Organizational Legitimacy: Six Key Questions

Legitimacy is a fundamental concept of organizational institutionalism. It influences how organizations behave and has been shown to affect their performance and survival (Pollock & Rindova, 2003; Singh, Tucker, & House, 1986). As developed in organizational institutionalism the term has spread widely across the social sciences, and because of this, our current understandings of legitimacy and how it is managed are much more nuanced and elaborate than portrayed in early institutional accounts. In this chapter, we seek to bring greater clarity and order to the growing and sometimes confusing literature, focusing on the conceptualization of legitimacy itself and how it changes over time.This chapter builds from the previous edition (Deephouse & Suchman, 2008, available online at www.sage.org/organizational institutionalism/legitimacy). In updating that chapter we reviewed 1299 publications and conference papers that had the string “legitim” in the title, abstract, or keywords. Reflecting the reach and power of legitimacy, these publications included books and a wide range of journals and across a wide range of disciplines (e.g., communication, political science, public administration, and sociology — not just management). Our goal was both to identify both broad trends in theory and research and possible theoretical innovations and also to highlight important applications for scholars in organizational institutionalism. From this review we identified six central questions around which this chapter is arranged: What is organizational legitimacy? Why does legitimacy matter? Who confers legitimacy, and how? What criteria are used (for making legitimacy evaluations)? How does legitimacy change over time? These questions are shown in Figure 1.1. Our final section asks “Where do we go from here?” and offers suggestions for future research.