Prof. Enrico Giovannini, President of the Italian Statistical Institute (until 28.4.2013) Measuring and Achieving Societal Progress: A Paradigm Shift, London, London, 19 November 2009

1. Measuring and Achieving Societal
Progress: A Paradigm Shift
Enrico Giovannini
President of the Italian Statistical Institute
London, 19 November 2009

2. Beyond GDP (1)
“We have used GDP to determine wrongfully what is
in fact the state of well-being of a country … GDP is
necessary but inadequate, and we need to develop
additional indices that would tell a more
comprehensive, a more holistic story about how
human society is progressing … The human being
has two needs, the needs of the body and the needs
of the mind, and what we have focused on so far is
mostly the body, perhaps only the body … So, it’s a
paradigm shift that we need to make”.
Lyonpyo Jigmi y Thinley, PM of Bhutan
Roma, 17 novembre 2009
2

3. Beyond GDP (2)
“We have a very different measure of what
constitutes progress in this country. We measure
progress by how many people can find a job that
pays the mortgage; whether you can put a little
extra money away at the end of each month so you
can someday watch your child receive her college
diploma … not by the number of billionaires we
have or the profits of the Fortune 500, but by
whether someone with a good idea can take a risk
and start a new business, or whether the waitress
who lives on tips can take a day off to look after a
sick kid without losing her job an economy that
honours the dignity of work”.
Barak Obama, President of the USA
Roma, 17 novembre 2009
3

4. The Istanbul Declaration (1)
Ø A culture of evidence-based decision making
has to be promoted at all levels of government,
to increase the welfare of societies.
Ø We affirm our commitment to measuring and
fostering the progress of societies in all their
dimensions and to supporting initiatives at the
country level.
Ø We urge statistical offices, public and private
organisations, and academic experts to work
alongside representatives of their
communities to produce high-quality, factsbased information that can be used by all of
society to form a shared view of societal wellbeing and its evolution over time.
Roma, 17 novembre 2009
4

5. The Istanbul Declaration (2)
Ø To take this work forward we need to:
o encourage communities to consider for themselves
what “progress” means;
o share best practices and increase the awareness of the
need to do so using sound and reliable methodologies;
o stimulate international debate, based on solid
statistical data and indicators, on both global issues of
societal progress and comparisons of such progress;
o produce a broader, shared, public understanding of
changing conditions, while highlighting areas of
significant change or inadequate knowledge;
o advocate appropriate investment in building statistical
capacity, especially in developing countries, to improve
the availability of data and indicators needed to guide
development programs and report on progress toward
international goals, such as the MDGs.
Roma, 17 novembre 2009
5

6. The Global Project on “Measuring the Progress
of Societies”
Ø Three main streams of work:
o What to measure?
o How to measure?
o Ensure that measures are used
Ø Build a partnership with international
national and local organisations,
foundations, etc.
Ø Partners: WB, UNDP, UNICEF, IADB, AfDB,
EC, INTOSAI, ESCWA, ESCAP
Ø Associates: national and international
organisations, NGOs, universities, etc.
Roma, 17 novembre 2009
6

7. WEF Global Council “Benchmarking the progress
in societies”
Ø Main dimensions:
o Identify the metrics and indicators most widely used
o Identify variables that could complement measures of
income to build a more accurate understanding of
progress and well-being,
o Improve statistical capability, comparability and
reliability of data across countries
o Make data available to the general public to promote
openness and government accountability
o Engage foundations and other organisations to
promote statistics literacy and dissemination to the
civil society
Roma, 17 novembre 2009
7

8. 2009: A good year for measuring progress
Ø European Commission’s Communication
on “GDP and Beyond: Measuring Progress
in a Changing World
Ø OECD Framework to measure progress
Ø CMESP’s Report
Ø G20 Communique
Ø III OECD World Forum
Ø OECD Roadmap
Roma, 17 novembre 2009
8

9. European Commission’s Communication
Ø The overall aim is to develop more inclusive
indicators that provide a more reliable
knowledge base for better public debate
and policy-making.
Ø The Commission intends to cooperate with
stakeholders and partners to develop
indicators that are internationally
recognised and implemented
Roma, 17 novembre 2009
9

