1. Introduction

1Economic interpretations of sustainability today are usually based on the consensus reached by the World Commission on Environment and Development (WCED), which defined sustainable development as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (WCED 1987, p. 43).

2Although economists now generally accept the WCED definition of sustainability, in the 1970s and 1980s there was less agreement on what sustainable development means. As pointed out by Pearce et al. (1989, p. 28), the problem was that the concept was too broad and open to interpretation: «Definitions of sustainable development abound. There is some truth to the criticism that it has come to mean whatever suits the particular advocacy of the individual concerned. This is not surprising. It is difficult to be against ‘sustainable development’. It sounds like something we should all approve of, like ‘motherhood and apple pie’.»

3One of the earliest attempts in economics to operationalize sustainable development was the systems approach, which characterizes sustainability as the maximization of goals across environmental, economic and social systems (Barbier 1987; Barbier and Markandya 2012; Ekins 1994; Elliott 2006; Holmberg and Sandbrook 1992; Pezzey and Toman 2002). This approach is attributed to Barbier (1987), who first identifies three systems as basic to any process of development: the environmental (or ecological) system, the economic system and the social system. He proposes that «the general objective of sustainable economic development, then, is to maximize the goals all these systems through an adaptive process of trade-offs» (Barbier 1987, p. 104). This can be represented by a Venn diagram, which depicts sustainable development as the intersection of the goals attributed to the environmental, economic and social systems (see Figure 1 in the next section).

4The Venn diagram of sustainable development originated by Barbier (1987) has become a popular way of representing sustainability as an overall goal. However, it has been less useful for translating the concept into specific policy actions for managing the three systems to improve sustainability. A key limitation to the systems approach to sustainability is that «there is no guidance as to how the tradeoffs among the goals of the various systems should be made» (Barbier and Markandya 2012, p. 38). Appropriate goals for the environmental, economic and social systems also need to be selected. As suggested by Holmberg and Sandbrook (1992, p. 24), «choices must therefore be made as to which goals should receive greater priority. Different development strategies will assign different priorities.»

5However, this impasse changed with the establishment of the Sustainable Development Goals (SDGs), which built on the earlier Millennium Development Goals (MDGs) (UN 2015a). The SDGs were formally adopted in 2015 by the General Assembly of the United Nations (UN) as its 2030 agenda for sustainable development (UN 2015b). The 17 SDGs that comprise this objective are a complex system comprising 169 targets and currently about 230 indicators. The UN agenda emphasizes that the interlinkages and integrated nature of the SDGs are of crucial importance in ensuring that sustainable development is realized. More importantly, each SDG can be identified as primarily an economic, environmental, or social system goal, and thus, it is possible to determine whether progress towards achieving one goal by 2030 will come at the sacrifice or improvement of other goals (Barbier and Burgess 2017 and 2019; Costanza et al. 2016; Gupta and Vegelin 2016; Sachs 2012). Thus, collectively the UN’s SDG targets can be considered a representation of the systems approach to sustainable economic development, and increasingly various analytical frameworks are being developed to assess possible tradeoffs and complementarities in attaining the different goals (Allen et al. 2019; Barbier and Burgess 2017 and 2019; Costanza et al. 2016; Nilsson et al. 2016; Nilsson et al. 2018; von Stechow et al. 2016).

6The following paper shows the link between the systems approach to sustainability and the Sustainable Development Goals (SDGs). This link should not be surprising, as both developed from similar trends in sustainability thinking over the past 50 years or so. Both approaches arose through concerns that development based solely on economic progress is insufficient to meet additional social priorities and environmental objectives. Thus, the systems approach to sustainability was influenced by development thinking in the 1960s and 1970s that emphasized meeting the «basic needs» of the poor and conservationist concerns over the state of the global environment (Barbier 1987; Ekins 1994; Elliott 2006; Holmberg and Sandbrook 1992). Equally, the SDGs were developed in recognition that declining environmental goals may inhibit long term sustainable development, even with short term improvements in economic and social goals (Anand and Sen 2000; Griggs et al. 2013; Gupta and Vegelin 2016; Pradahan 2017; Sachs 2012). Consequently, the SDGs «aim for a combination of economic development, environmental sustainability, and social inclusion» (Sachs 2012, p. 2206), thus meshing well with the systems approach of sustainability that seeks «to maximize the goals all these systems through an adaptive process of trade-offs» (Barbier 1987, p. 104).

