Susse Georg

We often talk about different kinds of institutions, such as children’s institutions, educational institutions, prison institutions or more generally, public institutions. At the same time, many also use the term to refer to important organisations, such as the UN, which is an international political institution, or the World Bank, which is a major international financial institution. According to these applications, an institution may either be a physical place or an organisation that performs certain tasks. However, institution can also mean something completely different, i.e. social order or a social pattern, which is maintained through human interactions. Based on this definition, institutions regulate human behaviour and are, therefore, crucial for a sustainable transition of social development.

The word institution comes from the Latin word instituere, which means ‘to set up or establish’. Although institutions are often taken for granted, they are not just there. They are socially created. Consider many of our everyday actions such as eating dinner together. It is something people have always done, and it is something that is done in many different ways. However, what is the same is that having dinner together is a learned act. In most families, it is the adults who decide when and where the family should eat (for example, at the dining table or in front of the television) and the children just comply. While adults are to some extent conscious of the habits they establish, children (especially younger ones) are unaware of them. For them, it is just the way things are done. When the children move away from home and establish their own families, it is quite likely that they will continue many of the same habits that they grew up with in their families. Over the years, a gradual institutionalisation of the way people eat dinner has occurred. According to the sociologists, Berger and Luckmann, this institutionalisation process consists of three steps: firstly, the habits must be established. In relation to the example above, this occurs when adults develop their eating habits (probably before they get children) and mutually acknowledge them. Berger and Luckmann refer to this mutual recognition as ‘typification’. When the children arrive, they experience the habits as facts – as an external force which they have to comply with. The habit that was created by the parents becomes objective reality for the children. This step is referred to as ‘objectivation’. The final step ‘internalisation’, is when the children reproduce ‘what they learned at home’.

There are many other types of institution than those that regulate the way we eat our dinner. They are established, maintained and developed in the situations where people interact repeatedly. Institutions are essential and allow us to coordinate and control things. According to the sociologist, Richard Scott, institutions consist of cognitive, normative and regulatory structures that give social behaviour stability and meaning.

The cognitive structures relate to the conditions that can affect our thinking habits and understandings. Language is particularly important in this respect. Language is a system of signs that enables people to express themselves and it is, therefore, important for the above-mentioned objectivation of everyday reality. More generally, symbols – whether they be words, signs or gestures – all help us to understand what is happening around us. They influence how we make sense of things and contribute to establishing what some call our ‘cognitive map’ – the framework for understanding through which we make sense of things. The creation of meaning takes place individually as well as collectively – it takes place in a concrete connection and is, therefore, also influenced by the cultural context. In every context there are some fundamental rules that determine how things, relationships and processes are categorised, i.e. how the above-mentioned symbols are arranged. If we take the issue of climate change as an example, there are major differences in people’s understanding of the seriousness of the situation. While the vast majority of people now consider climate change to be man-made, there are climate sceptics who believe that this is not the case. According to their world view, climate change is something that has always been around. The many scientific reports that document the seriousness of the situation in various ways have not influenced their perception of what is ‘real’.

The normative structures encompass different types of rules for how to behave. In other words, they specify what is correct or appropriate, while at the same time they involve assessments of whether people are following the norm. There is an element of coercion because people are expected to comply with the norms. Norms influence many things, for example, what is considered the appropriate way of treating the elderly or foreigners, what behaviour is acceptable in the workplace or the appropriate use of mobile phones. If you do not comply with the norms, you may face different types of sanction, which may range from a raised eyebrow and a shake of the head to verbal reprimands. Bullying can be regarded as a particularly malicious form of sanctioning that implies that you do not fit in with some of your classmates’ norms that dictate the right way to be.

What all norms have in common is that they are based on some underlying values as to what is desirable. This becomes a ‘standard’ against which people’s behaviour is judged. Norms express certain expectations regarding our interpersonal relationships – they indicate the correct way to do things. In addition, it can be said that norms define what the appropriate – or legitimate – means are for achieving a specific goal. Legitimacy is something most organisations strive for as it represents their ‘license to operate’. In the last 40 years of development in industry, norms for a company’s social responsibility, known as Corporate Social Responsibility (CSR), have gradually developed, strongly encouraged by environmental, work environment and labour market legislation (see below). However, what CSR more specifically involves is something that many consultancy companies like to advise industrial companies about. Consultancy companies, among other things, earn their keep by formulating rules, guidelines and voluntary standards that define what constitutes responsible corporate operations. The spread of such rules and standards helps to define what is considered legitimate business conduct. In order for a company to maintain its legitimacy, it must be able to justify its choices/actions. For example, the VW Group has had a lot of difficulty with this in the aftermath of the repeated scandals in 2016 when it became known that their cars pollute much more than the company had stated.

