‘If the populace & corporate players embrace sustainability, both wellbeing & GDP will gain’
Shedding light on a 2019 move by the New Zealand Government to re-engineer its national Key Performance Indicator (KPI) to track national wellbeing, Franco Azzopardi – Chairman and CEO of Express Trailers – has praised the country for its bold move.
“Re-writing economics. New Zealand have taken the bold step of changing its national KPI of the long-standing measure of GDP to national well-being. Moving from hard numbers to what matters in society.”
There has been a growing tide against the use of GDP as a measure of national well-being, as critics argue where income inequality is present, a rising GDP does not translate into an increase of national wellbeing across society.
GDP represents the market value of all good and services produced by the economy, including consumption, investment, government purchases, private inventories and the foreign trade balance.
Health, satisfaction and work-life balance, on the other hand, are considered as key indicators of well-being.
Shining a spotlight on the debate, Mr Azzopardi says that New Zealand’s move against GDP as the sole indicator of wellbeing “assumes, and generally holds true, that economic results don’t impinge on well-being, or perhaps better, is not the only measure of success.
“It’s been hard-coded in people that economic wealth is the ultimate contributor to well-being even if we ultimately realise it’s not.
“At the same time, is well-being affected by economic prosperity? Most probably for the many of us mortals it is indeed.”
Mr Azzopardi adds that in the corporate world, change is taking place towards sustainability, which is captured in ESG – environmental, societal and governance.
“Question is should ESG be a measure of business success or is business success a measure of ESG? I think one fuels the other in an iterative process. But I too believe that if the populace and the corporate players embrace sustainability, then both the well-being of people and GDP will gain.”