The Happy Planet Index: Global Leaders in Sustainable Wellbeing with KPI

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The Happy Planet Index: Global Leaders in Sustainable Wellbeing with KPI

The Happy Planet Index: Measuring What Matters Most

The Happy Planet Index (HPI), now spearheaded by the Hot or Cool Institute, is a leading alternative to GDP that measures what truly matters: the efficiency with which countries transform the Earth’s limited resources into long, happy lives for their citizens. In May 2024, the Hot or Cool Institute released the sixth edition of the index, introducing groundbreaking data on how internal income inequality affects a nation's sustainability and wellbeing.

What is The Happy Planet Index?

The Happy Planet Index (HPI) is a global metric that measures how efficiently countries provide long, happy lives for their citizens while staying within planetary boundaries. Unlike GDP, which tracks economic growth, the HPI combines wellbeing, life expectancy, and carbon footprint. In the 2024 report by the Hot or Cool Institute, Vanuatu ranked as the most efficient nation, while many G7 countries lagged behind due to high ecological costs.

📊 The Core Formula

Unlike traditional economic indices that prioritize production, the HPI uses a "socio-ecological efficiency" equation. It essentially asks: How much "wellbeing" do we get per unit of "environmental impact"?

The index is calculated using three primary metrics:

  1. Life Expectancy: The average number of years a person is expected to live.

  2. Self-Reported Wellbeing: Based on the "Ladder of Life" survey, where residents rate their life satisfaction from 0 to 10.

  3. Carbon Footprint: The total greenhouse gas emissions per capita associated with consumption within that country.

The Goal: A "good" HPI score requires high longevity and happiness while staying within a "fair consumption space"—defined in the 2024 report as a maximum of 3.17 tonnes of $CO_2e$ per capita.

🏆 Key Findings from the 2024 Report

The latest report reveals a sobering reality: no country has yet achieved a "perfect" score (high wellbeing within ecological limits). However, the rankings highlight clear leaders in efficiency:

  • Top Performers: Vanuatu took the #1 spot, followed by Sweden, El Salvador, Costa Rica, and Nicaragua.

  • The GDP Paradox: High GDP does not guarantee a high HPI. In fact, 6 out of the 10 wealthiest nations have below-average HPI scores because their environmental costs far outweigh their marginal gains in happiness.

  • The "Carbon Elite": In almost every country, the top 10% of earners have the lowest HPI scores. Their carbon footprint is significantly higher, yet their wellbeing scores do not rise proportionally.

🌿 About the Hot or Cool Institute

Based in Berlin, the Hot or Cool Institute is a public interest think tank exploring the intersection of society and sustainability. They took over the Happy Planet Index to align it with their mission of "1.5-Degree Lifestyles"—working toward a future where everyone can live well within the global warming limits set by the Paris Agreement.


The Happy Planet Index: Global Leaders in Sustainable Wellbeing

The 2024 report by the Hot or Cool Institute highlights a select group of nations that are successfully "decoupling" high quality of life from high environmental destruction. While no country has achieved a perfect "green" score across every category, these leading nations represent the world's best examples of socio-ecological efficiency.

1. Vanuatu: The Global Leader

Vanuatu stands as the overall #1 because it achieves the highest level of wellbeing per unit of environmental impact.

  • The Performance: With a life expectancy of 70.4 years and a robust wellbeing score of 7.1/10, the nation proves that "the good life" does not require massive industrial consumption.

  • Ecological Edge: Its carbon footprint is just 2.6 tonnes of $CO_2e$, well below the global fair-share limit of 3.17 tonnes.

  • Secret to Success: The report attributes Vanuatu's success to its strong "informal" economy, where community support, traditional knowledge, and sustainable land use prioritize social stability over financial accumulation.

2. Sweden: The High-Income Exception

Sweden holds the #2 spot, a rare feat for a highly industrialized G7-adjacent nation.

  • The Performance: It boasts an elite life expectancy of 83 years and one of the highest wellbeing scores in the world (7.4/10).

  • The Trade-off: Its carbon footprint (8.7 tonnes) is over the fair-share limit, yet it remains significantly lower than other wealthy nations like the USA or Australia.

  • Secret to Success: Sweden has successfully integrated high-quality public services with aggressive climate policy, proving that developed nations can maintain top-tier wellbeing while drastically reducing their ecological toll.

3. El Salvador: Efficiency in Latin America

Ranking #3, El Salvador is a prime example of a nation that "punches above its weight" economically.

  • The Performance: Despite having a much lower GDP than Western nations, residents report a high level of life satisfaction (6.4/10).

  • Ecological Edge: It maintains a very low carbon footprint of just 2.03 tonnes, making it one of the most ecologically responsible countries in the top ten.

