The Inclusive Wealth Index is a new sustainability index that is meant to replace Gross Domestic Product (GDP) and the Human Development Index (HDI), and measures wealth using countries' natural, manufactured, human and social capital.
It was revealed in the Inclusive Wealth Report, an analysis of the inclusive wealth of 20 countries representing 56% of world population and 72% of world GDP, including high, middle and low-income economies on all continents.
17 June 2012: The UN University’s International Human Dimensions Programme on Global Environmental Change (UNU-IHDP) and the UN Environment Programme (UNEP) have jointly launched the Inclusive Wealth Index (IWI), a new sustainability index that goes beyond other traditional economic and development indices.
The IWI is set out in the “Inclusive Wealth Report 2012: Measuring Progress Toward Sustainability,” produced by UNU-IHDP and UNEP. The Report provides a comprehensive analysis of the different components of wealth by country, and is intended to be produced every two years. It proposes the IWI, an index that measures wealth using countries’ natural, manufactured, human and social capital, and which is intended as a replacement to Gross Domestic Product (GDP) and the Human Development Index (HDI).
The Report presents the inclusive wealth of 20 countries representing 56% of world population and 72% of world GDP, including high, middle and low-income economies on all continents. It concludes that: human capital has increased in every country and is the main capital form that offsets the decline in natural capital in most economies; there are clear signs of trade-off effects between the different forms of capital; and technological innovation and/or oil capital gains outweigh decline in natural capital and damages from climate change.
The Report also contains a set of recommendations and calls on countries to, inter alia: invest in renewable natural capital such as reforestation and agricultural biodiversity; and incorporate the IWI in their planning and development ministries in order to encourage the creation of sustainable policies. [UNU Press Release] [Publication: Inclusive Wealth Report 2012: Measuring Progress Toward Sustainability]