Ecuador is building on its indigenous past by incorporating the concept of sumak kawsay into its approach to development. Rooted in the cosmovisión (or worldview) of the Quechua peoples of the Andes, sumak kawsay – or buen vivir, to give it its Spanish name – describes a way of doing things that is community-centric, ecologically-balanced and culturally-sensitive. A far cry from the market-is-king model of capitalism, it inspired the recently revised Ecuadorian constitution, which now reads: "We ... hereby decide to build a new form of public coexistence, in diversity and in harmony with nature, to achieve the good way of living."

In English, buen vivir loosely translates "good living" or "well living", although neither term sits well with Eduardo Gudynas, a leading scholar on the subject. Both sit too close to western notions of wellbeing or welfare, he says: "These are not equivalents at all. With buen vivir, the subject of wellbeing is not [about the] individual, but the individual in the social context of their community and in a unique environmental situation."

Similar thinking is inspiring other social movements across South America, says Gudynas. The link to other indigenous belief systems, such as those of the Aymara peoples of Bolivia, the Quichua of Ecuador and the Mapuche of Chile and Argentina, is explicit. Yet Gudynas is at pains to point out that buen vivir owes as much to political philosophy as it does to indigenous worldviews. "It is equally influenced by western critiques [of capitalism] over the last 30 years, especially from the field of feminist thought and environmentalism," he explains. "It certainly doesn't require a return to some sort of indigenous, pre-Colombian past."

Harmonious, collective development

Gudynas is the executive secretary of the Latin American Centre for Social Ecology in Uruguay and author of 10 books and many academic articles, including a recent background paper on the buen vivir philosophy.

A defining characteristic of buen vivir is harmony, he says, harmony between human beings, and also between human beings and nature. A related theme is a sense of the collective. Capitalism is a great promoter of individual rights: the right to own, to sell, to keep, to have. But this alternative paradigm from South America subjugates the rights of the individual to those of peoples, communities and nature.

How does this play out in practice? Take property, for example. According to buen vivir, humans are never owners of the earth and its resources, only stewards. This plays against idea of natural capital, now used widely in business circles. Ecosystem services, for example, where a monetary value is given to environmental goods such as the water provision of rivers or carbon sequestration of forests, is anathema. A more accurate parallel to buen vivir might be collaborative consumption and the sharing economy, two related ideas that are gaining traction globally.

"If you put a price on nature, then you're suggesting an ownership of the planet ... Furthermore, capital is something that is interchangeable between people. But if you destroy the environment, then it's difficult to rebuild it, which undermines it being interchangeable," Guynas argues.

The same is true for human capital. To say a factory worker's hand is worth more than his foot because he or she needs the former to operate a machine constitutes an "unacceptable mercantilisation" in Gudynas' opinion. "For the worker, he still doesn't get his hand back," he adds. Likewise, he cautions against market-driven thinking creeping into education too. "Buen vivir wouldn't design education programmes as forms of investment in human capital, but rather it would design them so that people become more illustrados [enlightened]".

Principals that can be incorporated

Despite these critiques, the principles of buen vivir are not fundamentally incompatible with market capitalism – albeit with some important modifications. Starting with the demand side, advocates of buen vivir stress the need for us to consume less: "It's all very good pushing for energy efficiency and the like, but if your product does less environmental damage per unit but you end up selling lots more units, then the net impact is worse." The logic is hard to argue with. Nor is it an argument to which corporations are deaf to, as Unilever's championing of 'decoupled growth' illustrates.

In addition, consumers need to begin to pay the "real value" of the products they consume, Gudynas argues. That's to say, environmental and social costs should be incorporated into the final price and not externalised. He gives the example of a $25 electric fan on sale in his home city of Montevideo. "It's made in China, with plastic that isn't recyclable, with copper probably from Chile and other metals perhaps from Peru. None of the social and environmental costs of mining or transport appear in the price. If they did, it could never retail at that price."

An economy structured in accordance with buen vivir would require significant changes to capitalist modes of production too, especially with regards to agriculture. A major crunch point is size. For buen vivir, explains Gudynas, small is beautiful. Small-scale production has a number of benefits: it's more likely to reflect and enhance local culture, to include local people and to protect the local environment. Importantly, it also has a higher probability of serving local needs too. The days of industrial agriculture geared for export would be numbered therefore – a fact that Andean consumers of quinoa would no doubt welcome.

"The current discussion in about how to apply buen vivir is based around production processes that use low levels of raw materials and energy, and [which are] orientated towards regional markets," Gudynas continues. "This would imply a certain disconnection of South America as an exporter of primary commodities for the global economy. It also implies extracting only the amount of natural resources that we need to demand in the continent itself."

Traditional approaches to corporate social responsibility don't come out too well either. "Studies about CSR show that it is a good strategy for improving the brand of a company, but that it doesn't have much impact on the social performance of the sector," Gudynas argues. The problem is partly to do with the founding principles of modern corporations. "They aren't made to be responsible," he says. "They are made to generate profits."

Even if the two – responsibility and profits – could be resolved, the impediment of size still crops up: "There's an enormous distance between the decision-makers, the owners and the consequences of the company's actions … and the managers running the company day in, day out aren't really accountable for the social impacts of their decisions because the owners are so diffuse and spread out."

Gudynas concedes that buen vivir remains an unfolding philosophy. Nor is it meant primarily as a template for organising economic affairs. Rather it describes a way of life and a form of development that sees social, cultural, environmental and economic issues working together and in balance, not separately and hierarchically as at present.

Rather than see buen vivir as a strict blueprint for change, Gudynas suggests that it is better to view it as a launch pad for fresh thinking and new perspectives: "It helps us see the limits of current development models and it allows us to dream of alternatives that until now have been difficult to fulfil."

This content is brought to you by Guardian Professional. Become a GSB member to get more stories like this direct to your inbox