Up to now, the way institutions and organizations have been used in the development of open systems has not often gone further than a useful heuristics. In order to develop systems actually implementing institutions and organizations, formal methods should take the place of heuristic ones. The paper presents a formal semantics for the notion of institution and its components (abstract and concrete norms, empowerment of agents, roles) and defines a formal relation between institutions and organizational structures. As a result, it is shown how institutional norms can be refined to constructs–organizational structures–which are closer to an implemented system. It is also shown how such a refinement process can be fully formalized and it is therefore amenable to rigorous verification.