Q Academy of Management Review

2016, Vol. 41, No. 1, 130–150.

http://dx.doi.org/10.5465/amr.2014.0330

A RHETORICAL MODEL OF INSTITUTIONAL DECISION MAKING:

THE ROLE OF RHETORIC IN THE FORMATION AND CHANGE OF
LEGITIMACY JUDGMENTS
ROLF L. HOEFER
INSEAD

SANDY E. GREEN, JR.

California State University, Northridge

We integrate a rhetorical perspective with neoinstitutional theory to develop a rhetorical

model of institutional decision making. We use this model to describe how the com-
municative practices of decision makers both enable and constrain how actors manage
the risk and uncertainty of their judgments and decisions within an institutional context.
We first develop a dual conception of reason as both communication (public argument)
and cognition (private argument). With this dual conception of reason, we conceptualize
actors as active and passive speakers and listeners who interpret, produce, and present
public and private arguments to persuade themselves and others to adopt, maintain, or
reject practices. Speakers and listeners have cognitive limits and thus create pre-
sumptions or shared decision-making rules to help them efficiently produce and process
the arguments needed to debate, evaluate, and adjudicate recurring institutional de-
cisions. We suggest that arguments shape actors’ reasoning and judgment because they
reflect appeals to pathos (emotion), logos (logic), and ethos (values) that support or
criticize decisions to act. These appeals also shape the nature and construction of
presumptions that bind rationality. We describe how these binds on rationality affect
the formation of judgments and decisions, as well as the performance evaluation of
institutional practices.

How does rhetoric influence legitimacy judg-
ments in institutional decisions to adopt or reject
practices? Recently, two emerging streams of re-
search have developed that help neoinstitutional
theorists answer this question. The first stream of
research, often labeled “rhetorical institution-
alism” (Cornelissen, Durand, Fiss, Lammers, &
Vaara, 2015: 12; Green & Li, 2011), suggests that
communication in general and rhetoric in partic-
ular play a critical role in shaping the legitimacy
process (Golant & Sillince, 2007; Green, 2004;
Hartelius & Browning, 2008; Heracleous & Barrett,
2001; Phillips, Lawrence, & Hardy, 2004; Sillince &
Suddaby, 2008; Suddaby & Greenwood, 2005).
Scholars with this perspective theorize that
communication shapes legitimacy because le-
gitimation “is built upon language and uses lan-
guage as its principal instrumentality” (Berger &
We thank Roy Suddaby, John Lammers, and three anony-
mous reviewers for their helpful and insightful comments on
ideas expressed here. We also thank Philip Anderson,
Thomas Goodnight, Derek Harmon, and Sorah Seong for
support and/or feedback on earlier drafts of the manuscript.
Both authors contributed equally. All errors and omissions
are entirely our own.
130
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Luckmann, 1966: 64). This communicative per-
spective of institutional theory frequently em-
phasizes the performative aspects of language
and thus attempts to explain how communication
causally shapes legitimacy judgments and the
institutionalization process (Suddaby, 2010). Al-
though there are many variants of the rhetorical
institutional approach, such as “framing (Fiss &
Zajac, 2006), tropes (Etzion & Ferraro, 2010), dis-
course (Phillips, Lawrence, & Hardy, 2004), and
rhetoric (Green, 2004),” (Cornelissen et al., 2015:
12–13), in most of this research there is an as-
sumption that communication plays a perfor-
mative role in the development of legitimacy
judgments. More broadly, this research grapples
with explaining how the performative use of
language “affects actors in their thoughts and
behaviors” because the “cognitive contents and
inferences for institutionally prescribed actions
are produced and realized through and in the use
of language” (Cornelissen et al., 2015: 13).
In contrast to the rhetorical institutionalism re-
search stream, which emphasizes communica-
tion, a second more recent stream of research
emphasizes the role of cognition in the formation
2016 Hoefer and Green
of legitimacy judgments (Bitektine, 2011; Bitektine &
Haack, 2015; Tost, 2011). Scholars focusing on the
role of cognition in the formation of legitimacy
judgments argue that past institutional research in
general and rhetorical institutionalism research in
particular (e.g., Maguire, Hardy, & Lawrence, 2004;
Suddaby & Greenwood, 2005) mistakenly concep-
tualize listeners or audiences as passive evalua-
tors of legitimacy. Scholars working from this
cognitive perspective argue that ignoring the role
of listeners as active agents “underestimates the
importance of active cognitive processing, in-
formation search efforts, and social interactions
that precede the formation of legitimacy” (Bitektine,
2011: 151). These scholars go on to argue that
ignoring the role of individuals’ active cognitive
processing hinders institutional theorists from
explaining how individual judgments of legitimacy
form, as well as “how those judgments emerge to
motivate individuals to work for change or main-
tain the status quo” (Tost, 2011: 694). To resolve these
shortcomings, scholars have recently focused more
attention on the active role that audiences or eval-
uators play in rendering legitimacy judgments
(Bitektine, 2011; Bitektine & Haack, 2015; Tost, 2011).
In aggregate, both streams of research in-
dependently increase our understanding of the
role of communication and cognition in legiti-
mation processes. However, these independent
streams of research are limited because they fail to
integrate and explain the reflexive interplay be-
tween cognition and communication in legitima-
tion processes. This critique was an important
motivation for the recent Special Topic Forum
on Communication, Cognition, and Institutions
in the Academy of Management Review (see
Cornelissen et al., 2015). Specifically, largely
missing from the first research stream on commu-
nication and legitimacy are insights about the
cognitive and interpretive processes that listeners
actively and passively deploy when evaluating
communications about legitimacy. Largely miss-
ing from the second research stream on cognition
and legitimacy are explanations of the funda-
mental role of communication in the hermeneutic
or interpretive processes that social actors in-
tentionally and unintentionally use to shape their
own as well as others’ cognitive judgments about
legitimacy. Consistent with the calls for future re-
search in the recent Communication, Cognition,
and Institutions special issue, here we attempt
to integrate these two research streams in order
to develop a more sophisticated, robust, and
131
integrated understanding of the role of communi-
cation and cognition in institutions in general
and the formation of legitimacy judgments in
particular.
To address the aforementioned issues, we build
on suggestions about the promising potential of
rhetoric for further developing institutional theory
(Suddaby, 2010: 17). We acknowledge the critique
that previous rhetorical institutional approaches
have overemphasized classical rhetoric’s concern
with the speaker and (the means of) persuasion in
the formation of legitimacy at the expense of the
active role of the listener and interpretation in
the construction of legitimacy judgments. In re-
sponse, we develop and propose a rhetorical
model of decision making that incorporates the
speaker and persuasion as well as the listener
and interpretation. In particular, our proposed
model retains aspects of “classical rhetoric” that
describe the performative role of language in the
formation of legitimacy judgments. However, we
also introduce and integrate aspects of the “new
rhetoric,” which emphasizes the listener and in-
terpretation and thus resonates and is consistent
with more cognitive explanations of the formation
of legitimacy.
We believe that integrating both classical and
new rhetoric into a model of decision making pro-
vides four key contributions to our understanding
of how rhetoric affects the legitimacy judgments
that shape institutional decisions. Our first contri-
bution is the integration of classical and new
rhetoric to develop and propose a dual conception
of reason as both communication (public argu-
ment) and cognition (private argument). The com-
bination of new rhetoric’s emphasis on the listener
and interpretation with classical rhetoric’s em-
phasis on the speaker and persuasion highlights
how speakers and listeners coproduce meaning
(Crusius, 1991; Hyde & Smith, 1979). Integrating
classical and new rhetoric suggests that cognition
is inherently communicative and, thus, social, di-
alogic, and double-sided because cognition re-
flects and constitutes actors’ private and public
arguments (Billig, 1996). Moreover, an integration
of classical and new rhetoric also suggests that
communication is inherently cognitive because
actors’ arguments or appeals (e.g., pathos, logos,
and ethos) essentially reflect as well as constitute
actors’ emotions, logics, and morals.
Our second contribution is our use of this dual
conception of reason to describe the formation
of legitimacy judgments as an argumentative
132 Academy of Management Review
process. As an argumentative process, speakers
and listeners with cognitive limits coproduce the
meanings that form legitimacy judgments while
persuading and interpreting the world for them-
selves and others. Within this framework, argu-
mentation is the product and process by which
speakers and listeners interrelate system 1
(i.e., automatic and unconscious) cognitive pro-
cesses with system 2 (i.e., deliberate and con-
scious) cognitive processes (Green & Li, 2011; Tost,
2011). Actors deploy deliberate cognitive pro-
cesses (Evans, 2008; Kahneman, 2003; Stanovich,
1999) when they consciously use arguments to
balance and weigh their reasons. However, the
deliberate and conscious use of these arguments
also produces and establishes presumptions—
decision rules regarding a class of situations.
Presumptions are devices of argumentation and
deliberation (Godden & Walton, 2007) that help
actors organize and weave reasons into their un-
conscious webs of belief. These unconscious
webs of belief reflect automatic cognitive pro-
cesses that structure and bind decision maker
rationality. We believe this communicative and
cognitive model details how actors as both
speakers and listeners passively and actively
participate in the formation of legitimacy judg-
ments and institutional decisions, thereby offer-
ing a portrayal of institutional embeddedness
that is neither too underrationalized nor too
overrationalized (Powell & Colyvas, 2008).
