Earlier this month the Scottish Government unveiled its new 10-year National Strategy for Economic Transformation. The much anticipated plan included the welcome aspiration to become a Wellbeing Economy. But it failed to set out how we will genuinely transform our economy to one that ensures good lives for all of Scotand’s people and protects the health of our planet. In this blog, WEAll Scotland’s, Dr Lukas Hardt, explores the substance of the Strategy and makes the case for a inclusive national debate on how we move beyond business as usual.

The day before the Strategy was published, the global scientific community issued its starkest warning yet about the disastrous consequences ahead if we fail to urgently act to avoid climate breakdown. The Intergovernmental Panel on Climate Change (IPCC) cautioned that further delay in action will miss a “brief and rapidly closing window to secure a liveable future.”

At the same time, the cost of living crisis threatens to deepen already eye-watering levels of poverty and inequality in Scotland. One in four children in Scotland is growing up in poverty. Without new approaches that reflect the realities of today, rather than the recipes of the last century, the Scottish Government looks set to miss its child poverty targets. The need to reprogramme our economy has never been more apparent.

Scotland has positioned itself at the forefront of the movement to build a new type of economy which is designed to deliver good lives for all on a healthy planet. Scotland was a founding member of the Wellbeing Economy Governments partnership – a collection of nations who are united in their ambition to redesign their economies. Nicola Sturgeon’s Ted Talk on the subject received 2.4 million views. But this rhetorical commitment to a different sort of economy has yet to be met with sufficient action.

Ahead of the publication of the National Strategy for Economic Transformation, 40 leading economists and climate change academics urged the Scottish Government to set out how it will put environmental and social concerns at the heart of financial and economic decision making. The final Strategy includes some positive commitments such as a Wellbeing Economy Monitor to measure the things that really matter to people and to review ‘how to increase the number of social enterprises, employee-owned businesses and cooperatives in Scotland’. But overall it marks a continuation of the same flawed logic that has delivered decades of inequality and environmental degradation.

The economy we have today is driven by a widely debunked logic – that continually growing the economy will automatically ‘trickle down’ to more wealth for the whole population. Yet in practice this necessitated that governments have to set aside some of this money in taxes to pay for the social and environmental casualties of our economic system. This economic paradigm has driven a cycle of paying to fix what we continue to break.

For example, the Scottish and UK Governments spend billions of pounds in Scotland topping up poverty wages, housing people who are homeless and building flood defences. Our recent report on Failure Demand has quantified the financial cost of this way of operating.

By privileging GDP growth and indiscriminate productivity, the National Strategy for Economic Transformation continues to follow this flawed logic. The most important challenge for Scottish and other economies in the 21st century is not a lack of productivity, innovation, inward investment (as important as they are). It is that they are often construed as goals in their own right. What we need to do is ask: What sort of innovation? Productivity of what and who gets the benefits? And how to ensure investment flows to those activities most aligned with a Wellbeing Economy? The key responsibility of governments in our time is to embed a new purpose into all economic and financial decision making. It is to ensure that  power is shared across workers and communities so that our economy uses our resources and creativity to provide the things that really matter. Governments have to make sure that care work is valued, that we all have the basics, like safe warm homes, that we expand the economic activities we need more of, such as decarbonisation, not just those that offer the biggest profits. There is very little in this strategy to suggest that the Scottish Government is living up to this responsibility.

Businesses have a vital role to play in a Wellbeing Economy, but the Strategy fails to offer a clear mechanism to ensure the enterprises Scotland will nurture will help build thriving local communities. Fostering social enterprise, employee-owned businesses and cooperatives has to be a key part and the Strategy promises a review of how their number can be increased. But more concrete support is needed urgently.

The Government needs to set the right rules and incentives to make sure that the right thing to do for people and planet becomes the right thing to do for businesses. The many enterprises in Scotland that are pioneering fair, green and transformative ways of working would welcome moves to rectify the unfair competition they face from those businesses who are shirking their responsibilities to the environment and society.

The Strategy talks about “Team Scotland” and rightly notes that economic transformation has to be supported by all citizens, and implemented through collaboration of the public, private and third sector. But the process of developing this Strategy has not lived up to this ambition. There is little evidence that this Strategy has had input from citizens and communities across Scotland.