7This paper is organized as follows. The next section describes the evolution of the systems approach of sustainability, and how it was shaped by key development and environmental influences on sustainability thinking from the late 1960s and 1970s. The subsequent section shows that these same influences helped propel the emergence of the SDGs and the UN’s Agenda 2030 in more recent years. The paper then discusses recent approaches that explore the link between the systems approach to sustainability and the SDGs, and the development of various analytical frameworks to assess possible tradeoffs and complementarities in attaining the various environmental, economic and social goals. The conclusion explores further research issues and challenges in operationalizing the systems approach to further sustainability and analyzing tradeoffs and synergies among the SDGs.

2. Sustainability and the Systems Approach

8In the late 1960s and 1970s, the rise of conservation movements worldwide led to calls for a re-thinking of the role of the environment in development (IUCN 1980; Schumacher 1973; UN 1972; Ward and Dubos 1972). By the 1980s, this led to «the growing recognition that the overall goals of environmental conservation and economic development are not conflicting but can be mutually reinforcing,» which in turn «prompted serious policymaking interest in environmentally sustainable development.» (Barbier 1989, p. 37).

9The 1972 United Nations Conference on the Human Environment, held in Stockholm, is usually credited with popularizing this view [1]. However, the origins of «ecologically» sustainable development can be traced back to the Paris Biosphere Conference and the Washington D.C. Conference on the Ecological Aspects of International Development, which were both held in 1968 (Caldwell 1984). By the end of the 1970s, this concept was firmly established in the international policy-making community. For example, the 1980 World Conservation Strategy emphasized «the maintenance of essential ecological processes and life-support systems, the preservation of genetic diversity, and the sustainable utilization of species and ecosystems» with the overall aim of achieving «sustainable development through the conservation of living resources» (IUCN 1980, section 8.4.i and p. IV).

10Concern during this era that natural resource and environmental scarcity would constrain and potentially undermine economic growth was examined in the report «The Limits to Growth» by Meadows et al. (1972). The idea that the world would «run out» of various resources instigated considerable debate. On the one hand, Georgescu-Roegen and Daly, amongst others, argued that there are physical limits to production that would constrain economic growth in the long term (Georgescu-Roegen 1971; Daly 1974). On the other hand, Solow and Stiglitz explored how technical progress and capital substitution, could enable constant or increasing consumption over time (Solow 1974a and 1974b; Stiglitz 1974). Later, Solow (2009) extended this viewpoint to show how exhaustible resource depletion, and its potential constraint on growth, could be offset by transition to an alternative or «backstop» technology (Couix 2019).

11These insights enabled economists to develop a capital approach to sustainability. This approach asserts that the value of the aggregate stock of all capital – physical, human and natural – must be maintained or enhanced over time to ensure that overall welfare does not decline (Barbier 2019). However, within this approach, there are contrasting weak versus strong sustainability views, which differ in the treatment of natural capital (Barbier 2019; Barbier and Markandya 2012; Neumayer 2010; Pearce et al. 1989; Toman et al. 1995; Turner 1993). As pointed out by (Barbier and Markandya 2012, p. 42), «the main disagreement is whether natural capital has a unique or essential role in sustaining human welfare, and thus whether special ‘compensation rules’ are required to ensure that future generations are not made worse off by natural capital depletion today». Weak sustainability assumes that there is no difference between natural and other forms of capital (e.g. human or physical), and thus as long as depleted natural capital is replaced with more value human or physical capital, then the total value of wealth available to current and future generations will increase. In contrast, strong sustainability argues that some natural capital is essential (e.g. unique environments, ecosystems, biodiversity and life-support functions), subject to irreversible loss, and has uncertain value. Consequently, the sustainability goal of maintaining and enhancing the value of the aggregate capital stock requires preserving essential natural capital.

12The 1970s also saw another major revision in development thinking, which was influenced by an emphasis on meeting the «basic needs» of the poor (ILO 1976; Stewart 1985; Streeten et al. 1981). For example, the ILO report for the 1976 World Employment Conference defined basic needs in terms of food, clothing, housing, education, employment, health and transportation, along with an emphasis on «grassroots» participation in decision-making (ILO 1976). The call for a basic needs strategy put poverty alleviation and reducing inequality at the heart of economic development, or at the very least, minimum criteria for assessing progress. Thus, Meier (1976, p. 6) defined economic development as the «process whereby the real per capita income of a country increases over a long period of time – subject to the stipulations that the number below an ‘absolute poverty line’ does not increase, and that the distribution of income does not become more unequal.» However, others suggested that «socially» sustainable development should be a goal in itself, and ultimately concerned with «putting people first» (Cernea 1985; Goulet 1971; Uphoff 1985). That is, for economic development to be truly «sustainable» it requires «tailoring the design and implementation of projects to the needs and capabilities of people who are supposed to benefit from them.» (Uphoff 1985, p. 359). More generally, to be socially and culturally sustainable, «development must be gauged by the values [which] a society itself, or some member thereof, deems to be requisite for its health and welfare» (Goulet 1971, p. 333).

