Economic development over the years has lead to an increased look into environmental and social concerns as part and parcel of productivity and economic growth. Data has shown that increasing productivity and economic growth went hand in hand with better and improving living conditions.
More recent data suggests that trends in
economic growth no longer tell the whole story. The need to better
understand the relationship between economic competitiveness and social
and environmental sustainability has been revealed by events such as the
“Arab Spring”, the rise of unemployment in many advanced economies –
particularly among the young and less skilled population –, increasing
income inequalities and social unrest in rapidly-growing economies as
well as by increasing pressure on natural resources or the high levels
of pollution.
The World Economic Forum’s annual
Global Competitiveness has embarked on a major effort to deepen
understanding of how sustainability relates to competitiveness and what
this means for the development path of economies. Since 2011 the Forum presents the Sustainability-Adjusted Global Competitiveness Index (GCI). This new measure aims to assess the “the
set of institutions, policies and factors that make a nation remain
productive over the longer term while ensuring social and environmental
sustainability”. measures not only the propensity to prosper and
grow, but also integrates the notion of “quality growth”, taking into
account environmental stewardship and social sustainability.
This innovative approach builds on the Global Competitiveness Index (GCI), highlighting the
importance of competitiveness as the key indicator of prosperity. The
GCI is then adjusted by two new pillars: The social sustainability pillar, which measures the “set
of institutions, policies and factors that enable all members of
society to experience the best possible health, participation and
security; and to maximize their potential to contribute to and benefit
from the economic prosperity of the country in which they live” and the environmental sustainability pillar which measures
“the institutions, policies and factors that ensure an efficient
management of resources to enable prosperity for present and future
generations”.
One
of the most important findings of this analysis suggests that there do
not seem to be any necessary trade-offs between being competitive as
well as socially and environmentally sustainable.
The results
presented in this edition are preliminary and tentative as the work
continues. The lack of high-quality available data and a more
evidence-based understanding of the complex relationship between
competitiveness and environmental and social sustainability prevent us
from presenting more conclusive results.
