Composite Indicators: When and How To Use Them Jon Hall Global Project, OECD

Composite Indicators A powerful tool for advocacy A way to promote debate But they can be controversial

Potential Users Civil Society Bureaucrats Politicians Media Citizens

Potential Users – Potential Uses If I was from Civil Society …… How would I use a composite indicator?

Potential Users – Potential Uses If I was from Civil Society …… To lobby government, the media, the public about issues of concern To focus debate within my organisation on issues of concern

Potential Users – Potential Uses If I was from a Bureaucrat…… How would I use a composite indicator?

Potential Users – Potential Uses If I was from a Bureaucrat…… To portray issues of concern to ministers - to galvanise action and keep focus To demonstrate that policies are having an effect To encourage joined up government NOT to design detailed policy proposals

Potential Users – Potential Uses If I was from a Politician…… How would I use a composite indicator?

Potential Users – Potential Uses If I was from a Politician…… To demonstrate to voters the need for new – perhaps difficult – policies To demonstrate to voters that policies are working The political economy of reform

Potential Users – Potential Uses If I was from the Media…… How would I use a composite indicator?

Potential Users – Potential Uses If I was from the Media…… To tell an exciting story – the public like composite indicators To communicate complicated issues in a simple way The Happy Planet Index

A Happy Planet Index Launched by nef in July 2006 HDI style rank order of nations Measure of the “Ecological efficiency with which human well-being is delivered” Over 1,000,000 downloads to date

What HPI measures Human system Ecosystem Resource demand Ecosystem well-being Human well-being Culture Social Capital Governance Economy Education Healthcare Natural Capital Biodiversity CO 2 emissions Soil erosion Water quality Air quality

What HPI measures Human system Resource demand Happy and Long Lives Resource Use (divided by) Human well-being

What HPI measures Human system Resource demand (Life Sat) * (Life Exp) Eco Footprint (divided by) Human well-being

Potential Users – Potential Uses If I was from a Citizen…… How would I use a composite indicator?

Potential Users – Potential Uses If I was from a Citizen…… To participate more effectively in democratic debate? Lobby my government, write to my member of parliament? Decide on who to vote for? Change my behaviour…. Consume less resources? Move to another country?

But …. Potential Uses are many – and can be very important Vital that we are transparent about the limitations of composite indicators Vital that we are transparent about the assumptions within them Be clear about what they explain and do not explain Great as a tool for simplifying a complex story Great as a way to initiate a debate But don’t oversimplify But they seldom tell the whole story

“Everything should be as simple as it is, but not simpler.” - Albert Einstein