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A Summary of Studies on Organizational Legitimacy

Open Journal of Business and Management, 2017, 5, 487-500
ISSN Online: 2329-3292
ISSN Print: 2329-3284
DOI: 10.4236/ojbm.2017.53042 July 11, 2017
A Summary of Studies on Organizational
Yuanyou Tang
School of Business Administration, South China University of Technology, Guangzhou, China
In recent years, more and more scholars have begun to explore the influence
of institutional factors on the production and operation of the organization,
and formed a new research perspectiveinstitutional basis, and organiz
tional legitimacy is the “core concept” of the new institutionalism theory. T
article through the domestic and foreign related literature, systematically e
pounded the basic issues of organizational legitimacy, research perspective,
dimension division and so on, in order to deepen knowledge and understan
ing of the organization’s legitimacy.
Institutional Theory, Organizational Legitimacy, Research Review
1. Introduction
The early scholars of management regarded the organization as a “rational sys-
tem”, where the organization and the surrounding environment had very precise
boundaries, and the business was planned to follow the pre-planned operations
(Scott, 1987). The “open system” school objections, that the boundary between
the organization and the outside world is not clear, but interrelated. Further,
the institutional school emphasizes the evolution of the organization not only
from the financial, technical and other aspects of pressure, but also from the
social and cultural norms, symbols, beliefs and customs, etc. [1]. For example,
in the transition and upgrading system environment, in promoting the “public
entrepreneurship, innovation” slogan, the entrepreneurial activity reached an
unprecedented height, but the survival rate of new enterprises is very low; it
will be difficult to explain from the angle of “economic man” assumption. In-
stitutional scholars believe that the new entry defects and the resulting legiti-
macy threshold are an important reason for the high mortality rate of enterpris-
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Tang, Y.Y. (2017
A Summary of Studies on Organizational
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Y. Y. Tang
es [2]; this view and perspective have been recognized by the academic commu-
nity, and the reason why such a cognitive change is due to “legitimacy” boarded
the stage of history and is carried out by the relevant research [3]. Although
Weber introduced “legitimacy” into organizational sociology, it was not until
1995 that western academics began to systematically study it [3] [4]. In China,
although the study of the legitimacy of the organization has been widespread, it
is not deep enough. Therefore, the “legitimacy” of the relevant proposition is not
understood enough. Based on this, this article sorts out and deepens their un-
derstanding of the “legitimacy” through the new system theory of legitimacy li-
2. The Emergence and Development of Institutional Theory
There are three pillars in the field of strategic management, namely, the Mar-
ket-Based View, the Resource-Based View and the Institutional-Based View. The
concept of market orientation is the first to draw attention, which is due to the
development of industrial organization theory. In the 1930s, Mason and Bain
put forward the SCP analysis paradigm of industrial organization theory, and the
Market-Based View was formed. The core view was that the industrial structure
theory had a great influence on the development of the enterprise. The choice of
the enterprise industry market has a decisive role in the future of the enterprise.
If the industry and the market are wrong, it is difficult for the enterprise to
achieve the expected benefits and vision. However, in practice, scholars have
gradually found why in the same industry, some companies develop well, some
companies are in critical condition? Based on this, Wernerfelt formally put for-
ward the Resource-Based View [5], so that the enterprise development-related
research perspective from the market perspective to the concept of Resource-
Based View, academics believe that the strategic resources within the enterprise
and unique ability is the key to the survival and development of enterprises, but
not all of the resources of enterprises can be converted into the core competi-
tiveness. Only when the resources to meet the value, scarcity, irreplaceability and
difficult to imitate when they can become a tool in the market competition.
Then, some scholars pointed out that the role of the environment can not be ig-
nored, the dynamic changes in the external environment has an important im-
pact on the enterprise. The system environment has strong binding force and in-
fluence on all aspects of enterprise production and management [6]. Later, more
and more scholars focused on the study of the institutional environment, and
Pengs series of research first introduced the system elements into the strategic
management of enterprises, and laid the Institutional-Based View in the strateg-
ic management of the historical position [7]. Peng in 2002 also formally put
forward the institutional basis of the concept can be with the resource base con-
cept, the market based on the view of the same level, so far, strategic manage-
ment “three pillars” situation shaping [8]. Resource-based view that the internal
resources of enterprises is the basis for a series of choices, and strategic institu-
tional basis view that the strategy needs to meet the expectations of internal and
Y. Y. Tang
external stakeholders to ensure that the strategy is legitimate [9].
