Sort a list and all its nested objects using LINQ

You can sort before :

    organisations.ToList().ForEach(o => o.Departments = o.Departments.OrderBy(d => d.Code).ToList());
    organisations.SelectMany(o => o.Departments).ToList().ForEach(d => d.Employees = d.Employees.OrderBy(e => e.Name).ToList());

And then use the list already sorted

        var legalEntitiesCollectionByType = new Dictionary<string, ICollection<Organisation>>
        {
            {
                "Institutional", organisations
                    .Where(x => x.Type == "Institutional")
                    .ToList()
            },
            {
                "Retail", organisations
                    .Where(x => x.Type == "Retail")
                    .ToList()
            }
        };

NB : the sort is not in place, you can achieve this using a comparer

        organisations.ToList().ForEach(o => o.Departments.Sort(CreateCustomComparison));
        organisations.SelectMany(o => o.Departments).ToList().ForEach(d => d.Employees.Sort(CreateCustomComparison));

I know this is an old question, but there's a simpler way of achieving the same result:

organisations = organisations.OrderBy(org =>
{
   org.Departments = org.Departments
   .OrderBy(dept =>
   {
     dept.Employees = dept.Employees
                     .OrderBy(employee => employee.Code)
                     .ThenBy(employee=>employee.Name);
     return dept.Code;
   })
   .ThenBy(dept=>dept.Name);

   return org.Code;
})
.ThenBy(org=>org.Name); 

You need to do all three levels of sorting inside the objects that you return, like this (I'll show only the "Retail", the "Institutional" needs to be sorted in the same way):

{
"Retail", organisations
    .Where(x => x.Type == "Retail")
    .OrderBy(x => x.Code).ThenBy(x => x.Name)
    .Select(x => new Organisation {
        x.Code
    ,   x.Type
    ,   x.Name
    ,   Departments = x.Departmentsd.OrderBy(d => d.Code).ThenBy(d => d.Name)
        .Select(d => new Department {
            d.Code
        ,   d.Name
        ,   Employees = d.Employees.OrderBy(e => e.Code).ThenBy(e => e.Name).ToList()
        })
    }).ToList()
}

Since you need to select this multiple times, you may want to wrap this code in a method, and use it from several spots, like this:

private Organisation SortedOrganisation(Organisation x) {
    return new Organisation {
        x.Code
    ,   x.Type
    ,   x.Name
    ,   Departments = x.Departmentsd.OrderBy(d => d.Code).ThenBy(d => d.Name)
        .Select(d => new Department {
            d.Code
        ,   d.Name
        ,   Employees = d.Employees.OrderBy(e => e.Code).ThenBy(e => e.Name).ToList()
        })
    };
}

...

var legalEntitiesCollectionByType = new Dictionary<string, ICollection<Organisation>>
        {
            {
                "Institutional", organisations
                    .Where(x => x.Type == "Institutional")
                    .OrderBy(x => x.Code).ThenBy(x => x.Name)
                    .Select(SortedOrganisation)
                    .ToList()
            },
            {
                "Retail", organisations
                    .Where(x => x.Type == "Retail")
                    .OrderBy(x => x.Code).ThenBy(x => x.Name)
                    .Select(SortedOrganisation)
                    .ToList()
            }
        };