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Planet health index

There is a high interest today in combining global environmental Earth System Science variables and socio-economic variables e.g. from statistics offices to try to understand how the ecological health of the planet relates to “socio-economic health”. OEMC project plans to build a tool that can help analyse the impact of various economic activities on environmental degradation, such as climate change, biodiversity loss, and ecosystem services; as well as the opposite: to measure the impact of ecosystem degradation on financial systems.

What is the challenge?

Current methods for assessing economic and financial risks often do not fully account for the impacts of environmental degradation, climate change, and ecosystem service loss. There is a need for a holistic approach that can integrate diverse data sets to identify vulnerabilities and provide a more complete picture of systemic risk. The complexity of relationships between environmental, economic, and financial systems makes it difficult to quantify and predict impacts. Furthermore, the confidentiality of financial data requires that any tools for assessing risk are flexible and adaptable enough to work with sensitive data.

Our solution

To tackle this challenge, within the OEMC we have proposed to design a framework capable of calculating what we call a Planet Health Index (PHI) from data cubes of Earth system data and socio-economic indicators. Such an index would be composed of three separate axes, each representing one of the domain “spheres” of interest: (1) the atmosphere, (2) the biosphere and (3) the socio-economic sphere. The trajectory of different countries or regions could be explored and compared within these axes This provides a methodologically sound, transparent approach for identifying significant events that impact the economy and society. The index combines data related to climate, ecosystems, and social factors to produce a small number of interpretable indicators of change. The tool would allow for flexible integration with various data, including financial and macroeconomic data, to help users understand how different parts of the financial and economic system are vulnerable to environmental and climate-related risks.

Who will benefit?

The European Central Bank (ECB), as our main stakeholder. But the workflow, viewer and tool will be open, allowing other users to apply it to their own data and tailor it for their needs, thereby potentially benefiting other policy support and decision making agencies.

Scope
Target Partner Organizations
OEMC Leading Partner
Get in touch!

Gregory Duveiller
Max Planck Group
gduveiller@bgc-jena.mpg.de

Type of output

Various climatic, biospheric and societal map products

Technology readiness level

TRL2: Technology concept formulated

Location

Worldwide

Links of interest
Related use-cases