13By the 1980s, it became clear that, to be truly sustainable, economic development must be both «ecologically» and «socially» sustainable [2]. However, economists also cautioned that broadening the concept of development to include «ecological» and «social» sustainability goals requires accounting for trade-offs among the various economic, environmental and social objectives. For example, while lauding the general underlying message, Tisdell (1983) criticized the definitions and objectives of «ecologically» sustainable development in the 1980 World Conservation Strategy for being too vague for practical application and ignoring crucial tradeoffs among economic and conservation goals. Similarly, Barbier (1987, p. 103) argued that, to be truly «sustainable», «any development effort must surmount a continuous and dynamic configuration of trade-offs, such as between increasing productivity and environmental degradation, or improving the status of women and preserving traditional values, or introducing new techniques and relying on traditional skills. Assessing the appropriate choice in the face of these trade-offs will require knowledge of the benefits and costs in alternative decisions.»

14This comprehensive view of sustainable development became the genesis of the systems approach, which characterizes sustainability as the maximization of goals across priority systems, such as environmental, economic and social systems (Barbier 1987; Barbier and Markandya 2012; Ekins 1994; Elliott 2006; Holmberg and Sandbrook 1992; Pezzey and Toman 2002). The systems approach can be reflected in a Venn diagram (see Figure 1), which depicts sustainable development as the intersection of the goals attributed to three interlinked systems: environmental (or ecological), economic and social. The Venn diagram representation of sustainability now has many versions, but was first employed by Barbier (1987) and depicted the maximization of goals across environmental, economic and social systems. For illustrative purposes, environmental systems goals may be reflected by indicators such as biological productivity, resilience and biodiversity amongst other factors. Likewise, economic systems goals may be depicted by attributes such as efficiency, equity and reduced poverty. Social systems goals may be reflected by indicators of social wellbeing, such as social justice (i.e. access to wealth, opportunities and privileges), good governance and social stability.

15One important insight is that attempting to maximize the goals for just one system does not necessarily achieve sustainability, because the impacts on the other systems are ignored (Holmberg and Sandbrook 1992). For example, achieving greater efficiency, equity and reduced poverty in economic systems may generate unintended negative environmental and social impacts that undermine ecological and social systems. As shown in Figure 1, the latter approach to development fails to recognize that environmental, economic and social systems are interlinked, and that progress solely focused on one system’s goals could have important consequences for the other systems.

16Instead, sustainable development can only be achieved by balancing the tradeoffs and synergies among the various goals of the three systems [3]. As explained by Barbier (1987, p. 104), although «each system has its own set of human-ascribed goals», attaining «sustainable development involves a process of trade-offs among the various goals of the three systems». Attempting to maximize the goals for just one system, or even two, does not achieve sustainability either, because the costs and benefits imposed on the other systems are not taken into account. For example, an economic system may be efficient, and even equitable, in the allocation of resources but still generate environmental degradation that threatens biological productivity, biodiversity and the resiliency of ecosystems. Thus, the economic system should strive for efficiency, equity and poverty reduction, but at the same time account for the impacts on biological productivity, biodiversity and ecological resilience as well as the implications for social justice, good governance and social stability. «The general objective of sustainable economic development, then, is to maximize the goals across all these systems through an adaptive process of trade-offs» (Barbier 1987, p. 104), which is illustrated by the intersection of the environmental, economic and social systems in the Venn diagram of Figure 1.

Figure 1

The Systems Approach to Sustainability

The Systems Approach to Sustainability

17Although the systems approach to sustainability has conceptual appeal, it does have practical limitations in terms of applicability and guidance for policy (Barbier and Markandya 2012; Pezzey and Toman 2002). Barbier and Markandya (2012, p. 38) point out that operationalization has been limited, because the approach offers «no guidance as to how the tradeoffs among the goals of the various systems should be made. How should we decide to trade off, for example, more economic efficiency for less biodiversity and ecological resilience?» As suggested by Holmberg and Sandbrook (1992, p. 24), a more fundamental problem is deciding on the overall economic, environmental and social goals, and «choices must therefore be made as to which goals should receive greater priority. Different development strategies will assign different priorities.» To assist policy makers in making these choices among sustainability goals, it is necessary to know what are the gains and losses – i.e. the different welfare implications – of such choices. That is, if we decide to prioritize improvements towards one goal or set of goals, and there are consequences for achieving another goal, is there likely to be a net gain in welfare from this choice?