Our third contribution is the further elaboration of
the concept of presumption to model the formation
of legitimacy judgments and the making of in-
stitutional decisions as a joint communicative ac-
tivity that entwines the cognitions of both speakers
and listeners (Bitektine, 2011; Cornelissen et al.,
2015; Tost, 2011). Specifically, we conceptualize
presumptions as the communicative and cognitive
mechanism through which institutions organize
actors’ communicative interactions and limited
cognitive resources. Presumptions organize com-
municative interactions by assigning the burden of
proof to one or the other side of an argument. They
organize cognitive resources by deploying decision
rules that govern the rationality of actions within
a particular class of situations. Sometimes pre-
sumptions dictate that actors decrease the de-
ployment of cognitive resources, and this often
predisposes actors to imitate and maintain in-
stitutions. Other times presumptions pressure ac-
tors to increase the use of cognitive resources, and
this often drives actors to innovate and change
January
institutions. We theorize how variation in pre-
sumptions shapes the level of questioning and
interrogation and the deployment of cognitive re-
sources. We then theorize how the level of in-
terrogation and deployment of cognitive resources
might influence the performance evaluation of or-
ganizational practices.
Our fourth contribution is our description of how
presumptions allow us to construct an institutional
model of decision making that integrates pro-
cedural and substantive rationality. Specifically,
with the introduction of pathos, logos, and ethos
appeals to reason, we theorize how presumptions
are in many ways artifacts of substantive ratio-
nality (e.g., emotion, logic, and values) manifested
in procedural rationality (e.g., satisficing). These
appeals construct and shape the tilt and strength
of presumptions and thus reflect the content or
“substance” that binds decision maker rationality.
In sum, our rhetorical model of institutional de-
cision making details how cognition and commu-
nication entwine procedural and substantive
rationality for a more holistic and realistic view of
human reasoning and, thus, institutional decision
making built on logic, values, and emotion.
We organize the article as follows. We first de-
scribe and integrate classical and new rhetoric to
reconceptualize institutional decision making as
a product and process of arguments deployed by
speakers and listeners. Based on this integrated
rhetorical conception of institutional decision mak-
ing, we theorize how speakers use arguments to
persuade or influence listeners’ legitimacy judg-
ments and how listeners use arguments to interpret
and form legitimacy judgments from the communi-
cations they evaluate. We then use this model of
how arguments shape both persuasion and in-
terpretation to explain the role of rhetoric in the
formation of legitimacy judgments and, thus, actors’
decisions to adopt and institutionalize practices or
reject and deinstitutionalize practices. Finally, we
elaborate on what this means for our understanding
of institutional decision making, the interrelation-
ship of communication and cognition, and the per-
formance evaluation of institutional practices.
RHETORIC AND DECISION MAKING
Rhetorical Theory: Integrating Classical and
New Approaches
Rhetoric is the symbolic manipulation of limited
attention and cognitive resources to persuade
2016 Hoefer and Green
or “make known” meaning to oneself and to
others in order to influence social action (Hyde &
Smith, 1979: 348; see also Bizzell & Herzberg,
2001, and Perelman & Olbrechts-Tyteca, 1969).
Although the scope of rhetorical theory is large
(Bizzell & Herzberg, 2001), in this article we in-
tegrate classical and new approaches to rheto-
ric to inform our understanding of institutional
decision making. The classical approach to
rhetoric emphasizes the speaker’s use of rhetor-
ical strategies, especially appeals of pathos
(e.g., emotions), logos (e.g., logic), and ethos
(e.g., values), in the construction and deployment
of rationality (Aristotle, 1992). It starts with the
assumption that actors’ cognitive limits are crit-
ical to understanding rationality, decision mak-
ing, and behavior, and it emphasizes a direct
relationship between communication, cognition,
and action in an uncertain, contingent world
(Aristotle, 1992). Classical rhetoric emphasizes
persuasion and the point of view of the speaker or
rhetor, as opposed to the listener or audience,
and thus conceptualizes the audience “as a tar-
get, a source of expectations” that guides the
production of speakers’ persuasive messages
(Benoit & Smythe, 2003: 96). Moreover, classical
rhetoric often emphasizes rhetoric as “ontic” or
public discourses that exist between individuals
as speakers and listeners for the purpose of
persuasion (Bonet, 2014: 794–796; Hyde & Smith,
1979; also see Jasinski, 2001: 292).
In contrast to classical rhetoric, new rhetoric
emphasizes identification and interpretation from
the point of view of the listener or audience, as
opposed to the speaker or rhetor. It focuses on the
audience as an active agent in the persuasion pro-
cess by elaborating on the role of rhetoric in self-
persuasion, interpretive processes, and personal
judgments (Bonet, 2014: 800–804; Crusius, 1991:
70-80). New rhetoric emerged with Kenneth Burke’s
A Rhetoric of Motives (1969a), Chaı̈m Perelman
and Lucie Olbrechts-Tyteca’s The New Rhetoric:
A Treatise on Argumentation (1969), and Martin
Heidegger’s student Hans-Georg Gadamer’s Truth
and Method (1975). Similar to classical rhetoric,
new rhetoric emphasizes the importance of cogni-
tive limits and the way actors use language to
manage the uncertainty inherent in “living through”
and existing “in a world of almost infinite linguistic
possibilities” (Jasinski, 2001: 289). Within this
framework, rhetoric is the process humans use
to select and reveal a linguistic possibility
“as something” and thus to make known meaning
133
(Hyde & Smith, 1979: 354; Jasinski, 2001: 289). More-
over, new rhetoric often emphasizes rhetoric as
“ontological” or private discourses that exist
within the individual’s intrapersonal domain to
form personal interpretation and personal judg-
ments (Bonet, 2014: 802; Hyde & Smith, 1979: 354;
Jasinski, 2001: 292).
Integrating new and classical rhetoric suggests
that speakers and listeners have cognitive limits
and thus coproduce meaning while persuading and
interpreting the world for themselves and others.
Focusing on the contingency of human actions and
the coproduction of meaning suggests that the art of
persuasion and the art of interpretation entwine
when actors deploy phronesis or practical judgment
needed to make decisions based on common sense,
plausible interpretations, or persuasive argument
(Booth, 1974; Crusius, 1991: 9; Perelman & Olbrechts-
Tyteca, 1969). Within this framework, rhetoric ini-
tially shows itself in a person’s thinking and, thus,
in the intrapersonal domain as actors interpret
the world and persuade themselves. Rhetorical
scholars theorize that this internal process often
leaves traces in public discourse (Hyde & Smith,
1979: 354; Jasinski, 2001: 292). In addition, rhetori-
cal scholars argue that for actors to share their
interpretations and persuade other actors about
the validity of their interpretations, they must
transition this private discourse into public dis-
course. Once actors transition their private dis-
course into public discourse, speakers and listeners
negotiate and coproduce shared meanings be-
tween each other through rhetorical exchanges
(Jasinski, 2001: 292; Mailloux, 1990).
Deploying an Integrated Rhetorical Perspective
in Human Decision Making
Rhetoric, as a field of inquiry, was the first field
of study developed to examine human choice
under conditions of contingency and probability
(Aristotle, 2001). Decisions are choices that bring
into existence or confer actuality on contingent
courses of action (e.g., the adoption or rejection of
practices; Lonergan, 2005: 613). These decisions or
choices for action often result from judgments or
choices that temporarily complete one’s knowl-
edge and assessment or evaluation of an existing
actuality (e.g., a practice is good or bad; Lonergan,
2005: 613). Deploying a rhetorical perspective
sensitive to concerns of both classical rhetoric
and new rhetoric produces a powerful framework
for understanding decision making. For instance,
134 Academy of Management Review
discussing the importance of studying rhetoric in
decision-making, Aristotle stated:
Most of the things about which we make decisions,
and into which therefore we inquire, present us
with alternative possibilities. For it is about our
actions that we deliberate and inquire, and all our
actions have a contingent character; hardly any of
them are determined by necessity (Aristotle, 1992:
1357).
From an integrated rhetorical perspective,
rhetorical scholars describe beliefs, thinking,
reasoning, and decision making as entangled in-
extricably with arguing and arguments (Billig,
1996; Brown, 1987). This view suggests that actors’
arguments or reasons are often double-sided and,
thus, embedded within an uncertain argumenta-
tive context—designed to describe the world in
ways that either criticize or support alternative
courses of action (Billig, 1996; Bonet, 2014: 794;
Potter, 1996). Arguments are double-sided be-
cause choice is inherently about contingencies
and probability. We argue that the double-
sidedness of arguments is best captured in com-
munication and the communicative nature of
cognition because decision makers are simulta-
neously speakers and listeners when they seek to
construct and deploy reasons that justify their
choice, to themselves and to others (Aristotle, 1992;
Billig, 1996; Tetlock, 1992). Within this framework,
argumentation or the weighing of reasons for or
against various alternatives is the best model of
human decision making because the cognitive
processes underlying our thoughts and decisions
are both the product and process of arguing
(Billig, 1996). This formulation resonates with
scholarship suggesting that communication pro-
duces and constitutes our beliefs and rationalities
(Garfinkel, 1967; Habermas, 1984; Quinn, 1996;
Rorty, 1980; Wittgenstein, 1963).
