustrate the lawsuit. Second bank in terms of presence in news photos is JPMorgan Chase. We find also a significative presence of images about Goldman Sachs. There are only marginal appearences of other banks: Morgan Stanley, Deutsche Bank, Citigroup and First Horizon. Other banks do not even appear as photo news.

This clear result suggest a kind of Winner-take-all rule, that in the field of reputation crises becomes a curse: in a set of several affected companies by an scandal or a crisis, media tend to concentrate image attention to the one appearing as the most exposed to the scandal, in a disproportionate way compared to all other affected companies.

It is true that Bank of America has been sued by the largest amount of sellings to Fannie and Freddie. But while they support less than a third of all eventual sanctions linked to selling mortgage securities, it completely controls media choices as image to be shown to present the FHFA lawsuit news.

US FHFA Sues 17 Financial Institutions on Mortgages Securities: Who Pays the Reputation Bill?

Posted on by • Posted in Companies, Corp - Bank of America • Tagged , , , , , , , , , , , , • 4 Comments

(See also the post about the news image of FHFA lawsuit)

US Federal Housing Finance Housing (FHFA) sued 17 firms “to recover losses to Fannie Mae and Freddie Mac” (see Press Release) by Septemeber 2, 2011. FHFA is a federal agency acting as “the regulator and conservator of Fannie Mae and Freddie Mac and the regulator of the 12 Federal Home Loan Banks”, which official Mission statement is to “Provide effective supervision, regulation and housing mission oversight of Fannie Mae, Freddie Mac and the Federal Home Loan Banks to promote their safety and soundness, support housing finance and affordable housing, and support a stable and liquid mortgage market”.

In accordance with its mission, FHFA launched a lawsuit against 17 firms based on”FHFA’s conclusion that some portion of the losses that Fannie Mae and Freddie Mac incurred on private-label mortgage-backed securities (PLS) are attributable tomisrepresentations and other improper actions by the firms and individuals named in these filings. Based on our review, FHFA alleges that the loans had different and more riskycharacteristics than the descriptions contained in the marketing and sales materials provided to the Enterprises for those securities” (Press Release).

One day before, New York Times announced the imminent suing action. Apparently, it came as a surprise legal movement to many people in the market. In this article, the journalist mentionned that a “more than a dozen of big banks” where in the list. But New York Times mentionned only four of them: Bank of America, JP Morgan Chase, Goldman Sachs and Deutsche Bank “among others”.

Article by NYTimes provoked a substantial drop in mentionned companies in Friday 2 September trading (Bank of America -8.3%, JPMorgan -5.3%, Goldman Sachs -4.5%, Deutsche Bank -5.9%). Names of other affected companies came only after the market closed.

Today, Monday 5 September, affected companies in Europe have suffered a major fall, pushing all European stock markets into red. American companies are not trading today due to Labor Day. This was a specific Black Monday by European companies sued by US Federal Agency: Deutsche Bank -8.9%, Credit Suisse -8.1%, RBS -12%, HSBC -3.6%, Barclays -6.7%, Société Générale -8.6%.

The crisis we consider in this post is very interesting to us, as it is a common legal action against 17 different financial institutions. The amount of purchased made by Freddie and Fannie to each institution varies notably. Some affected institutions are American and other are European, (Plus Japanese Nomura). Finally, New York Times did only mention four of them.

The lawsuit has had an immediate tremendous financial impact. Billions of dollars of equity value have wiped away from stock owners’ pokets. This is a natural investor’s reaction to the anticipation of the losses linked to the legal process and the eventual financial fines. What we have observed today is nevertheless probably an irrational overreaction that could be corrected.

FHFA has not provided  numbers about the amount of losses they expect to recover: ““is is premature and potentially misleading to estimate what recoveries would be”. Some analysis estimate that the total sanctions to 17 entities coud reach $30Bn. Keefe, Bruyette & Woods estimate that it could cost as much as $60Bn to banks.

Financial expert John McDermott from Financial Times estimates that total amount of losses expected to recover by FHFA are $40Bn, with Bank of America expected to pay $12Bn, JPMorgan $7Bn and RBS $6.3Bn. The detail of the estimations for each bank are presented in the table.

Other analysists consider that $6Bn fine is more probable. In this latter case, these losses would represent barely 4% of total profits of these firms (Seeking Alpha, Sept 5 2011).

Whatever the extent of the direct financial impact of the lawsuit in terms of litigation costs and final finalcial sanctions, we understand that this case of a US Government Agency against 17 prominent national and international financial firms will be mainly a matter of tremendous reputational costs. This federal agency is in a sense pointing out these companies as key actors in the 2008 financial crisis that costed many sacrifices to US taxpayers and that finally became an economic crisis with the consequence of massive unemployment. A long, public and contrversial judicial process in the midst of the present renewed financial and economic crisis would become a constant media affaire with highly exposure linked to the sued institutions.

News linked to this lawsuit could be all of them severely damaging to banks reputations, as they are understood as being in the hart of the present crisis. This judicial process could render ineffective any other positive reputational efforts and expenditures assumed by the companies in sporsorship or CSR actions.

As already pointed out, the attractive aspect of this reputation crisis is that it is puting 17 companies in the same group, while the level of formally suing responsibility varies enormously, in a ratio 1 to 50. Would the public opinion and investors treat each bank differently or would they treat all of them equally as responsible for the crisis?

Media coverage to this lawsuit will provide us a lot of relevant information about the extent of the reputation damages for each one of the 17 indicted firms. As we have shown in precedent posts and in our research group reports (MRI Universidad de Navarra), we count with a number of tools that may provide useful information and knowledge for firms, practitioners and academia.

We show first in the following figure the amount of Mortgage Securities sold by each sued institution to Fannie and Freddie, in billions of US$, according to Wall Street Journal. We include under the umbrella of Bank of America $6Bn sold directly by BofA plus $26.6Bn by Countrywide Financial and $24.8Bn by Merrill Lynch/First Franklin Financial. Both firms were acquired by Bank of America.