18These challenges to implementing the systems approach to sustainability remained largely unresolved, until the emergence of the Sustainable Development Goals (SDGs) in the early decades of the 21^st century.

3. The UN Sustainable Development Goals (SDGs)

19In September 2000, the United Nations Millennium Declaration committed Member States to reduce extreme poverty and other development goals, with a deadline of 2015. Eventually, other broad targets were agreed, which have become known collectively as the Millennium Development Goals (MDGs) (UN 2015a). The goals comprising the MDGs were accompanied by specific targets set for the year 2015, such as halve, between 1990 and 2015, the proportion of people whose income is less than one dollar a day and reduce by two-thirds, between 1990 and 2015, the under-five mortality rate.

20The MDGs were the culmination of efforts over several decades by the international community to agree a set of global development goals and targets (Hulme 2009). By the 1990s, a number of influential reports from international meetings and organizations had established different lists of agreed targets, including Shaping the 21^st Century (DAC 1996), the Human Development Report 1997 (UNDP 1997) and We the Peoples (Annan 2000). These targets were eventually debated and modified by the UN at the Millennium Summit in 2000 to form the eight MDGs:

21

• Goal 1: Eradicate Extreme Poverty and Hunger
• Goal 2: Universal Primary Education
• Goal 3: Promote Gender Equality and Empower Women
• Goal 4: Reduce Child Mortality
• Goal 5: Improve Maternal Health
• Goal 6: Combat HIV/AIDS, Malaria and other Diseases
• Goal 7: Ensure Environmental Sustainability
• Goal 8: Develop a Global Partnership for Development.

22This list consists of mainly economic and social goals, with one over-arching goal for environmental sustainability (Goal 7). To achieve this objective, Goal 7 consists of four main targets: integrate the principles of sustainable development into country policies and reverse the loss of environmental resources, reduce biodiversity loss, halve the proportion of the population without sustainable access to safe drinking water and basic sanitation, and improve the lives of those living in slums (UN 2015a). Thus, to some extent, the MDGs affirmed «further acceptance of the arguments that development and poverty reduction had to involve environmental goals» (Hulme 2009, p. 18), which as we have discussed in the previous section, had been gaining momentum in the international policymaking community since the early 1970s.

23The MDGs received widespread support from the international community, led by the UN Secretary-General Kofi Annan. The MDGs were also championed by Jeffrey Sachs, who not only strongly advocated in favor of the approach in his popular writings (Sachs 2005) but also agreed to head the UN’s Millennium Project that was tasked with implementing the goals (Sachs and McArthur 2005). Sachs’ involvement and direction of the Millennium Project proved critical in how the MDGs were viewed and ultimately implemented by the international community. As noted by Fukuda-Parr et al. (2013, p. 20), as originally envisioned, the MDGs «can be used in two ways: first as benchmarks in monitoring progress toward important objectives; and second to communicate an important normative objective based on shared values.» However, Sachs argued in favor of the former: «The UN Millennium Project’s core operational recommendation is that every developing country with extreme poverty should adopt and implement a national development strategy that is ambitious enough to achieve the MDGs» (Sachs and McArthur 2005, p. 350).

24Progress in achieving the eight MDGs was mixed (Asadullah and Savoia 2018; McArthur and Rasmussen 2018; Sachs 2012; UN 2015a). In addition, critics of the approach maintain that the poor performance of some low and middle-income countries in attaining the goals, especially in Sub-Saharan Africa, was due to the misuse of the goals as barometers of progress rather than as an overall guide for development efforts (Easterly 2009; Fukuda-Parr et al. 2013; Vandemoortele 2009). For example, according to Easterly (2009, p. 26), «the MDGs were meant as a major motivational device to increase development efforts in and on behalf of poor countries» but they instead became «poorly and arbitrarily designed to measure progress against poverty and deprivation». Equally problematic was the choice of targets for some of the goals, such as environmental sustainability (Goal 7). One of the targets, integrate the principles of sustainable development into country policies and programs and reverse the loss of environmental resources, was never quantitatively assessed (UN 2015a), and the two other targets under Goal 7, halve by 2015 the proportion of people without sustainable access to safe drinking water and to have achieved a significant improvement in the lives of at least 100 million slum dwellers by 2020, are less environmental than social or economic goals.