The Role of Rhetoric in Institutions: Arguments,
Beliefs, and Legitimacy
An integrated view of rhetoric complements
and extends the model of decision making un-
derlying neoinstitutional theory. The model of
decision making presently used in neoinstitu-
tional theory in many ways extends a set of criti-
cal ideas and assumptions initially developed by
Herbert Simon and elaborated further by scholars
within the Carnegie perspective of institutions
(Argote & Greve, 2007; DiMaggio & Powell, 1991).
Similar to an integrated rhetorical view, the
January
Carnegie model of institutional decision mak-
ing rests on a theory of choice that explains and
describes human behavior as shaped by actors’
attempts to manage the uncertainty of their de-
cisions and actions (March & Simon, 1958; Simon,
1976). Within this framework, actors use argu-
ments or premises to direct attention and struc-
ture the beliefs that underlie institutional
decisions (Green, Li, & Nohria, 2009; Suddaby &
Greenwood, 2005).
Beliefs are the content of judgments. Beliefs
are critical to institutional decisions because they
are the substantive content of actors’ legitimacy
judgments—evaluators’ opinions about whether
an individual, organization, or practice is legiti-
mate or illegitimate (Bitektine, 2011: 152; Tost,
2011: 687). Legitimacy judgments occur when ac-
tors acquire, manifest, or change their beliefs.
When actors believe in the appropriateness of
a practice, they often judge the practice as legiti-
mate and thus are motivated to decide to adopt
and institutionalize the practice. When actors doubt
the appropriateness of a practice, they often judge
the practice as not legitimate and thus are moti-
vated to decide to reject and deinstitutionalize the
practice. Within this framework, understanding
how arguments shape and reflect beliefs is criti-
cal to explaining the adoption and institution-
alization of practices, because the acquisition,
manifestation, or change in beliefs shapes the
formation and evolution of legitimacy judgments,
which, in turn, shape actors institutional deci-
sions to adopt and institutionalize or reject and
deinstitutionalize practices.
Arguments shape beliefs. An integrated view
of rhetoric suggests that actors shape others’ as
well as their own beliefs via argumentation. Ar-
guments construct and modify beliefs and, thus,
action, because actors have cognitive limits and
exist in an uncertain world where they never
fully know the performance implications of their
beliefs and the consequences of their actions
(Aristotle, 1992; Bitzer, 1968; Simon, 1976). Within
this uncertain world, adherence to particular be-
liefs and/or actions engenders risk and therefore
requires rhetorical justification. Despite the ef-
forts of analytic philosophers, there is no univer-
sal, unassailable justification for belief (Quine &
Ullian, 1978; Toulmin, 1969). Whether a belief is
justified is a matter of whether actors assess
that it merits further questioning. Similar to the
Carnegie perspective of institutions (Gavetti,
Levinthal, & Ocasio, 2007), an integrated rhetorical
2016 Hoefer and Green
perspective suggests that actors assess the merits
of their beliefs for particular choices or decisions
through reason or the process of drawing conclu-
sions from premises (Aristotle, 1992; Simon, 1976;
Tompkins, Tompkins, & Cheney, 1989).
A Rhetorical View of Institutional Decision
Making: A Dual Conception of Reason
From both a rhetorical and a Carnegie per-
spective, decision premises are the reasons
that justify the beliefs that form the judgments
that shape our decisions or choices for action. In
addition, in an integrated rhetorical view of
institutional decision making, these decision
premises or reasons are themselves essen-
tially public and/or private arguments and,
thus, both communicative and cognitive (Billig,
1996; Nienkamp, 2001). Sometimes actors deploy
or state their premises or reasons for their choices
at the ontic level and therefore make public state-
ments or arguments. Other times, and for various
reasons that we discuss later, actors deploy their
premises or reasons for their choices only at the
ontological level and therefore let their cognitive or
private arguments go unstated (Green et al., 2009).
This dual conception of reason as existing at both
the ontic and ontological levels and as both com-
municative and cognitive resonates with the com-
monly understood semantic conception of reason
as both a communication or “statement offered
in explanation or justification” and a cognition
or “rational ground or motive” (Merriam-Webster
Dictionary, 2003). Moreover, from a rhetorical view
of institutional decision making, a dual concep-
tion of reason also provides the empirical and
conceptual bridge to integrate levels of analysis
and move from the ontological or cognitive
microprocess of individual thinking or private
argument to the ontic or communicative and in-
tersubjective macroprocess of social interaction
or public argument.
From both a rhetorical and a Carnegie per-
spective, actors have cognitive limits, and, thus,
the premises that underlie their decisions shape
and control their behavior (Aristotle, 1992; Simon,
1976). Decision premises have many institutional
sources, including family, religion, and educa-
tion (Douglas, 1986; Friedland & Alford, 1991;
Tompkins & Cheney, 1985). The Carnegie per-
spective conceptualizes the organization as an
institution (Cyert & March 1963; March & Simon,
1958) and, therefore, an additional source of
135
decision premises underlying actors’ organiza-
tional decisions. In fact, Simon argued that de-
cision premises were perhaps the most important
unit of analysis for understanding organizations
(Simon, 1976: 123, xii).
A rhetorical conception of institutional decision
making extends these ideas and suggests that
institutions limit the phenomena that actors con-
sider worthy of rational consideration via the
management of decision premises. Sometimes
these decision premises or warrants are explicit
and consciously stated by organizational actors.
At such times the rationalization of practices
as both comprehensible and appropriate is the
product of actors’ conscious and deliberate de-
ployment of reasons or arguments (Green et al.,
2009). Other times decision premises or warrants
are implicit and taken for granted. At such times
the institutionalization of practices is the process
by which actors weave their reasons for action
into their unconscious web of belief as they accept
and take these reasons for granted (Green et al.,
2009). Taking premises for granted frees up limited
cognitive resources for more pressing problems.
This is an important benefit of institutionalization,
because for actors with cognitive limits complete,
irrefutable proof for the beliefs supporting a prac-
tice is often unobtainable.
Institutions help to allocate limited cognitive
resources efficiently by legitimating the trunca-
tion of doubts that might otherwise completely
absorb attention without providing a useful result
(Collins, 1992). Accordingly, institutions and their
corresponding beliefs are a blessing because
they help actors efficiently allocate limited cog-
nitive resources (e.g., attention) across problems
and solutions. However, this efficiency comes at
a cost. That is, institutions are also a curse be-
cause failing to question beliefs conserves lim-
ited cognitive resources at the expense of diligent
evaluation and interrogation.
Building on these ideas, we model important as-
pects of institutional decision making as changes in
public and private argumentation. Sometimes ac-
tors make public arguments and state their reasons.
In such cases actors are likely not taking their prac-
tices for granted. At other times actors make private
arguments or cease to state their reasons. In these
cases actors are likely taking their practices for
granted. Within this framework, the production and
acceptance of argument is the concrete mechanism
that actors use to decide whether to initiate and
maintain institutions or dismantle and change
136 Academy of Management Review
them, because actors use arguments to weigh the
risk of believing and judging an institutional prac-
tice as legitimate versus the risk of doubting and
judging an institutional practice as not legitimate. In
the next section we detail and describe how actors
use argument to weigh the risk of believing versus
doubting institutional practices.
RHETORIC AND THE FORMATION OF
LEGITIMACY JUDGMENTS
Argumentation and the Risks of
Forming Judgments
A primary goal of a rhetorical model of in-
stitutional decision making is to describe how
actors use arguments to weigh the risk of believ-
ing and judging a practice as legitimate versus
the risk of doubting and judging a practice as not
legitimate. We use the concept of risk because it is
both an antecedent and consequence of decisions
to communicate and act. When individuals take
action or make utterances, they take risks and
subsequently modify the risks to themselves and
others. The risk of believing describes the nega-
tive consequences actors face when they initially
believe something is true that they or their com-
munity later believes is false. Thus, the risk of
believing and judging a practice as legitimate
includes the consequence of believing that a prac-
tice will perform well but having actors sub-
sequently evaluate that practice as not performing
as initially expected. The risk of believing and
judging a practice as legitimate also includes the
risk that social neighbors will judge one as irra-
tional or incompetent for using or advocating the
use of the practice. A decrease in actors’ assess-
ment of the risk of believing indicates the institu-
tionalization of those beliefs.
In contrast to the risk of believing, the risk of
doubting and judging a practice as not legitimate
includes the negative consequences of initially
believing something is false that actors or the
community later believes is true. These risks
include the risk of wasted time and attention, re-
dundant retesting and reinterrogation of effica-
cious practices, and/or benefits forgone because
of delayed or half-hearted investment. An addi-
tional risk of doubting and judging a practice as
not legitimate is that social neighbors will judge
one as incompetent, irrational, or subversive by
failing to evaluate as true that which the com-
munity perceives as true. An increase in actors’
January
assessment of the risk of doubting indicates the
institutionalization of those beliefs.
