Governance effects of media coverage on firms' R&D activities under signalling theory: The moderating effect of economic policy uncertainty and the mediating role of financing constraints

The influence of media coverage on organizations' research and development operations is a significant subject within the intersection of corporate governance and innovation management studies. This study examines Chinese A‐share listed businesses from 2012 to 2021, utilizing signaling theory to investigate the influence of media reporting on corporate R&D investment. The data are sourced from the China Research Data Service Platform (CNRDS) and the China Economic and Financial Research Database （CSMAR）. A total of 3,303 listed companies are selected to form the unbalanced panel data. A two-way fixed-effects model is employed to account for individual and temporal heterogeneity, as well as to address endogeneity through the instrumental variable method. The study concludes that media coverage substantially enhances firms' R&D investment by mitigating financing constraints, with the effect persisting across different media channels (online/traditional) and reporting tendencies (positive/negative); economic policy uncertainty amplifies the marginal impact of media coverage on R&D investment; and the heterogeneity analysis indicates that the R&D investment of non-state-owned firms, industries with low pollution levels, and firms located in the eastern region is more responsive to media signals. Mechanism experiments indicate that both positive and negative reports can diminish the cost of debt funding, both network and negative reports exert a substantial inhibitory influence on the cost of equity financing; nonetheless, all report types result in a decline in financing efficiency. The research indicates that organizations must develop a dynamic media management system to dismantle information silos, investors should create a “public opinion-financing structure” analytical framework to discern valuation risks, and regulators ought to refine the media credit rating system to mitigate false disclosures, thereby improving the efficiency of innovation resource allocation through collaborative efforts and fostering new momentum for the high-quality advancement of the economy.