25Despite these problems, it soon became clear that «globally agreed goals to fight poverty should continue beyond 2015», and should be based on «a shared focus on economic, environmental, and social goals», which is «a hallmark of sustainable development and represents a broad consensus on which the world can build» (Sachs 2012, p. 2206). Consequently, in 2015, the General Assembly of the United Nations (UN) adopted 17 Sustainable Development Goals (SDGs). The aim of these goals is to set attainable targets that can achieved as a 2030 agenda for sustainable development; e.g., «the goals and targets will stimulate action over the next 15 years in areas for critical importance for humanity and the planet» (UN 2015b, p. 5). The SDGs are further decomposed into 169 targets, and there are currently about 230 indicators that have been proposed for realizing these targets.

26To date, quantitative assessment of the 17 SDGs has largely focused on formulating appropriate targets and indicators for each goal, designing new metrics for monitoring overall success, and collecting comprehensive and reliable data (Campagnolo et al. 2018; Colglazier 2015; Costanza et al. 2016; Dang and Serajuddin 2020; Hák et al. 2016; Le Blanc 2015; Lu et al. 2015; Reyers et al. 2017). Such progress is essential, to ensure that the proliferation of targets and indicators does not undermine the aim of the SDGs to provide a coherent framework for coordinated action across environmental, economic and social policy domains (Reyers et al. 2017). Thus, selecting appropriate indicators for each goal and evaluating the relevance of the indicators is important to operationalizing the SDGs (Hák et al. 2016).

27Recently, there have been several efforts to create an aggregate indicator of the SDGs as a means to measure progress towards all 17 goals simultaneously (Sachs et al. 2018; Biggeri et al. 2019). However, the practicality of establishing such an aggregate SDG indicator is highly challenging. It requires choosing which targets and indicators to use, how much weight to attribute to each measure, and how to aggregate the data. In addition, as in the case of the MDGs, there is an underlying concern that the SDGs were intended as an overall guide to development efforts rather than as a monitor and measure of actual progress. Other measures and indicators of sustainability include the UN Inclusive Wealth Index (IWI), which measures sustainability of the economy and societal wellbeing based on a country’s wealth in terms of natural, manufactured, human and social capital (UN 2012). The World Bank similarly tracks the wealth of countries (where wealth is taken to include produced, natural and human capital, plus foreign assets minus liabilities) as an indicator of sustainable economic development (World Bank 2018). The use of such aggregate indicators as a measure of sustainability can be challenging, especially because the overall index could be increasing even though one or more goals may be declining. That is, so long as the fall in a declining goal is more than compensated for by the rise in other goals that are increasing, then the aggregate measure will indicate that a country is on a sustainable development path.

28Much less attention has been devoted to estimating possible tradeoffs and complementarities in attaining the different SDGs. Such an assessment is also crucial, given the emphasis on the interlinked and integrated nature of the SDGs and the need to make progress on all 17 goals to ensure sustainability (Sachs 2012; UN 2015b and 2019). Although it may be possible to make progress across all 17 goals independently, it is more likely that improvement toward one SDG by 2030 may come at the expense or by aiding another goal. Such tradeoffs and complementarities clearly exist, as highlighted by the United Nations’ report on progress in attaining the various 2030 SDG targets (UN 2019). The report notes that, since 2000, extreme poverty has continued to decline, infant and maternal mortality rates have dropped, and the proportion of the global population with access to electricity has increased. On the other hand, the per capita «material footprint» of developing countries has grown, the global share of sustainably fished stocks has declined, the Earth’s forest areas continue to shrink, and more than half of children and adolescents worldwide remain illiterate. Other studies also emphasize potential interactions among attaining different SDGS (Barbier and Burgess 2017 and 2019; Nilsson et al. 2016; von Steckhow et al. 2016). In effect, such analysis of the possible tradeoffs and complementarities among the 17 SDGs illustrates the application of the systems approach to sustainability.

4. The SDGs and the Systems Approach

29The SDGs adopted by the UN fits well within the systems approach to sustainable development discussed previously. First, the 2030 Agenda emphasizes that the SDGs are interlinked, and that ensuring integration across all 17 goals is critical to achieving sustainable development (UN 2015b). Second, the 17 SDGs represent a clear choice by the international community as to which goals should receive priority in the quest for sustainable development globally, which Holmberg and Sandbrook (1992) have stressed is an important precondition for implementing the systems approach. Finally, and most importantly, each of the SDGs can be characterized as a goal primarily attributed either to the economic, environmental or social system. Grouping the 17 goals under the three systems makes it is possible to determine whether progress towards achieving one goal within a system, such as the economic system, by 2030 will come at the sacrifice or improvement of other goals in the same economic system or in the other social and environmental systems (Barbier and Burgess 2017 and 2019; Costanza et al. 2016; Gupta and Vegelin 2016; Sachs 2012).

