Effectual framework for supporting sustainable entrepreneurship with development cooperation: case study of Mozambique

Abstract

This thesis aims to develop a new framework for better supporting sustainable entrepreneurship with development cooperation. The thesis first presents the context of development cooperation. Global (OECD-DAC members) official development assistance expenditures amounted to 125.6 billion USD (0.29 % of GNI) in 2012. Finland used slightly over 1 billion EUR (0.53 % of GDP) for official development assistance in 2012. Development cooperation is often performed through programmes and projects which are designed utilising the Logical Framework Approach (LFA).

Sustainable development is viewed to consist of environmental, social and economic dimensions. A commonly cited definition for sustainable development is that of the UN World Commission "Brundtland Report". One view of sustainability by Turner is that in the concept of "strong sus-tainability" the three dimensions are not interchangeable. In addition, the environmental dimen-sion sets the outer limit for sustainability.

Sustainable entrepreneurship aims to create environmental, social and economic value. One en-trepreneurship theory is the effectuation theory by Sarasvathy, according to which expert entre-preneurs start from the means they control and think what they can accomplish with those means instead of defining a final goal and the most suitable path to get to that goal. The theoretical frame of reference of this thesis assumes both development cooperation and sustainable entrepreneur-ship have a common objective of supporting sustainable development and are thus complemen-tary.

The empirical section of the thesis includes inductive research for developing a framework for supporting sustainable entrepreneurship with development cooperation through a case study of Mozambique. Mozambique in South-Eastern Africa is one of Finland's long-term development cooperation partners. The empirical research included field observations, archival research at the Ministry for Foreign Affairs of Finland and expert interviews.

"Aid for Entrepreneurship (AfE)" is proposed as a new development cooperation category sepa-rate from "Aid for Trade (AfT)" and "aid for infrastructure development". This thesis also intro-duces a new effectual framework for supporting sustainable entrepreneurship with development cooperation. The framework was named "Sustainable Effectuation Framework Approach (SEFA)" and is a management tool comparable to the LFA used by development aid agencies worldwide.

The inability to field test the newly developed SEFA was a limitation of the research. Suggestions for further research also include developing measurement tools and indicators for holistic value creation and evaluation of holistic value creation opportunities.