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Theory of change (SF 2018-21)

  • January 24, 2018

  • Corporate Documents

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Summary

Aligned with the 2030 Agenda, with a primary focus on SDG 1 on poverty eradication and SDG 17 on the means of implementation, UNCDF aims, under its Strategic Framework, 2018-2021, to promote the social and economic transformation of least developed countries (LDCs). It seeks to achieve this by helping to build inclusive financial markets and local development finance systems and to unlock public and private finance that can help LDCs get more and better resources flowing to the local level.

UNCDF is designed to have a risk tolerance to operate where few others see viability and seeks to create demonstration value for changing the dynamic of how risk is perceived and addressed in the public and private sectors, so that more and better resources flow to poor men and women, small businesses, and local governments so that they can build a better future. UNCDF’s work provides concrete examples of how LDCs can bring public and private capital and approaches together for more SDG-positive and inclusive results. The potential for scaling up is critical to UNCDF’s business model, and is reflected in UNCDF’s approaches, results indicators, and theory of change.

This document outlines the theory of change underlying the results chain of the Strategic Framework, 2018-2021. The full results chain has three tiers – impact, outcomes and outputs – supported by the financing model and institutional enablers. It articulates UNCDF’s priorities in targeting poor and vulnerable populations to reach the last mile, and presents a gender-responsive theory of change (Annex 3 to the Strategic Framework), which explains how UNCDF’s work specifically addresses gender equality and women’s economic empowerment.

Output to Outcome pathways

UNCDF’s Strategic Framework presents two mutually-supportive outcomes:

  1. Enhanced inclusive financial markets and local development finance systems that benefit poor and vulnerable populations, and
  2. Unlocked public and private finance for the poor.

Progress under each outcome requires, and contributes to, progress under the other. For example, helping to build inclusive financial markets contributes to helping poor households and SMEs access finance; and unlocking public and private finance for local investments helps build robust local development finance systems. The end goal is to create inclusive, equitable, and resilient financial markets and local finance systems that are more efficient and effective in their ability to empower poor men and women, SMEs, and local governments in LDCs.

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