Ensuring workers retire with dignity and security is a hallmark of a civilized society. And for many people achieving security in retirement is one of the most important long-term financial goals. But retirement security across the globe is under threat from multiple fronts. Slow growth, low interest rates and the looming threat of inflation are challenging the economics of retirement funding. At the same time, the shift in funding responsibility to the individual is changing the very dynamics of retirement.

But above all, demographic forces are reshaping the global retirement landscape. Put simply, the world is getting older. The World Bank estimates that by 2050 the global elderly population will triple to 2.1 billion people — making retirement security one of the most pressing social issues facing the world over the next 30 years.

Given the importance of retirement security, Natixis Global Asset Management and CoreData have developed the Global Retirement Index (GRI). Now in its fifth year, the GRI is a multi-dimensional index examining the factors determining the welfare and financial security of retirees around the world. It aims to establish which countries offer the most attractive environments for retirees. The index considers 18 drivers of retiree welfare and groups these into four sub-indices: Health, Finances in Retirement, Quality of Life and Material Wellbeing. Scores are then calculated to produce an overall ranking for all 43 nations studied. The study includes IMF advanced economies, members of the OECD and the BRIC countries.

This year, Norway, Switzerland and Iceland reclaim the top three spots respectively in the index. These countries continue to present the most favourable conditions for retirement security. Eight of the top 10 countries in this year’s GRI are located in Western Europe. New Zealand and Australia complete the top 10.

And Europe as a whole dominates the upper ranks — 15 of the top 25 countries hail from Western Europe and three from Eastern Europe. At the other end of the scale, the bottom of the index is mainly made up of BRIC countries.

The conditions in which retirees live play an important role in overall GRI rankings. Indeed, the Material Wellbeing sub-index — which measures income per capita, unemployment and income equality — is a key driver of overall performance. Seven of the top 10 countries in the GRI rank in the top 10 for Material Wellbeing.

Quality of Life, which measures environmental factors and includes a happiness indicator, is another strong driver of overall performance. Seven countries finishing in the top 10 in Quality of Life also finish in the top 10 overall.

And six of the top 10 countries overall feature in the top 10 for the Health sub-index. These countries typically spend large amounts on healthcare per person, have high levels of insurance coverage and relatively high life expectancies.

However, the best overall performers do not do so well in the Finances sub-index due to higher tax burdens and higher public debt as a percentage of GDP.

On a regional basis, North America (United States and Canada) tops the GRI rankings, finishing just ahead of Western Europe. Some countries in Western Europe such as Italy, Spain and Portugal continue to face financial difficulties, pulling down the Finances score for the region. The top three countries in the Finances sub-index are Singapore, New Zealand and Chile.

There is a sizeable gap between the top two regions of North America and Western Europe and the rest of the pack. Eastern Europe and Central Asia comes next in the regional rankings, followed by Latin America and lastly Asia Pacific.

Elsewhere, BRIC countries have a poor showing in most sub-indices, indicating that crucial elements relating to the life of retirees such as health expenditure per capita remain inadequate.

Those countries performing poorly in the GRI need to address their shortcomings as a matter of urgency. But more widely, diffusing the demographic time bomb of ageing populations must be a priority for policymakers across the globe. As is the case with tackling climate change or averting another financial crisis, it requires a global consensus and a joined up strategy.

What is clear is that the retirement landscape is undergoing fundamental change. And the GRI is an indispensable guide to the changing decisions and fortunes facing retirees around the globe.