Integrating social, environmental and economic dimensions into a monitoring framework Maria Martinho martinho@un.org

Summary Context What do data tell us about the integration of the three dimensions of sustainable development? Indicators/measures to monitor sustainable development Inequality measures Conclusion

Rio+20, HLPGS, post-2015 discussions Context Rio+20, HLPGS, post-2015 discussions Increasing interest in having sustainable development at the core of development Need to integrate the social, economic and environmental dimensions of development HLPGS: High Level Panel on Global Sustainability

What do data tell us about the integration of the social, economic and environmental dimensions of development?

Illustrative example: HDI versus Ecological footprint HDI is reflecting socio-economic development; ecological footprint is reflecting environmental impact.

HDI versus Ecological footprint So far, in most countries, there has been a trade-off between socio-economic development and environmental protection

Is it possible for countries to reach higher levels of social development while keeping a sustainable environmental impact?

HDI versus Ecological footprint Some countries have succeeded in moving higher up in the HDI while keeping within a sustainable ecological footprint Peru is all the way within the Earth’s biocapacity (2.1 hectares per person).

HDI versus Ecological footprint And others have succeeded to move to a lower ecological footprint while keeping high levels of HDI Decrease of ecological footprint in Germany has been mainly achieved by moving out of coal (information provided by Global Footprint Network, 2012).

What measures can make the inter-linkages between the socio-economic and environmental dimensions visible?

Indicators/measures to monitor sustainable development should: Permit to visualize the environmental implications of socio-economic activities and the welfare implications of imbalances and changes of ecosystems to promote synergies and avoid trade-offs favouring one dimension over the others Reflect the complexity of sustainable development in its multiple dimensions but be simple and user-friendly for policy makers

Integrating the 3 dimensions Indicators on the three dimensions of sustainable development Social indicators Health Education Hunger Shelter etc Economic indicators Income GDP Debt Productivity etc Environmental indicators GHG emissions Land degradation Water Forests etc

Integrating the 3 dimensions Indicators that reflect impacts on all 3 dimensions eradicating hunger Social: food security MDG 1.8, prevalence of underweight children MDG 1.9, population below a minimum level of dietary energy consumption Economic: efficient use of water and land Agricultural output per unit water consumed (CSD indicator), but data are scarce Environmental: decreased environmental degradation and waste, in food production and consumption Amount of food waste (FAO) Use of agricultural pesticides (FDES indicators) ‘Agricultural output per unit water consumed’ was proposed in Indicators of sustainable development: guidelines and methodologies, UNDESA (2001).

Integrating the 3 dimensions Another example: sustainable energy for all Social: energy access Energy use per capita (IEA) Share of households without electricity or other modern energy services (CSD indicator; collected in household surveys), but data are scarce Economic: energy efficiency Energy use per $1000 GDP (IEA) Environmental: use of renewable and clean sources Renewable as % of total (IEA) % of population using solid fuels (WHO)

Integrating and balancing the 3 dimensions Social indicators Health Education etc Economic indicators Income Employment etc Environmental indicators GHG emissions Land degradation etc Social summary measure Economic summary measure Environmental summary measure

Integrating the 3 dimensions Summary measures to provide an overall picture of what happens in social, economic and/or environmental dimensions GDP Human development index Ecological footprint, environmental performance index, living planet index etc Better life index: 11 topics reflect what the OECD has identified as essential to well-being in terms of material living conditions (housing, income, jobs) and quality of life (community, education, environment, governance, health, life satisfaction, safety and work-life balance). The Living Planet Index (LPI) is an indicator of the state of global biological diversity, based on trends in vertebrate populations of species from around the world. The Living Planet Index was originally developed by WWF in collaboration with UNEP-WCMC.

Integrating and balancing the 3 dimensions Social indicators Health Education etc Economic indicators Income Employment etc Environmental indicators GHG emissions Land degradation etc Social summary measure Economic summary measure Environmental summary measure How to integrate them?

Integrating the 3 dimensions Measures that favour synergies and penalize trade- offs Many summary measures do not penalize trade offs methodology for aggregation: simple average of different indicators Country Env Soc Eco X 0.1 0.5 0.9 Y 0.4 0.6 Simple average Both countries, X and Y, have the same average (Env + Soc + Eco)/3 = 0.5 S = social measure Eco = economic measure Env = Environmental measure

Integrating the 3 dimensions Measures that favour synergies and penalize trade- offs Many summary measures do not penalize trade offs methodology for aggregation: simple average of different indicators Country Env Soc Eco X 0.1 0.5 0.9 Y 0.4 0.6 But country X performs much better in the economic dimension at the price of a low environmental performance S = social measure Eco = economic measure Env = Environmental measure Values closer to one indicate better performance

Integrating the three dimensions Country Env Soc Eco X 0.1 0.5 0.9 Y 0.4 0.6 Simple average Both countries, X and Y, have the same mean (Env + Soc + Eco)/3 = 0.5 Geometric mean Country X: 0.36 Country Y: 0.49 3 Soc × Eco × Env SD = Penalized for the economic-environmental trade-off

Integrating the 3 dimensions Measures that favour synergies and penalize trade- offs Geometric mean Has been used in the calculation of the human development index since 2011 Better than simple average at penalizing trade-offs

Integrating and balancing the 3 dimensions Social indicators Health Education etc Economic indicators Income Employment etc Environmental indicators GHG emissions Land degradation etc Social summary measure Economic summary measure Environmental summary measure Overall SD measure

Inequality measures Measure disparities across a population of the resources received by that population Resources: income, land, education, health services, energy, water, etc. Measures across all population versus disaggregating for specific groups Across all population: Gini coefficient, Hoover coefficient, % population with access to a service, etc. For specific groups: disaggregating indicators for women/men, by wealth quintiles, for minorities, for persons with disabilities, etc.

Income inequality measures Increased interest in the SDG discussions Associated to social negative outcomes, like increased violence, increased adolescent pregnancy rates Popular/discussed measures Gini coefficient Palma index Poorest quintile's share in national income/consumption

Income inequality measures Popular/discussed measures Gini coefficient Intuitive More sensitive to changes in the middle class Not immediate to see the situation of the poorest Palma index Ratio of the income of top 10% to the bottom 40% Most equal countries have Palma index close to one The bottom 40% may improve without improvement of the bottom 10% Poorest quintile's share in national income/consumption Cumulative income Cumulative population

Palma index for Brazil

Income inequality measures Popular/discussed measures Gini coefficient Intuitive More sensitive to changes in the middle class Not immediate to see the situation of the poorest Palma index Ratio of the income of top 10% to the bottom 40% Most equal countries have Palma index close to one The bottom 40% may improve without improvement of the bottom 10% Poorest quintile's share in national income/consumption Can supplement other inequality measures Cumulative income Cumulative population

Concluding points Sets of indicators should address the three dimensions of sustainable development Combining measures can help promote synergies in the three dimensions geometric means Many inequality measures around, selection depends on purpose