The reports of the Citizens’ Assembly of Scotland and the Scottish Climate Assembly clearly show that people want the Government to step up to the plate and set a new direction for our economy.  Four in five Climate Assembly delegates supported the recommendation to reframe the national focus for Scotland’s future away from economic growth towards the prioritisation of a more person and community centred vision of thriving people, thriving communities and thriving climate. While the Strategy references an aim to respect environmental limits there is very little evidence of how this will be achieved nor how this squares with the thrust of the Strategy which focuses on growth.

This Strategy has failed to present solutions that are adequate for the challenges of the 21st century. Scotland now needs an urgent and inclusive national debate on how to transform our economy into one that truly delivers good lives and protects the health of the planet we depend on.



Commenting on Scotland’s National Strategy for Economic Transformation, Jimmy Paul, Director of Wellbeing Economy Alliance Scotland, said:

We welcome the Scottish Government’s aspiration to become a Wellbeing Economy and the aim to respect environmental limits. The Strategy includes some positive commitments such as a wellbeing economy monitor to measure the things that really matter to people.

“But this does not amount to a plan to transform our economy to one that truly puts our collective wellbeing first. The last decades have shown us that economic models that focus too narrowly on growth and productivity for their own sake fail to translate into more secure jobs, higher wages, decent housing for all, or a healthier natural environment. Assuming growth and productivity will trickle down to all has been debunked – Scotland needs to be bolder in its approach to economic change.

“Businesses have a vital role to play in a Wellbeing Economy, but the Strategy fails to offer a clear mechanism to ensure the enterprises Scotland will nurture will help build thriving local communities.

“The Strategy refers to economic transformation as a “collective national endeavour”, but there is no evidence that this Strategy has had input from citizens and communities across Scotland. This must be the start of conversation across Scotland about how we choose a new economic path that serves the health and wellbeing of our communities and protects the planet we depend on.  

“Scotland has positioned itself at the forefront of the movement to build a new type of economy, and the world is watching. Last week, 40 leading economists and climate change academics urged the Scottish Government to set out how it will put environmental and social concerns at the heart of financial and economic decision making. This Strategy stops short of achieving that. 

ENDS

For enquiries call 07855 069 952 or email frances@scotland.weall.org

Notes to editors

  • Dr Lukas Hardt, ecological economist and Policy Lead at Wellbeing Economy Alliance Scotland is available for interview.
  • Scotland’s National Strategy for Economy Transformation is here 
  • Nicola Sturgeon has previously championed the Wellbeing Economy agenda with her Ted Talk on the subject receiving 2.4 million views. Scotland is a founder member of the Wellbeing Economy Governments Partnership together with New Zealand, Wales, Finland and Iceland.
  • Last week, 40 leading economists and academics called on the Scottish Government to use the strategy to set out how it will put environmental and social concerns at the heart of financial and economic decision making. Their asks, supported by Poverty Alliance, Friends of the Earth Scotland, Scottish Environment Link and others here.
  • The strategy comes as yesterday’s IPPC report showed we only have a brief window to secure a liveable and sustainable future for all. 



Written by: Isabel Nuesse

In the system that we’re currently living in, money reigns in every aspect of our lives. Wherever money flows in our economy will dictate the priorities of our culture. If this is the case, what can we do in the short-term to influence where money is flowing and, therefore, influence the priorities of our time? 

In October 2021, Jags Walia, a portfolio manager and responsible investor since 2008,  gave a WEAll Talk “From Nudge to Push – Money, Power and CO2” where he shared his own experience of influencing big companies to reduce their CO2 emissions as a smart investment decision. 

He gave our audience his take on how to do this, and assurance that he’s not alone working on these bold objectives.

As an investor, Jags told us he has two priorities: 

  1. Make money for his clients;
  2. Consider the environmental implications of those decisions, to reduce harm and the amount of CO2 emitted into the atmosphere.

There are a number of strategies to go about meeting these goals, and, rather than shying away from today’s big polluters as potential clients, Jags operates on the notion that, by  choosing to work with a dirty company, he can have a bigger impact by directly  influencing their decision making. You can read his Investment Guide here.

“I find the companies that are not the saints today – and try to change their behavior and rehabilitate them.”

He shared a story of a client he worked with back in 2019. The company had proposed to build two brand new coal power plants. Of course, he was adamantly against this decision. But rather than coming out and saying his opinion, he needed to show them that making such a choice was bad business. Why? Well, the average lifespan of a coal power plant is 48 years, and he was predicting that, in 48 years, coal will not be the primary energy resource that we use and, therefore, the return on their investment wouldn’t be realized. In the end, after 8 long months of back and forth, the company decided that they wouldn’t go ahead with the power plants and not only that, but they vowed never to build another coal fired power plant again. 