30For example, Barbier and Burgess (2017) suggest how each of the 17 SDGs of the 2030 agenda (UN 2015b) can be designated as primarily a goal associated with the economic, environmental or social system. Their classification of the 17 SDGs by system type is shown in Table 1. According to this classification, there are seven economic system goals, five environmental system goals, and five social system goals. As the authors acknowledge, their assignment of the 17 SDGs as being primarily «economic», «environmental» or «social» is somewhat arbitrary. Some of these SDGs may be considered to overlap more than one type of system [4].

Table 1. The 17 Sustainable Development Goals

1. No Poverty: End poverty in all its forms, everywhere (Economic)

2. Zero Hunger: End hunger, achieve food security and improved nutrition and promote sustainable agriculture (Economic)

3. Good Health and Well Being: Ensure healthy lives and promote well-being for all at all ages (Economic)

4. Quality Education: Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all (Social)

5. Gender Equality: Achieve gender equality and empower all women and girls (Social)

6. Clean Water and Sanitation: Ensure available and sustainable management of water and sanitation for all (Economic)

7. Affordable and Clean Energy: Ensure access to affordable, reliable, sustainable and modern energy for all (Economic)

8. Good Jobs and Economic Growth: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all (Economic)

9. Industry, Innovation and Infrastructure: Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation (Economic)

10. Reduced Inequalities: Reduce inequality within and among countries (Social)

11. Sustainable Cities and Communities: Make cities and human settlements inclusive, safe, resilient and sustainable (Environment)

12. Responsible Consumption and Production: Ensure sustainable consumption and production patterns (Environment)

13.Climate Action: Take urgent action to combat climate change and its impacts (Environment)

14. Life Below Water: Conserve and sustainably use the oceans, seas and marine resources for sustainable development (Environment)

15. Life on Land: Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss (Environment)

16. Peace, Justice and Strong Institutions: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels (Social)

17. Partnerships for the Goals: A successful sustainable development agenda requires partnerships between governments, the private sector and civil society. These inclusive partnerships built upon principles and values, a shared vision, and shared goals that place people and the planet at the center, are needed at the global, regional, national and local level (Social)

Table 1. The 17 Sustainable Development Goals

Figure 2

The Systems Approach to Sustainability Applied to the 17 SDG

The Systems Approach to Sustainability Applied to the 17 SDG

31Despite these caveats, designating each SDG in Table 1 as primarily either an economic, environmental or social goal is critical for applying the systems approach to sustainability and enabling analysis of progress in attaining the various SDGs. For example, by re-arranging the 17 SDGs by system, one can obtain a revised and updated version of the Venn diagram of sustainability, where the SDGs are now depicted as the new economic, environmental and social system goals (see Figure 2). Grouped in this way, the 17 SDGs represent the UN’s goals for attaining sustainable development across the three interlinked systems. Thus, as Figure 2 indicates, sustainable development represents the intersection of the 17 goals attributed to the environmental, economic and social systems, which can be achieved only by balancing the tradeoffs and synergies among the goals of the three systems. Consequently, what is required is an analytical approach for estimating these potential tradeoffs and synergies to show the gains and losses involved.

32An increasing number of studies have attempted to develop such an analytical framework. For example, Pradhan et al. (2017) systematically assess correlations between SDG indicators using data for 227 countries. They identify a statically significant positive correlation between a pair of SDG indicators as a synergy, whereas a statistically significant negative correlation between indicator pairs is classified as a trade-off. These synergies and trade-offs between SDG pairs are then ranked at the country and global scale to identify the most frequent interactions. The authors propose that this ranking can then assist in prioritizing policies to promote sustainable development. Pothen and Welsch (2019) explore the relationship between economic growth and environmental impact, in this case materials use (represented by domestic material consumption and material footprint) for middle and low-income countries using country level data from 1990-2008. They show that overall improvements in economic growth are associated with an increased use of materials and thus environmental system stress. However, more developed countries appear to have outsourced material-intensive production, and demonstrate a relative decoupling of GDP growth and domestic material consumption.

