The Green Economy Coalition (GEC) has produced a paper summarizing the current situation in the growing field of ‘green economy’ and ‘green growth.’ This post-Rio+20 assessment is intended as a working draft for consultation and the GEC welcomes any feedback and insights.
The paper, titled “Surveying the ‘Green Economy’ and ‘Green Growth’ Landscape,” examines the current key players (from international institutions, through governments and the civil society to business) as well as the emerging trends and developments shaping the green economy landscape.
The paper concludes that there has been a rapid shift in the ‘green growth’ and ‘green economy’ agendas with even some mainstream economist and finance industries seeing an opportunity in green growth as a way out of economic stagnation. The paper further highlights that Rio+20 provided a much needed space for discussions on ‘green economy’ and that further UN discussions on this topic are vital for the international policy agenda.
The GEC also proposes that it is “critical for multi-stakeholder groups to work together to define and own the wider understanding of green economy – as one that tackles poverty and inequity and one that protects our natural systems.” It calls on coalitions and alliances to use their collective network, influence and experience to both complement and challenge the emerging agendas.
Link: GEC paper – working draft for consultation
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.
Link: UNU-IHDP Inclusive Wealth Report news
The Ecologic Institute, a private not-for-profit think tank, has released a new report on resource efficiency indicators and their potential use for measuring progress towards sustainable industries. The report, titled “Integrating resource efficiency, greening of industrial production and green industries – scoping of and recommendations for effective indicators,” is the outcome of work undertaken by the Ecologic Institute as part of the process of establishing a Green Industry Platform by the United Nations Industrial Development Organization (UNIDO) in 2012.
The authors of the report note that there currently appears to be a gap concerning indicators for measuring progress towards sustainable industries and sustainable industrial development (including the greening of industries, progress achieved in green industries, and greater resource efficiency in industrial production) and this report aims to contribute to filling this gap.
The report uses the Life Cycle Assessment (LCA) as an organizing framework for systematic evaluation of the existing indicators as a measure of resource efficiency. The 10 most promising indicators considered in this study are:
- Environmentally weighted material consumption (EWC)
- Energy intensity by sector
- Production based CO2 productivity
- Water consumption by sector
- Sustainable Process Index (SPI)
- Water abstraction rates and water stress
- Corporations’ turnover, value added and exports of the environmental goods and services sector
- Resource Productivity / Material Productivity
- Total Material Consumption (TMC)
- Ecological Footprint (EF)
The authors suggest that since there exist many different aspects of industrial production it is only logical to consider building a basket of indicators that jointly give a more comprehensive picture than any of the indicators could give alone. They propose 4 different dimensions of sustainable industrial development to be part of the basket, namely:
- Protection of critical environmental goods and services;
- Minimal environmental impacts;
- Efficient resource-use; and
- Social and economic aspects of industrial production.
Based on the reviews conducted in report the following indicators are proposed to be included in the basket:
- EMC (or eco-efficiency or overall environmental impact indicator) to capture environmental impacts;
- Energy intensity by sector and production-based CO 2 productivity to cover the critical environmental areas energy and climate change;
- Water productivity by sector and water stress to capture resource efficiency for a second critical environmental resource; and
- Resource productivity (or TMC over GDP) to capture resource efficiency.
The authors note that the social aspects of sustainable industry have not been within the scope of their analysis, but should be considered in the development of the basket. They also highlight that this scoping study did not provide the necessary frame to develop a fully fledged analysis or road-test the proposed indicator basket and that such research tasks should be undertaken in followup projects under the auspices of UNIDO.
Link: Ecologic Institute download site of the report
Nef (the new economics foundation) has recently released “The Happy Planet Index: 2012 Report,” nef’s third global report based on one of the leading global measures of ‘sustainable well-being’, the Happy Planet Index (HPI).
HPI is a measure of progress that uses global data on experienced well-being, life expectancy, and Ecological Footprint to generate an index revealing which countries are most efficient at producing long, happy lives for their inhabitants, whilst maintaining the conditions for future generations to do the same. This efficiency is expressed in the number of Happy Life Years (life expectancy adjusted for experienced well-being) achieved per unit of resource use.
The results in this year’s report show that we are still not living on a ‘happy planet’ (similarly as the results in the past reports -published in 2006 and 2009 – suggested). At the present time, no country is able to combine success across the three goals of high life expectancy, high experienced well-being and living within environmental limits. The positive news is that at least some countries, like Costa Rica, are coming close.