However, the development of institutional theory is not smooth sailing, but
also experienced many setbacks, which at the beginning of a little suffered cold,
or even not to be seen. As early as 1962, Chandler pointed out in his book
“Strategy and Structure” that the basis for corporate strategy is to adapt to the
environment and therefore must be developed on the basis of an analysis and
evaluation of the environment. However, for the next fifteen years or so, the in-
stitutional elements of the environment have not been taken seriously. 1962-
1977 was the prevailing period of the old institutionalism theory. Although few
scholars pointed out the importance of the system in this period, it was not ex-
plored deeply, the maximization of efficiency advocated by economists and the
extreme dominance of extreme utilitarianism, according to the representative of
the old institutionalist school Van Buren (1983) pointed out that the system is
essentially a person or society on some of the relationship or some of the role of
the general thinking habits, and the system attributed to a popular mental state
[10]. And this passive situation until 1977 was finally broken. In 1977, Meyer &
Roman first proposed the new institutionalism theory [11], after each scholar is
mainly divided into two factions, one is the North as the representative of the
economic school, the main study is the efficiency of different system selection
[12]. The other is based on Scott as the representative of the sociology of the or-
ganization, the main research is the legitimacy of the system and the system itself
[13]. Williamson (1975, 1985) argues that institutional differences will lead to
different transaction costs, and that an efficient institutional environment will
gradually replace inefficient institutional environments [14] [15]. Since then, the
representative of the school of the North defined the system as a constraint to
organizational behavior and the relationship between the zero-sum game, the
institutional environment is more like a linear programming constraints, in a se-
ries of conditions to achieve maximum efficiency [16]. The representative of the
sociology, Scott, emphasizes that the system is a regular, normative and cogni-
tive framework and activity that not only constrain the behavior of enterprises,
but also guide the behavior of enterprises. North divides the system into formal
and informal systems, including the relevant laws and norms, which include
sanctions, taboos, customs, traditions and codes of conduct. He also believes that
the environment is the decisive factor in the efficiency of economic organiza-
tions. [17]. However, the definition of institutional sociology is clearly broader
than that of the North, For example, Hall & Taylor points out that the system
not only covers laws, norms, traditions and customs, but also regulators, as well
as moral templates, cognitive templates, and symbolic systems that provide
meaningful frameworks for human action [18]. Scott divides the system into the
system of regulation, normative system and cognitive system. The regulation is
the pillar of formal system, and the informal system is based on norms and cog-
nition [4].
3. Legitimacy Definition
Legitimacy is the core concept of the new institutionalism theory. The legitimacy
Y. Y. Tang
mechanism is the most important mechanism of the new institutionalism
theory. The basic idea is: the social legal system, cultural expectations, the con-
cept of the system, once become widely accepted by the social facts, it has a
strong power, restrain and regulate peoples behavior. Weber is considered to be
the first scholar to introduce legitimacy into sociological research (Johnson
et al.
2006; Ruef & Scott [19], 1998; Suchman [3], 1995). Weber argues that organiza-
tional legitimacy is that organizational activity is consistent with organizational
rules and structures [20]. It is critical to emphasize that the organization is con-
sistent with universal values and “motto”that legitimacy comes from consis-
tency with social rules, norms and laws. Then, a large number of scholars dis-
cussed the definition of legitimacy, such as: Parsons (1956, 1960) on the basis of
Weber’s view, extended the connotation of legitimacy: Organizational legitimacy
is the consistency of organizational values with the values of the organizations
embedded social context [21]. Maurer (1971) points out that legitimacy is a
process that is the process by which the organization gives power to its partners
or superior systems [22]. Dowling & Pfeffer (1975) defines legitimacy as “social
values associated with business activities consistent with accepted behavioral
norms in larger social systems” [23]. Meyer & Rowan (1977) tied legitimacy to
resources, believing that both are more efficient than the old institutional theor-
ists, and that they need to be consistent with the institutional environment.
Meyer & Rowan (1977), Zucker (1977), although only talking about legitimacy
and did not define the legitimacy of the law, but the organization of legitimacy
research to enhance a level, directly or indirectly to promote the rise of the new
institutionalism [24]; Meyer & Scott (1983) proposed organizational legitimacy
is a degree of cultural organizations have been supportedexternal culture of
the organizations existence, function, value, power, and so there is absolutely no
alternative explanation. A legitimate organization is an organization that does
not have a problem, its goals, methods, resources, and control systems are ne-
cessary, clear, complete, irreplaceable [25]. The legitimacy given by Knoke (1985)
is that an organization has the power to act on its strategic choice, which is un-
iversally accepted by the community [26].
There are a lot of definitions about legitimacy,can be said that different people
have different views. Some scholars believe that legitimacy from the negative de-
finition may be better understood, such as Pfeffer & Salancik (1981) pointed out:
when the behavior was found to be illegal, then the next will be Attack! [27].
However, the academic community is still talking about each other, there is no
awareness of the consistency of legitimacy, which greatly hindered the develop-
ment of institutional theory. Some scholars have studied more than 20 years of
research and found that the academic community described more about legiti-
macy than defined (Terreberry, 1968, suchman, 1995) [3] [28]. Until 1995,
Suchman published in the Academy of Management Review “Managing legiti-
macy: Strategic and institutional approaches” article, for the previous study is
often only part of the legitimacy of some of the limitations, given a broad defini-
tion: Legitimacy is the enterprise stakeholders to the existing system of laws,
Y. Y. Tang
rules, norms, values, beliefs as the evaluation criteria for corporate activities ap-
propriate, proper and desirable in general perceived or envisaged [3]. This defi-
nition has been widely recognized by academia, which has laid the definition of
organizational legitimacy in one fell swoop and has had a profound impact on
future research. Throughout the previous explores the definition of legitimacy,
we can easily find that although Weber early on the “legitimacy” into the orga-
nizational sociology, but until 1995, it has a consistent understanding, which is
not difficult to understand why in 1995 the western academic circles began to
systematically study the legitimacy [3] [4]. The definition of legality can be sum-
marized as Table 1.