Actors do not wish to experience the conse-
quences of failing to correctly assess what to believe
and what to doubt as legitimate. Rhetorical theory
suggests that actors assess the risk of believing and
doubting symbolically via the search for, the con-
struction and production of, and the competition
between arguments (Paglieri & Castelfranchi, 2010;
Perelman & Olbrechts-Tyteca, 1969; Toulmin, 1969).
Actors use arguments to parsimoniously (Paglieri &
Woods, 2011) allocate their limited cognitive abili-
ties and attention in the evaluation of practices—
articulating beliefs and doubts so that they effi-
ciently and appropriately attend to and weigh
the relative risks of believing versus doubting
(Perelman, 1982; Perelman & Olbrechts-Tyteca,
1969). When actors have a choice or decision to
make that implies action or inaction, they often ex-
perience an increase in their desire to explain or
account for their behaviors; thus, they seek and
construct reasons to justify their choice, to them-
selves and to others (Irwin & Davis, 1995: 329; Lerner
& Tetlock, 1999; Tetlock, 1992). Within this frame-
work, the balance or weighing of reasons for and
against various alternatives determines the choice
to believe or doubt (Burnstein & Vinokur, 1977;
Isenberg, 1986; Shafir, Simonson, & Tversky, 1993;
Vinokur & Burnstein, 1978). Individuals and groups
make decisions by choosing the alternative with the
highest tally (e.g., quality and/or quantity) or bal-
ance of reasons (Barber, Heath, & Odean, 2003;
Shafir et al., 1993; Tversky, Sattath, & Slovic, 1988).
From a rhetorical perspective, actors shape the
balance of reasons through argumentation. Argu-
ments shape the balance of reasons and, thus,
beliefs by transforming the perception of risks. For
example, what may appear risky to believe prior to
the presentation of an argument can appear risky
to doubt after the argument’s presentation. Ar-
guers accomplish this transformation by guiding
attention to valid reasons that are unseen or less
valued by the audience prior to their utterance
(Weick, 1979; Weick & Browning, 1986). Arguers,
such as management gurus or consultants, can
therefore decrease or mitigate a portion of the risk
of doubting or believing experienced by them-
selves and others by presenting a complete, or
partially complete, search result (Abrahamson,
1996; March & Simon, 1958; Weick & Browning,
1986). Within our rhetorical institutional frame-
work, the conferral of legitimacy is the consequence
of the successful reduction and management of
2016 Hoefer and Green
these risks. Decisions to adopt, maintain, or reject
institutional practices are a consequence of belief
in or judgment about the legitimacy of a practice.
Belief or judgment about the legitimacy of a practice
is a consequence of the production, presentation,
and processing of arguments. Thus, actors decide to
adopt and institutionalize practices to the extent
they believe or judge these practices to be legiti-
mate or appropriate and those who adopt or main-
tain these practices to be rational, competent, and
themselves legitimate. These beliefs or judgments,
in turn, depend on the production and presentation
of arguments by actors, an activity that requires
actors to expend attention, use limited cognitive
resources, and undertake risks to produce and
present arguments.
Speakers, Listeners, and Legitimacy Formation
An integrated rhetorical model of institutional
decision making provides a conceptual basis for
connecting institutional decisions to the argu-
ments social actors deploy to shape the risk of
believing or doubting the legitimacy of organi-
zations, events, or practices. The model we pro-
pose suggests that the formation of legitimacy
judgments takes place in a dialogical argumen-
tative environment where cognitively limited
speakers and listeners exchange public and pri-
vate arguments between themselves (i.e., ontic)
and within themselves (i.e., ontologically), re-
spectively, to manage the risks involved with
forming legitimacy judgments about practices. In
this section we discuss the persuasion and in-
terpretation processes speakers and listeners use
when they manage the risks involved in forming
legitimacy judgments and making institutional
decisions.
Speakers and listeners. Social actors manage
the risks involved with forming judgments and
making decisions. Within our rhetorical in-
stitutional model there are two primary roles for
social actors: speakers and listeners. Speakers
and listeners manage the risks of making legiti-
macy judgments via the production, presentation,
and processing of arguments. Social actors take
on the role of speaker and the means of persua-
sion when they produce and present argu-
ments regarding the legitimacy or illegitimacy
of institutional practices targeted at listeners
(Cornelissen et al., 2015). Speakers deploy many
means or types of rhetorical strategies to per-
suade and influence the legitimacy judgments
137
of listeners (Green, 2004; Harmon, Green, &
Goodnight, 2015; Suddaby & Greenwood, 2005;
Vaara & Monin, 2010). Social actors take on the
role of listener and the means of interpretation
when they receive arguments from speakers
that they attempt to make sense of (Cornelissen
et al., 2015). Listeners also deploy many in-
terpretive strategies to interpret and form le-
gitimacy judgments (Burke, 1969b).
Although in previous institutional research
scholars often conceptualized the formation of
legitimacy judgments as a passive and/or unidi-
rectional process from speaker to listener, recent
research emphasizes the active role of listeners in
the construction of legitimacy judgments (Bitektine,
2011; Tost, 2011). Our rhetorical model of institu-
tional decision making attempts to build on this
conception of an active role for the listener and
the means of interpretation without swinging the
pendulum too far and underemphasizing the
role of the speaker and the means of persuasion
in the formation of legitimacy judgment. Thus,
our rhetorical model of institutional decision
making highlights both the speaker and the
listener and, thus, the dialogical construction
or coproduction of legitimacy judgments. This
formulation resonates with recent calls from
institutional researchers to emphasize and
analyze meaning as a joint communicative and
cognitive product of speakers and listeners
within institutions (Cornelissen et al., 2015:
13–14).
Automatic or passive versus deliberate or
active cognitive processes. From a rhetorical
institutional perspective, argumentation is the
concrete process actors as speakers and listeners
use to persuade and interpret for themselves and
others the risks of believing versus the risks of
doubting. Through argumentation, or the rhetori-
cal management of the risks of believing versus
the risks of doubting, speakers and listeners vary
the amount of cognitive resources they deploy to
produce, present, and process future arguments.
When the deployment of cognitive resources is
high, speakers and listeners actively and con-
sciously deliberate the choices before them.
When the deployment of cognitive resources is
low, speakers and listeners passively and auto-
matically respond to the choices before them.
These ideas resonate with frameworks such as
the cognitive response or elaboration likelihood
model (see Benoit & Smythe, 2003, and Petty &
Cacioppo, 1986).
138 Academy of Management Review
We argue that conceptualizing variation in the
deployment of cognitive resources provides our
model with a window into the dynamic and in-
tegrated role of speakers and listeners and their
use of persuasion and interpretation processes.
For instance, we suggest that when speakers de-
ploy a minimum amount of cognitive resources,
they are passively speaking, and when they de-
ploy a larger amount of cognitive resources, they
are actively speaking. When speakers actively
speak, they take on the dual role of both speaker
and listener. Active speakers deploy more cogni-
tive resources and, thus, are highly conscious of
or attuned to the many persuasive possibilities
in the rhetorical situation. Active speakers, in
a sense, are able to listen to the argument they are
presenting from the vantage point of the listener
in real time and are therefore able to comprehend
various potential interpretations of their argu-
ment. This increases the ability of the speaker to
discover, invent, and articulate the many poten-
tial available means of persuasion by becoming
cognizant of the many potential ways listeners
can interpret their arguments. Most important,
during active speaking, the persuasion process
entwines with interpretation processes because
speakers must take on the role of listener as
they attempt to interpret the potential meaning of
their arguments. In contrast, passive speaking
takes place when speakers deploy minimal cog-
nitive resources and are, in effect, almost on
autopilot and so producing and presenting argu-
ments in a rote or almost ritualistic manner, often
unaware of or unconcerned with the various in-
terpretations of their arguments.
Similar to active and passive speaking, we
propose that when actors listen, they can also vary
the amount of cognitive resources they deploy. For
instance, we suggest that when listeners deploy
a minimum amount of cognitive resources, they
are passively listening, and when they deploy
a larger amount of cognitive resources, they are
actively listening. Similar to speakers, when lis-
teners actively listen, they take on the dual role of
both listener and speaker. Active listeners deploy
more cognitive resources and, thus, are highly
conscious or attuned to the many interpretive
possibilities in the rhetorical situation. Active
listeners, in a sense, are able to speak or present
the argument they are receiving from the vantage
point of the speaker in real time and are therefore
able to comprehend the various potential in-
tentions and alternative persuasive constructions
January
of arguments. In such cases actors will often
struggle with meaning or multiple interpretations
by asking themselves or others, “What does this
mean?” yet it is only in the role of the speaker that
the active listener can raise questions or provide
alternative answers to themselves (i.e., privately)
or others (i.e., publicly). Similar to speakers, when
listeners deploy large amounts of cognitive re-
sources, the interpretation process entwines with
the persuasion process because listeners must
take on the role of speaker as they discuss with
themselves or others the various interpretations of
the messages they have received.
Ontic and ontological. Finally, our rhetorical
model of institutional decision making proposes
that speakers and listeners coproduce meaning in
general and legitimacy judgments in particular at
two levels: the ontic level and the ontological
level. At the ontological level a social actor pro-
duces private arguments that he or she only hears.
