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LEGITIMACY THEORY - Essay Example

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According to Suchman “legitimacy is a generalized perception or assumption that the actions of an entity are desirable, proper, or appropriate within some socially constructed system of norms, values, beliefs, and definitions” (Suchman, 1995, p. 574). Mathews sheds light on…
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LEGITIMACY THEORY

Conflation of these concepts can be a very difficult proposition though such organizational contingencies existing within its operational environment could act as a compulsion to achieve such fusion so that legitimacy becomes an institutionalized organizational goal.
Financial reporting mechanisms and the connected objectivity perspectives have been questioned by researchers and analysts on the ground that organizations present such annual financial reports with a view to legitimizing their activities in the eyes of the society. This social obligation arguably reinvigorates the existing debate on the dichotomy between the legitimacy theory and reliable financial reporting as an organizational requirement. While theoretical underpinnings of accounting and financial reporting are concerned with professional impartiality and numerical accuracy as explicitly required under IAS, legitimacy of organizational behaviour in the food sector is determined by a series of endogenous and exogenous variables ranging from industry-centric environmental factors to national and supranational regulatory compulsions. Food industry-centric environment has been subject to a revolutionary paradigm shift in quality and safety. This evolving scenario of extreme choices has invariably predicated upon the stricter legitimacy-prone standards that are being witnessed in it today.
A variety of theoretical approaches have been developed over the years to build a comprehensive framework of analysis to study an otherwise complex concept in organizational beahviour. Legitimacy theory is just one such theoretical postulate that has evolved into what’s now known as the yardstick of organizational behaviour concerning that particular aspect of its ethical responsibility to the very society in which it operates as a corporate entity. Thus the very logic of organizational behaviour hinges on the fundamental premise that organizations are bound by a universal requirement to justify and ... Read More
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