Corporate social responsibility towards human development: A capabilities framework

The starting point of this paper is the need to promote a people‐centred corporate social responsibility (CSR) framework in a context where many human needs and rights remain unsatisfied and where businesses may have both a positive and a negative impact on the quality of life of human beings today and tomorrow and may even lead to irreversible damage. Our normative definition of CSR is consistent with the criteria established by the EU Commission in 2011. We conceive CSR as a responsibility towards human development in two complementary ways: (a) a holistic responsibility shared by companies together with other actors to safeguard humanity and (b) a direct liability of each company for its impact on stakeholders' capabilities. We apply Nussbaum's list of central capabilities and concept of thresholds to specify the nature and extent of corporate responsibilities towards employees, subcontractors, investors, customers, and humanity as a whole. In addition, we leverage fieldwork in developing and developed countries to analyse the effect of business activities on human capabilities. We demonstrate that by quantifying the impact of businesses' activities on various dimensions of stakeholders' lives, and especially on the most vulnerable ones, these businesses can be held accountable for the negative externalities they produce.