Judgements of SMEs' Legitimacy and Its Sources

Organizational legitimacy is an important resource, which provides access to other resources. As such, it impacts the survival chances of organizations. In this study, we examine the individual judgments of the owner-managers of small-and-medium size enterprises (SMEs) of the legitimacy of their own...

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Bibliographic Details
Published in:Journal of business ethics 2020-09, Vol.165 (3), p.395-410
Main Authors: Ruffa, Olga Ivanova, Mnisri, Kamel, Morin-Esteves, Christine, Gendron, Corinne
Format: Article
Language:English
Subjects:
Business administration
Business and Management
Business Ethics
Clients
Cues
Education
Ethics
Humanities and Social Sciences
Interest groups
Legitimacy
Management
Original Paper
Philosophy
Quality of Life Research
Small & medium sized enterprises-SME
Stakeholders
Studies
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Summary:Organizational legitimacy is an important resource, which provides access to other resources. As such, it impacts the survival chances of organizations. In this study, we examine the individual judgments of the owner-managers of small-and-medium size enterprises (SMEs) of the legitimacy of their own enterprise as well as their perception of the legitimacy evaluations of relevant stakeholders. This research is based on interviews with owner-managers of SMEs located in the Lorraine region of France. The results show that when legitimacy is perceived as acquired, their judgments are based on instrumental, relational and moral evaluations, whereas when legitimacy is perceived as being deferred, judgement is based on mainly instrumental evaluations and when they report not being in position to judge their own legitimacy, their judgements are based on moral evaluations. In addition, the legitimacy judgements employed are associated with the different types of legitimacy sought by the SME owner-managers. Moreover, they perceive the validity cues coming from clients and employees as the most important sources of legitimacy. Other stakeholders are accorded secondary importance in granting legitimacy.
ISSN:0167-4544
1573-0697
DOI:10.1007/s10551-018-4063-3