At the ontic level social actors produce public argu-
ments that both parties hear. If the listener creates
a private argument, he or she must take on the role
of the speaker. If the speaker creates a private ar-
gument, he or she must take on the role of the
listener. If the listener or speaker makes his or her
argument public, he or she takes on the role of the
speaker, and the other party receiving the argu-
ment takes on the role of the listener. Within this
framework, persuasion and interpretation takes
place at the ontological level via self-persuasion
and self-interpretation, as well as at the ontic level
via social persuasion and social interpretation. At
the ontic level speakers and listeners produce,
present, and interpret arguments to manage the
public or interpersonal risks of forming legitimacy
judgments. At the ontological level speakers and
listeners produce, present, and interpret argu-
ments to manage the intrapersonal risks of form-
ing legitimacy judgments.
Presumption and the Management of Legitimacy
Judgment Risks
From a rhetorical institutional perspective,
the formation of legitimacy judgments is a co-
production of cognitively limited speakers and
listeners who differently deploy cognitive re-
sources in order to produce, present, and process
arguments. Although many factors can shape the
formation of legitimacy judgments (Bitektine,
2011; Tost, 2011), a rhetorical perspective empha-
sizes presumptions as perhaps the most relevant
2016 Hoefer and Green
and important cognitive and communicative
mechanism or device actors use to manage the
risks of forming judgments and making decisions
(Goodnight, 1980). The concept of presumption
fully embraces a dual conception of reason as
both communicative and cognitive. Specifically,
presumptions are decision rules that give a cog-
nitive and communicative advantage to one
side of a decision or dilemma (Goodnight, 1980;
Whately, 2009). A rhetorical model of institutional
decision making suggests that actors create and
deploy presumptions so as to effectively de-
liberate with themselves and others about a re-
curring class of situations or problems requiring
a decision (Ullman-Margalit, 1983).
Presumptions function as decision rules be-
cause they form assumptions made before prac-
tical deliberation that tilt the burden of proof for or
against an alternative unless there is sufficient
reason to believe otherwise (Godden & Walton,
2007; Ullman-Margalit, 1983). In a sense, pre-
sumptions are judgments because they judge one
side of an argument as more acceptable than
the other side, holding all else constant. In an-
other sense, presumptions are also decision rules
because they shape the production of arguments—
the communicative actions of speakers and lis-
teners. The side with the burden of proof finds it
more difficult to produce interpretable and per-
suasive arguments because this side carries
a cognitive and communicative burden or disad-
vantage and thus needs more evidence to support
its claims. By shifting the burden of proof, pre-
sumptions can help decision makers achieve de-
sired outcomes when the best course of action
depends on whether a “certain state of affairs
obtains,” yet the boundedly rational agent “is in
a state of ignorance or doubt concerning” the true
state of affairs (Ullman-Margalit, 1983: 155). In the
context of forming legitimacy judgments, pre-
sumptions help define which side of the legiti-
macy judgment (e.g., legitimate or not legitimate)
is required to deploy more cognitive resources
and to engage in more active listening and/or
speaking.
As communicative and cognitive devices, pre-
sumptions are both a product and process of
actors’ use of rhetoric to manage their limited
cognitive resources. From a rhetorical perspec-
tive, institutionalization is the process through
which actors manage and optimize limited cog-
nitive resources by taking the legitimacy of
a practice for granted. When actors take the
139
legitimacy of a practice for granted, they often
intentionally or unintentionally create pre-
sumptions: they assign a cognitive and commu-
nicative advantage that shapes the production of
future arguments for one side or the other within
a class of recurring situations (e.g., the decision
to adopt a given practice). Describing pre-
sumptions as an argumentative bind on future
judgments and decisions to act suggests that
actors also form judgments and make decisions
about communication. Specifically, as with many
other decisions to act, social actors weigh the costs
and benefits of taking the act of communication for
granted by either “letting the taken-for-granted
pass” and moving on with a conversation, or chal-
lenging the taken-for-granted by conducting
further analysis through questioning (Hopper,
1981: 207–208). The creation and deployment of
presumptions provide a concrete way to un-
derstand how the taken-for-granted can operate
recursively on other taken-for-granteds (Hopper,
1981; Townley, 2008).
Most important, presumptions are previously
negotiated settlements or agreements between
speakers and listeners concerning the organiza-
tion and weighing of reasons for and against re-
curring choices to believe that a practice is
legitimate or illegitimate and, thus, worthy of
maintenance and adoption or rejection. The cre-
ation and evolution of presumptions provide
an important lens or window from which re-
searchers may observe how social actors col-
lectively form legitimacy judgments. The concept
of presumption also complements and extends
the Carnegie concept of “satisficing.” Specifically,
the Carnegie perspective suggests that satisfi-
cing is a key cognitive mechanism of procedural
rationality, because satisficing describes how
decision makers sample and evaluate alterna-
tives during the search process. In the context of
making a decision, we can use the concept of
satisficing to describe part of the process by
which an actor reaches a judgment or decision
that is good enough to act on or live with. More-
over, satisficing also helps describe how actors
might manage their searches by using heuris-
tics or stop rules based on adjustable aspirations
in order to achieve their goals (Gavetti, Greve,
Levinthal, & Ocasio, 2012; Simon, 1997). Within
this framework, satisficing is a procedural con-
straint on rationality because it selects a mini-
mally acceptable as opposed to an optimum state
of affairs, and it limits the search for solutions to
140 Academy of Management Review
the first one expected to achieve this state of
affairs (Baumol, 2004). This makes actors “in-
tendedly rational, but only limitedly so” (Simon,
1976: xxviii).
Yet while satisficing describes an important
aspect of how actors might choose to deploy cog-
nitive resources when making decisions, we ar-
gue that the addition of presumption furthers our
understanding of how actors form judgments and
make decisions, because presumptions help us
understand how decisions contain both cognitive
and communicative properties. Specifically, while
the concepts of presumption and satisficing de-
scribe a similar cognitive function—to help actors
find a minimally acceptable as opposed to an
optimum state of affairs—presumption organizes
the burden of proof between speakers and lis-
teners and thus orients decision making within
a communicative context by incorporating the
intersubjective symbolic environment where
satisficing takes place.
Not surprisingly, presumptions are common
communicative and cognitive devices used
throughout organizations to make legitimacy
judgments and institutional decisions. For exam-
ple, in the practice of U.S. criminal justice, courts
presume that defendants accused of a crime are
innocent until proven guilty (Bentham & Dumont,
1981). Within this institutional context, judges and
juries are predisposed to believe and thus decide
not guilty because the assignment of the burden of
proof makes it more difficult for the prosecution to
produce interpretable and persuasive arguments
compared to the defense. Similarly, for corporate
law cases, courts often abide by the Business
Judgment Rule, which presumes that directors of
a corporation act in good faith and in accordance
with the interests of the corporation’s stakeholders
unless proven otherwise (Wasserstein, 1998). In
this situation the burden of proof is in favor of in-
cumbent managers’ decisions, and, thus, critics of
incumbent managers find it more difficult to pro-
duce interpretable and persuasive arguments rela-
tive to arguments in favor of managerial decisions.
Managers also use presumptions in business
institutions to make legitimacy judgments and
decisions about adopting or rejecting practices.
For example, consider decisions by information
technology managers in the 1970s and 1980s to
purchase and use computer equipment. During
this period, information technology managers of-
ten purchased the more expensive International
Business Machines (IBM) computers rather than
January
less expensive alternatives of similar quality be-
cause of the common business presumption that,
all else being equal, IBM technology was superior
(Rawsthorn, 2011). Managers summarized the es-
sence of this presumption in the popular phrase
“no one ever got fired for buying IBM” (Rawsthorn,
2011). In this institutional context, the burden of
proof tilted heavily in favor of judging the pur-
chase of an IBM product as legitimate compared
to the purchase of competitors’ products. All else
being equal, one would expect managers buying
non-IBM products in such an environment to find
it more difficult to search for and produce in-
terpretable and persuasive arguments that justi-
fied their purchase decisions than managers who
decided to buy IBM products.
Presumption, interpretation, and persuasion.
In short, presumptions tilt the burden of proof in
favor of one alternative. This burden of proof
places different argumentative requirements on
the proponents of the presumption compared to
the opponents of the presumption. Presumption
proponents may produce arguments that pre-
sume matters of fact “in the absence of certain
reasons for belief” (Ullman-Margalit, 1983: 152).
Presumption opponents, however, must possess
those certain reasons for belief in order to produce
arguments that rebut the presumption (Ullman-
Margalit, 1983). Simply put, to produce interpret-
able and persuasive arguments, those objecting
to the presumption must deploy more cognitive
resources than those supporting it (Godden &
Walton, 2007).
Proposition 1: As the strength of pre-
sumption in favor of conferring a judg-
ment of legitimacy for a given practice
increases, organizational members will
find it easier to produce interpretable
and persuasive arguments in favor of
that practice.
