Person:

Kalev, Alexandra

Institutionalists describe large domains of corporate policy and practice as symbolic. The work of entire departments is carried out to convey a firm’s commitment to efficiency (the now dismantled strategic planning unit) or to fairness (the Chief Diversity Officer and her cadre). Executives may deliberately choose purely symbolic policies that will not alter proven routines or traditions that employees hold dear. What distinguished institutional theory, from the start, was the recognition that while organizational practices are often ceremonial, they may nonetheless serve the very material purpose of conferring legitimacy on the firm, which helps executives to raise capital, win customers and attract talent.