We find that Bank of America, JP Morgan and RBS represent some $120Bn of products sold to Fannie and Freddie, or 61% of all liabilities of all 17 banks. We should note that RBS was not mentioned in the NYTimes article, while it identified Deutsche bank and Goldman Sachs.

The following figure presents the first results concerning the media coverage analysis. We compare the share of all purchased from each financial institutions, against the media coverage received in relation with FHFA lawsuit, in US newspapers. We identify in bold lines the institutions that were identified in NYTimes news.

US media coverage indicates that, as it could be expected, the distribution of news do not follow exactly the extent of expected legal liabilities: institutions that sold “small” amounts of financial products receive a substantial amount of media attention. While the 5 firms with lower financial implications have sold “just” $8Bn representing 4.2% of all funds, they receive a media coverage equivalent to 22.4% of all news about the lawsuit. The top 5 firms by liabilities suppose 76% of all sellings but only 45% of all media impact.

This is a natural result in terms of media coverage, as many newspapers mention all 17 affected companies or at least many of them. Even of the financial liabilities are indicated in the news articles, this balance of news appearances irrespective of liabilities produces paradoxically a negative reputation shift punishing the less affected companies. This result clearly favors the main involved firms: Bank of America, JP Morgan adn Royal bank of Scotland.

A second element emerging from the figure is a first assessment of the reputational impact of being mentioned in the original news at New York Times. Except for Bank of America, all other companies mentioned in the article suffer from a media impact premium in comparison to companies not present in this article. Just compare media impact of JP Morgan vs RBS, which are similar in liabilities. We also observe that Goldman Sachs reveives much more media attention than average, like Deutsche Bank. Citigroup appears also as outlier. Even if the group was not included in the list, it was directly mentioned in the article as a bank being sued by the same kind of financial practices. UBS was also mentioned in the article, but it is not included among the banks issued as UBS reached an agreement some weeks ago with federal authorities.

In the following figure we look just at banks mentioned in New York Times article. We show the relationship between funds involved and media coverage received in US newspapers between Friday 2 and Monday 5. As expected, media coverage of news that mention New York Times (NYTimes News) as source are roughly similar to all four banks, independently of the amount in charge. If we include all news in relation with the FHFA case between Friday 2 and Monday 5 (FHFA news) we see that Bank of America becomes main media reference (share of 28%) while the foreign bank receives lower attention in US newspapers than deserved by funds involved.

A complementary check is to look at banks explicitly mentioned in the headlines. Of course, being in the headline of a news implies a stronger negative reputational impact than just being mentioned in the content of the news. We have selected the headlines of news referring directly to New York Times filtration. Hre we find that newspapers tended to choose Bank of America (56% of all cases) followed by JP Morgan (38%).  Goldman Sachs appeared marginally and Deutsche Bank did not appear in the headlines.

The following set of figures shows media coverage of FHFA lawsuit by countries. Precedent analysis used results using US newspapers. Now we analyze how local media abroad is covering this crisis.

We show the share of news received by each single financial institution. We compare it to mortgages securities sold and against global media coverage. This allows to identify local media treatment specificities. We use bold line marks for identifying banks receiving specific local media attention departing from global trend.

US Newspapers count for 50% of all current news about FHFA lawsuit. This makes that its profil is similar to global coverage. One of the particualrities of US media coverage is that they under represent European continental banks (DB, CS, SocGen), while this does not happen with British firms.

Media from countries in Europe with local banks in the list focus their media coverage in their local affected institution. This is also a natural result, but with our analysis we provide empirical data enabling to estimate its extent.

This result has eveidently serious implications in reputation terms. Key market for any company is the local market, especially if this is a big market. Local market represents many times the biggest share of relevant stakeholders: owners, workers, consumers and relevant public legistation. Reputational issues in the local original market are extremely important for global brands. And this current crisis is linking main local banks to the origin of the economic and financial crisis, that is currently attacking also all these three markets: Britain, France, Germany.

Next figures is media coverage from countries that do not have local banks sued by FHFA. We find that media from Spain follow global media trend, except for Barclays and Nomura, that receive more media attention.

Media from apparently directly unaffected countries like Brazil and India follow basically global media trend.

AFLAC Media Reputation: Impact of Jokes About Tsunami in Japan

Posted on by • Posted in Companies, Corp - AFLAC, Country - Japan, Country - United States, Disasters, Event - Tsunami Japan, Rep Issue - Communication Crisis, Rep Issue - News Content Analysis • Tagged , , , , , , , , , , , , , , , , , , • 7 Comments

(NOTE: You can download here a pdf version of this post, edited by Media, Reputation and Intangibles center, MRI Universidad de Navarra. It contains additional analysis about media reputation of AFLAC rivals, like Metlife, Prudential Financial or Aetna).

In a recent post we showed the list of American companies most affected by the earthquake and tsunami in terms of global media coverage. AFLAC was one of the top ranked companies. As explained there, this was partially due to the fact that this insurance company has a substantial business presence in Japan. We mentioned also that some of the news appearances were related to jokes from a representative of the company using the tsunami as elements of the joke. These jokes were known widely, as they were published by the author trough Twitter. The author of the joke was almost inmediately fired from the company. These events happened on March 14, only three days after the earthquake. As the incresing dimension of the tragedy was evident at that moment and media coverage was massive, this affaire attracted a substantial amount of media attention.

The responsible of the jokes was comedian Gilbert Gottfried. He was the “voice” of AFLAC duck, the official mascot of the company, and apparently present in more than 50 different commercials. Gottfried was working for the company for almost ten years. The press release by AFLAC stated that it “announced today that it has severed ties with comedian Gilbert Gottfried.

