Beyond corporate social responsibility: enhancing accountability and market (r)evolution in multinational companies through molar-molecular democracy

• Pages: 297-330
• Author: Jaseff Raziel Yauri-Miranda

BEYOND CORPORATE SOCIAL RESPONSIBILITY:

ENHANCING ACCOUNTABILITY AND MARKET (R)

EVOLUTION IN MULTINATIONAL COMPANIES THROUGH

MOLAR-MOLECULAR DEMOCRACY

Jaseff Raziel Yauri-Miranda

Erasmus University Rotterdam and University of the Basque Country

1. INTRODUCTION1

Big rms and multinational corporations face societal and public expectations

that extend beyond prot-making and customer service delivery. Despite not

being elected like governments, some of these entities wield signicant inuence

over politics and society. As their impact broadens to include areas such as

environmental issues, cultural dynamics, and technological advancements, they

must adopt a heightened level of accountability to society (Leach et al., 2010).

Given that these players are not chosen by citizens and consumer preferences

alone cannot ensure accountability, mechanisms must evolve to hold both

private rms accountable (Benish & Mattei, 2020; Smith, 2014). This shift calls

for accountability frameworks that transcend customer-centric approaches and

external market regulations, ultimately aiming to bolster the social legitimacy

of rms in this century.

A broader, more inclusive perspective on market accountability necessitates

moving beyond traditional concepts like customer satisfaction (Alcaniz et al.,

2020) and the core principle-agent dynamic, which denes relationships between

producers and consumers (Winter, 2006). In the context of the digital economy,

even with the rise of the “prosumer” — individuals simultaneously generating

and consuming data services — accountability must incorporate principles of

inclusivity, active participation, and stronger ties between rms and civil society.

1 To deep into the concept of accountability, see the recording of the author’s seminar at the

Basque Institute of Criminology, in 2024, at https://www.youtube.com/watch?v=dX11UIyHGa0.

298 jaSeFF raziel yauri-miranda

Such an approach could pave the way for innovative economic models that are

still under development. Yet, this rstly requires a redenition of accountability

studies, emphasizing substantive rather than procedural dimensions. Greater

focus should be placed on bottom-up demands and diverse voices within private

corporations. For example, as big companies grow their political and societal

inuence, they should also become more responsive to public demands and

activism. In an era of multimodal technological governance and inuence of

“algocracy” (Fukuyama et al., 2021), it is vital to ensure that no authority, including

market-driven ones, operates beyond the control of society (Tawney, 1964).

While debates persist regarding the extent of market players’ power over

society (Balzam & Yuran, 2022), it is essential to establish new societal objectives

for big corporations. Faced with ecological crises and social inequalities, studies

have pointed to implement Corporate Social Responsibility across different sectors

and develop societal impacts at a macro level (molar), whereas other authors

have claimed a transition from shareholder-centric models to participatory

systems that engage citizens as stakeholders within each company at a meso and

micro level (molecular) (Freeman, 2010; Manganelli & Nicita, 2022). This study

analyzes how the molar and molecular proposals can converge to recalibrate

traditional market organizations and to enhance their social legitimacy. To do

so, an accountability operationalization based on four principles is proposed:

responsibility, transparency, answerability, and participation. This accountability

proposal then is applied in two mini-cases that traditionally remain reluctant or

represent a challenge to molar and molecular initiatives. These mini-cases are from

a multinational mining company and a global investment fund. The accountability

proposal investigates potential mechanisms that can be mobilized in practical

terms through reform, but also in hypothetical cases to imagine deeper structural

reforms and futures. In the last scenarios, the study concludes that a deeper social

role of rms would depend also on a transformation of economy itself and the

conversion of assets to social value. That is, although the precise form of this new

model remains open to discussion, greater legitimacy must be built upon the

conversion of capitals’ assets into distributed social assets (in the molar level),

and upon grassroots participation in the core management of companies (in the

molecular level), as these could serve as a guiding principle for accountability and

market (r)evolution.

2. MOLAR SOLUTIONS: CORPORATE SOCIAL RESPONSIBILITY

Without the aim to exhaust this topic, Corporate Social Responsibility (CSR)

represents a complex and evolving area of scholarly inquiry, encompassing diverse

theoretical frameworks that emphasize the ethical, social, and environmental

obligations of businesses alongside their economic goals, looking for alliances

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beyond Corporate SoCial reSponSibility

across different sectors to develop societal impacts at a macro level (molar). Early

conceptualizations, such as Friedman’s (1970) assertion that a corporation’s

primary responsibility is to its external shareholders, laid the groundwork for

debates around the limits of corporate accountability. This view was challenged

by Drucker (1984) theory, which broadened corporate obligations to include

various stakeholders—employees, communities, and customers—advocating for

businesses to create shared value for all these groups.

Carroll’s (1999) pyramid model further elaborated on CSR by categorizing

corporate responsibilities into economic, legal, ethical, and philanthropic

domains, emphasizing a holistic approach to responsible business practices.

In parallel, legitimacy theory (Suchman, 1995; Deegan, 2019) highlighted

the importance of aligning corporate behavior with societal norms to sustain

organizational legitimacy, while institutional theory (DiMaggio & Powell,

1983) suggested that CSR practices often arise from external pressures such as

regulatory requirements and cultural expectations.

The integration of environmental concerns into CSR gained prominence with

Elkington’s (2006) triple bottom line framework, which called for balancing

economic, social, and environmental objectives to promote sustainability.

Kramer and Porter (2006) shared value approach further linked business

success to societal progress by advocating for strategies that address social

challenges while fostering economic competitiveness. And Matten and Crane

(2005) introduced the notion of corporate citizenship, framing businesses as

actors with roles and responsibilities akin to those of individuals in governance

processes, thereby expanding CSR to include global issues such as climate

change, human rights, and social equity. At the same time, Garriga and Melé

(2004) synthesized CSR theories into instrumental, political, integrative, and

ethical domains, providing a comprehensive taxonomy for understanding

corporate motivations and practices

In a governance perspective, scholars like Michael (2003) identify three

distinct “schools of practice” on the role of CSR. The neo-liberal school emphasizes

industry self-regulation, where businesses engage in CSR activities based on a

cost-benet analysis of risks and rewards. The state-led school highlights the

importance of national and international regulations and collaborative efforts

between governments and corporations. The third way school focuses on the

partnership between for-prot and not-for-prot organizations, emphasizing

their joint contributions to societal development.

However, these approaches face criticism when analyzed through broader

developmental theories. The neo-liberal school is critiqued for its inability to

resolve resource misallocations that often arise from CSR initiatives driven

by market forces. The state-led school is challenged for overlooking the

political dynamics and power structures inuencing government-promoted