The United Nations University International Human Dimensions Programme on Global Environmental Change (UNU-IHDP) and the United Nations Environment Programme (UNEP) in collaboration with the UN Water Decade Programme on Capacity Development (UNW-DPC) and the Natural Capital Project have released a new report, titled “Inclusive Wealth Report 2012” (IWR 2012) at the Rio+20 conference.
The report is first in a series of biennial reports aiming to track the sustainability of countries using a newly developed measure, the Inclusive Wealth Index (IWI). The IWI aims to go beyond the present generation of short-term economic and development measures, such as the gross domestic product (GDP) and the Human Development Index (HDI). The IWI has been developed to capture the full wealth of nations by looking into country’s capital assets, including manufactured, human and natural capital, and its corresponding values.
In the Inclusive Wealth Report 2012, twenty countries were assessed using the IWI over a period of 19 years (1990-2008). Together they represent more than half of the world population and almost three quarters of world GDP and include high, middle, and low-income economies on all continents.
Some of the key findings of the IWR 2012 included:
- 70 percent of countries assessed present a positive Inclusive Wealth Index (IWI) per capita growth, indicating sustainability.
- High population growth with respect to IWI growth rates caused 25 percent of countries assessed to become unsustainable.
- While 19 out of the 20 countries experienced a decline in natural capital, six of them also saw a decline in their inclusive wealth, thus following an unsustainable track.
- Human capital has increased in every country, being the prime capital form that offsets the decline in natural capital in most economies.
- 25 percent of assessed countries, which showed a positive trend when measured by GDP per capita and the HDI, were found to have a negative IWI.
- The primary driver of the difference in performance was the decline in natural capital.
Based on these key findings, the report offers a set of recommendations to national-level policy-makers. It calls on countries to:
- Build up their investments in renewable natural capital
- Mainstream the Inclusive Wealth Index within planning and developing ministries
- Support/speed up the process of moving from an income-based accounting framework to a wealth accounting framework
- Move away from GDP per capita
- Establish research programs for valuing key components of natural capital, particularly ecosystem services.
The next issue of the Inclusive Wealth Report is expected to be released in 2014 with a special focus on social capital.