Thanks for the comment
Oxford advanced defines the word "institutionalize" as, "to make sth become part of an organized system, society or culture, so that it is considered normal". From above definition "institutionalizing morality" means making morality teaching a part of institutions in organized way. This means I am right. I think main theme of passage was morality teaching all the rest was supporting points. Since Religion has failed in teaching morality, it was the duty of modern institutions to induce morality in members of society otherwise excessive materialism will annihilate present civilization.
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