On the fourth of January, 1934,

A young man delivered a report

to the United States Congress

that 80 years on,

still shapes the lives of
everyone in this room today.

Still shapes the lives of
everyone on this planet.

That young man wasn't a politician,

he wasn't a businessman,

a civil rights activist,

or a faith leader.

He was the most unlikely of heroes,

an economist.

(Laughter)

His name was Simon Kuznets

and the report that he delivered was called,

"National Income, 1929-32"

Now, you might think that

this is a rather dry and dull report,

and you're absolutely right.

It's dry as a bone.

But this report is the foundation

of how, today, we judge the 
success of countries.

What we know best as
Gross Domestic Product,

or GDP.

GDP has defined and shaped our lives

for the last 80 years.

And today I want to talk about

a different way to measure
the success of countries.

A different way to define 
and shape our lives

for the nest 80 years.

But first, we need to understand

how GDP came to
dominate our lives.

Kuznet's report was delivered

at a moment of crisis.

The U.S. economy was plumetting

into the Great Depression.

and policy makers were 
struggling to respond.

Struggling because they didn't
know what was going on.

They didn't have data and statistics.

So what Kuznet's report gave them

was reliable data on what 
the U.S. economy

was producing,

updated year by year.

And armed with this information,

policy makers were, eventually,

able to find a way out 
of the slump.

And because Kuznet's invention

was found to be so useful,

it spread around the world.

And now today, every country

produces GDP statistics.

But, in that first report,

Kuznets himself delivered a warning.

It's in the introductory chapter,

page 7 he says,

"The welfare of a nation can, therefore,

scarcely be inferred

from a measurement of 
national income

as defined above."

It's not the greatest soundbite 
in the world,

And it's dressed up in the 
coursest language

of the economist,

but his message was clear,

GDP is a tool

to help us measure
economic performance.

It's not a measure
of our wellbeing.

And it shouldn't be a guide

to all decision making.

But we have ignored

Kuznet's warning.

We live in a world where

GDP is the benchmark of sucess

in a global economy.

Our politicians boast when
GDP goes up,

Markets move

and trillions of dollars in capital

move around the world

based on which countries
are going up,

and which countries 
are going down.

All measured in GDP.

Our societies have become

engines to create more GDP.

But we know that GDP is flawed.

It ignores the environment.

It counts bombs and prisons and progress.

It can't count happiness

or community.

And it has nothing to say

about fairness or justice.

Is it any surprise,

that our world,

marching to the drumbeat of GDP,

is teetering on the brink

of environmental disaster

and filled with anger and conflict?

We need a better way

to measure our societies.

A measure based on the real things

that matter to real people.

Do I have enough to eat?

Can I read and write?

Am I safe?

Do I have rights?

Do I live in a society where
I'm not discriminated against?

Is my future

and the future of my children

prevented from environmental disaster?

These are questions that GDP

does not and cannot answer.

There have, of course,

been efforts in the past

to move beyond GDP.

But I believe that we're living

in a moment when we

are ready for a measurement revolution.

We're ready because we've seen,

in the financial crisis of 2008,

how our fetish for economic growth

led us so far astray.

We've seen in the Arab Spring

how countries like Tunisia

were supposedly economic superstars

but they were societies

that were seething with discontentment.

We're ready because today

we have the technology

to gather and analyze data

in ways that would have been

unimaginable to Kuznets.

Today, I'd like to introduce you to

the Social Progress Index.

It's a measure of the wellbeing of society,

completely separate from GDP.

It's a whole new way
[Social Progress Index]

of looking at the world.

The Social Progress Index

begins by defining what it

means to be a good society

based around three dimensions:

The first is, does everyone have
the basic needs for survival?

Food, water, shelter, safety.

Secondly, does everyone have

access to the building blocks

to improve their lives?

Education, information, health
and sustainable environment.

And then third,

does every individual have access

to the chance to pursue their goals

and dreams and ambitions

free from obstacles?

Do they have rights?

Freedom of choice?

Freedom from discrimination

and access to the the world's
most advanced knowledge?

Together, these 12 components

form the Social Progress framework.

And for each of these 12 components,

we have indicators to measure

how these countries are performing.

Not indicators of effort or intention,

but real achievement.

We don't measure how much

a country spends on healthcare,

we measure the length and quality

of people's lives.

We don't measure whether governments

pass laws against discrimination,

we measure whether people 
experience discrimination.

But, what you want to know

is who's top, don't you?

I knew that, I knew that, I knew that.

Okay, I'm going to show you.

I'm going to show you on this chart.

So here we are,

what I've done here is 
put on the vertical axis

social progress.

Higher is better.

And then, just for comparison,

just for fun,

on the horizontal axis,

is GDP per capita.

Further to the right is more.

Okay,

the country in the world

with the highest social progress,

the number one country on social progress

is New Zealand.