10. European Commission’s Communication
FIVE ACTIONS TO BETTER MEASURE
PROGRESS IN A CHANGING WORLD
Ø Complementing GDP with environmental
and social indicators
Ø Near real-time information for decisionmaking
Ø More accurate reporting on distribution and
inequalities
Ø Developing a European Sustainable
Development Scoreboard
Ø Extending National Accounts to
environmental and social issues
Roma, 17 novembre 2009
10

11. European Commission’s Communication
Ø The Commission intends to step up its
efforts and communication in this field to
provide indicators that do what people
really want them to do, namely measure
progress
Ø Ultimately, national and EU policies will be
judged on whether they are successful in
improving the well-being of Europeans
Ø For this reason, future policies should be
based on data that is rigorous, timely,
publicly accepted and covers all the
essential issues
Ø The Commission intends to report on the
implementation and outcomes of the
actions put forward by this Communication
by 2012 at the latest
Roma, 17 novembre 2009
11

12. OECD Framework to measure progress
Roma, 17 novembre 2009
12

13. OECD Framework to measure progress
Ø Ecosystem Condition: outcomes for the
environment
o
o
o
o
land (geosphere)
freshwater, oceans and seas (hydrosphere)
biodiversity (biosphere)
air (atmosphere)
Ø Human well-being: outcomes for people
o
o
o
o
o
o
physical and mental health
knowledge and understanding
work and leisure
material well-being
freedom and self-determination
interpersonal relationships
Ø Human well-being: cross-cutting goals
o intra-generational aspects: equity/inequality
o inter-generational aspects: sustainability/vulnerability/
resilience
Roma, 17 novembre 2009
13

14. OECD Framework to measure progress
INTERMEDIATE GOALS
Economy
- national income
- national wealth
Governance
-
-
-
-
-
human rights
civic and political engagement
security
trust
access to services
Culture
- cultural heritage
- arts and leisure
Resource management, use, development and
protection
- resource extraction and consumption
- pollution
- protection and conservation of economic and environmental
assets
Roma, 17 novembre 2009
14

15. Çommission on the measurement of economic
performance and social progress
J. Stiglitz
A. Sen
JP Fitoussi
B. Agarwal
A. Atkinson
JP Cotis
A. Deaton
K. Arrow
P. Weil
K. Dervis
H. Flassbeck
M. Fleurbay
N. Folbre
J. Gadrey
E. Giovannini
R. Guesnerie
G. Heal
C. Henry
D. Kahnemann
A. Krueger
J. Lin
R. Putnam
N. Stern
C. Sunstein
J. Heckman
3 working groups
Report available at www.stiglitz-sen-fitoussi.fr
Roma, 17 novembre 2009
15

16. Çommission on the measurement of economic
performance and social progress
Key messages
-
-
-
-
-
-
-
From production to well-being
Focus on people (households)
No single metric, no composite indicator
Taxonomy of dimensions
Objective and subjective measures (happiness)
Measure difficult things
Round-table
Roma, 17 novembre 2009
16

17. OECD Framework to measure progress
_________________________________________
MDG
GP
CMEPSP
________________________________________
Income/Poverty
Employment and work
Health
Education
Environm. Sust.
Partnership for dev.
Material well-being
Work
Health
Knowl. and underst.
Freedom /self-deter.
Interp. relationships
Ecosystem condition
Economic well-being
Personal activities
Health
Education
Pol. voice and govern.
Social connections
Environment
Vulnerability
Inequality/poverty
Special populations
Insecurity
Inequality/poverty
--- Cross cutting
Gender equality
Roma, 17 novembre 2009
17

18. G20 Communique
Ø Today we are launching a Framework for
Strong, Sustainable, and Balanced Growth
Ø To put in place this framework, we commit to
develop a process whereby we set out our
objectives, put forward policies to achieve
these objectives, and together assess our
progress
Ø As we commit to implement a new, sustainable
growth model, we should encourage work on
measurement methods so as to better take into
account the social and environmental
dimensions of economic development
Roma, 17 novembre 2009
18