The study of the new institutionalism theory scholars attach great importance
to legitimacy, they believe that the face of legitimacy requirements, the organiza-
tion can only sacrifice part of the performance of the cost, in exchange for the
necessary legitimacy [6] [11], more scholars mentioned because of lack of legi-
timacy, the ability of an organization to pursue its goals and the ability to accu-
mulate resources will be greatly reduced, and even lose the foundation of surviv-
al [29] [30], Elsbach (1994) considers necessary to attach importance to the legi-
timacy of the constraints posed by the system pressure to shape the role of the
organization, to obtain legitimacy remains the foundation of the survival and
development of the organization [31]. Since legitimacy is so important, who will
judge me unlawful? What are the indicators of judgment? How can I get legiti-
macy? Davis
et al.
(2000) pointed out that the institutional environment in
which the organization is located is filled with requests and specifications from
various stakeholders, and therefore, as a member of the environment, in order to
obtain the support of stakeholders, especially the support of key stakeholders to
obtain organizational legitimacy, it must be based on the majority of the mem-
Table 1. Legitimacy definitions.
The process of
giving power
Maurer (1971)
Legitimacy is a process that is the process by which an
organization gives power to its partner or superior system
Meyer & Rowan
The legitimacy and the resources side by side, that both are not just as
old institutional theory scholars say as the efficiency of its core, and
the need to have consistency with the institutional environment
Knoke (1985)
Is an organization has its strategic choice to start the power of action, this power
by the public "generally accepted"
Weber (1958)
Organizational legitimacy is that organizational activity is consistent
with organizational rules and structures.
Organizational legitimacy is the consistency of organizational values
with the values of the organizations embedded social context
Pfeffer (1975)
Social values associated with business activities are consistent
with accepted behavior in larger social systems
Meyer & Scott (1983)
Organizational legitimacy is the degree to which an organization
receives cultural support
Suchman (1995)
Legitimacy is the enterprise stakeholders to the existing system of laws, rules,
norms, values, beliefs as the evaluation criteria for corporate activities
appropriate, proper and desirable in general perceived or conceived
When the act is considered illegal, then it will be attacked!
Source: Author finishing.
Y. Y. Tang
bers of the institutional environment recognized by the industry norms or rules
for their own code of conduct [32]. There are also scholars in the country made
a similar point of view, such as Song Tiebo (2013) pointed out that members of
society need to be observed by their own structure or behavior by the communi-
ty, and members of the community perceived by the structure and behavior and
system requirements are consistent, in order to obtain legitimacy [33].
However, a systematic exposition of these questions and answers is oliver, she
proposed 5c model, that is the cause, constitute, content, control, context five
kinds of system. The relationship between the factor and the firms strategic re-
sponse behavior as shown in Table 2.
4. Exploring the Two Perspectives of Organizational
Because of the legitimacy of the organization, the organization and the external
environment are so closely linked, and some scholars in the strategic direction of
the enterprise begin to use this concept to interpret the strategic behavior of the
organization [31] [34]. Thus, there are two research perspectives-institutional
legitimacy and strategic legitimacy, both of which are interrelated and differen-
4.1. Institutional Legitimacy Perspective
The perspective of institutional legitimacy adopt a passive attitude toward legi-
timacy, and legitimacy will be seen as an ideological notion of constraint. That
organizational legitimacy is the product of the system [6], is the social solidifica-
tion of faith, only in line with the behavior of belief have the legitimacy to speak.
The behavior of the subject “deeds” releases the information that is judged by
the stakeholders, and the objective information gives the organization the cor-
responding legitimacy [35]. Based on this, companies bear the brunt need to
make themselves look reasonable, other resources in the process of access to this
Table 2. The relationship between institutional factors and corporate strategic response behavior.
elements research problem Institutional Factors and Strategic Response
Why the organization will be forced to obey
the rules and expectations of the system
And the system pressure to keep the amount of expected social legitimacy, the
lower the economic benefits, the greater the likelihood of resistance
Constituents Who put pressure on the organization The higher the diversity of the constituent, the lower the degree of external de-
pendence on the source of the system, the greater the likelihood of resistance
Content What rules and requirements the
organization is compelled to comply with
Institutional standards or requirements with the institutional objectives of the
lower degree of consistency, the greater the arbitrariness of organizational con-
straints, the greater the likelihood of resistance
Control How the system pressure or how to put
Institutional standards, the degree of mandatory law behind the requirements, the
lower the degree of spontaneous spread, the greater the possibility
of institutional
resistance to institutional pressure
Context How to apply the system pressure situation
Uncertainty in organizational context and the less interactive degree
of institutional environment, the greater the likelihood of resistance.