4. Costa Rica: The Sustainable Pioneer

A long-time champion of the HPI, Costa Rica ranks #4 in the 2024 edition. While it dropped from its previous #1 spot due to the economic impacts of the pandemic, it remains a global blueprint for sustainability.

  • The Performance: High life expectancy (77 years) and a culture of Pura Vida keep wellbeing high.

  • Secret to Success: Costa Rica generates nearly 99% of its electricity from renewable sources. By abolishing its army in 1948 and redirecting those funds into healthcare and environmental protection, it has built a society focused on long-term resilience rather than military or industrial growth.

5. Nicaragua: Regional Consistency

Rounding out the top five, Nicaragua reflects a regional trend where Latin American countries achieve high life years and happiness with relatively low resource use.

  • The Performance: It maintains a life expectancy of 73.8 years and a carbon footprint of 2.61 tonnes.

  • Key Takeaway: Like its neighbors, Nicaragua demonstrates that social connectivity and a smaller industrial scale can lead to a higher HPI than the "wasteful" consumption models found in North America.

Summary Table: The Top 5 (2024)

RankCountryLife ExpectancyWellbeing (0-10)Carbon Footprint (CO2​e)
1Vanuatu70.47.12.6 t
2Sweden83.07.48.7 t
3El Salvador70.76.42.0 t
4Costa Rica77.06.44.4 t
5Nicaragua73.86.12.6 t


The Mechanics of Progress: Explaining HPI Key Performance Indicators

While GDP focuses on the quantity of economic activity, the Happy Planet Index (HPI) measures the socio-ecological efficiency of a nation. It essentially acts as an efficiency ratio: the "output" of human wellbeing divided by the "input" of environmental cost.

To understand how a country ranks, the Hot or Cool Institute evaluates three core Key Performance Indicators (KPIs).

1. Life Expectancy (Health Output)

This is the most objective "hard" data point in the index. It uses data from the UN to determine the average number of years a person is expected to live in a given country.

  • The Logic: Long life is a fundamental prerequisite for wellbeing.

  • The Target: The HPI considers 75 years or more to be the "Green" (optimal) threshold.

2. Self-Reported Wellbeing (Happiness Output)

Instead of measuring wealth, the HPI asks people directly how they feel about their lives. This uses the "Cantril Ladder" (or Ladder of Life) data from the Gallup World Poll.

  • The Question: Respondents imagine a ladder from 0 (worst possible life) to 10 (best possible life) and state which step they currently stand on.

  • The Target: A score of 6.0/10 or higher is considered the benchmark for a "good" life.

3. Carbon Footprint (Environmental Input)

The most critical change in the 2024 edition was the shift from "Ecological Footprint" to a specific Consumption-based Carbon Footprint. This measures the greenhouse gas emissions associated with everything a country consumes, including imported goods.

  • The Logic: To be truly successful, a country must provide good lives without overshooting its share of the global carbon budget.

  • The Target: The "Fair Consumption Space" is defined as a maximum of 3.17 tonnes of $CO_2e$ per capita.

The "Traffic Light" Scoring System

The Hot or Cool Institute uses a color-coded system to show how countries perform across these three KPIs. This makes it easy to see where a nation is failing:

KPI🟢 Green (Good)🟡 Amber (Middling)🔴 Red (Poor)
Wellbeing> 6.04.6 – 6.0< 4.6
Life Expectancy> 75 yrs64 – 75 yrs< 64 yrs
Carbon Footprint< 3.17 t3.17 – 7.18 t> 7.18 t

Key Takeaway: Most Western nations (like the USA and Germany) score 🟢 Green on Wellbeing and Life Expectancy but 🔴 Red on Carbon Footprint. Conversely, many developing nations score 🟢 Green on Carbon Footprint but 🔴 Red or 🟡 Amber on Health and Wellbeing.

The HPI leaders are the rare few that manage to get "Green" or high "Amber" across all three categories simultaneously.

A New KPI: The Inequality Disaggregation

For the first time in 2024, the report added a "hidden" KPI: Internal Income Inequality. By breaking down HPI scores by income bracket, they discovered that in almost every nation, the richest 10% have the worst (lowest) HPI scores. This is because their carbon footprint skyrockets while their happiness levels only show "diminishing returns"—proving that extreme wealth is an inefficient way to produce happiness.


The Visionaries Behind the Data: Organizations and Founders

The Happy Planet Index is not just a spreadsheet; it is the result of a multi-decade collaboration between economists, statisticians, and social scientists who believe that national success should be measured by human and planetary health rather than financial transactions.

1. The Hot or Cool Institute (Current Custodians)

Based in Berlin, Germany, the Hot or Cool Institute took over the responsibility for the HPI in 2023. As a public interest think tank, their mission is to provide the science needed to transition toward "1.5-Degree Lifestyles."

