Publicity and perceptions of risk: The effects of HRO naming and shaming on sovereign credit rating

Previous scholarship has demonstrated that shaming by human rights organizations produces economic consequences. For example, human rights shaming by international organizations negatively affects foreign direct investment (FDI), decreases exports, and redirects foreign aid received. The relationship between shaming and sovereign credit, however, has yet to be studied. States greatly rely on their ability to access cheap international credit, as evidenced by the fact that newly issued sovereign debt outpaced new foreign investment by almost $3 trillion in 2017. Understanding the relationship between human rights-related advocacy efforts and a state’s access to this valuable source of capital is critical for recognizing the effects naming and shaming can have on creditors. We therefore ask: Does naming and shaming by human rights organizations have a negative impact on the target state’s sovereign credit rating? We find that increased naming and shaming leads to a decrease in a state’s sovereign credit rating.