A joint project by US News & World Report, marketing company Y&R and the Wharton School, a business school at the University of Pennsylvania, the Best Countries report analyzed 80 countries this year, up from 60 in its first edition last year.
Included for the first time, Switzerland shot to the top of the ranking overall, ahead of Canada, the UK, Germany and Japan in the top five.
Sweden, the US, Australia, France and Norway made up the top ten ‘best countries'.
Under the study's methodology, 65 country attributes were identified that are “relevant to the success of a modern nation”, according to a press release.
These were grouped into nine categories: Adventure, Citizenship, Cultural influence, Entrepreneurship, Heritage, Movers, Open for business, Power and Quality of life.
The attributes were presented in a survey to 21,000 people across the globe “who are broadly representative of the global population”. They were asked to assess how closely they associated an attribute with a nation.
“Switzerland debuts as the world's 'top' country, in part because of its progressive social systems, protection of human rights and business-friendly environment,” said the ranking authors.
Within the categories, Switzerland ranked third for Citizenship after Norway and Sweden, achieving a score of nine out of ten or above for ‘respects property rights', ‘trustworthy', ‘cares about the environment', religious freedom' and ‘cares about human rights'.
It came sixth in the Quality of Life category, achieving a perfect ten for ‘safe' and ‘economically stable'.
It was also perceived as the best country to headquarter a corporation.
In an analysis, US News contributor Christopher F Schuetze said Switzerland presented an idyllic picture from the outside.
“Its top ranking comes from consistently high scores in 'soft power' areas, such as providing an inclusive society and a high quality of life for its people.”
However Schuetze noted that this perception may not take into account issues within the country such as the rise of nationalistic populism, its dependency on trade with the EU and the difficulties foreigners can have finding a job within the country.