Source: According to Oliver C. Strategic responses to institutional processes. Academy of management review, 1991, 16 (1): 145-179.
Y. Y. Tang
goal will be a matter of course, is a derivative by-product. According to the legi-
timacy of the system, enterprises will accept the legitimate behavior and related
forms, but do not care whether the operation efficiency of the enterprise has im-
proved [41]. Obviously, from the perspective of institutional legitimacy, the or-
ganization of the field of enterprises under the pressure of the institutional en-
vironment, forcing the final behavior of members of the field tend to be consis-
tent [36]. According to Dimaggio & Powell (1983), the organization obtains legi-
timacy by coercive conformal, normative isomorphism and mimicry [6]. Coer-
tive isomorphism refers to the institutional pressure generated by the interde-
pendence of the organization. The leading enterprises in the field often rely on
their own strong strength to influence other individual behaviors; Normative
isomorphism is based on the requirements of various professional organizations
in the organization field. Memetive isomorphism refers to the fact that enter-
prises are faced with the uncertainty of the environment, in order to avoid risks
and reduce stress, imitate the results of the benchmark companies within the
However, the legitimacy research based on institutional perspective has been
widely criticized as hanging in the air and can not land, lack of micro-founda-
tion (Cao Zhenghan, 2005) [37]. There is no way to measure and manipulate le-
gitimacy because there is no micro mechanism in the formation and evolution of
legitimacy in a specific field [38]. Therefore, there is no way to measure and ma-
nipulate the legitimacy. Based on this, the research on the micro mechanism of
organizational legitimacy is urgent and becomes a hot spot. Until a number of
management scholars introduced the concept of legitimacy into the field of
management research, the use of strategic vision of the legitimacy of the organi-
zation as an important resource, the legitimacy of the study from the initial “re-
treat” to “pragmatic” change.
4.2. Strategic Legitimacy Perspective
With the transfer of legitimacy from the institutional perspective to the strategic
perspective, the academic community takes a more proactive approach to legi-
timacy. Some scholars have begun to pay attention to the organization to obtain
legitimacy, can improve the ability of enterprises to absorb and access to re-
sources [39], and of great significance to the enterprisessurvival and develop-
ment [11] [25] [40] [41]. Thus, legitimacy is regarded as a strategic resource, and
strategic schools focus on the initiative of the enterprise itself [41]. That legiti-
macy is an “important resource that can help the organization acquire other re-
sources” [42]. Strategic legitimacy is different from the institutional legitimacy
because of initiative to play, so in the face of legitimacy constraints, why the in-
itiative has the possibility to play? A very important reason is that under the
influence of multiple institutional pressures in the field, the intensity of insti-
tutional constraints in the field is reduced. Different interests of the individual
expectations of the enterprise is not the same or even a large difference, re-
sulting in the organization may face a variety of stakeholders from the multiple
Y. Y. Tang
system pressure, requires different and even demands that the exact opposite of
the system pressure greatly dilutes the strength of the legality of the field con-
straints, provides the opportunity for the organization to play a subjective initia-
5. Division of Legitimacy Dimension
The division of the dimensions of organizational legitimacy is the focus of re-
search on organizational legitimacy. In 1986, singh first divided the legitimacy
into the internal legitimacy and external legitimacy [43], internal legitimacy re-
fers to the internal members of the organization to coordinate their role in the
organization, external legitimacy refers to the external grant organization iden-
tity or status [43]. The sources of external legitimacy include government, trade
unions, licensing agencies, subvented organizations, public opinion and media,
intellectuals, professional organizations, business. The sources of internal legiti-
macy include managers, employees, board members, personnel experts and so
on. Aldrich & Fiol (1994) first divides legitimacy into two dimensions: social and
political legitimacy and cognitive legitimacy [44], according to the different
sources of legitimacy constraints faced by start-ups. On this basis, Scott (1995)
further divides socio-political legitimacy into regulative legitimacy and norma-
tive legitimacy. Regulatory legitimacy refers to “doing things correctly”, from the
industry associations, governments, professional organizations and other de-
partments to develop a variety of laws and norms. Normative legitimacy specifi-
cally refers to “doing the right thing”, also known as moral legitimacy, from the
universal values and morality of society, reflecting the public on the enterprise
“to do the right thing” is expected. The values and morals here mean that the
market competition includes values, beliefs and norms that are shared by all
stakeholders [45]. Cognitive legitimacy emphasizes what is understood and ac-
cepted by people, especially “universally accepted”, which is similar to the “ca-
tegorization” of strong legitimacy levels, reflecting the degree of coincidence
between the organizations activities and the “Taken for granted” rule [6].
Cognitive legitimacy has two connotations: the first layer of connotation refers
to the legitimacy of the establishment of the premise is “understanding”, That
is, stakeholders believe that the behavior of enterprises is appropriate, can be
understood and accepted, people trust the action taken by the enterprise.
