Adjusting the social footprint methodology based on findings of subjective wellbeing research

Abstract

Purpose

Following some years of practical application, some weaknesses have been identified in the original 2018 version of the ‘social footprint’ methodology, where wellbeing was seen as exclusively related to consumption activities and as inseparably linked to production through the budget constraint, implying that the value of wellbeing was limited to be a mirror of the value of production. Several improvements in both methodology and data are presented here.

Methods

The theoretical improvements are inspired by the suggestion of Juster et al. (Rev Income Wealth 27: 1–31, 1981) that wellbeing can be seen as the sum of the value added generated from work and the intrinsic activity benefits, i.e. the positive affect from performing or taking part in specific work or leisure activities. This implies a relatively low preference for income relative to intrinsic activity benefits, which is confirmed by recent findings of subjective wellbeing research. Other findings of subjective wellbeing research provide a constraint on the conversion factor between Disability-Adjusted Life-Years (DALY) and Quality-Adjusted person-Life-Years (QALY), leading to a surprising 0.3 QALY/DALY, against the more intuitive 1 QALY/DALY. These theoretical improvements, combined with the availability of more recent country-specific data on impacts on wellbeing, allow to calculate a global potential level of wellbeing of 0.958 QALY/person-life-year, replacing the global potential productivity of the 2018 version of the ‘social footprint’ methodology.

Results and discussion

The new country-specific data allows the valuation of impacts on wellbeing to be assessed separately from the valuation of inequality, the latter now done with equity weights relative to country-specific average income baselines, rather than to the global baseline used in the 2018 version.

Conclusion

The new data confirm the dominating role of impacts of missing governance, now quantified at 78% of all sustainability impacts, which was the original motivation and rationale behind the 2018 version of the ‘social footprint’ methodology.

Appendix 1. Non-production-specific impacts vs. impacts attributable to specific activities

As a streamlined approach, the social footprint methodology initially focuses on the macro-scale impacts of non-production-specific impacts, i.e. impacts unrelated to enterprise-specific actions and choice of technology (Weidema 2018). Therefore, it is important to separate these non-production-specific impacts from the impacts that are attributable to specific activities, especially to avoid double-counting when the latter are treated separately in the impact assessment. This annex describes the division of the overall wellbeing impacts into these two groups. Table 3 provides an overview of the size of the global annual impacts for year 2019, expressed in million QALY, following Section 5 in Weidema (2022b). To obtain data per person, divide by the global 2019 population of 7.7 billion.

Table 3 Distribution of global annual impacts, expressed in million QALY, over the impacts that are attributable to specific activities and non-production-specific impacts. Data for year 2019 from Weidema (2022b)

Table 4 provides the shares of non-production specific impacts per country and the absolute numbers in million QALY for the 64 countries with largest contributions to the global total.

Obviously, the 64 countries in Table 4 include mainly developing countries and a few large developed economies, while the smaller and richer countries with smaller contributions are part of the ‘Rest of World’

Table 4 Sum of non-production-specific impacts per country. Data for year 2019 from Weidema (2022a)