19. The III OECD World Forum
Ø
Ø
Ø
Ø
1924participants
201 speakers from 50+ countries
57 exhibitors
9 plenary sessions and 37 parallel sessions
Ø Media attention and growing political
awareness
Ø Strong network of committed people
Ø Launch of Wikiprogress
Roma, 17 novembre 2009
19

20. The III OECD World Forum
Ø Mainstreaming:
o
o
o
o
OECD roadmap
EC follow up
Revision of HDI
G20 “progress framework”
•
•
Well-being frameworks for Treasuries
Statistical developments
Ø Strengthening:
o Research network
o Capacity building (advise and training)
o Connection with opinion leaders (Club of Rome,
etc.)
o Community of practitioners
Roma, 17 novembre 2009
20

21. OECD Roadmap
Ø The OECD will put in place a process to
prioritise the recommendations of
CMEPSP:
o OECD Committees will be asked to consider how they
can contribute to implementing the recommendations
Ø Developing measures, methods and tools
o to advance methodologies to produce new indicators
of well-being and to present existing measures under
a well-being perspective (statistical compendiums,
working papers, etc.)
Ø Improving and enhancing policy making
o use measures of well-being to enhance policy-making,
creating a series of monographs to discuss the
outcomes and the various policies that bear on these
drivers and outcomes
Roma, 17 novembre 2009
21

22. Beyond GDP (1)
“We have used GDP to determine wrongfully what is
in fact the state of well-being of a country … GDP is
necessary but inadequate, and we need to develop
additional indices that would tell a more
comprehensive, a more holistic story about how
human society is progressing … The human being
has two needs, the needs of the body and the needs
of the mind, and what we have focused on so far is
mostly the body, perhaps only the body … So, it’s a
paradigm shift that we need to make”.
Lyonpyo Jigmi y Thinley, PM of Bhutan
Roma, 17 novembre 2009
22

23. Beyond GDP (2)
“We have a very different measure of what
constitutes progress in this country. We measure
progress by how many people can find a job that
pays the mortgage; whether you can put a little
extra money away at the end of each month so you
can someday watch your child receive her college
diploma … not by the number of billionaires we
have or the profits of the Fortune 500, but by
whether someone with a good idea can take a risk
and start a new business, or whether the waitress
who lives on tips can take a day off to look after a
sick kid without losing her job an economy that
honours the dignity of work”.
Barak Obama, President of the USA
Roma, 17 novembre 2009
23

24. The Istanbul Declaration (1)
Ø A culture of evidence-based decision making
has to be promoted at all levels of government,
to increase the welfare of societies.
Ø We affirm our commitment to measuring and
fostering the progress of societies in all their
dimensions and to supporting initiatives at the
country level.
Ø We urge statistical offices, public and private
organisations, and academic experts to work
alongside representatives of their
communities to produce high-quality, factsbased information that can be used by all of
society to form a shared view of societal wellbeing and its evolution over time.
Roma, 17 novembre 2009
24

25. The Istanbul Declaration (2)
Ø To take this work forward we need to:
o encourage communities to consider for themselves
what “progress” means;
o share best practices and increase the awareness of the
need to do so using sound and reliable methodologies;
o stimulate international debate, based on solid
statistical data and indicators, on both global issues of
societal progress and comparisons of such progress;
o produce a broader, shared, public understanding of
changing conditions, while highlighting areas of
significant change or inadequate knowledge;
o advocate appropriate investment in building statistical
capacity, especially in developing countries, to improve
the availability of data and indicators needed to guide
development programs and report on progress toward
international goals, such as the MDGs.
Roma, 17 novembre 2009
25

26. And what about the crisis?
… Happiness lies not in the mere possession of
money; it lies in the joy of achievement, in the thrill
of creative effort. The joy and moral stimulation of
work no longer must be forgotten in the mad chase
of evanescent profits …
… Without regard to party, the overwhelming majority
of our people seek a greater opportunity for
humanity to prosper and find happiness. They
recognize that human welfare has not increased and
does not increase through mere materialism and
luxury, but that it does progress through integrity,
unselfishness, responsibility and justice …
F.D. Roosevelt, President of the USA, 1933
26
Roma, 17 novembre 2009
26