Another meaning is “take for granted”, that is, all stakeholders categorically
that the organization should take such behavior, without any reason, this cog-
nitive paradigm has long been deeply rooted in the stakeholders themselves
values, and this “justified” belief is the most important source of cognitive legi-
We need to note that Scotts division of the main concern is the external
stakeholders (that is, the government, the public, upstream and downstream en-
terprises) on corporate behavior awareness and evaluation.
Suchman divides socio-political legitimacy into moral legitimacy and prag-
matic legitimacy on the basis of Scotts classification and Aldrich & Fiol’s (1994)
Y. Y. Tang
classification. Practical legitimacy is based on rational evaluation, which can be
further subdivided into influence legitimacy, exchange legitimacy and disposi-
tional legitimacy according to different evaluation objects and perspectives. The
legitimacy of the law is based on the judgment of the correctness of the act,
which is divided into the procedural legitimacy, consequential legitimacy and
structural legitimacy. Scott and Suchmans division of the legitimacy of the or-
ganization was followed by the later scholars. Although some scholars have used
its modified use, such as Greenwood specifically defined the legitimacy of the
profession; Archibald suggests that cognitive legitimacy and normative legiti-
macy be referred to as the legitimacy of culture; Zilomerman & Zeitz (2002)
classifies the legitimacy of a start-up firm based on the classification of the pre-
vious two scholars and joined the industry legitimacy dimension, but Scott and
Suchmans legitimacy dimension is still the mainstream of academic research,
become the basic theory of related research, each scholar division of the legiti-
macy dimension can be summarized as Table 3.
6. Legalization Strategy
In the academic community to use the institutional legitimacy perspective and
strategic legitimacy perspective to study the legitimacy of the further, more and
more scholars have begun to note that the organization under the constraints of
legitimacy is not completely passive, can take the initiative to take legal behavior
to obtain legitimacy, and then a series of strategic actions on the legitimacy of
organizational research-that is, legalization strategy. (Maurer, 1971 [22], Such-
man, 1995 [3], Zimmerman & zeitz, 2002 [42], Tornikoski & Newbert, 2007
Table 3. Legitimacy dimension division.
The source
of the
Aldrich &
Fiol (1994)
(1995) Suchman (1995) Greenwood
Social and
of legitimacy
Source: Author finishing.
Y. Y. Tang
The legalization strategy, that is, the organization in order to be consistent
with the institutional environment recognized by the stakeholders, to take a se-
ries of changes in their own structure and behavior of strategic initiatives to ob-
tain legitimacy. Some organizations are considered to be self-disciplined because
they have the resource capacity recognized by the various interest groups, espe-
cially key interest groups. But the vast majority of organizations in accordance
with the expectations of stakeholders and their own resources, with the institu-
tional environment and their own resources to match the strategic behavior,
which has been recognized by the relevant interest groups and access to strategic
legitimacy [46]. According to Suchman’s (1995) [3] division, the organization of
the legalization strategy can be divided into compliance legalization strategy, se-
lective legalization strategy and manipulation of legalization strategy. The so-
called compliance-based legalization strategy, refers to the organization in strict
accordance with the existing standards and concepts, systems, norms to obtain
interest groups recognition and acceptance. Enterprises use the familiar lan-
guage, methods and patterns to obtain the recognition of customers and other
stakeholders. The organization found that as long as a well-behaved, consistent
with and adhere to the existing institutional framework, it can easily obtain or-
ganizational legitimacy. Enterprises adopting this strategy will strictly abide by
the existing cultural order and system in production and business activities, and
do not easily transcend the accepted cognitive framework [47]. The so-called se-
lective legalization strategy, refers to the choice of enterprises conducive to their
own development of the subdivision environment (more acceptable or more
popular system area) to obtain the relevant interest groups recognition and ac-
ceptance. This is because the business is very clear that not all of the business ac-
tivities are recognized by the external environment, this time a wise business will
choose a most friendly market for their own, and thus get organizational legiti-
macy. The so-called manipulation strategy, refers to the impact, control or
change the existing system, norms, standards and concepts to obtain stakeholder
recognition and acceptance. Showing the enterprise more initiative. The core of
this legalization strategy is to take the initiative, with its passive to adapt to the
environment to get legitimacy, not as good as change and manipulate the envi-
ronment to take the initiative to fight for legitimacy. In general, it is extremely
difficult and risky to implement this strategy, but if it is successful, the benefits
are far better than the first two legalization strategies. The strategies that can be
adopted in the organizations legalization strategy are shown in Table 4.
Since then, Zimmerman & Zeitz (2002) [42] proposed four kinds of legaliza-
tion strategies based on the three legalization strategies of Suchman (1995), such
as compliance, selection, manipulation and creation. Creative legalization strat-
egy requires enterprises to create a new institutional environment with great
concentration, cultivate new cognitive basis and beliefs. When the existing sys-
tem does not match the cognitive basis of the enterprise, the enterprise needs to
create new patterns, practice and cognitive beliefs to obtain legitimacy. This le-
galization strategy is more difficult to implement, but once successful, the return
Y. Y. Tang
Table 4. Strategies that can be adopted in the organization’s legalization strategy.