The regulatory structures include legislation, rules, contracts and other forms of formal agreements as well as the necessary monitoring and sanction systems that are required to ensure compliance. This requires an authority with the necessary capacity to: (1) establish the rules; (2) investigate and monitor to ensure others are complying with the rules, and; (3) impose sanctions if necessary either in the form of a penalty or reward with a view to influencing the actions of others. What the regulatory structures have in common is a statement of what the involved parties may and may not do, and that there is one or another form of penalty if this is not followed.

Development in the environmental field serves as an interesting example of how regulatory, normative and cognitive structures are intertwined. The Environmental Protection Act was introduced to help ensure that societal development is sustainable by making companies reduce their pollution of the air, water, soil and underground. Companies are thus subject to a number of rules that they must adhere to. If not, they can be reported to the police and may receive a fine. During the 40-year history of the Environmental Protection Act, two significant changes have been made to the goals and measures of the law: From focusing on environmental protection, the goal has been changed to include the prevention of problems. At the same time, the widespread measures (approval of the companies’ production and emissions) have been supplemented by an increased use of voluntary environmental management standards (self-regulation) to promote the companies’ environmental work.

This development must be seen in the light of the great political interest in simplifying the legislation and streamlining the public sector, which is linked to the introduction of New Public Management in the public sector in the mid-80s. The authorities’ limited resources to control companies was one of the factors that helped to legitimise an increased use of self-regulation. At the same time, many believed that in this way, they could achieve better (environmental) results because the companies would be more motivated and would find it easier to comply with conditions, the arrangement of which they had been involved in. The three types of institutions – cognitive, normative and regulatory – support each other: Environmental standards are normative regulations that stipulate how companies’ environmental efforts should be organised. The introduction of these works together with ideas about what best encourages companies in terms of their environmental work, and with ideas about the need to streamline the public sector. Together, this justifies the use of normative instruments in addition to judicial regulation.

Institutions are important sources of power: The cognitive structures influence our framework of understanding; our perceptions of what is real and important. Our interpretation of what is happening (or has happened) around us depends on our knowledge and the models of understanding we apply. And here the normative structures, such as upbringing, schooling, educational choices, etc., play a role and shape our views on how to behave and how development should take place. The cognitive and normative structures thus work together in creating our understanding and expectations and, thus, have ‘power to define’ to a certain extent. The regulatory structures are perhaps more tangible as they are laid down in laws and contracts. By stipulating who is entitled to what, it is possible to ensure ‘law and order’ and protect the interests of the different parties. However, it is by no means certain that all interests are weighted equally. As a result, ‘positional power’ may be established, where some have more right or more rights than others. Such bastions of power are far from secure or stable – they can be and are challenged by people who think and act in a different way to that which is prescribed by the institutions.

Because institutions are socially constructed, they are also changeable. Things can be different. The introduction of new technology is often the reason why institutions change. Just think about the development of the Internet and the resulting opportunities to acquire information and keep in touch with people over great distances. At the same time, it has meant changes in our perceptions and norms. Ten years ago, reading a newspaper during a class was perhaps not unthinkable, but it was at least frowned upon. However, today, teachers have to deal with students’ use of Facebook and other social media during teaching. Similarly, a few years ago, opening and reading post while in a meeting at work was unthinkable. You just did not do it. But today, checking email while in a meeting has almost become normal. This erosion of what is considered acceptable behaviour illustrates that institutions can be changed (relatively) quickly.

Ensuring a sustainable transition demands that changes are made to many institutions, from our perception of what constitutes human society (a metabolic organism) and what it can withstand, to our norms about how we should interact with each other and nature and to the legislation that needs to be formulated in order to promote the transformation of our energy system, etc.

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