This was a huge win for Jags and his team, as the outcome of their work turned out to be a long-term company-wide divestment from coal, rather than something restrained to one single project within the company. 

How does Jags do it? He shared his 3 main strategies  for how to engage with companies effectively.

  1. Understand the complexity of the situation that the company is in. Really put yourself in the shoes of these businesses. Who are their stakeholders? Who are the beholden to? What steers their decision making?
  2. Find the right question(s) to ask. When engaging with any company, find out what is possible for them within their context. Don’t suggest something outrageous for them to achieve without first understanding what is reasonable. 
  3. Evaluate what each company says they’re doing vs. what they are actually doing. Many companies will boast about their sustainability achievements, but these can often be overembellished. Do your due diligence to better understand what kinds of commitments the company is actually making. 

One of the participantsasked Jags about the Key Performance Indicators he looks at when evaluating whether a company is ‘clean’ or ‘dirty’. 

He said that he looks at three things, 

  1. Willingness
  2. Ability 
  3. Commitment 

In other words, are the companies willing to make a change? Is it possible and are they able to make it? And, can they get paid to commit to making significant changes? Still working within the current framework, Jags understands that in order for companies to decarbonize, they still have to meet their financial obligations and therefore be paid to do it. 

There is always a balance between uprooting what exists, and improving the status quo. This talk with Jags showed a clear example of how to improve the current situation within the existing boundaries or our system. 

If you missed the talk or want to engage further with this topic, you can watch the full talk recording on our YouTube channel:https://www.youtube.com/watch?v=bgCljvMqzKY

By: Rabia Abrar

On October 25, we held a launch event for the Happy Planet Index 2021, the 5th edition of an index that ranks countries based on how efficiently they use our limited ecological resources to live long, happy lives. 

Watch the full launch event here.

What is the Happy Planet Index?

Nic Marks kicked things off by explaining why the Happy Planet Index (HPI) was created: to address the tension with sustainability around good lives now and good lives in the future. 

We all want good lives. The way we create them today, though, often comes at the expense of the planet. 

The HPI gives us an idea of whether or not a country’s wellbeing is ‘sustainable’, by looking at how much of the fundamental ‘input’ – ecological footprint (the pressure we put on the planet) – is used to create the ultimate ‘output’ we’re looking for – long, happy lives. 

The key takeaway: We can still have good lives – we just need to create them more ‘efficiently’.

The Happy Planet Index is by no means a ‘complete’ or ‘perfect’ metric – it simply aims to act as a compass that points towards a new vision of progress for the economy.

Letting the data speak

Saamah Abdallah walked us through the sometimes surprising data insights from the Happy Planet Index, using the maps, rankings, comparison feature, and trend charts over 15 years on the interactive website

The Happy Planet Index World Map offers individual views for life expectancy, wellbeing, ecological footprint, and overall HPI score

Life expectancy (from the UN):

A good score is 75+ years. As you might expect, wealthy countries have the highest life expectancies – but there are some surprises. 

  • Chile and Costa Rica have life expectancy rates over 80 years – and Lebanon’s 79 year life expectancy is higher than the USA. 
  • Other countries with 75+ years have much lower GDPs – Ecuador, Algeria, and Vietnam.

Subjective wellbeing (from the Gallup World Poll):

  • The top scorer was Finland, with a score of 7.8/10. 
  • The high life expectancy in East Asia doesn’t translate into high wellbeing.
  • Subjective wellbeing doesn’t correlate with GDP. Costa Rica and Vanuatu both have a score of 7/10 – higher than the USA – even with considerably lower GDPs than the USA.
  • India has the 4th lowest subjective wellbeing score in the world in 2019.

Ecological footprint (from the Global Footprint Network):

When looking at the same world map for ecological footprint – the outcomes flipped. On the whole, countries in the ‘green’ turned ‘red’ and vice versa, showing a tension between wellbeing and life expectancy and ecological footprint.

  • Africa and South Asia, with lower rates of wellbeing, have ecological footprints within the Earth’s biocapacity 
  • 3 countries that stayed ‘green’ were Ecuador, Armenia, and Sri Lanka – each had high life expectancy with low (sustainable) ecological footprints
  • Only 27% of countries have a per capita footprint that is lower than earth’s biocapacity.

Putting it all together: the Happy Planet Index score

If you’re used to looking at more traditional measures of development – the HPI results will be surprising.