“Gilbert’s recent comments about the crisis in Japan were lacking in humor and certainly do not represent the thoughts and feelings of anyone at Aflac,” Aflac Senior Vice President and Chief Marketing Officer Michael Zuna said. “Aflac Japan – and, by extension, Japan itself – is part of the Aflac family, and there is no place for anything but compassion and concern during these difficult times.”

Japan is a crucial market for AFLAC. According to AFLAC Company Fact Sheet, they are “the number one insurance company in terms of individual insurance policies in force in Japan”. AFLAC considers that is also a top mind brand in Japan “Promote our number one brand position –We will capitalize on our market-leading status to attract consumers and distinguish our products while emphasizing the attributes that led us to our number one position.” According to their corporate overview: “Aflac Japan is the number one insurance company in Japan in terms of individual policies in force and the largest foreign insurer in Japan in terms of premium income. Aflac Japan also ranks first in the number of individual policies in force among all of Japan’s life insurers and is the fifth most profitable foreign company in any industry in Japan.”

This “lacking in humor” jokes were judged with severity by many media. Negative comments range from “bad taste and judgement” (Washington Post), “insensitive tweets” (USA Today), “insensitive remarks” (New York Times), “tasteless tweets” (ABC News), or “mocking jokes” (AP and Boston Globe).

As we mentioned in the precent post, this case show how big a mistake can develop in episodes of severe crisis submitted to massive media coverage.

In this post we further develop this analysis, showing media reputation of this specific event and its impact in global AFLAC reputation.

We use again the analysis of diamonds of media reputation, as we did is several precedent posts, like for instance the comaprison between media perception of Haiti versus Japan earthquake, or media reputation of Bank of America associated to Wikileaks. Please refer to those post for the explanation of the methodology applied. Basically, the stronger the association with a given media reputation vector, the bigger the diamond is in the graphs.

As we are checkin the impact of an event expected to generate bad reputation, we concentrate the analysis an results showing media reputation associated with “Scandal” and with “Tragedy”.

In next figures we compare the media content profile of news about AFLAC with explicit mentions to the jokes, agains media perception of AFLAC with all news published in March 2011 in relation with the Japanese tsunami. We also introduce as term of comparison the media reputation of AFLAC during year 2010, for news published between August and November 2010.

Results clearly indicate that Gottfried jokes are perceived as shocking by the media, as it produces a substantial increase of relation with “Scandal” association, in comparison with 2010 and current news about AFLAC. Bad image is specially present concerning the vector components of scandalous, harm, mistake and embarrassing.

Concerning the vector “Tragedy”, it penalizes AFLAC specially concerning the components harm and horrible.

The news content analysis technique that we propose at MRI Universidad de Navarra captures the negative impact that this event produces in AFLAC.

How substantial is the negative image transmitted by media coverage about jokes by “AFLAC duck voice”? A way to answer to this question is to compare the profile of these news against other controversial recent events. We compare  AFLAC jokes reputation crisis versus the profile of news referring to Homer Simpson and some episodes with crude humor about nuclear accidents. We compare it also to South Park TV series, as considered transgressor.

Our resuts indicates that Gottfried’s jokes are perceived basically as disgusting as The Simpson episodes related to nuclear plant. AFLAC jokes are more associated to mistake component. In contrast, present time news about South Park animated series is currently weackly associated to “Scandal”. We observe also a similar behaviour trend concerning the reputation vector “Tragedy”.

A surprising but revealing term of comparison is Rebecca Black, one of these new kind of explosive Youtube hits. Official video counts with 78 millions visits at the beginning of April 2011. The special feature of this new singer is that she has received extremely negative reviews. Votes in Youtube show that 189,000 viewers like it, while somo other 1.5 million viewers dislike, almost 90% of negative votes.

Our results indicate that both news about Rebecca Black “Friday” clip and news about the jokes by Gilbert Gottfried receive basically the same profile in terms of bad reputation concerning “Scandal” and “Tragedy” components. Rebecca Black is viewed in a slighly worst image than AFLAC comedian.

All comparisons with other brands in the enterteinment industry with expected negative image show clearly that jokes aired through Twitter are judged really bad by newspapers.

How harmful will be this episode for the global media reputation of AFLAC? AFLAC executives took a bold decisions, firing almost immediately the comedian. In a reputation crisis, how to react concerning the source of the troubles, as well as the timing are always key decisions influencing the evolution of the crisis.

We check first to which extent the jokes scandal has contaminated other decisions taken by AFLAC.

In accordance with its strong presence in Japan, AFLAC was one of the first companies in the United States to commit donations for affected people. A press release was published by March 11, the day the earthquake occurred, reproduced here:

Aflac Pledges 100 Million Yen to Red Cross Disaster Relief for Japan
COLUMBUS, Ga., March 11, 2011 /PRNewswire via COMTEX/ — Aflac has pledged 100 million yen to the Red Cross to assist with their disaster relief efforts in Japan. Aflac is the largest insurer in Japan based on policies in force.
“Our thoughts and prayers go out to the Japanese people during this very difficult time,” Aflac Chairman and CEO Dan Amos said. “We stand ready to assist in the healing process and are pledging these funds to ensure that basic needs are cared for during this crisis.”
Aflac will work with the Red Cross to expedite this contribution.

In the press release announcing that “Aflac Severs Ties with Gilbert Gottfried”, they arlo made reference to past donation. This linkage could affecet negatively the reputation profile of news about support to victims of the disaster. We show now the media reputation of news about the donations made by AFLAC to the victims of the earthquake.

The answer, according to our results, is that media make a clear distinction between the two events and decisions, and news about donations are not associated to scanal, as news about the jokes are indeed. News about donations share basically the same profile that news about AFLAC and the tsunami.