Proposition 1 suggests that the strength of pre-
sumption represents an important factor in the
formation of legitimacy judgments, because the
strength of presumption tells decision makers
which side of the legitimacy judgment has the
burden of proof. For example, with respect to
presumptions that support the conferral of legiti-
macy, the strength of presumption shapes the
production, presentation, and interpretation of
arguments in favor of lowering the risks of be-
lieving and raising the risks of doubting the
legitimacy of a given practice. In such cases
2016 Hoefer and Green
interlocutors are more likely to find arguments
supporting the legitimacy of that practice in-
terpretable or minimally reasonable and legiti-
mate and/or persuasive and highly appropriate.
In contrast, interlocutors hoping to rebut or criti-
cize the legitimacy of the practice will find it more
difficult to produce interpretable and persuasive
arguments critical of the legitimacy of that
practice. To accomplish their goals, these in-
terlocutors will have to expend far more cognitive
and communicative resources than those in favor
of the practice.
Proposition 1 also suggests that presumptions
are potentially an important way actors embed
themselves within institutions by participating in
the communicative organization of cognitive re-
sources across problems and social actors. Pre-
sumptions as the communicative organization or
construction of a burden of proof constrain or bind
the individual and collective rationality of actors
in the context of recurring institutional decisions.
Presumptions, once formed and taken for granted,
define how actors’ automatic cognitive processes
come to bind or constrain actors’ deliberate cog-
nitive processes. Moreover, Proposition 1 suggests
that communication or symbolic exchange is
a critical element in the formation of legitimacy
judgments. This conceptualization transforms
the formation of judgment and institutional de-
cision making from a solitary cognitive process
implied by the traditional concept of satisficing
(see Miller, 1990) and recent descriptions of the
formation of legitimacy (e.g., Bitektine, 2011;
Bitektine & Haack, 2015) into a social process
where communication and cognition interrelate
as speakers and listeners deliberate about the
choices available to them.
Presumption, adoption, and institutional
persistence. Building on Proposition 1, we also
argue that presumptions shape adoption, insti-
tutionalization, and institutional persistence. For
instance, presumptions may shift the burden of
proof to those who want to change institutions
(Block, 1978), making it more difficult for those
in favor of change to produce and present in-
terpretable and persuasive arguments in favor of
institutional change. In such cases institutional
practices are very persistent, and social actors
will need to deploy more cognitive and commu-
nicative resources to convince themselves and
others to change or deinstitutionalize them. The
strength of presumption in favor of an insti-
tutional practice also often relates to the degree
141
actors take that institutional practice for granted.
The higher the strength of presumption, the more
entrenched an institutional practice and, thus,
the more cognitive and communicative resources
needed to change that institutional practice.
Although existing institutional practices often
have presumption on their side (Hirschman, 1991;
Whately, 2009), the strength of presumption varies
across institutional practices. Some institutional
practices have strong presumptive support and
are deeply embedded and entrenched. These
institutional practices, therefore, are highly re-
sistant to change and require the deployment of
a great deal of cognitive and communicative re-
sources before they will change. In contrast, other
institutional practices have weak presumptive
support and are fragile. These institutional prac-
tices are more susceptible to change and require
the deployment of far less cognitive and commu-
nicative resources in order to change.
Proposition 2: As the strength of pre-
sumption in favor of legitimacy judg-
ment for a given practice increases, the
institutional persistence of that prac-
tice will increase and the institutional
change of that practice will decrease.
Presumption and Substantive Rationality
With the introduction of the concept of pre-
sumption, Propositions 1 and 2 help us integrate
the communicative elements of procedural ratio-
nality with the cognitive elements of procedural
rationality in the formation of legitimacy judg-
ments. In addition, the concept of presumption
also lays the groundwork for increasing our
understanding of substantive rationality in
judgment formation and institutional decision
making. Specifically, the development of Prop-
ositions 1 and 2 suggests that the strength of
presumption shapes and mediates the forma-
tion of legitimacy judgments and, thus, de-
cisions to adopt or institutionalize a practice.
Although there are many potential reasons for
actors to construct and/or vary the strength of
presumptions, rhetorical theory posits that ac-
tors vary the strength of presumptions in order to
manage the risks of making decision errors—
Type I and Type II errors (Goodnight, 1980). Type I
errors, or false positives, are decision errors
where actors initially believe something is true
that they later believe is false. Type II errors, or
142 Academy of Management Review
false negatives, are decision errors where actors
initially believe something is false that they later
believe is true. Type I and II errors are especially
important in the context of organizational de-
cision making (Shapira, 1995).
Rhetorical theory incorporates substantive ra-
tionality into decision making by suggesting that
three main types of reason (i.e., pathos, logos, and
ethos) influence actors’ decision error prefer-
ences. Logos (particularly induction) strengthens
presumption in the direction of the decision error
that is least likely to occur. Logos appeals often
relate to the production of pragmatic or technical
legitimacy judgments (Green, 2004; Suchman,
1995). Pathos and ethos strengthen presumption
in the direction of decision errors that the indi-
vidual actor or the community, respectively, is
most comfortable accepting. Actors’ use of pathos
appeals usually relates to the production of
pragmatic or emotional legitimacy judgments. In
contrast, ethos appeals usually relate to and
produce normative or moral legitimacy judg-
ments (Green, 2004; Suchman, 1995). Pathos, logos,
and ethos appeals coexist, yet one usually out-
weighs the others in constructing and defining the
nature or strength of a given presumption. Con-
ceptualizing pathos, logos, and ethos appeals as
shaping the strength of presumptions extends
and builds on our understanding of how in-
stitutions might procedurally bind rationality to
encompass and incorporate the way institutions
substantively bind rationality.
Presumption and logos. Rhetorical theory sug-
gests that actors with cognitive limits can never
avoid all decision errors. One way actors manage
decision errors is by using logos or logic. Logos
appeals usually induce formal and methodical
calculation of means and ends to achieve effi-
ciency or effectiveness (Green, 2004). Presumptions
help cognitively limited actors manage and reduce
Type I and II errors by providing deliberative rules
and guidelines for choosing the best course of ac-
tion in order to reduce the error (Type I or II) that is
most likely to occur (Goodnight, 1980; Perelman &
Olbrechts-Tyteca, 1969; Ullman-Margalit, 1983).
For example, in U.S. law courts, many important
decisions depend on whether an individual is
dead. Sometimes a body is not available to con-
firm death, and individuals are just missing. In
these cases the courts presume that people are
dead if they are absent without explanation for
more than seven years. This does not mean that
individuals that are missing for more than seven
January
years are, in fact, dead. It only means that it
makes good practical sense to infer that they are
indeed dead unless there is evidence to suggest
otherwise.
An important factor shaping the development
and evolution of presumptive rules is the per-
ceived performance of the presumptive rule
(Ullman-Margalit, 1983). If the performance of
a presumptive rule fails to reduce the chance of
decision errors, actors may begin to question
and change the presumptive rule. For example,
business managers and legal courts may aban-
don or change presumptive rules if the purchase
of IBM products fails to deliver initially expected
returns or if individuals missing for more than
seven years begin to show up alive.
Presumption and pathos and ethos. Rhetorical
theory also suggests that actors tilt presump-
tions out of concern for the emotional or social
acceptability of decision errors (Goodnight, 1980;
Ullman-Margalit, 1983). There are two main ways
actors rhetorically manage these errors: pathos
and ethos appeals. “Pathos appeals connect with
the emotions of individuals (e.g., fear, greed, etc.)”
(Green, 2004: 659). Ethos appeals link to moral or
ethical concerns usually manifested in socially
accepted norms and mores. While culture shapes
both appeals, pathos (like logos) justifications
“emphasize individual concerns and interests,”
whereas “ethos appeals focus on social and col-
lective interests” (Green, 2004: 660).
Presumptions based on ethos offer a useful way
to understand the influence of culture on in-
stitutional decisions. For example, it is entirely
possible that most individuals charged with
a crime are indeed guilty. In such a world, a pre-
sumptive rule of “guilty until proven innocent”
reduces the total number of errors for most legal
decisions. However, even in the face of such in-
ductive evidence, U.S. society prefers a pre-
sumptive rule of “innocent until proven guilty,”
because U.S. values or ethos prefers a world
where the guilty go free over a world where the
innocent are imprisoned for crimes they did not
commit (Bentham & Dumont, 1981). This prefer-
ence for one type of error over another is an im-
portant way that cultural, moral, and social
preferences constrain or bind the rationality of
actors’ judgment formation and decision making
(Ullman-Margalit, 1983). This means that the analy-
sis of presumptions also offers a method for exam-
ining the influence of society and culture on social
decisions and actions (Edmondson, Roberto,
2016 Hoefer and Green
Bohmer, Ferlins, & Feldman, 2005; Lounsbury &
Ventresca, 2002; Schein, 1996).
In sum, presumptions based on logos consti-
tute and reflect the logic of induction by reduc-
ing the probability or chance that actors will
make decision errors. Presumptions based on
ethos and pathos reduce decision errors that
actors find the most socially or emotionally un-
acceptable or least preferred. By shaping actors’
perceptions of the probability of or preference
for particular decision errors, the rhetorical ap-
peals of pathos, logos, and ethos shape the tilt
and/or strength of presumption. As described
earlier, changes in the tilt and/or strength of
presumption can influence institutional persis-
tence and change.
