Proposing a composite environmental index to account for the actual state and changes in environmental dimensions, as a critique to EPI

Abstract

While environmental composite indexes are useful tools in ranking the relative performance of countries on characteristics of interest, critiques are being made about their lack of relevance and responsiveness pertaining to changes in the environment; this negatively affects their usefulness and relevance. In this paper, an alternative to the Environmental Performance Index (EPI) is proposed by constructing a proof-of-concept index based on component variables whose changes reflect the actual state of the environment and the environmental sustainability on the particular dimensions measured. The proposed Environmental State and Sustainability Index (ESSI) also takes into account the relationships between variables in constructing the composite index by checking the relevance of the theoretical environmental dimensions against factor components, which explains the complex relationships between environmental variables and aims at achieving a relevant weighting of the component variables. Results indicate that ESSI scores are comparable with EPI and reflect better the actual situation of some countries with high-rank differences. Thus, ESSI can be used as a basis for constructing or revising environmental indicators that are closer to the objective of achieving a truly overarching measure of the state of the environment that is relevant in informing policy and reflect actual changes in the component dimensions as relevant data becomes available.