This Paper develops a conceptual model of a collegial system working without external adjudication or an institutional charter governing the conduct of its operations. The model is applicable to many of the academic and research organizations established in the developing countries, which have attempted to emulate the equivalent professional organization in the advanced industrial countries but have achieved low efficacy. The analysis suggests that an unadjudicated collegial system is not sustainable, for it will tend to create an authoritarian administration which will impair the collegial norms and misallocate scarce resources to the activities fueling bureaucratization and expansion of administrative scope, while professional autonomy, innovativeness and self-actualized behavior are suppressed. Professional conduct tends to be more-value rational than the bureaucracy since it is subject to reviews by external peers. Thus, legitimation of referent power is essential to creating value-rational decisions which assure a balanced resource allocation that sustains a collegial system. Limiting scope of the administration through an external scrutiny of its conduct or a charter appears to facilitate this process.