The Happy Planet Index rankings, based on 2019 data
  • Latin America is mostly in the green – the best performing world region on the HPI – outperforming wealthier countries like in North America.
  • A lot of European countries also came up green – mainly due to declines in ecological footprint – with Switzerland rising to the top 5!
  • While its ecological footprint has declined, the USA is still performing ‘inefficiently’ at 122nd place. It still uses over 5 planets worth of resources. 

Key trends over time: pre & post pandemic

  • Some world regions saw HPI scores rise – Western Europe, due to declining ecological footprints and Africa due to rapidly rising life expectancy without the same kind of rise in ecological footprint.   
  • The index increased by 3 points in 2019 since 2016 – meaning that we are becoming more efficient at delivering longer, happier lives with fewer environmental resources
  • While much of the data from 2020 was estimated, it still provided interesting lessons from the pandemic: ecological footprint has dropped by 6.5% globally – and 15% in wealthier countries. Meanwhile, wellbeing didn’t fall in all countries – and actually rose in some (per data from the Gallup World Poll, Eurobarometer, and national statistics agencies, like in Italy). 

This is a potentially positive story: It is possible to reduce our ecological footprints while maintaining a good quality of life.  

Overall, what is the Happy Planet Index telling us? 

Countries like Costa Rica show its possible to have high life expectancy and wellbeing with much lower ecological footprints than wealthier countries. In other words:

But, no country delivers high levels of happy life years with a low ecological footprint yet.

While we’ve made some progress – we’re not getting there fast enough to address challenges like the climate and biodiversity crises.

That needs to change.

Our panel on making the Happy Planet Index practical and actionable

Next, we jumped into our panel discussion, which kicked off a flurry of comments and questions in the chat.

The panelists discussed the key challenge for metrics like the Happy Planet Index:

“How do we go beyond it being a metric to compare and to see how we’re doing, to being a framework that is used to determine what policies that governments and others take forward.”  

Sophie

I can’t take credit for this – but someone told me that this was the best panel discussion they’ve attended this entire year. Thanks Liz, Lorenzo, Sophie, and Tim for inspiring hope and challenging our thinking!

Key highlights from the panel discussion and Q&A session:

How is the HPI helpful for creating a new vision for an economy and for helping us work towards it?

Values are guiding principles in how we make decisions in life. Standard measures of progress like the Dow Jones, GDP, etc value financial success, economic growth, making as much money as possible. The values that drive those measures and are reinforced when those measures go up.

The real promise of HPI and other sorts of measures like it is to reorient citizens, politicians, and organisations, towards a different set of values than those which have been traditionally by purely economic indicators.

How do we make this a reality?

Indicators like HPI have to be taken as seriously as our current indicators are. Imagine a world in which you hear in the news and from political leaders at all levels and from friends – just as much info about how wellbeing in nation is doing right now, or how many bird species have gone extinct as we hear about stock indicators, gdp, etc. 

With more exposure of indicators telling us how well we’re doing on delivering these intrinsic values, people will start to think they are important and put pressure on their politicians to make institutional policy decisions to maximise those values – just like right now, they are putting pressure on politicians to maximise other economic outcomes. 

Some of this is happening at city, state, and regional  levels – but we need to ramp this up to really have success. This is what needs to happen with an indicator like the HPI. 

Tim

How is Wales leading the way to a Wellbeing Economy?

Wales is the only country in the world that has legislated to protect the interests of future generations through the Wellbeing of Future Generations Act, which focuses on achieving seven national wellbeing goals. This legislation has been driving a different approach to decision making. In developing Wales’ new ‘Beyond Recycling’ strategy, the government made the connections between zero waste and community wellbeing and tackling loneliness and isolation. What has zero waste got to do with that?

To achieve multiple of the seven national wellbeing goals – ecological resilience, inequality, community cohesion, etc – the Zero Waste initiative is doing things like establishing community libraries, library of things, repair cafes – which bring those two things together. It’s bringing people together to reduce waste and also build relationships in their communities.

I’m proud of the Welsh government’s economic strategy — which doesn’t mention GDP. What it does say – right up front – is that improving the wellbeing of everyone in Wales is the government’s economic mission. 

Sophie

Why are decision-makers not already making this shift to prioritising the wellbeing of people and planet? How can we address these barriers to change and get political traction?

One of the reasons is that the status quo is much easier. We live in a world where there is a huge amount invested in the current economic world working. So, anyone trying to push against that is pushing against a big machine.