We give a complement of the impact of donations on the media reputation of AFLAC by showing a couple of examples of positive brand vectors. News about donations strongly reinforce the media reputation of AFLAC in two dimensions cherised by this company: “Excellence” and “Commitment”. “How Do we Do Business: From the very beginning of our business, Aflac leaders have worked hard to build a culture of open communication, honesty, integrity and caring customer service. And from the days when three brothers founded Aflac, we’ve approached our shareholders with those same values.” (AFLAC Fact Sheet).

We observe that even of all three group of news depited in the graphs refer to Japan’s disaster, they portray different media reputation: news about AFLAC and the tsunami and about the jokes are poorly associated to “excellence”, while news about donations for victims are strongly associated to all components of “excellence”, like honesty, awareness or Corporate Social Responsibility.

We find a similar pattern regarding “Leadership, Commitment”. Low degree of association with news about the tsunami and jokes, but high when linked to the donations. Stronger association with components inspiring, leadership and awareness.

When AFLAC announced the cessation of relations with Gilbert Gottfried, it also annunced a casting call for the new voice of AFLAC Duck: “Aflac will immediately set plans in motion to conduct a nationwide casting call to find a new voice of the iconic Aflac Duck. It should be noted that Gilbert Gottfried is not the voice of the Aflac Duck in Japan” (AFLAC Press Release March 14, 2011). Was it a correct marketing and branding strategy? There were a clear risk of linkage of the cating call news to the jokes scandal, and that every news about the auditions generate new references to the awful jokes. This could clearly expand in time the negative impact of the jokes on AFLAC reputation.

We compare here the media reputation of news related to the casting in comparison with news about the jokes. Results show clearly that news about the casting are not contaminated at all by the jokes affaire in terms of association with “Scandal”. Franckly speaking, this is a big surprise for us, as our own percpetion was to find the opposite result, and our initial judgement was to consider the nationawide casting as a mistake in terms of branding strategy.

Results concerning “Excellence” confirm again that the casting news are not affected by the negative image generated by Gottfried’s jokes.

Has Gilbert Gottfried killed the Duck?

Immediate reaction to the scandal provoked by Twitter jokes was required by AFLAC staff. Not only because of the massive media impact produced, and not only because Japan is the main market for AFLAC in terms of revenues.

A decide reputational crisis management was needed because AFLAC Duck is apparently one of the main intangible assets of the company. The white duck is not only the conductor of all commercials run by AFLAC: it is part of AFLAC logo, as shown below. It is thus present in all official documents and references to the company.

The crisis generated by Gilbert Gottfried’s jokes could then become not only a short term reputational crisis. It could tarnish the brand perception of AFLAC Duck by the media consumers and all stakeholders.

According to AFLAC sources, “In 1990, Daniel P. Amos was named CEO of Aflac Incorporated. After several unsuccessful attempts to increase Aflac’s brand awareness, on January 1, 2000, Mr. Amos boldly introduced America to the Aflac Duck. A marketing sensation, the Aflac Duck is now a corporate icon holds a place on Madison Avenues Walk of Fame and is part of American pop culture” (AFLAC Corporate Overview).

We indenify now to which extent the current negative news are affecting negatively the media reputation of “AFLAC Duck”. We compare current (March 2011) news about AFLAC Duck against media profile of news about Gottfried jokes, and against media reputation of AFLAC during second half of year 2010.

Our results indicate that AFLAC Duck has not been affected by the jokes, in terms of association to “Scandal” media reputation vector. AFLAC Duck shares the same media recognition than the company news before the scandal of the jokes happened.

The analysis about the media reputation vector “Tragedy” produce the same results and conclusions: the Duck has not been affected by the neagtive image of the jokes.

We check finally one of the positive reputation vectors. We select “Excellent”, as already used to analize the other issues. Once again we find that even in the midst of the flow of negative news about the bad jokes of “the voice of AFLAC Duck”, media reputation of the white duck is resilient and unaffected in negative terms: the Duck is apparently one of AFLAC drivers of brand equity, as it reinforces the association of AFLAC to “excellence”, specially for to key components for this company: honesty and Corporate Social Responsibility.

All these final results tend to clearly state that the Withe Duck is indeed an intangible asset of extraordinary value for AFLAC, that has perfecly survived to the attack of the tasteful jokes by its voice almost since by its inception in the United States advertising strategy. This analysis is also according to us a nice example of the strengths and power of the techniques developped by Media, Reputation and Intangibles center, MRI Universidad de Navarra to assess media reputation of any kind of brands, and to evaluate the impact of events and crisis from very different nature.

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Company Reputation: Risky Business: When T-Mobile Dances with the Royal Wedding of Prince William and Kate Middleton

Japan VII. Fukushima as a Chernobyl Nuclear Disaster: Media References by Countries

Japan XVII. Haiti and Japan Earthquake Media Coverage During the First Month

Japan XVI AFLAC Media Reputation: Impact of Jokes About Tsunami in Japan

Japan XV. American Companies Most Affected by Earthquake, Tsunami or Nuclear Crisis in Japan, by Media Impact

Japan XIV. New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (II)

Japan XIII. New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (I)

Japan XII. Japan Prefectures Media Coverage. Relationship with Personnel and Property Casualties by Earthquake and Tsunami

Japan XI. Companies in Europe Most Affected by Japan Earthquake, Tsunami, Fukushima Nuclear Crisis, by Media Impact

Japan IX. Fukushima Nuclear Crisis Media Views in United States, United Kindgom, Australia and India.

Japan VIII. Wikileaks on Fukushima and the Japan Nuclear Crisis. Measurement of the Initial Media Storyline.