Dependent type Select type Manipulation type
Obey the request
Obey the requirements of the competent
authorities such as the government
Subject to stakeholder cooperation
Choose to market segments
Choose a friendly system area
Choosefriendly collaborators
Adhere to promote
Obey the specification
Obey social norms
Obey the values of the public
Subject to professional norms
Select the range of activities
Select the activity content
Select the target audience
Prove successful
Change the concept of
public opinion
Obey the existing model
Follow the example of advanced
Obey the standard
Select the logo
Choose corporate culture slogan
Select the certification system
Product advertising
Image advertising
Source: Suchman M C. Managing legitimacy: Strategic and institutional approaches. Academy of Management Review, 1995, 20 (3): 571-610. Zimmerman
M A, Zeitz G J. Beyond Survival: Achieving New Venture Growth By Building Legitimacy. Academy of Management Review, 2002, 27 (3): 414-431.
is far ahead of the three legalization strategies. Oliver (1991) [34] in accordance
with the level of initiative, to legalize strategy is divided into five, and is accom-
panied by 15 kinds of tactics, as shown in Table 5.
There are many studies on the strategy of legitimacy, and now the mainstream
of the academic community is basically the model of three legalization strategies
(compliance, choice, manipulation) and Olivers five legalization strategies (ac-
quiescence, compromise, avoidance, resistance and manipulation).
7. Research Outlook
The research and development of organizational legitimacy in institutional
theory are the result of cross-infiltration of management, psychology, behavior
and sociology. Research on the legitimacy of the organization in the near future
encountered a bottleneck; the development rate is relatively slow. A large part of
the reason is that the legitimacy of the organization is too focused on qualitative
research, scholars are willing to carry out quantitative research, but the special
nature of organizational legitimacy making qualitative research is very complex
and difficult, or even inoperable. In view of this, this paper believes that the legi-
timacy of the relevant research has the following breakthrough:
To improve the measurement of the legitimacy of the organization, the re-
searchers need to develop a scale to measure the legitimacy of the organization
of this idea; of course, this is not easy. However, once the development of the
academic community on the organization recognized the legitimacy of the scale,
the study of the legitimacy of the organization will be epic breakthrough.
To improve the organization of the micro-mechanism of the legitimacy of the
study, too many studies have pointed out the way in which organizational legi-
timacy is acquired and the strategic path. But in a specific area of organizational
legitimacy formation process, evolution mechanism, mechanism of action and
other micro-researches are very few. Such as the interaction process of the firm
Y. Y. Tang
Table 5. Enterprise legalization strategy under different degree of initiative.
Initiative strategy Connotation Tactics Example
Low initiative
The reason for acquiescence is in a single or integrated
motive to enhance legitimacy, fear of being sanctioned,
and want to get additional resources
habit Follow the standard of course
imitate Imitate the institutionalized example
obey Comply with rules and standards
In the context of conflicting authorities, the
organization discovers that there are spaces in the
multiple scenarios that have considerable operational,
understand, bargain, and compromise
Balance the expectations of multiple
appease To appease and be motivated
to discuss Negotiate with stakeholders
Organizations tend to try to hide themselves and
prevent certain parts of the organization from
being influenced by the system requirements
that should or must comply
hide Camouflage compliance
buffer Relax system dependency
divorced Change the goal, activity or field
If the organization’s norms or gains are in substantial
divergence from the organization attempting to impose
its requirements, the organization takes a rebellious act
Ignore the specific standards and
challenge Compete for regulatory right
attack Attack the source of stress
manipulate The organization tries to cooperate with the system
activists to influence or even control the environment
by-election The introduction of strong
influences Shape values and standards
control Dominate the system and process
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... Organizations use coercive conformal, normative isomorphism, and mimicry to establish legitimacy in a social value system (Tang, 2017). Coercive isomorphisms relate to the institutional pressures produced by organizational interdependence. ...
... Farivar et al. (2018) suggest that employees measure their self-perception by in-group similarity. However, organizations that favor a particular social group as less likely to care about operational efficiency (Tang, 2017). Lack of operational efficiency is consistent with findings that distributive injustice negatively affects co-workers' psychological health , influences anxiety (Lee et al., 2019), and links to organizational identity. ...
... Social norms, government regulations, and organizational practices influence employee perception and leadership decision-making (Lin et al., 2020). These three conditions confirm that organizations are likely to benchmark successful coercive conformal, normative isomorphism, and mimicry to establish organizational legitimacy (Tang, 2017). ...
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Diversity and inclusion concepts remain unclear, which has generated an explosion of new viewpoints to pursue distributive justice. These variations suggest the need for a criterion to recognize partiality or prejudices in diversity and inclusion practices. This study applies the social identity approach to investigate the impact of diversity and inclusion distributive injustices on an employee's organizational identity. Research on perceived employee distributive injustice (PEDI) suggests organizations that favor a person's social categorization or identity may more likely create unfair compensations and incentive biases. This study hypothesizes that distributive injustices can recognize diversity and inclusion practices that negatively affect an employee's organizational identity. The study consists of 451 full-time US employees. A Cronbach's alpha coefficient for distributive injustice is .94, and organizational identity is .92. The findings confirm that leaders and HR professionals who implement diversity and inclusion practices that favor a social characteristic or identity will erode organizational identity.