In terms of that shift – we are really reliant on courageous pioneers – but there aren’t enough of those at the national level! We can’t wait for those few national leaders … we need this to happen fast and at scale.

We need to start supporting local place based change — cities, regions, local areas that can start creating that momentum. 

The big barrier is the sense that it’s not possible. But, even without endless financial resources or legislation – a lot of this is mindset, about how you’re making those decisions, what you’re prioritising, what compass you’re using.

Local places can start doing that tomorrow: they can start saying, in our area – a tiny town or big city or region – we’re going to make our decisions based on this compass, not a compass that has gotten us into this unbelievable mess in the first place.

Liz

There’s no easy answer to it, but it’s a good start to do it bit by bit. For example, in Wales, one intervention was in stopping a motorway from going ahead because it couldn’t demonstrate how that was in line with our Wellbeing of Future Generations Act. This has now led to transformation in the whole approach to transportation planning.

But if we started with trying to change the whole transportation planning system, it would have been too big and difficult. You’ve got to start somewhere and start building a movement around challenging and speaking out when decisions are being taken that are not in line with delivering wellbeing and happiness. 

Sophie

Who are the actors that need to be involved in shifting priorities of economic decision making, and how can they use a tool like the HPI to effect change?

At least two actors are fundamental – but are not usually engaged: business and media.

Not everyone understands the value of this immediately – and it’s our job to create the demand for new indicators. It’s not enough to publish it – we need to be active scientists – we need to tell a story – we need to make sure that an entrepreneur sees that the HPI is useful to showcase what he or she does. 

It’s not enough to have one “heroic person: that tries to push this agenda — it can’t be isolated. Around that story, we need to build lots of other stories that amplify the impact. 

Lorenzo

What other tools or stories does the HPI story need to work with to gain traction overall?

The HPI has to work with all the subjective wellbeing indicators – the alternative GDP movement, everything that is moving in that direction – they may not be the same thing but they are telling a very similar story. 

It’s crucial to showcase all these indicators as ways of doing economics better – about living better and doing better.

We need to have a better story to sell. “Doing better” if we prioritise a wellbeing approach to decision making, is a good story. This will give us a competitive edge over the captivating and competitive story of “doing more”, which is what the current economic system is promoting. 

Lorenzo

How might we apply a “restorative climate justice” lens to making this shift? 

When we talk about restorative climate justice – we are looking at past, current, and future generational justice issues – huge past injustices that hugely affect lives of current generations. When we take on this new kind of legislation / way of thinking / compass, we need to really start to challenge these inequalities that came from the past and look at the future and make sure what we do is sustainable.

Liz

Can ‘wellbeing’ act as a competitive advantage? 

Just like New Zealand has done such a good job at attracting rich people from other countries to live in New Zealand – that’s the kind of tool we need to give to all countries and say to them, “use this – you are going to create better jobs, people will live longer, you’ll reduce crime, and get a lot of investment from overseas, and rich people will want to come live here. Why? Because you pollute less, you live longer, you have better wellbeing outcomes than anywhere else.” 

As a national policymaker, that’s what I would want to have, because I want to be better than the others, I want to compete.

That’s how you make an indicator powerful. Once it gets catchy, it gets picked up by different countries. Wellbeing Economy Governments (WEGo) countries will hopefully do this – become a reference point for the rest of the world. You get competitive and others will want to be like you. That’s the edge I want to see coming out of this discussion. 

Lorenzo

What’s not to love about a sustainable wellbeing focused approach? The world is kind of moving on. Our young generations want entirely different things – they don’t want work-life balance – they want life-work balance. If we’re going to attract those quality young people to come and work in our country, then we need to recognise that. And that plays into the wellbeing and happiness agenda. 

Sophie

These are all lessons that the Happy Planet Index, and other similar metrics, must apply in order to move the needle in decision making at all levels. As Lorenzo put it, “the power of an indicator is defined by the ability that it has to transform the political system where it is applied”.

Are you inspired to work with us towards creating sustainable wellbeing?

There are lots of ways to get involved: 

  • Join WEAll’s global network of organisations, movements, individuals, and policymakers who are working towards a Wellbeing Economy – one designed to serve people and planet.

Together, let’s create a world we all want, where good lives don’t cost the earth. 

Watch the full recording of the event here.

For those who didn’t get a chance to have their questions answered during the event, check out our Frequently Asked Questions page. We’re updating it regularly as more questions come in!

Want to get in touch? Email us at: happyplanet@weall.org