  • The Role: They manage the data collection, analyze the impact of income inequality on sustainability, and published the landmark 2024 report.

  • Key Figure: Dr. Saamah Abdallah, the Programme Lead for Sustainable Wellbeing at Hot or Cool, has been a core developer of the index since its inception in 2006.

2. The New Economics Foundation (The Pioneers)

The New Economics Foundation (NEF) is a British think tank that originally launched the HPI in 2006. Their goal was to challenge the dominance of GDP and "mainstream" economic thinking.

  • The Legacy: NEF housed the index for its first four editions, establishing it as the world’s first global measure of sustainable wellbeing.

3. Nic Marks (The Creator)

The HPI was originally conceived by statistician Nic Marks. He founded the Centre for Wellbeing at the NEF and famously introduced the index to the global stage in his 2010 TED Talk, which has since been viewed millions of times.

  • The Philosophy: Marks argued that the environmental movement should stop using "scary" data and instead focus on a positive vision: that a happy life doesn't have to "cost the Earth."

4. The Wellbeing Economy Alliance (WEAll)

A global collaboration of organizations and governments, WEAll managed the index between 2019 and 2021. They remain a primary partner, using HPI data to advocate for "Wellbeing Economies" where the goal of policy is to ensure that everyone thrives within planetary boundaries.

Evolution of the HPI Management

PeriodLeading OrganizationKey Development
2006 – 2018New Economics Foundation (NEF)Launched HPI 1.0; defined the original "Ecological Footprint" metric.
2019 – 2022Wellbeing Economy Alliance (WEAll)Integrated the index into the global "Beyond GDP" political movement.
2023 – PresentHot or Cool InstituteShifted to "Carbon Footprint" metrics and introduced income inequality analysis.

Data Partners and Contributors

To maintain scientific rigor, these organizations rely on high-level data from several global institutions:

  • Gallup World Poll: Provides the "Ladder of Life" wellbeing data.

  • United Nations: Provides Life Expectancy and population statistics.

  • Global Footprint Network / UNEP: Contributes the environmental impact data used to calculate the carbon and ecological footprints.


The Foundation of the Index: Global Data Sources

To ensure that the Happy Planet Index (HPI) is both scientifically rigorous and globally comparable, the Hot or Cool Institute relies on high-quality, independent data from three primary international bodies. This "triangulation" of data allows the index to map human health and happiness against the hard reality of environmental limits.

1. Subjective Wellbeing: The Gallup World Poll

The "happiness" component of the HPI is derived from the Gallup World Poll, specifically the Cantril Self-Anchoring Scale (often called the "Ladder of Life").

  • The Process: In over 150 countries, representative samples of approximately 1,000 people per country are asked to imagine a ladder where 10 is the best possible life and 0 is the worst. They then report which "step" they currently stand on.

  • Why this source: Gallup’s methodology is the gold standard for subjective wellbeing, providing a consistent metric that has been tracked since the 1960s.

2. Health and Longevity: The United Nations (UNDP)

Life expectancy data is sourced primarily from the United Nations Development Programme (UNDP) and the UN Population Division.

  • The Process: This data tracks the average number of years a newborn is expected to live if mortality patterns remain constant.

  • Adjustments: In cases where UN data is delayed (such as during the peak of the COVID-19 pandemic), the Hot or Cool Institute uses national statistics to calculate absolute changes and harmonizes them with UN baselines.

3. Environmental Impact: The Global Carbon Atlas & World Inequality Database

A major technical shift in the 2024 edition was moving from "Ecological Footprint" to Consumption-based Carbon Footprint.

  • The Data: The index uses data from the World Inequality Database (WID), which builds upon the Global Carbon Atlas and the Eora Global Supply Chain Database.

  • The Metric: Unlike "territorial" emissions (what a country produces), this measures consumption-based emissions. If a smartphone is made in China but bought in the UK, the carbon cost is attributed to the UK’s footprint. This prevents wealthy nations from "outsourcing" their pollution to lower the score of developing ones.

Data Source Summary Table

ComponentSource OrganizationPrimary Metric
WellbeingGallup World PollCantril Ladder (0–10 scale)
Life ExpectancyUnited Nations (UNDP)Years of life at birth
Carbon FootprintWorld Inequality Database (WID)Tonnes of $CO_2e$ per capita
InequalityHot or Cool Institute AnalysisDisaggregated income decile data

The "Inequality Disaggregation" Innovation

In 2024, the Hot or Cool Institute added a layer of complexity by sourcing income distribution data. By overlaying carbon and wellbeing data with income brackets, they created a new way to see how inequality "breaks" the efficiency of a nation. This allows the HPI to show that even within a high-ranking country, the "carbon elite" (the top 10%) are often living much less efficiently than the rest of the population.

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