Measuring social progress

Over the past few years there have been a multitude of shifts in the type of reporting expected from companies of all shapes and sizes.

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From the changes related to the Strategic Report, those to be rolled out with the EU Directive on Non-Financial Reporting or the continued momentum of the Integrated Reporting framework, there is no doubt that people want to know more about how a company is working in relation to the wider environment alongside their long term forecasts.

While lots of changes have happened around reporting for companies, relatively little has changed for countries. This looks set to change after the EU recently committing to look beyond just GDP and measure a country's worth using Professor Michael Porter’s Social Progress Index.

After relying on Gross Domestic Product (GDP) since 1934 as an indicator for progress and growth in a country, the Social Progress Index looks into matters such as Basic Human Needs, Foundations of Wellbeing and Opportunity, which can be split down further into issues such as access to technology and ecosystem sustainability.

According to the Social Progress Imperative, “Measuring social progress guides us in translating economic gains into advancing social and environmental performance in ways that will unleash even greater long-term economic success.”

This change in measurement is unlikely to have an impact on stock markets as there is much debate about their correlation with GDP, but it is likely that this expanded level of measurement for countries could in turn encourage further steps in to transparent sustainable, long term reporting.