The back-to-school landscape is often categorised by celebrities humblebragging about how their bad grades had no lasting impact on their eventual amazing life. “I think of Jeremy Clarkson,” writes the head teacher author of Exam Nation, “ritually tweeting every exam season about how he failed his A-levels and he’s done all right.”

On the one hand, we tell young people that exams make no difference and you can still have a great life if education doesn’t work out for you. Which is, of course, true. But on the other hand, we continue to pressurise children and grade them and rank them in relation to one another. Which, naturally, can also have its practical merits. Exam Nation is an attempt to chart a path between these two extremes. It’s an essential read – as entertaining as it is insightful – for anyone who cares about the way we treat young people.

This book is particularly timely. Ofsted has just announced an end to single-word grading of schools. No more “outstanding”. And this year’s A-level and GCSE grades have reverted to more sober pre-pandemic levels after a couple of years of grade inflation. These are necessary correctives. But Exam Nation argues that we have gone so far down the path of metrics, measurement and quantification – usually inevitably linked to economic factors (from government cuts to house prices in catchment areas) – that we have entirely lost sight of the real point of education.

In the early stages of reading this book, I became slightly annoyed that it wasn’t more angry in tone. After all, the situation Sammy Wright describes is dire and in urgent need of reform. Wright has taught English for more than 20 years and is now head teacher at a secondary school in Sunderland. But he is also a novelist – and it shows. This book is a pleasure to read and its strength is that it is not simply an enraged, politicised polemic. It is a considered and nuanced journalistic diagnosis, looking at education from every possible angle: from the point of view of the children experiencing it, of adults looking back on their own education, of parents, of teachers and of politicians. Michael Gove is singled out for a pasting, satisfyingly.

Exam Nation wears its sometimes disturbing findings lightly and mixes in healthy doses of self-awareness and black humour throughout. In his two decades of teaching, Wright has been called every possible four-letter insult by the children in his charge and has lived through every awkward conversation imaginable (“I’ve had to explain to one parent that his child was in trouble because he’d been sharing a picture of a man having sex with a chicken”). The one trait he exhibits as an expert witness and narrator is the one he finds largely missing from our education system: curiosity without judgment.

He is brilliant at describing the tension between social interaction and the acquisition of knowledge and reveals this through extensive (anonymised) case studies with teenagers. Candace, 16, explains that she knows she wasted her school years by messing around but felt she had no other choice because “good” behaviour would have meant social isolation. Her behaviour is “a response to the values of her peer group and the pressures they exert”. School is not just for exams. It’s for learning how to be around other people and, as Candace says: “It’s nothing the school can do to stop it, I think, it’s just the way people are – they’re horrible sometimes.”

Exam Nation asks the question: “What is school for?” Wright argues that education’s purpose is to help us to make sense of ourselves and of our place in the world – and to show us how fulfilling and useful it is when you enjoy learning something for the sake of it. In good schools and with good teachers, this happens naturally. And this is the process that unites both the “who cares about grades?” brigade and the A* students in the long term.

In the final 14 pages he outlines a comprehensive rethink of the entire education system, which would involve equipping students for life instead of equipping them to pass exams. I can’t imagine any algorithm-obsessed government adopting Wright’s sensible, community focused, learning-led suggestions in real life. But he makes it sound as if many of the best teachers are attempting to fight the good fight, anyway, on top of their “teach for exams” obligations. Turns out that the process of great education is a bit like the process of doing well in any test or indeed in life: you have to be prepared to do the work.

• Exam Nation: Why Our Obsession With Grades Fails Everyone – and a Better Way to Think About School by Sammy Wright is published by Bodley Head (£22). To support the Guardian and Observer order your copy at guardianbookshop.com. Delivery charges may apply