... In that regard, when a state tends to deviate its actions from society's expectations and perceptions, there is a potential for having problems in 'maintaining' or 'retaining' legitimacy. Hence, Tang (2017) offers one of the most insightful contributions for maintaining legitimacy: the use of legalization strategy. ...
... Tang defined the compliance legalization strategy as the state's ability to strictly operate by the existing societal standards, systems, and norms to ensure social recognition and acceptance. On the other hand, Tang argues that the selective legalization strategy is centers on the decision of the entrepreneur's ability to gain recognition and acceptance from the relevant state ministries and organizations, whereas, the manipulation strategy refers to the impact, control or changes arising from the existing social system, norms, and concepts to obtain stakeholders recognition and acceptance (Tang, 2017.) Given that legitimacy lies in the heart of state disclosure, Tang tactic is essential for maintaining and obtaining state legitimacy. ...
... Seabrooke (2005) clarifies that one of the primary sources of non-legitimate actions is lack of disclosure between two actors, especially when unknown information becomes known to the other actor. Hence, in a situation wherein there is lack of awareness, the legalization strategy for maintaining legitimacy outlined by Tang (2017) will be challenging to accomplish because the general perceptions about the actions and activities derived from the existing policy will be interpreted as non-legitimate. ...
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The outcome of youth entrepreneurship in developing economies is impacted by something much more acute than the lack of entrepreneurial competence and finance: The legitimacy of the state policy framework and its compatibility with the entrepreneur’s expectations. This study investigates youth entrepreneur’s legitimacy judgments about the current state policy framework in Sierra Leone. The purpose of this study is to understand the legitimacy of the state policy framework and its implication on youth entrepreneurship through an empirical study; and to propose an adapted framework of the linkage between state policy, legitimacy, and entrepreneurial outcome. The study adopts a qualitative approach in evaluating the congruence between the state policy and entrepreneurial outlook in Sierra Leone. Data were obtained through extensive interviews with participants from three groups: The Ministry of Youth Affairs and its Commission, Sierra Leone Opportunity for Business Operation, and devoted youth entrepreneurs. The data were coded manually and analyzed using the Gioia method to complement a comprehensive literature review of entrepreneurship and legitimacy. The findings of this study show that youth entrepreneurs perceived the current state policy as non-legitimate, due to lack of awareness about the functions of various policy organizations, political commitments to specific communities, and limited access to existing entrepreneurial resources. However, it also provides suggestions on how to ensure that policy actions and activities are legitimate and compatible with the entrepreneur’s expectations. The country already has a suitable policy framework designed to support the actions and activities of the Ministry of Youth Affairs and its Commission that must be compatible with the entrepreneur’s expectations. There are also extensive entrepreneurial resources that must be easily attainable and accessible to all youth entrepreneurs. Sierra Leone also needs a policy that affects the entrepreneur’s attitude towards policymakers to reduce the stigma of apprehensive youth attitude. The result of this study provides a suitable angle to evaluate entrepreneurship and identify other factors that strengthen the effectiveness of entrepreneurship research in developing economies.
... The basic idea of legitimacy centers on the social and legal system and cultural expectations, which regulate people's behavior. According to Tang (2017), Weber was the first academic to introduce legitimacy to sociological research, arguing that legitimacy was consistent with organizational rules and structures, and stemmed from the coherence between organizational goals and social rules, norms and laws. The legitimacy of formal structures is one of the theories that predominates over an alternative source consisting of a formal Weberian structure. ...
... Internal legitimacy External legitimacy Aldrich & Fiol (1994) Social and political legitimacy Cognitive legitimacy Scott (1995) Regulatory legitimacy Normative legitimacy Cognitive legitimacy Suchman (1995) Pragmatic legitimacy Moral legitimacy Cognitive legitimacy Hunt & Aldrich (1996) Regulatory sociopolitic legitimacy Normative sociopolitic legitimacy Cognitive sociopolitic legitimacy Greenwood (2002) Expert legitimacy General specification legitimacy Archibald (2004) Regulatory legitimacy Cultural legitimacy Source: Adapted from Díez-Martín, Blanco-González, & Prado-Román (2010b), and Tang (2017). ...
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The main goal of this study is to enlarge the understanding of the concept of legitimacy. In recent decades, organizational legitimacy has received a great deal of attention from researchers who have tried to establish how organizations acquire, manage, and use it. However, there is still no conceptual agreement on how organizational legitimacy should be understood and how it can be measured. This reflects the complexity in the literature about understanding this phenomenon and suggests research opportunities. This chapter aims to strengthen the understanding of the role legitimacy plays in organizations by reviewing the related literature and analyzing the relationship between legitimacy and trust. Our findings suggest that there is a positive relationship between these two concepts. Moreover, we conclude that legitimacy can be achieved in two different ways: the first via trust and the second via control. In the first instance, we found a double-loop relationship between legitimacy and trust, generating a feed-forward relationship, given that both of these concepts mutually reinforce each other. In the second instance, there is a single-loop relationship because legitimacy based on control improves stakeholders’ trust in the organization. However, there is no reciprocal impact given that the legalistic remedies used are, in fact, the substitutes of trust.
