ESG Communication Tactics and Reputational Capital on Social Media

Abstract

Analyzing 2,309,573 tweets by S&P 500 firms along with 2,498,767 public replies, we examine how firms’ ESG communication tactics on social media influence the micro-level accumulation of reputational capital. Leveraging the prior communication literature, we categorize firms’ ESG messages based on three primary communication functions: Information, Community-Building, and Action. Information-based tactics unidirectionally disseminate knowledge; community-building tactics foster engagement and relationship-building; and action-based tactics seek to mobilize stakeholders to take direct action. Our results indicate that information-focused ESG messages relate to reputational awareness, whereas community-building tactics are associated with reputational favorability. Additional analyses reveal different audience response patterns between ESG-specific and general corporate messaging as well as between B2C and B2B firms. This study provides evidence of new, non-reporting-based ESG communication tactics and illustrates how firms accumulate reputational capital on a micro, message-by-message, day-to-day level. Our findings offer insights into the strategic use of ESG communication to enhance corporate reputation.