Abstract: Every institution has its ethical dimension, which requires reviewing the ethical legitimacy of school structures from the perspective of institutional ethics. Only when an institution is equipped with ethical legitimacy can it be a good one. However, under the influence of instrumental rationality and utilitarianism, efficiency, rather than morality, acts as the criteria for assessing schools. In pursuit of efficiency, schools tend to adopt a control-focused ‘dehumanized’ standardization, causing a ‘demoralizing education’ in school life. To cope with this crisis, people should take into consideration the great value of good institution in school life. Good institution is the best way to protect school life, as it gives human existence higher priority, takes justice spirit as the ethical base, and rational dialogue as the ethical system.

Key words: institution, institutional ethics, demoralization, school governance, good institution