... Within the literature, different types of legitimacy are mentioned (Tang, 2017). For example, Jaber and Oftedal (2020) used three institutional dimensions (regulative, normative and cognitive) to measure legitimacy in an organization under a sustainable change. ...
Purpose This study aims to identify the legitimacy issues raised during a sustainable business model innovation, deployed by an Italian company, which was analyzed through the lens of the legitimation theory and the business model innovation theory. Design/methodology/approach A single case study methodology is employed for empirical research. Semistructured interviews, with top and middle management, were conducted together with the analysis of several internal and external documents, to corroborate the case analysis. Findings Results show how the potentiality of digital technologies allows the development of new sustainable business models, which, though, still need to gain legitimation to be accepted. The study findings allow drawing both on the business model innovation theory and on the legitimation theory, as they show how legitimation is a dynamic concept that involves internal as well as external stakeholders to support business model innovation. Originality/value The paper is novel, since it addresses the topic of sustainable business models development, showing how companies can get legitimation. The paper builds on existing theories and provides a practical example.
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This study focusses on adopting a multi-level model for the organizational context within work groups and a functional perspective for socially responsible behaviours. This study developed a multi-level model for sustainable accounting practices within the work environment and tested it to illustrate some of the reasons that make organizations voluntarily participate in the green environmental behaviour. The quantitative (questionnaire survey) design was used to gather data from included 313 company workers in Iraq who were organized into 60 work groups. The results show that it was revealed that routine redesigning, legitimacy and functional affordance are related to sustainable accounting practices within the work environment for the leaders and members of the work groups. Furthermore, there was a direct relationship between routine redesigning, legitimacy, and functional affordance and sustainable accounting practices in addition to a mediation-mediated relationship by organizational sensemaking within work groups. Theoretical effects and the revealed results highlighted psychological, social and organizational conditions that determine the sustainable work practices, and it was recommended that organizations should facilitate their social responsibility and environmental sustainability.
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Now organizations are always vulnerable to the liabilities of newness, but such pressures are especially severe when an industry is in its formative years. We focus on one set of constraints facing entrepreneurs in emerging industries-their relative lack of cognitive and sociopolitical legitimacy. We examine the strategies that founders can pursue, suggesting how their successful pursuit of legitimacy may evolve from innovative ventures to broader contexts, collectively reshaping industry and institutional environments.
This article synthesizes the large but diverse literature on organizational legitimacy, highlighting similarities and disparities among the leading strategic and institutional approaches. The analysis identifies three primary forms of legitimacy: pragmatic, based on audience self-interest; moral, based on normative approval: and cognitive, based on comprehensibility and taken-for-grantedness. The article then examines strategies for gaining, maintaining, and repairing legitimacy of each type, suggesting both the promises and the pitfalls of such instrumental manipulations.
This paper argues that evolutionary processes occur in the environments of organizations. Ideal types of environment, originally conceptualized by Emery and Trist, are elaborated and extended. A review of recent literature gives evidence of the decreasing autonomy and the increasing interdependence of organizations. Four approaches to interorganizational analysis are reviewed and found inadequate to deal with present-day conditions. This paper then outlines a perspective which allows any organization, its transactions, and the environment itself to be viewed in a common conceptual framework. Two hypotheses are discussed: (1) that organizational change is increasingly externally induced; and (2) that organizational adaptability is a function of ability to learn and to perform according to changes in the environment.
Using data on 143 hospital organizations, this article examines the antecedents and effects of two forms of organizational legitimacy (managerial and technical) over a 46-year period. Results show that both the managerial and technical forms provide notable improvements in organizational survival chances but that the strength of each effect varies over time depending on the nature of the institutional environment. Variation also appears in the antecedents of legitimacy - for example, the ability of a hospital to secure approval for its managerial practices depends on the correspondence between its mission and the logic of the surrounding institutional environment. The results suggest that a multidimensional model can reveal nuances of organizational legitimacy that are missed by more unitary conceptions.
While many sociologists have noted that organizational legitimacy is important for organizational survival, legitimacy has been infrequently empirically examined. This paper presents a conceptual framework in which organizational legitimacy is defined as the congruence between the values associated with the organization and the values of its environment. Challenges to organizational legitimacy and responses to these challenges are illustrated in a discussion of the American Institute for Foreign Study. Corporate philanthropic contributions, the composition and size of boards of directors, and the content of annual reports and other organizational communications are presented as efforts on the part of organizations to achieve legitimacy. The focus on processes of organizational legitimation can be used in analyzing a variety of organizational behaviors that are components of organization-environment interaction.