33Allen et al. (2019) adopt a multi-criteria analysis (MCA) framework to assess and prioritize SDG targets, based on their ranking according to «level of urgency», «systemic impact» and «policy gap». Utilizing a number of approaches within the MCA framework to take account of target feedbacks and interlinkages, and mapping policy alignments and gaps, the authors show how MCA can provide an assessment approach to support national planning and reporting. Nilsson et al. (2016) also propose mapping interactions between the 17 SDGs using a rubric for systematically assessing interactions. They establish a 7-point scale from +3 to -3 to represent the range of synergies and trade-offs between the different SDGs. These scores are then used to map interactions between the SDGs and inform decision makers of the negative and positive interactions between the SDGs. Nilsson et al. (2016) find that, in Sub-Saharan Africa, Zero Hunger (SDG 2) interacts positively with several other goals – including No Poverty (SDG 1), Good Health and Well Being (SDG 3) and Quality Education (SDG 4) – but interacts negatively with Affordable and Clean Energy (SDG 7) and Life on Land (SDG 15). Similarly, von Steckhow et al. (2016) discover possible tradeoffs between Climate Action (SDG 13) and several other SDGs. While such approaches can assist in the analysis of SDG targets and indicators, the assignment of scores may be somewhat subjective and arbitrary, and weights may be required to prioritize key goals.

34Ivanov and Peleah (2018) develop a conceptual framework for assessing progress towards sustainable development whilst accounting for trade-offs and complementarities based on the existing Human Development Index (HDI). The authors broaden the basic HDI index to reflect the status and process of achieving sustainable human development with respect to environmental considerations. The HDI is extended from three dimensions (i.e. health, education and living standards) to include a fourth environmental component to create a single index of a sustainable HDI. Costanza et al. (2016) identify three broad approaches that could be applied to assess progress towards the SDGs. These are: i. production, consumption and wealth-based indicators; ii. aggregation of SDG indicators into a unit-less index; and iii. statistical analysis of SDG contributions to subjective wellbeing. The authors go on to discuss a hybrid approach to link the SDGs to a Sustainable Wellbeing Index (SWI), whilst taking account of stocks and flows of natural and social capital. The authors propose that such a hybrid model could be used to assess progress towards sustainable wellbeing.

35Sachs et al. (2018) construct a single unified indicator, the Sustainable Development Goal Index (SDG-I), to monitor progress at the global level. As noted previously, the practicality of establishing such an aggregate SDG indicator is highly challenging and requires choosing which targets and indicators to use given the availability and reliability of the data, as well as how much weight to attribute to each measure. Biggeri et al. (2019) extend the Sachs SDG-I to incorporate an alternative approach to data aggregation, known as the Multidimensional Synthesis of Indicators (MSI) approach. They apply this to the SDGs to establish an adjusted SDG-I, called the Integrated-SDG Index (I-SDI). This could eventually be used to identify SDG patterns, outcomes and performance within and between countries over time. The authors argue that at the global level, longer term time series of the I-SDI would provide better understanding of the synergies and trade-offs among the SDGs and thus pathways to sustainable development (Biggeri et al. 2019).

36Perhaps the only economic approach to estimating progress in attaining one SDG while accounting for interactions in achieving other goals has been developed by Barbier and Burgess (2017 and 2019). The authors base their approach on standard methods for measuring the welfare effects arising from changes in imposed quantities (Freeman 2003; Lankford 1988) to devise an analytical model to estimate the welfare effects of progress in attaining one SDG while accounting for interactions in achieving other SDGs. They use this model as the basis for constructing an analytical framework to estimate the «willingness to pay» (WTP) in dollar terms by a representative individual for an improvement in one SDG indicator, whilst taking into account possible simultaneous changes – positive or negative – in other SDG indicators.

37For example, Barbier and Burgess (2019) apply this method to the world and low-income countries over 2000-2016. For the world, the authors estimate that the per capita welfare change of reductions in 2000-2016 poverty rates net of any gains or losses in attaining each of the remaining 16 goals is $12,737 per capita. This is more than double the welfare change of $5,671 per person for poverty reduction alone from 2000 to 2016. However, once interactions with other SDGs are taken into account, the net welfare change for poverty reduction in poor economies from 2000 to 2016 is $244 per person, which is almost 20% lower than the welfare estimate of $299 per capita of poverty reduction on its own. The implications are that low-income countries achieved less progress in achieving overall sustainable development compared to all countries in the world.

38Several implications for policy emerge from this analysis by Barbier and Burgess (2019). First, reducing poverty and improving other important social and economic SDGs over 2000-2016 may have come at the expense of making our economies less sustainable, especially with respect to «environmental» goals, such as SDGs 11 to 15 (see Table 1). Lack of progress in attaining any one of these latter goals, such as climate action, may on its own be sufficient to constrain future progress towards all other SDGs goals. Second, low-income countries should be a priority in policy efforts to improve global sustainability. As the authors’ analysis shows, the SDG indicators that improved for poor economies over 2000-2016 generally increased less than for the world. However, the declines in SDG indicators were substantially much larger for low-income countries, and the aggregate effect of the interactions across all SDGs was to lower the net benefits from reducing poverty. Thus, future policies should focus on the specific sustainability challenges faced by poor economies in implementing the 2030 sustainable development agenda.