American Companies Most Affected by Japan Earthquake, Tsunami or Fukushima Nuclear Crisis, by Media Impact

Posted on by • Posted in Companies, Corp - AFLAC, Corp - Bank of America, Country - Japan, Country - United States, Disasters, Earthquake, Event - Fukushima, Event - Tsunami Japan, Issue - Nuclear Crisis, Debate, Rep Issue - News Content Analysis, Rep Issue - Newspapers, Rep Issue -Media Impact Analysis • Tagged , , , , , , , , , , , , , , , , , , , , , , , , , • 7 Comments

In a previous post we showed the list of top 50 companies in Europe most affected by Japan disaster, in terms of media coverage received in relation with the catastrophe. List was dominated by energy companies and insurance and financial institutions.

In this post we show the list concerning the American companies. We show exactly the same approach and ways to establish the list of companies in Europe. You can refer to the post about Europe or the presenting note about our methodology if you need further explanations. We will show in a future post the list of most affected companies in Asia.

The sample for American companies is elaborated with the companies included in the Stoxx Americas 600. It includes companies from United States and Canada. Official site provides information about the 600 components of the index. This sample was also used to estimate the American companies most affected by Wikileaks in the initial stage of revelations and reactions by some US companies.

We use as unit of reference the same applied to the European case, in order to make it comparable. A Media impact value of 1.0 indicates that this firm has received an amount of news related with the Japanese disaster in an equal number than the average of news received by all Stoxx Europe 600. In the graph we also indicate if the company is more associated to news about the earthquake and tsunami or to the nuclear ongiong crisis in Fukushima.

Period monitored includes news published by newspapers all over the world between March 11 and March 21 2011.

According to our data, the company most affected in terms of media attention received is General Electric, with 37.1 points of media value. This media attention is mainly driven by Fukushima nuclear problems. This result shows the potential harm that the present crisis can generate for General Electric reputation and business interests, as its linkage with the crisis is due to the fact that General Electric was the company that designed the reactors, and that are still in use in other nuclear plants elsewhere. Probably we will identify in the future the impact of this crisis for General Electric in terms of media reputation, as we did with Bank of America or Chevron in relation with Wikileaks revelations.

Second firm in the list is Moody’s. In this case, the presence of this rating agency in Japan related news does not reflect a direct exposure of the firm. It is reflecting the media coverage given to the eventual assessment of the impact of the disaster on the quality of Japanese public debt. Third and fifth positions are also for financial institutions: JP Morgan and Goldman Sachs. These financial companies are present in the news in a similar way as Moddy’s is. They appear in Japan related news not basically as a company affected by the disaster, but as analysts and experts consulted to asses the extent of the economic and financial impact of the disaster.

Fourth place is for AFLAC, an insurance company. In this case, media presence is related with business exposure to the economic impact of the tsunami. For this company, this relationship with the tsunami is also a matter for negative reputation, as a substantial amount of media coverage received is not related with the estimation of the damages, but to the impact of unfortunated jokes tweeted by comedian Gilbert Gottfried, the voice of AFLAC trademark duck. Gilbert Gottfried was fired by March 14. Our results show how relevant are mistakes in times of crisis with massive media coverage.

Following places are taken by industrial companies, like General Motors and Caterpillar. Caterpillar appears as one of the potentila beneficiaries of the disaster, as this construction oriented firm.

Some US companies receive some of their media coverage associated to the tsunami as corportate donors through corporate foundations.

The presence of US automotive and technological (Intel, Apple, National Semiconductor) firms in the media with relation with the Japanese disaster is mainly associated to the problems that the earthquake can produce in terms of production shortages, as some damaged factories in Japan produce key components in the supply chain of these industries.

We find also in the list some US companies highly exposed to the Japanese economy, as this market is responsible for a relevant share of revenues and profits. Examples are Tiffany (position 25), Wal-Mart (position 11) or Starbucks (position 23).

If we compare this list with companies from Europe, we find that the most affected companies in Europe were mainly electric and energy companies and reinsurance firms.

Other posts

Japan XVI. AFLAC Media Reputation: Impact of Jokes About Tsunami in Japan

(NOTE: You can download here a pdf version of AFLAC crisis post, edited by Media, Reputation and Intangibles center, MRI Universidad de Navarra. It contains additional analysis about media reputation of AFLAC rivals, like Metlife, Prudential Financial or Aetna).

Japan XV. Cities Affected by Earthquake, Tsunami or Nuclear Crisis  in Japan, by Media Impact.

Japan XIV. New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (II)

Japan XIII. New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (I)

Japan XII. Japan Prefectures Media Coverage. Relationship with Personnel and Property Casualties by Earthquake and Tsunami

Japan XI. Companies in Europe Most Affected by Japan Earthquake, Tsunami, Fukushima Nuclear Crisis, by Media Impact

Japan IX. Fukushima Nuclear Crisis Media Views in United States, United Kindgom, Australia and India.

Japan VIII. Wikileaks on Fukushima and the Japan Nuclear Crisis. Measurement of the Initial Media Storyline.

Japan VII. Fukushima as a Chernobyl Nuclear Disaster: Media References by Countries

New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (I)

Posted on by • Posted in Companies, Corp - New York Times, Corp - Wall Street Journal, Countries, Country - Japan, Country - United States, Disasters, Event - Fukushima, Event - Tsunami Japan, Issue - Nuclear Crisis, Debate, Political Leaders, Rep Issue - Media Bias, Rep Issue - News Content Analysis, Rep Issue - Newspapers, Rep Issue - Storyline Analysis • Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , • 10 Comments

We continue our analysis of the initial media storyline of Japan earthquake and tsunami, and the related Fukushima nuclear crisis. In a previous post we have shown how the Fukushima crisis is portrayed by media from United States, United Kingdom, Australia and India. National results are elaborated by the sum of the contributions of all local newspapers.

If an event receives a relevant and sustained media impact, content storyline analysis can also be performen for singular newspapers. For instance, in precedent research projects we have measured how top US newspapers by circulation were following Republican and Democrat candidates, and to which extent they presented bias in terms of total media coverage. As the current media attention to Japan disasters is global and massive, we can study the specific behaviour of any particular newspaper.

