Human development pillars

The United Nations Human Development Index (HDI) was created ‘to emphasise that people and their capabilities should be the ultimate criteria for assessing the development of a country, not economic growth alone’. The Index works well as a high-level measure and countries that score well on it genuinely do tend to be delivering for their citizens, and vice versa. However, like all metrics it has its limitations. Many companies that we believe contribute to human development and positive social outcomes do not map directly to any of the Index’s constituent components – income, education and health – and so we have spent some time thinking about how we could expand this idea.

Taking inspiration from many different sources, we have determined 12 broad pillars1 that we believe encapsulate the essence of human development. All investee companies are assessed and mapped to positive social outcomes which contribute to improving human development.

These pillars cover a range of areas that we believe to be central to the spirit of sustainable human development, and quality of life for people around the world, particularly in emerging markets. Most of them are self-explanatory and link back in clear ways to Amartya Sen’s concept of ‘development as freedom’2 and the HDI.

While many of the contributions that our companies are making are not groundbreaking, they are no less powerful or important to sustainable human development.

It is the essential medicines in Brazil, the first-time mortgages in India, the household appliances in China, the HVAC systems in the United States and power cables in Europe that are helping, and will continue to help, hundreds of millions of people to live longer, better and healthier lives.