5. Conclusion

39One of the first attempts in economics to explain sustainable development was the systems approach, which suggests that sustainability can only be achieved by balancing the tradeoffs among the various goals across environmental, economic and social systems (Barbier 1987; Barbier and Markandya 2012; Ekins 1994; Elliott 2006; Holmberg and Sandbrook 1992; Pezzey and Toman 2002). This approach was directly related to early sustainability thinking from the late 1960s and 1970s, and tried to reconcile concepts of «ecologically» and «socially» sustainable development in an overall concept of sustainability. Although conceptually appealing and easy to visualize (see Figure 1), the systems approach provided little policy guidance on how to assess the tradeoffs among various system goals or how to determine the welfare implications of such choices, until the emergence of the Sustainable Development Goals in 2015 as part of the 2030 Sustainable Development Agenda of the United Nations (UN 2015b).

40There is now a growing literature that seeks to analyze more systematically the potential interactions among various SDGs (Allen et al. 2019; Barbier and Burgess 2017 and 2019; Costanza et al. 2016; Ivanov and Peleah 2018; Nilsson et al. 2016; von Stechow et al. 2016; Sachs et al. 2018; Biggeri et al. 2019). Yet, some challenges remain. Much attention has focused on the choice of relevant SDG indicators, and on whether some critical social, environmental and economic goals may be under-represented or ignored among the 17 SDGs of UN Agenda 2030 (Hák et al. 2017; Nilsson et al. 2016; Reyers et al. 2017). For example, it is widely recognized in economics that good governance and institutional quality are essential for long-run development success (Glaeser et al. 2004; Gradstein 2004; Rodrik et al. 2004). There is also empirical evidence suggesting that more effective institutions and governance could be crucial to sustaining progress towards extreme poverty reduction and other key SDGs (Asadullah and Savoia 2018). Advances in the various approaches that examine the possible interactions among SDGs should take into account additional indicators that capture the quality of institutions and governance across countries and the implications for sustainability.

41The aim of the SDGs is to provide guidance to countries in attaining key economic, environmental and social benchmarks that are considered essential to sustainable development. Interpreting the relevance of SDGs as a guide to sustainability requires understanding fully their limits as a policy tool. The goal-oriented approach that began with the Millennium Development Goals formulated in 2000 and was adopted by the UN Agenda 2030 for the SDGs has been subject to several criticisms. One concern is that such goals were meant to apply only at the global level, not at the country or regional level (Vandermootele 2009). Others suggest that, as benchmarks for gauging progress toward important objectives, the SDGs should not be treated as planning goals, and when used as measures of national performance, the criterion of success should focus on the pace of progress rather than on achieving the targets (Fukuda-Parr et al. 2013). From a policy perspective, there are also two ways to interpret the SDGs: as performance measures or as ambitious targets meant to motivate extra effort toward achieving them (Easterly 2009). More attention needs to be given to these criticisms, if the application of the systems approach and the SGDs is to be a useful guide for achieving sustainability.

42Finally, there is a growing scientific literature emphasizing that human populations and economic activity are rapidly exceeding «planetary boundaries», which could lead to abrupt phase changes, or «tipping points» (Lenton et al. 2008; Rockström et al. 2009; Steffen et al. 2015). Crossing these boundaries may lead to irreversible and irrevocable damage to major Earth systems, such as climate, global pollution sinks, biodiversity and natural areas. As a consequence, associated with these boundaries, is a «safe operating space for humanity», which places limits on how much economic activity can exploit the global biophysical subsystems or processes. It has been proposed that sustainable development in the Anthropocene should be re-defined as «development that meets the needs of the present while safeguarding Earth’s life-support system, on which the welfare of current and future generations depends» (Griggs et al. 2013, p. 306). The protection of essential environments that may be subject to irreversible conversion could require the implementation of whole suite of innovative policy approaches such as precautionary approaches and safe minimum standards, as well as efforts at the international level to invest in global public environmental goods, such as biodiversity (Barbier et al. 2018; Sterner et al. 2019). This would be equivalent to the «strong» sustainability requirement of the «capital» approach to sustainability, wherein environmental capital that is essential, irreversible or uncertain in value may need to be preserved, rather than be available for conversion and the proceeds reinvested in an alternative asset in the economy. The protection of essential environments suggests that analyzing tradeoffs among economic, environmental and social goals in the «systems» approach to sustainability may be necessary, but not sufficient, to ensure sustainability, unless safeguards on Earth’s life support system are also adopted.