We have chosen in this blog to show the storyline profile of two leading and influential American newspapers: The New York Times and The Wall Street Journal. As these two newspapers are new content generators, they become content providers for other newspapers when cited by. As WJS is a business oriented journal, we expect to find a specific focus on the economic consequences of the earthquake and the tsunami concerning local and international companies, and this should be reflected in the storyline. Those effect are of main importance for Japan’s economy and business, but less relevant for the global economy.

But in contrast with all other big natural disasters, Tohoku earthquake captures media attention with a clear local interests interpellation, as the Fukushima nuclear crisis may seriously open the debate about the future of nuclear energy use. United States uses profusely nuclear power. According to Gallup, in year 2010, 62% of respondents were favorable to nuclear power use for generating electricity, and 33% were opposed. Approval rates are partisan: using 2009 data it appears that 71% Republicans approve nuclear energy, while the approval rate for Democrats drops to 52%. Approval rates right now are respectively 62% and 32%. As it could be expected, approval rating are falling substantially in the context of the Japanese nuclear crisis: 39% of all respondents feel a lot more concerned about a nuclear disaster occurring in the United States after events in Japan, and an additional 31% are a little more concerned.

As many people consider NYT more liberal than WSJ, or WSJ more conservative than NYT, we want to check using our approach to which extent we find a different storyline profile about Fukushima nuclear crisis between these two leading newspapers. We will compare their behaviour to the storyline resulting from all newspapers from United States in our sample.

The analysis of this post is based in the content analysis of more than 200 different articles published by NYT and some 1,300 by WSJ directly related to Japan earthquake. Even if the range of the sample is wide enough, caution is required concerning the interpretation of individual results. When the media impact of an specific storyline component of NYT or WSJ is bigger than 1.0 points, we consider that results are quite reliable, as reflect an important amount of prevalence in different news. For issues obtaining lower scores as they are less frequently in the news, individual results are not directly reliable. In this case we consider that the relevant information appears if all single storyline components pertaining to similar issues behave following a common trend.

First figure just refer to the extension given to the main events suffered by Japan. First reference is still the earthquake, specially present in WSJ news. Fukushima related news receive a similar amount of news.

The following figures refer all to the Fukushima storyline.

The first one of them refers to main global issues in relation with Fukushima. While global attention to Fukushima is similar in both newspapers, we find that NY Times insists more than WSJ concerning “radioactive”, “contamination” and somewhat also “meltdown”. If we compare both to average US newspapers, we find that is WSJ which is underscoring these issues. It follows a clear different pattern concerning media coverage to “radioactive” and “contamination”.

In the following figure we show to which extent the newspapers use the reference to past nuclear disasters as a piece of the present Fukushima crisis storyline. We find a clear differenciated pattern between both newspapers. In comparison to US media coverage average, Wall Street Journal underuse references to past nuclear accidents. The underuse ratio is higher concerning the most severe past nuclear accident (Chernobyl, Level 7 accident) than concerning references to Three Mile Island, which did not provoke direct human casualties. The opposite happens with New York Times coverage: it stresses the media references to past nuclear accidents, in ha higher extent than US newspapers. Similar results concerning references to past disasters from other nature. References to the A-bomb suffered by Japan in Hiroshima and Nagasaki. References to BP oil spill disaster in Gulf of Mexico in the context of Japan disaster are marginal in US media and WSJ, by they play a certain role in the NYT storyline. Finally, the reference to the precedent big earthquake suffered by Japan, Kobe 1995 quake is reported in a similar way both by WSJ and NYT. In this case, the reference to past Japanese tragedy is unrelated with the nuclear debate.

There is a crucial choice that influences the whole profiling of the storyline: the basic labeling of the event. In the newxt figure we show the weight given by the newspapers to different wording of what is happening in Fukushima nuclear plant I Daiichi.

According to our results, the most used labeling is to refer to Fukushima as a “nuclear crisis”. This labeling takes 4.7 points of media impact in the storyline of news about the Japan disaster. In relative terms, this is also a preferred way to present the events by Wall Street Journal journalists. Other naming are “nuclear disaster”, by far less present, with 1.1 points of media impact. This is again a preferred option for WSJ. Third used option is “nuclear accident” (0.4 points), and is the chosen formula by NYT in relative terms to other media (in absolute terms, the main reference is to consider it as a “nuclear crisis”. Final used option is “nuclear emergency” (0.2 points), most widely used by WSJ. We can appreciate that the reference to an objective event, which is the explosion, is refelcted in the news in the same way by noth newspapers.

We echoed in a precedent post the controversial description by a top official from the European Union of Fukushima as an apocalyptic event. Our results show that only marginal media attention is given by US newspapers, and that NYT tends to use is in a higher proportion. Similar result concerning the use of “nightmare”.

Next figure refers to the appeareance of main local Japanese and international actors and authorities related with the crisis. Main reference for US media is Tokyo Electric Power, the company managing the Fukushima nuclear plant. We have splitted mentions to full name and those referring to it as TEPCO. WSJ shows references to the comapny in line with US average, and apparently prefers to use TEPCO instead of full name, in relative terms. This absence of divergent pattern is paradoxically an unexpected result. As WSJ is a business oriented newspaper, we should expect to find a special focus and media attention to Tokyo Electric Power concerning all different aspects when covering this nuclear crisis. This does not happen actually, and we will see later that this absence of interest on TEPCO is in sharp contrast with the media interest shown by WSJ in all other economic and business impact derived from the Japan earthquake and tsunami.

Concerning Japanese authorities, we find that WSJ and NYT insist more than US average when talking about them as a group (“Japanese Government”, “Japanese authorities”), but in a lower extent when referring to persons (Prime Minister Edano, Chief Cabinet Kan). Finally, the reference to the International Atimic Energy Agency is lower than average for NYT and specially for WSJ. The ratio Japanese Government/IAEA is 1.2 for average US media, 1.9 for NYT and 3.6 for WSJ. The way reference to local and international authorities is made is probably also a key factor in designing the storyline.

