Now hear this: When senior-level media veterans sit on corporate boards, companies get better press, and more favorable press, in the wake of sensational events. That’s not conjecture but fact, according to a new research paper entitled, “Price of Publicity,” by Umit Gurun, an associate professor at the University of Texas in Dallas. Even in the advent of new media, this edge persists.

Institutional Investor contributor Steven Mintz spoke with Gurun recently about his research and its implications.

1. What started you down this road?

Earlier academic literature shows that board members with special qualifications bestow advantages. Scrutiny is more informed and networks are more extensive. Companies with bankers on their boards, for instance, enjoy an edge when dealing with banks generally, from an advisory or monitoring standpoint. Attorneys often confer beneficial effects on legal matters before companies.

Given these correlations, I wondered if a board member with media chops improves media slant — more news coverage and more favorable content when bad news breaks. If firms with media experts are more successful in doing so, we should not only see more coverage but also more favorable coverage of a firm with a media expert on the board than one without after one of these events.

2. How did you handle the research?

We identified 1,200 media experts. In that group, around 500 serve on boards of public companies. It’s a finite talent pool, which rules out filling board seats at every company with someone savvy about media. But at the same time, it’s a large enough sample to furnish statistically significant evidence of a trend we suspected. An econometric model added routine variables: firm size, geographic location, growth rate, institutional ownership and analyst coverage, among others.

Then research examined media coverage in the wake of two kinds of events that garner media attention: news pertaining to product safety and employee safety. We looked into whether coverage and news slant varied where media experts joined boards more than a year before events occurred.

3. What did you find out — the bottom line?

Public companies with a media expert on their boards received 40 percent more media coverage, or seven more news articles a year for an average company in the sample. The news that’s reported also includes 25 percent fewer negative words compared with articles on control firms.