In fact, Costa Rica tops the Happy Planet Index for the second time in a row. It has the second highest life expectancy in the Americas, experienced well-being higher than many richer nations, and a per capita Ecological Footprint one third the size of the USA’s. Norway, in 29th place out of 151 countries, is the highest ranking Western European nation, just behind New Zealand in 28th place. The UK ranks 41st and the USA ranks 105th out of 151 countries.
Nic Marks of nef highlights that “overall, the HPI reflects the fact that while the challenges faced by rich resource-intensive nations and those with high levels of poverty and deprivation may be very different, the end goal is the same: to create long and happy lives that don’t cost the Earth.” He also notes that “if things are to improve we need new official measures of progress” [italics added]. This is why nef came up with the Happy Planet Charter alongside the report to underline the urgent need for better measures of progress. More information on this can be obtained at the Happy Planet Index website.
Happy Planet Index website
The World Bank has released a new report, titled “Inclusive Green Growth – The Pathway to Sustainable Development,” at the Global Green Growth Summit in Seoul in early May.
The report challenges governments to change their approach to growth policies, measuring not only what is being produced, but what is being used up and polluted in the process. It argues that sustained growth is necessary to achieve the urgent development needs of the world’s poor and that there is substantial scope for growing cleaner without growing slower. It also noted that green growth requires improved indicators to monitor economic performance.
The report focuses on 5 main points:
- Greening growth – it is suggested this is necessary, efficient, and affordable, and critical to achieving sustainable development
- Chief obstacles to greening growth, such as political barriers, entrenched behaviors and norms, and a lack of financing instruments
- Multi-disciplinary solutions to overcome constraints and ensure progress
- Green growth ‘variability’ – it is pointed out that strategies will vary across countries
- Green growth not being inherently inclusive – it is highlighted that green growth policies must be carefully designed to be inclusive, by maximizing benefits for, and minimizing costs to, the poor and most vulnerable to avoid irreversible negative impacts
At the Global Green Growth Summit, the Government of Korea announced a partnership with the World Bank Group and pledged $40 million to further promote green growth.
Links: World Bank News
Oxfam has released an interesting discussion paper in February 2012, written by its senior researcher Kate Raworth (with the support of colleagues) and titled “A safe and just space for humanity – Can we live within the doughnut?”
The paper presents a single visual framework – shaped like a doughnut – that represents a space in which humanity can thrive. This doughnut-like area is defined by a set of 9 planetary boundaries as proposed by a group of leading Earth-system scientists in 2009 (published in Nature by Rockström et al., Sept 2009). Raworth combined this “Planetary Boundaries” framework with 11 social boundaries, based on the 11 dimensions of human deprivation that emerged from the issues raised by governments in their Rio+20 submissions.
The author argues that “moving into the safe and just space for humanity means eradicating poverty to bring everyone above the social foundation, and reducing global resource use, to bring it back within planetary boundaries.” She also suggests that the “doughnut” provides an easy-to understand framework showing, for instance, that we need to eradicate poverty and inequity for all, within the means of the planet’s limited resources. The data on hunger, energy and income provided in the paper illustrate that bringing everyone alive today above the social foundation need not stress planetary boundaries and it is highlighted that the real source of stress is excessive resource use by roughly the richest 10 percent of people in the world.
The paper touches also on the aim of economic growth and traditional growth policies (based on GDP) in relation to the “doughnut” concept. The author argues that the economy’s over-arching aim should be to bring humanity into the safe and just space – inside the doughnut – and to promote increasing human well-being there. The paper concludes by stating that “the critical economic question is whether or not global GDP growth can be harnessed as a tool for moving into the doughnut – or whether a different approach to economic development is needed.”
This Oxfam Discussion Paper intends to encourage public debate and the author welcomes any feedback on this document. Comments can be added to the author’s Oxfam blog until 30 June 2012.
Links: Blog (with link to the download of the full Oxfam Discussion Paper)
Civic Exchange, a Hong Kong-based non-profit public policy think tank, has produced a new report titled “Measuring Well-Being in Cities – A Literature Review.” This Asian think tank is working on creating a tool – a well-being index for Asian cities – that can harness the power of indices plus engage people on issues of civic importance. The newly released report reviews a range of existing indices of well-being, quality of life and liveability, which have been consulted by the think tank’s researchers in developing the new index for Asian cities.
