From gross domestic product to gross national happiness

happiness

Happiness, a word that everybody possibly understands and has experienced at some point, is also a factor that is gaining popularity as a measurement of success for both governments and businesses.

But happiness… What does it have to do with success?

GDP as actual measure of success

First of all, let’s define success.

We live in a capitalist economic system in which the whole world is pursuing growth.

Growth is everything. An (unsustainable) ever-expanding growth is the base of our current economic system’s success: valuations need to grow, profits need to grow and revenues too. And what is more, economic growth is often considered “the end goal of development with human beings as the productive workers that are the means to this end” [1].

The Limits of Growth (Meadow et al.), already stated in 1972 that, by maintaining or increasing the current economic growth levels or relying only on technology to overcome the resource shortage, the global system would “overshoot and collapse” by the mid 21st century. However, by changing the view of the purpose of development we could reach a “stabilized world”.

Luckily, a new vision of the purpose of development is already challenging this economic growth paradigm. The human development approach, which understands people as the ends of development, considers economic growth to be one of the means to achieve human potential instead of being the main goal.

Therefore, this shift of unit of measurement – from economic to human – makes progress to be reconceived as sustainable. But, can it be implemented into our actual governance and policy making?

These people-centered values are difficult to be incorporated since GDP is the measure of success and so, “the dominant source of feedback upon which policy decisions are based” [2]. Neither GDP nor its cousin GNP provides information on how sustainably the economy is operating.

Therefore, policy information should be better in order to direct policy towards this sustainable development vision in order to change social and cultural norms.

Bhutan, the country that rejected GDP as the only measure of progress

Bhutan – a tiny country located at the foothills of Himalaya, between its powerful neighbours, China and India – is the real illustration of Meadows et al.’s sustainable system and a clear example of putting society, environmental conservation, and sustainability at the heart of a country’s political agenda.

For the last thirty years, Bhutanese prosperity has been measured through Gross National Happiness (GNH), where the new vision that is supported by GNH indicators, and social and cultural norms coexist and reinforce that vision.

“Happiness cannot come purely from material economic development, but it must be very carefully balanced with the spiritual health, with the environment and generally with the quality of life” [3]. So the concept of happiness does not only involve a personal stable feeling but a broader set of components that could be expressed as wellbeing.

For the past three decades, this belief of wellbeing as a preferable measure of progress over material growth, has been globally perceived quite odd. However, currently, in a time of economic, social and environmental crisis, this Buddhist state’s development approach seems to be attracting a lot of interest.

Bhutan, the mirror for the entire world

Since 2011, the UN, endorsed by 68 countries, has been considering ways to replicate the Bhutanese model worldwide by searching for a new approach to development where the pursuit of happiness is considered a fundamental human goal.
Conscious about the fact that “the GDP indicator by nature was not designed to and does not adequately reflect the happiness and well-being of people in a country” [4], the UN has developed some measures to pursue a sustainable growth.

The “World Happiness Report”, a UN initiative which measures happiness of 150 nations, has been created to help countries guide their public policies. The 2013 report revealed very interesting results as the population-weighted average only scored of 5.1 out of 10.

This score indicates that we should keep working on this new vision of growth and development at a fast speed. However, it also proves the growing concern about happiness among leaders, which raises the following question: If more leaders are paying attention to happiness, should companies also consider happiness as a measure of success?

Companies are also on board

During the last decades, a new trend has emerged: companies have started to integrate the so-called, Corporate Social Responsibility (CSR) into their business model.

This first step – recognizing economic, social and environmental aspects as the three main pillars to be successful – has been recently taken further, understanding human well-being as the “heart of success and progress” [5].

Companies play a crucial role in contributing to society. They do not only have an impact on their consumer wellbeing, production services and supply chain, but also on their staff, whose happiness and wellbeing are starting to be one of the measures of success.

It has been proved that those companies having happier staff achieve less periods of sick leave, and more engaged, creative and collaborative employees which will have a direct positive impact on production. Thus, treating staff well is a key component to outperform competitors.

Therefore, the signs of a rising aligned worldwide demand are starting to be a fact. We are not talking about a movement driven only by a tiny, mountainous and unconnected Asian country, but by many leaders, companies and citizens who feel that what really matters for a sustainable future is wellbeing.

References:
[1] Sen, A.K. “Development as Capability Expansion” in S. BROOKS, J. (2013) “Avoiding the Limits to Growth: Gross National Happiness in Bhutan as a Model for Sustainable Development”. Sustainability [online]. Available from: www.mdpi.com/journal/sustainability. [Accessed: Feb 2015].

[2] Deiner, E.; Seligman, M.E.P. “Beyond money: toward an economy of well-being” in S. BROOKS, J. (2013) “Avoiding the Limits to Growth: Gross National Happiness in Bhutan as a Model for Sustainable Development”. Sustainability [online]. Available from: www.mdpi.com/journal/sustainability. [Accessed: Feb 2015].

[3] “Bhutan: The Kingdom Where GDP Is Measured In Happiness” (2007). Documentary. Journeyman Pictures [online]. Available from: http://goo.gl/wCQPFR. [Accessed: Feb 2015].

[4] UN General Assembly (2011) “Happiness: towards a holistic approach to development ” in UNRISD (2014), “Happy Country, Happy Government: How Useful are International Happiness Rankings?” [online]. Available from: http://goo.gl/xsdpaK [Accessed: Feb 2015]

[5] WILLIAMSON, M. (2013) in WONG, H.A. (2013). “Happiness: the next big business metric?”. The Guardian [Online]. Available from: http://goo.gl/dxgNJG [Accessed: Feb 2015].

MEADOWS, D.H.; RANDERS, J.; MEADOWS, D. “Limits to Growth: The 30-Year Update” in S. BROOKS, J. (2013) “Avoiding the Limits to Growth: Gross National Happiness in Bhutan as a Model for Sustainable Development”. Sustainability [online]. Available from: www.mdpi.com/journal/sustainability. [Accessed: Feb 2015].

S. BROOKS, J. (2013) “Avoiding the Limits to Growth: Gross National Happiness in Bhutan as a Model for Sustainable Development”. Sustainability [online]. Available from: www.mdpi.com/journal/sustainability. [Accessed: Feb 2015].

Graham Turner (2008). “A Comparison of `The Limits to Growth` with Thirty Years of Reality”. Elsevier [online] Available from: http://goo.gl/BZ3HpO. [Accessed: Feb 2015].
THIMPTHU, A.K. (2012). “Gross national happiness in Bhutan: the big idea from a tiny state that could change the world”. The Guardian [online]. Available from: http://goo.gl/4R0QVj [Accessed: Feb 2015].

WONG, H.A. (2013). “Happiness: the next big business metric?”. The Guardian [Online]. Available from: http://goo.gl/dxgNJG [Accessed: Feb 2015].
“Report calls on policy makers to make happiness a key measure and target of development” (2013). Sustainable Development Solutions Network [Online]. Available from: http://unsdsn.org/resources/publications/world-happiness-report-2013/ [Accessed: Feb 2015].

Photo: ABC Religion and ethics