Joseph Stiglitz appropriately congratulates the OECD in taking a step forward to improve measurement of social progress in line with recommendations of the Stiglitz, Sen, Fitoussi report on the inadequacies of GDP as a measure of wellbeing. It’s easy to agree with the original report on “Mismeasuring Our Lives” and with Stiglitz’s comment that “if we measure the wrong thing, we will do the wrong thing.” The data and measures proposed in How’s Life should be used by governments and social activists to improve national and global policy-making. But how will that work in practice? The reality is that GDP as a target and measure of social policy is deeply entrenched in all national policy-making—and other rival (such as HDI, Happiness index) indices of wellbeing have failed to have much impact on either policy analysis or practice. Perhaps the data and analysis in HL will be better and more clearly organized, but what are the political and professional incentives that can help establish such a shift in governance practice? The bureaucratic, professional, and political infrastructure supporting the compilation of GDP and its centrality in economic modelling is formidable and the procedures of the UN System of National Accounts, while constantly reviewed will change only slowly. The evolution of the GDP measure and the SNA and the problems are well described in Ehsan Masood’s The Great Invention. Diana Coyle, who reviewed Masood’s book relatively favourably is one of many professionals advocating change in the way that GDP is compiled and used, though she favours a ‘dashboard’ set of indicators (along the lines of HDI and HL) rather than Masood’s complete reconstruction of GDP.

A more radical change in the prevailing social contract is needed, particularly in terms of addressing the growing need for collective goods and services. Many businesses now concede that their responsibilities must extend beyond the commercial bottom line and that their use of natural, human, and social capital must be covered in their annual reports and financial statements. The International Integrated Reporting Council (IIRC) has formulated principles of accountability that would require all entities, whether government or private to deal, not only with commerce’s financial, manufactured, and intellectual forms of capital, but also with broader society’s natural, intellectual, and social capital stocks and flows. These principles, drawn from standard business and government process and practice, strongly reject neoliberal theory that business by its nature can meet all of society’s objectives through its commercial operations. Accepting entity responsibility for management of all forms of capital should, eventually, lead to entity and national accounts that give a measure of changes in most aspects of social wellbeing—not merely commercial profit.

No question, all these changes will take time. But increasingly society is becoming aware of the risks of ignoring the evidence for and threats of climate change, and it is becoming much more conscious of the potential costs of inequality and the emerging menace of monopolistic use of social capital. Yes, I agree that HL is a step forward in recognizing the need to reform our social wellbeing measurement, but much more and better coordinated effort is required to build a thorough governance and societal response to this century’s challenges.