The review identifies six “approaches” to developing indices for well-being, including:
- Human development (e.g. GDP, Human Development Index, Gross National Happiness, or China’s Xiaokang Indicators)
- City competition (e.g. rankings published by consultancies and magazines based on liveability indices)
- City planning (very few internationally recognized)
- Satisfaction (e.g. Gallup World Path, nef’s National Accounts on Well-being)
- Health (e.g. a set of indicators under the WHO’s Global Health Observatory, The Australian Unity Well-being Index)
- Sustainability (e.g. Happy Planet Index, Genuine Progress Indicator)
It is concluded that it would not be effective to create a new index that attempts to merge all of these six approaches. Instead, suggests the author, it could work around what Asian urban residents themselves identify as their priorities and needs, as well as incorporating both objective and subjective criteria for well-being.
As part of the index-development process, the researchers at Civic Exchange have collected and studied information on over 160 indices from around the world that measures various elements that may be said to broadly relate to the concept of “wellbeing.” The have summarized this information in a document with clear summary tables containing all the indices they have studied from September 2011 to April 2012.
Links: Measuring Well-Being in Cities – A Literature Review, Summary of indices
The Centre for Bhutan Studies has released a short publication, “GNH and GNH Index: A Short Guide to the Gross National Happiness Index” providing background on the concept of Gross National Hapiness (GNH) and its measurement. The authors – Karma Ura, Sabina Alkire, Tshoki Zangmo – present information on the origins of GNH and focus especially on the 2010 GNH Survey, the first official national survey on GNH in Bhutan. They then go on with explaining the compounds of the GNH Index with its nine domains and 33 clustered indicators that are based on 124 variables. The domains include:
- psychological well-being
- time use
- community vitality
- cultural diversity
- ecological resilience
- living standard
- good governance
As can be seen from the selection of the domains, the GNH Index is truly multidimensional and the authors really highlight this feature. They point out that “in the GNH Index, unlike certain concepts of happiness, in current western literature, happiness is itself multidimensional – not measured only by subjective well-being, and not focused narrowly on happiness that begins and ends with oneself and is concerned for and with oneself.” In Bhutan say the authors ” the pursuit of happiness is collective though it can be experienced deeply personally.”
It is also stressed, on the other hand, that despite being a complex measure useful in the government policy settings, the GNH Index can also be decomposed into the ‘building blocks’ and used by other organizations and citizens.
The authors of the guide also inform that the outcomes of the GHN Survey can be used to identify where unhappiness is arising from and for whom. These findings can then be used to determine groups of “not-yet-happy people” and improve their conditions. In the GNH Index, people are considered “happy” when they have sufficiency in 66% of the (weighted) indicators or more, those below 66% are considered “not-yet-happy.”
The results of the 2010 GNH Survey in Bhutan have shown that the insufficiencies of not-yet-happy people differ in different parts of the country. In rural areas, not-yet-happy people tend to attain less education, living standards and balanced use of time, while in urban areas, not-yet-happy people are typically insufficient in non-material domains such as community vitality and culture, and psychological well-being.
Links: A Short Guide to GNH and GNH Index, Centre for Bhutan Studies, Gross National Happiness, Educating for GNH
The European Economic and Social Committee (EESC) has recently produced an own-initiative Opinion document on “GDP and beyond – the involvement of civil society in choosing complementary indicators.”
The document reports that the EESC recognizes the advances made in recent years in devising complementary indicators to Gross Domestic Product (GDP), at both world and European levels. However, it is stressed that, in the view of the EESC, the process leading to a new definition of well-being and progress of societies – beyond economic growth alone – cannot be separated from current European policies to tackle the renewed impact of the economic and financial crisis. At present, there is a wide gap between economic policies and policies for well-being and societal progress at both national and European level, but the authors see a possibility of narrowing this gap in connection with the adoption of indicators complementary to GDP by official statistical services.
The EESC proposes that there needs to be a thorough debate on the fundamental meaning of progress and the concept of development, and any decisions have to be based on contributions from the civil society. The Committee also emphasizes its willingness to act as a meeting place between organized civil society and official European bodies as part of a participatory decision-making process to identify and design indicators of progress for the European Union.
Wikiprogress, a global virtual platform for sharing information in order to evaluate social, environmental and economic progress, provides a draft document listing initiatives on measuring well-being on the national level. Based largely on the content of the Wikiprogress.org website, there are initiatives and examples from some 17 countries, including Australia , Belgium, Canada, China, Finland , France, Germany, Hungary, Italy, Japan, Luxembourg, the Netherlands , New Zealand, Slovenia, Spain, UK and the US.
The initiatives range from government-led projects to organization- and community-based initiatives, such as the Australian National Development Index, Canadian Index of Well-being, Findicator (Finland), World Database of Happiness (the Netherlands), the National Well-being Project (UK), or The State of the USA, to name just a few.