Review of the Environmental Performance Index (EPI): Methods, Constraints and Recommendations

Year 2024, , 59 - 73, 24.06.2024

Uğur Arcagök

https://doi.org/10.26650/imj.2024.96.1403313

Abstract

During the formation of composite index constructs, some constraints are encountered with respect to considerations such as the availability or accessibility of indicators, weights of such indicators, sub-indicators or variables to be used for reaching the indicators, data pertaining to such variables, and the determination of the most convenient method to be used for arranging the data set. In addition, it is required for the methods to be used to comply with the aim of the index to be formed. Researchers who want to develop a composite environmental index are required to consider all these considerations. This study aims to indicate and discuss the composite environmental index formation process through the examination of the EPI, which is a global composite index. One might argue that it contributes to the explanation of the composite index construction process, which has been examined, albeit limitedly, in the literature. Eventually, the methods that may be used in the index formation process by the researchers who want to form a composite index were discussed, and suggestions that may improve the methodological strength of the indices to be developed by them were presented. Our findings indicate the absence of an established theoretical methodology for composite sustainability indices. The creation of these indices has depended entirely on the expertise of the involved researchers.

JEL Classification : C30 , C38 , C82

Keywords

Composite Index, Weighting Methods, Indicators, Sustainability, Environmental Performance Index

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