Theory of change for sustainable business

Abstract

As social and environmental challenges mount, there is increasing pressure on the private sector to transform to more sustainable business models that go beyond traditional corporate social responsibility. This requires companies to deepen their understanding of the interplay between business and society. This essay argues that the theory of change approach is an important tool for such exploration, but that it must be adapted to a private-sector context primarily driven by business logic. Enabling the uptake of a theory of change approach within the private sector requires pragmatic use of the tool and a learning mindset, while accepting that it may come at the cost of a loss of rigour in the way theories of change have conventionally been conceived and used in a development context.