Rethinking Sustainability Assessment: An Integrated Data-Driven Framework for the European Union

Composite sustainability indices are widely used in the evaluation of environmental, social, and economic sustainability of states. However, different approaches to the selection of indicators, their weighting, and some other criteria can impact the validity and reliability of the currently utilized techniques of calculation of sustainability indices. In this research, the ISI is created and assessed for the 27 Member States of the European Union (EU-27) over the period 2010–2024 with the help of the combination of the components of composite indices, econometric analysis, multicriteria decision-making, sensitivity analysis, and benchmarking. Fourteen standardized indicators of sustainability are aggregated to create environmental, social, and economic sub-indices, which are further aggregated to produce the overall ISI. Pearson correlation, OLS regression, and two-way fixed-effects panel model with the fixed effects for countries and years were employed to estimate correlations between each sustainability indicator and the SDG Index, while the COPRAS method was used to evaluate the sustainability performance of the countries. The highest mean value of ISI was found for the Netherlands (0.750), while the lowest ISI values were estimated for Greece and Romania (0.327). The sustainability performance improved in 2010–2024 in 26 of the 27 EU Member States. The sensitivity analysis using the CRITIC method revealed the extremely high stability of the ranking (ρS = 0.989, p < 0.001). Validation of the ISI benchmarking the SDG Index revealed significant moderate positive correlations (rP = 0.563; ρS = 0.579; p < 0.001).