Corporate Legitimacy and Institutionalization: From Corporate Innocence to Responsibility for Complex Impacts

This chapter studies some of the significant changes in history of corporate responsibility and legitimacy. One line of development is that the company in the middle of last century was considered innocent. The main coordination mechanism was the market and economy. Gradually, more values and norms were introduced to judge the impacts of the company; and national regulation addressed some of the market imperfections and business impacts on health and environment. In this development, sociological theories, New Institutionalism, came up with very broad and general theories about norms, values, habits, norms, and institutions. The author finds that the very broad theories did not focus on the material aspects and the complexity of the praxes of the many agents. Therefore, I. Jensen (*) Department of Social Sciences and Business, Roskilde University, Roskilde, Denmark e-mail: [email protected] © Springer Nature Switzerland AG 2020 J. D. Rendtorff (ed.), Handbook of Business Legitimacy, https://doi.org/10.1007/978-3-319-68845-9_5-1 1 Jean-Paul Sartre, John R. Searle, and Jürgen Habermas are introduced to focus on social reality as materialized result of the many agents. In light of this, social construction is considered in two ways: institutions as socially constructed coordination mechanisms and as materially mediated and legitimate when supported in praxis. In the historical development of companies, their responsibility and legitimacy, there is a growing awareness of the need of new institutionalized coordination mechanisms that do not leave all responsibility to the individual company but enable cross-sector collaboration to address common international priorities