In June, the National Advisory Board (NAB) in the United States released a report that provides a framework on how federal government policies can support impact investing. Titled Private Capital, Public Good: How Smart Federal Policy Can Galvanize Impact Investing–and Why It’s Urgent, the report also makes recommendations on how both the legislative and executive branches of government can help the impact investing industry realise its full potential. The NAB comprises of 27 thought leaders that include private investors, entrepreneurs, foundations, academics, non-profit organisations, impact-oriented organisations and intermediaries, and its objective is to highlight areas of focus for US policymakers to support the growth of impact investing. The report looks at how smart strategies by governments can help spur impact investing and to realise its potential. Among the strategies the report recommends are a) the removal of regulatory barriers that impede impact investment; b) increasing the effectiveness of government programmes; and c) providing incentives for new private impact investment.Additionally, the report also talks of policies that will support impact investing, such as encouraging and supporting innovative impact-oriented organisations and impact investment opportunities, and standardizing metrics and improving access to data. The latter also relates to the measuring of impact, an area in which government can have a critical role to play, according to Andrew Kassoy, co-founder of non-profit organisation B-Lab and a member of NAB. First, the government can help convene investors and encourage them to measure and report transparently on impact; second, it can embrace common standards for measuring and reporting impact by requiring businesses that do business with government to measure and report their impact. Finally, government can determine which businesses and practices create the most benefit for society, allowing the government to create incentives that will reward impact, he says. As impact investing is still in its early days, there is no clear template on how government intervention can be most beneficial. However, government officials in countries around the world have begun to ask how they can help “because they recognise the power of impact investing to drive investment capital to businesses that are solving our greatest social and environmental challenges”, says Andrew.Impact investing is not a new concept for governments, since many of them have in fact been trying it out through various government-backed development finance institutions that play a critical role in catalysing private capital globally. These institutions have, in fact, been impact investors long before the term even existed. However, when it comes to the private sector per se, there is much governments can do to promote the impact investing industry. While this report addresses policy briefs that are specific to the US, it contains information that can be useful to policymakers even in markets such as Asia. Andrew points to the key recommendations of the study that can be applied across countries here as well. “Asian countries can look to the work being done elsewhere that creates the option for every company to be able to expand their fiduciary duties to consider their stakeholders, not just their shareholders, so that they can raise capital to scale while maintaining their intended public benefit,” he says.Asian countries that could benefit most from impact investing have governments that are preoccupied with several development/ economy related challenges at a national scale already. As such, one wonder if impact investing is even possible in these less-developed countries. Andrew says the answer is in the affirmative. Every country needs to address impact investing in their own context. “In general, we have seen that entrepreneurs in every country have a strong desire to help their country and broader society achieve a shared and durable prosperity by scaling businesses that create value for everyone,” he says, adding that countries that recognise this hunger and facilitate it by creating policies that allow it to flourish will reap the benefits of a private sector that can attract capital to scale even as it creates value for all. Governments in Asia should pay heed. A copy of the report can be downloaded here.