Other references

News Corp Scandal Media Coverage in US Newspapers

How Harmful Is News of the World Scandal for News Corp Reputation?

Movimiento 15-M, Democracia Real Ya: Perception by Local Newspapers El Mundo, El País, Intereconomía, Público

Bin Laden Killing News Storyline 1. Pakistan Media Coverage versus International Media (Ex USA)

New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (II) About The Nuclear Debate

Japan XIV. New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (II)

Japan XIII. New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (I)

Japan XII. Japan Prefectures Media Coverage. Relationship with Personnel and Property Casualties by Earthquake and Tsunami

Japan XI. Companies in Europe Most Affected by Japan Earthquake, Tsunami, Fukushima Nuclear Crisis, by Media Impact

Japan IX. Fukushima Nuclear Crisis Media Views in United States, United Kindgom, Australia and India.

Japan VIII. Wikileaks on Fukushima and the Japan Nuclear Crisis. Measurement of the Initial Media Storyline.

Japan VII. Fukushima as a Chernobyl Nuclear Disaster: Media References by Countries

Fukushima Nuclear Crisis Media Storyline: The Actors (TEPCO, the Workers, IAEA), The Nuclear Debate, The Economy

Posted on by • Posted in Companies, Countries, Country - Australia, Country - India, Country - Japan, Country - United Kingdom, Country - United States, Disasters, Event - Fukushima, Issue - Nuclear Crisis, Debate, Political Leaders, Rep Issue - News Content Analysis, Rep Issue - Newspapers, Rep Issue - Storyline Analysis • Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , • 1 Comment

This post follows the precedent one (Japan IX). Please check it for explanations about how data is gathered and calculated.

In this second part we show some additional storyline components. They deal mainly with the actors of the crisis, as portrayed by newspapers from the United States, United Kingdom, Australia and India. We will refer also the how media is giving media coverage to other implication of this disaster: about the nuclear debate, and about the economic consequences.

First two figures refer to public institutions and personalities directly or indirectly affected by the Fukushima nuclear problem in terms of decisions, competencies or responsibilites.

Main media reference is TEPCO, Tokyo Electric Power, the company that manages the troubled nuclear plant. It is the main reference in all countries. The company is scrutinized apparently by the media as the main responsible for managing the crisis and limiting the nuclear damages. In future posts we will show results about media reputation analysis about TEPCO.

The following prominent public figures are the Japanese Government as an entity, the Prime Minister Naoto Kan and the Chief Cabinet Secretary Yukio Edano. They al share a very similar media exposure. Mr Kan prevails are reference for Australian media, while Yukio Edano is the reference for US and UK media.

The International Atomic Energy Agency is the third actor in importance in terms of media impact in the Fukushima crisis storyline. For American media they play a minor role (1.5 points of media impact) in comparison with Mr. Edano (3.0 points). By contrast, Australia offers a wide coverage to IAEA, similar to weight given to local Japanese authorities. Also Indian media gives a major role than US and UK colleagues.

At this point, US President Barack Obama plays a significative role in this crisis only for US media.

Other actors with a relevent role according to media are presented in the following figure. Yukiya Amano, from Japan, is the current Director of the IAEA. His media coverage profile by countries is quite in line with that given to IAEA. The following person in importance by media coverage in relation to Fukushima is Gregory JaczKo. He is the chairman of the US Nuclear Regulatory Commission. His remarks in front of the US Congress depicting a somber evaluation of the Fukushima crisis has had not only a national impact in US media, but also in the other countries monitored.

Emperor Akihito offered a public appearance and declaration about how “deeply worried” he was with the earthquake and tsunami disaster. His presence hs been portrayed mainly by British newspapers. At this moment (with news up to March 18), Greenpeace is playing a marginal role, as it captures merely 0.1-0.2 points of media impact by the media of our selected countries. World Health Organization is not being used as reference up to now.

In the following figure we show some elements concerning how the Japanese nuclear crisis is opening the nuclear debate in each country. Remember that only Australia does not use nuclear power. We will probably show in the future a deeper analysis on this issue.

We find that Australia media refers less than the other countries to these issues, specially concerning nuclear industry, protesters, activists and nuclear lobby. Apparently at this point it is a more sensitive issue for media in India. There is ongoing media coverage about the nuclear industry in United States and United Kingdom.


Next figure refers to storyline content directly related to business and the economy. It give some insights of the weight of economic considerations against the other ongoing issues, and suggest which economic issues are considered most relevant right now. The impact of the nuclear crisis, and of the Tohohu tsunami on exchange rates between Yen and Dollar appear to be a leading issue in terms of media coverage. The impact on Yen valuation is highly covered by US media. Media from India is specially sensitive to the economic impact and the impact on oil prices. The concern about the impact of the Japanese disaster on the stock markets come as a second lin issue. According to our results, there is only a marginal mention in the media about possible impact in the financial crisis and economic crisis. This is currently not a major concern for media in all four countries monitored.

Final figure considers other actors related to the crisis in a very direct and dramatic way in  some cases, like the workers and the emergency workers, and others in an indirect way, like scientists and experts. Our approach allows to provide answers concerning the media coverage provided to each group in each country.

The role of workers in Fukushima nuclear crisis is the main reference group for media. Media from US insist more than others. This pattern is repeated when referring more specifically to emergency workers. The group of authorities comes second, are more favoured by media from Australia and India.