Proposition 3: Variation in pathos,
logos, and ethos can shape the tilt and/
or strength of presumptive support and
thus can influence institutional persis-
tence and change.
Proposition 3 suggests that the rhetorical ap-
peals of pathos, logos, and ethos play an impor-
tant role in institutional decision making. In
contrast to the conventional Carnegie view of in-
stitutional decision making as primarily an ex-
ercise in procedural rationality (Simon, 1978),
a rhetorical institutional view adds the commu-
nicative appeals of pathos, logos, and ethos to
create a model of rationality that has both pro-
cedural and substantive qualities. Specifically,
conceptualizing pathos, logos, and ethos ap-
peals as shaping the tilt and/or strength of
presumptions extends and builds on our un-
derstanding of how institutions might procedur-
ally bind rationality to encompass and integrate
the “substance” or content of these binds. This is
a much-needed improvement on the traditional
procedural view of decision making and rational-
ity, which suggests that organizational behavior is
ultimately “determined by the irrational and non-
rational elements that bound the area of rationality”
(Simon 1945: 79).
From a rhetorical view of institutions, our emo-
tions, as well as our values, are not irrational or
nonrational elements of decision making. In
particular, an integrated rhetorical approach to
institutional decision making suggests that pre-
sumptions as communicative warrants are sub-
stantively based on three appeals of reasoning
(pathos, logos, and ethos). Communication and
deliberation establish, infuse, and embed our
143
decision premises with pathos (emotions), logic
(logos), and values (ethos). These appeals shape
presumptions, which, in turn, influence the pro-
duction, presentation, and interpretation of argu-
ments, and therefore institutional persistence and
change.
Presumption, Contestation, and
Performance Evaluation
So far we have described how a rhetorical
model of institutional decision making connects
presumptions and argumentation to actors’ be-
liefs or doubts about legitimacy and decisions to
adopt or reject institutional practices. Next we
discuss the performance evaluation implications
of our model. We define performance evaluation
as the degree of fit between a past or current
and future belief or judgment about the state of
the world. In the context of managerial decision
making, such a definition suggests that managers’
decisions under uncertainty are predictions about
the future (Shapira, 1995). We contrast decisions to
adopt or reject a practice at time t1 and beliefs or
judgments about the effectiveness or legitimacy of
that practice at time t1 with beliefs or judgments
about the effectiveness or legitimacy of that prac-
tice at time t2.
In our rhetorical model of institutional deci-
sion making, we argue that the level of contes-
tation during the institutionalization process
can shape a practice’s performance evaluations.
All else being equal, the higher the burden of
proof a practice has to face in order to institu-
tionalize, the lower the risk of doubting the
effectiveness or legitimacy of that practice.
Therefore, institutional practices facing a higher
burden of proof are more likely to emerge via
deliberations that are contested, interrogated,
and scrutinized. In such cases actors’ initial
evaluations of performance for institutional
practices that have overcome such high burdens
of proof are more likely to match actors’ future
evaluations of those practices’ performance
(i.e., things we believe or judge as true that we
also believe and judge as true at some later point
in time). We theorize that decision makers ex-
amine institutional practices facing a higher
burden of proof more rigorously than other in-
stitutional practices facing less contestation.
Therefore, we theorize that practices facing
higher burdens of proof should suffer less
from decision-making problems that lead to errors
144 Academy of Management Review
such as groupthink (Janis, 1972) and/or other un-
foreseen mistakes or problems. For example,
Janis (1971) argued that a failure to reduce the risk
of doubting and increase contestation helped
produce groupthink for the Kennedy administra-
tion, which resulted in the failed Bay of Pigs
invasion in 1961 (see also Tetlock, Peterson,
McGuire, Chang, & Feld, 1992). Moreover, Janis
(1971) argued that reduction of the risk of doubting
and increased contestation prevented groupthink
in the institutional decision-making processes of
the Kennedy administration during the Cuban
Missile Crisis in 1962.
According to our model, variation in the tilt and/
or strength of presumption has a direct impact on
the amount of contestation, because the tilt and/
or strength of presumptions influences the pro-
duction, presentation, and interpretation of argu-
ments. Specifically, if a practice begins with
a favorable as opposed to critical presumptive tilt,
critics of the practice will find it more difficult to
produce interpretable and persuasive arguments
critical of the practice. All else being equal,
practices with a more favorable as opposed to
more critical presumptive tilt will overcome fewer
doubts or con arguments during the process of
adoption and institutionalization. Put succinctly,
practices that initially face a favorable as opposed
to critical presumptive tilt face less contestation
during the adoption and institutionalization process.
This is important if one considers that at any
given time a community or social field will have
a set of established and institutionalized prac-
tices. These institutionalized practices reflect
knowledge about what the community believes
and judges as true. However, history suggests
that there is always some percentage of insti-
tutionalized practices the community believes are
true today that the community will believe are not
true in the future.
Proposition 4: Social actors are more
likely to evaluate practices that were
institutionalized with strong presump-
tive support (i.e., faced less contestation)
as performing poorly in the future than
practices that were institutionalized
with weak presumptive support (i.e.,
faced more contestation).
Proposition 4 allows us to assess the perfor-
mance risks of institutionalized practices. In par-
ticular, the proposition suggests that a historical
analysis of the presumptive context and argument
January
contests that gave rise to an institutionalized
practice may provide insight into that practice’s
future performance evaluation. Our basic sug-
gestion is that some institutionalized practices
may have a history of low interrogation, driven by
a favorable initial presumptive tilt, whereas other
institutionalized practices may have a history of
high interrogation, driven by an initial critical
presumptive tilt. Practices developing in a favor-
able presumptive tilt are more likely to represent
institutional practices that actors presently be-
lieve are effective or true but then believe are in-
effective or false in the future, compared to those
practices that develop in a critical or unfavorable
presumptive tilt. Practices that develop in a favor-
able presumptive tilt must overcome fewer con
arguments and, thus, are more likely to represent
practices that actors evaluate as performing
poorly in the future. Conversely, practices initially
facing a critical presumptive tilt (e.g., controversial
practices) and a great many doubts or con argu-
ments necessitated more cognitive and communi-
cative resources to rebut these critiques and
produce interpretable and persuasive arguments
in favor of their adoption and institutionalization.
We propose that a higher number of con argu-
ments reflects an increase in the scrutiny and in-
terrogation of these practices and thus indicates
a decrease in the chance that actors will evaluate
these practices as performing poorly in the future.
In sum, Proposition 4 suggests that if pre-
sumptions shape the amount of interrogation and
diligent analysis of decision makers, and the
amount of interrogation and diligent analysis
shapes the production of decision errors, then
presumptions should shape the production of
decision errors. The practical implication of this
proposition is potentially powerful if we connect
this idea to insights from Donaldson and Lorsch
(1983), who suggest that managers can benefit
from periodically auditing or assessing their be-
liefs or judgments. For example, imagine a new
CEO who is assuming the leadership of a large
and complex business organization. Once in this
leadership position, the CEO faces many daunt-
ing and challenging tasks. One common and im-
portant task the new CEO and his/her executive
team face is assessing the effectiveness and risks
of the firm’s established institutional practices.
Within the set of established practices inherited
from the previous CEO and leadership team
are practices that are good and effective for the
firm. The new leadership team should keep and
2016 Hoefer and Green
maintain these practices. However, there are also
some practices that are bad and ineffective, and,
thus, the new leadership team should reject and
discard these practices. The institutional decision
problem is discovering and identifying which in-
stitutional practices to keep and which to discard.
Our rhetorical model of institutional decision
making recognizes the informational and time
constraints of the new leadership team and thus
proposes one strategy to efficiently address this
challenge. Specifically, if a history of the com-
munication surrounding the adoption of the
established practices exists, the leadership team
should examine this communication, identify
those practices that had strong presumptive
support during their adoption and institutionali-
zation, and spend more of their limited time and
resources interrogating these practices as op-
posed to those practices that were institutionalized
with low or unfavorable presumptive support. If
our model is correct, those practices that were in-
stitutionalized in the face of high presumptive
support should have more errors than those prac-
tices that were institutionalized in the face of low or
unfavorable presumptive support.
DISCUSSION AND CONCLUSION
Argumentation, Presumption, and Institutional
Decision Making
Our purpose in this article was to develop an
integrated rhetorical model of institutional de-
cision making in order to show how communica-
tion and cognition interrelate among active and
passive speakers and listeners to shape legiti-
macy judgment formation and institutional de-
cision making. Our first goal and contribution
was to show that judgment formation and de-
cision making are products and processes of
argumentation. We developed a model that de-
scribes how institutional actors manage the
blessing and curse of institutionalization through
the arguments and presumptions they deploy that
shape and weigh the perceived risk of believing
versus the perceived risk of doubting the effec-
tiveness or legitimacy of institutional practices.
Actors use argumentation to manage the bless-
ing of institutions by economizing limited cog-
nitive resources. However, argumentation and
presumptions also shape the curse of institu-
tions, because when actors take the effectiveness
or legitimacy of an institutionalized practice for
145
granted, they cease to evaluate and interrogate
their beliefs or judgments about the insti-
tutionalized practice. Consequently, this un-
questioned belief increases the probability that
actors will believe an institutional practice is le-
gitimate or efficacious today that they will per-
ceive as performing poorly in the future.