The nuclear crisis is special in its media coverage as it requires explanations about technical issues to be understood by public opinion, and the severity of the events ask for innovative measures and solutions, and opens forecasts to unchartered ways. This is why specialists acquire a substantial role in the storyline of the Fukushima news coverage. According to our results, main media reference group is the so called “experts”, with a high media impact value of 4-5 points. They are specially used as source or reference by media from India and Australia. Then follows the group of scientists, with a media impact value around 1 point. They are most widely used by US media. Finally, the group of technicians take some 0.5 points of media impact, and again is US media the ones more focussing on theyr role and contribution.

Other references

Other references

Japan XIII. New York Times and Wall Street Journal Coverage of Japan Earthquake and Fukushima Nuclear Crisis (I)

Japan XII. Japan Prefectures Media Coverage. Relationship with Personnel and Property Casualties by Earthquake and Tsunami

Japan XI. Companies in Europe Most Affected by Japan Earthquake, Tsunami, Fukushima Nuclear Crisis, by Media Impact

Japan IX. Fukushima Nuclear Crisis Media Views in United States, United Kindgom, Australia and India.

Japan IX. Fukushima Nuclear Crisis Media Views in United States, United Kindgom, Australia and India.

Japan VIII. Wikileaks on Fukushima and the Japan Nuclear Crisis. Measurement of the Initial Media Storyline.

Japan VII. Fukushima as a Chernobyl Nuclear Disaster: Media References by Countries

Japan VI. Fukushima Second Explosion Media Perception Compared to First Blast

Fukushima Explosion Media Coverage vs Wikileaks: Portraying Fears of an Unknown and Uncontrolled Disaster

Posted on by • Posted in Companies, Countries, Country - Japan, Disasters, Event - Fukushima, Event - Tsunami Japan, Issue - Nuclear Crisis, Debate, Org - Wikileaks • Tagged , , , , , , , , , , , , , , , , , , , • 14 Comments

We continue with this second post analysis about Wikileaks media profile by comparing it to the initial media coverage of the disaster in Japan.

Yesterday we provided information of how media covered the massive earthquake and consequent devastating tsunami just in the aftermath of it (three hours later), and with an update of the analysis with additional news published during the day. Before analysing the specific topic of this post, we show the new update of how media in English cover the Japanese disaster one day after. At this point, new footages show the exceptional devastation provoked by the tsunamis in Japan, and media attention start to focus on the nuclear problems in several sites, and specially the Tokyo Electric Power nuclear facility in Fukushima. We also know that by now there are few number of people dead as a consequence of the tsunami outside Japan.

As in the precedent post, we focus the analysis on the brand vector “Tragedy”. The results refer to all news published during the 26 hours after the earthquake in our data panel (some 33,000 news in English). We observe that the initial trend identified in the precedent update is confirmed. Additional news about the Japan earthquake are increasing the degree of associtation of the disaster to the components tragedy, catastrophic and horrible. The association with worst tend to decrease.

The main purpose of this post is to evaluate the media coverage given to a new collateral issue produced by the earthquake. The Government launched an energy emergency yesterday, as already mentioned in the precedent post. Fron the initial 2km evacuation order followed today an additional 10km evacuation order. At 3pm local time a huge explosion took place in one of the nuclear reactors. The news widespread quickly. Initial official reactions consider it a problem but under control. A new call for evacutation was immediately applied to 20km around the facilities. The press release by TEPCO by 3 pm did not mention the explosion. But soon later came a video aired by BBC news showing a huge blast in the nuclear facility. Fukushima is some 240 km away from Tokyo.

This is the contextual framework at the moment we checked and identified the news about the Fukushima nuclear explosion. There is a lot of incertitude, but also a lot of fears about the implications of this event. Panic word is emerging, altogether with Government calls to tranquility. We count with 900 news about the explosion, published till 11h30 am ECT. Our aim is to compare this very initial stage of media coverage of the Fukushima nuclear plant problems, and to compare it with global media coverage given to the Japan earthquake, and then also to the initial media coverage given to Wikileaks revelations.

Media coverage at this point makes difficult to disentangle the specific profile of how media is considering the Fukushima blast against the treatment given to the Japan earthquake, as they are intrinsically connected and share common press articles. All in all, marginal differences suggest the the Fukushima affaire is more associated than overall news about the Japanese disaster in “Tragedy” components related to harm and failure. The Japan earthquake predominates concerning horrible and worst.

We compare now the media coverage to Fukushima explosion against Wikileaks. As just mentioned, media profile of the nuclear explosion is very similar to the Japan disaster. Probably in the few next hours the nuclear explosion will acquire its own specific media profile. With the results at this point, and comparing it to news published about Wikileaks during the first month (December 2010), we first analyse differences concerning the brand vector “Scandal”. Wikileaks is more associated in general to scandal, even if some media voices start to critisize TEPCO role and conduit in past security nuclear alerts.

The brand vector “Tragedy” is at this point more strongly associated to Wikileaks than to Fukushima concerning the vector components tragedy and failure. Worst and harm are somehow more linked to Fukushima.

Results with new information will be more relevant, depending of course on the direction taken by the events after the blast in the nuclear facility. At this initial moment, reflecting an stage of doubts, questions and fears about something potentially extremely harmful, we conclude again by comparison that the media coverage given to Wikileaks related news and content was substantilly negative in terms of reputational impact.

Japan VIII. Wikileaks on Fukushima and the Japan Nuclear Crisis. Measurement of the Initial Media Storyline.

Japan VII.

Japan VI. Fukushima Second Explosion Media Perception Compared to First Blast

Japan V. Japan Earthquake Media Impact by Cities

Japan IV. Fukushima Nuclear Crisis Media Coverage Evolution

Japan III. Japan Earthquake Initial Media Coverage: Comparison with 2010 Disasters Haiti, Chile and Turkey Earthquakes

Japan II. Fukushima Explosion Media Coverage vs Wikileaks: Portraying Fears of an Unknown and Uncontrolled Disaster

Japan I. Japan Earthquake and Tsunami Vs Wikileaks: Media Coverage of Disasters