The Formation of Legitimacy Judgments
Our model contributes to the literature on the
formation of legitimacy judgments. Scholars
working from this perspective often focus on the
psychological and social psychological factors
that shape legitimacy judgments or evaluations
of desirability and appropriateness (Bitektine,
2011; George, Chattopadhyay, Sitkin, & Barden,
2006; Kennedy & Fiss, 2009; Tost, 2011). Building on
these seminal efforts, our rhetorical model de-
lineates the fundamental role of communication
in the persuasive and interpretive processes that
social actors as both listeners and speakers use
to shape their own as well as others’ cognitive
legitimacy judgments. For instance, our model
builds on primarily one-sided explanations from
listeners’ perspectives (Bitektine, 2011; Bitektine &
Haack, 2015; Tost, 2011) to develop a more bal-
anced explanation of when and how legitimacy
forms between speakers and listeners. Further-
more, our model provides insight into the “need”
(Bitektine, 2011)—what drives or motivates
people—to form or change legitimacy judgments.
In particular, in previous work researchers tended
to equate cognitive legitimacy judgments with
a lack of content. For instance, Tost argued that
legitimacy judgments are initially formed with
substantive justifications or content; however,
over time this content dissipates and cognitive
legitimacy or taken-for-grantedness emerges
(Tost, 2011: 697-698). We argue that describing
cognitive legitimacy as the absence of questions
or lack of substantive content hinders us from
explaining what it is “that leads individuals to
begin to actively interrogate an existing social
entity and to imagine possible alternatives” (Tost,
2011: 700) or what factors “lead people to move out
of the use stage, where institutional arrange-
ments are passively accepted, and into the judg-
ment reassessment stage, where institutional
arrangements are actively interrogated” (Tost,
2011: 700).
Our model suggests that the formation of cog-
nitive legitimacy often leaves substantive content
146 Academy of Management Review
or binds on the rationality or communication
patterns of speakers and listeners. Specifically,
for recurring classes of institutional decisions,
speakers and listeners will construct presump-
tions or rules regarding the burden of proof for one
side of a legitimacy judgment versus the other
side of the legitimacy judgment. Speakers and
listeners establish these binds on rationality for
particular reasons, and these binds have sub-
stantive content (e.g., pathos, logos, ethos) and
thus reflect the emotions, logic, and values of
these actors. Presumptions represent a mecha-
nism for describing how substantive content
shapes the formation of legitimacy judgments, as
well as reflects the emotions, logic, and values of
speakers and listeners. Moreover, presumptions
as burdens of proof provide us with a lens to use in
explaining when actors will passively accept
a judgment or actively interrogate and reassess
that judgment.
Practice Adoption and Implementation Literature
We also believe that this rhetorical model of
how argumentation affects institutional judg-
ments and decisions extends and complements
institutional theorists’ focus on practice adoption
and implementation literature (e.g., Gondo &
Amis, 2013). Specifically, Proposition 1 through 4
describe how presumption and rhetorical appeals
interrelate to shape the way organizational de-
cision makers weigh the benefits and risks of
forming judgments that shape the adoption and
rejection of institutional practices. We believe
these propositions extend the practice adoption
literature by detailing how adoption discourse
shapes perceptions of risk. In addition, Proposi-
tion 4 describes how presumption influences ac-
tors’ evaluation of practice performance. We
believe Proposition 4 complements the practice
implementation literature by highlighting how
adoption discourse can shape not only the im-
plementation of a practice but also the evaluation
of that practice’s performance.
Communication, Cognition, and the
Microfoundations of Institutions
Another of our goals was to describe the
entwinement of communication and cognition in
the institutional decision-making process. To
this end, in our rhetorical model of institutional
decision making, we provided a framework for
January
identifying and explaining when and how actors
as speakers and listeners use persuasion and
interpretation processes to manage the risk of
believing or doubting the legitimacy of organi-
zations, events, or practices. For example, we ar-
gued that the formation of legitimacy judgments
occurs when cognitively limited speakers and
listeners exchange public and private arguments
between themselves (i.e., ontic) and within them-
selves (i.e., ontologically) to manage the risks in-
volved with forming legitimacy judgments about
practices. Within this framework, argumentation
is both a concrete mechanism actors use to
manage their limited cognitive resources and
an important indicator of how automatic and
deliberate cognitive processes interrelate in
decision-making processes. Our model shows
how automatic cognitive processes via the de-
ployment and use of presumptions evolve and
develop out of deliberate cognitive processes.
This is a much-needed improvement over pre-
sent models of institutional decision making
that often create caricatures of human rea-
soning as under- or overrationalized (Powell &
Colyvas, 2008).
Procedural and Substantive Rationality
Finally, our rhetorical model of institutional
decision making provides a framework for con-
ceptualizing an institutional rationality that
combines both procedural and substantive
elements. Specifically, a rhetorical model of in-
stitutional decision making describes how logos/
logic, pathos/emotions, and ethos/values shape
presumptions and thus integrates the substance
and content of rationality with the procedural
deployment and operation of rationality. Within
this framework, presumptions reflect a dual con-
ception of reason as both communicative and
cognitive, revealing how logic, emotions, and
values interrelate to shape institutional action.
Presumptions are often the ontic traces and fos-
sils of ontological persuasion and interpreta-
tion processes. As such, they potentially provide
the best empirical window into the contours
and processes of how actors ontologically form
legitimacy judgments. Hence, presumption as
an ontic or communicative and cognitive mech-
anism by which values, emotions, and logic
bind procedural rationality extends the Carnegie
perspective’s emphasis on satisficing as the
primary cognitive and ontological interpretive
2016 Hoefer and Green
process organizations and institutions use to
make decisions. As a result, we believe this
model reflects a broader and therefore more
realistic conception of human reasoning and
institutional decision making built on more than
just logic—built on emotions and values as well.
Future Research
A rhetorical model of institutional decision
making resonates with and extends recent trends
in institutional research focused on the cognitive
(e.g., Bitektine, 2011; George et al., 2006; Kennedy
& Fiss, 2009; Powell & Colyvas, 2008; Tost, 2011)
and communicative (e.g., Cornelissen et al., 2015;
Gondo & Amis, 2013; Lammers, 2011; Lammers &
Barbour, 2006) underpinnings of institutions.
However, the model we propose also has limits
and potentially raises as many questions as it
answers. We hope that future research can vary
important factors, such as initial argument char-
acteristics (e.g., pathos, logos, and ethos) or bur-
den of proof, to predict future argumentation,
institutionalization, and institutional performance.
Researchers should examine how variations in
appeals to pathos, logos, and ethos shape how
automatic and deliberate cognitive processes in-
terrelate. Will pathos appeals more likely trigger
automatic responses or deliberate responses?
How do various aspects of human reason—that is,
emotion, logic, and values—instantiate and tran-
sition between automatic and deliberate cognitive
processes?
From a formal organizational perspective, fu-
ture research should continue to explicate the role
of managers as rhetors in institutional processes
(Alvesson, 1993; Green, 2004; Mintzberg, 1973).
Managers guide attention, beliefs, and meaning
by regulating the timing, framing, and flow of
argumentation (Alvesson, 1993; Czarniawska &
Joerges, 1996). For example, NASA program man-
agers reversed the standard of proof of engineer-
ing teams, from proving that the Columbia Space
Shuttle was safe to fly to proving that it was un-
safe to fly, hampering the flow of arguments that
might otherwise have prevented the Columbia
fiasco (Weick, 2005). More process-based research
into how powerful actors control the flow and
circulation of arguments (Sahlin & Wedlin, 2008)
could significantly elucidate our understanding
of the process of institutional decision making, as
well as highlight the role of power in institutional
decision making.
147
Conclusion
Our rhetorical model of institutional decision
making emphasizes a broad conception of human
reasoning as rhetorical cognition. Rhetoric and,
thus, reasoning are emotional, logical, and con-
cerned with values. A rhetorical approach recog-
nizes that cognition is limited and, thus, sometimes
automatic, as well as sometimes consciously de-
liberate. Within this framework actors rhetori-
cally manage their limited cognitive resources
and the associated risks and errors these limita-
tions bring about in order to best navigate a prob-
lematic and uncertain world. We hope our model
provides more insight into how researchers might
examine the communicative and cognitive factors
shaping the creation, maintenance, and perfor-
mance evaluations of institutions, and into how
managers might deploy and analyze their argu-
ments to more effectively manage the blessing and
curse of institutions.
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Rolf L. Hoefer (rolf.hoefer@insead.edu) is a doctoral candidate in the Department of Or-

ganizational Behavior/Entrepreneurship at INSEAD. His current research focuses on im-
printing, cognition, communication, and learning in both entrepreneurial and
institutionalized settings.
Sandy E. Green, Jr. (sandy.green@csun.edu) is an associate professor of management at
California State University, Northridge. He received his Ph.D. from Harvard University
Graduate School of Business. His current research interests include neoinstitutional
theory, rhetorical theory, and corporate governance.