This week, almost 1,000 people from 54 countries around the world gathered in Delhi  to talk about the future of impact investing. The event, which was organised by the Global Steering Group for Impact Investment (the successor to the G8 Taskforce on Social Investment) brought together investors, entrepreneurs, politicians and policymakers to hear from the likes of Al Gore, Ratan Tata, and Prince Maximilian of Liechtenstein – and to discuss how we can bring about what GSG chair Sir Ronald Cohen calls ‘the impact revolution’.

As I have written before, the social and environmental challenges that we face are so huge and so global that governments (even with the help of philanthropy) cannot hope to resolve them. That’s why we urgently need to unlock more private capital to invest for impact, and to develop more creative financial tools to make sure this capital reaches those that need it.

What politicians and policymakers can do, however, is to accelerate this revolution – by creating the conditions that allow these solutions to succeed at scale. If you look at the countries around the world with the most developed and active impact investing markets, all have benefited from a supportive policy environment.

In the last few months, I’ve been chairing a working group for the GSG looking at exactly what the governments of the 20 GSG members (19 countries plus the EU) have been doing to support the growth of impact investment – with a view to producing a toolkit that can help policymakers learn from their counterparts in other countries. Launched in Delhi this week, our report identifies 15 key tools – which can be grouped into three broad categories:

First, governments can act as a market facilitator. That might be through education or capacity-building support for impact businesses – as in Argentina, where state-funded incubators and accelerators are working directly with impact-driven entrepreneurs. Or it might be by supporting the growth of impact investment funds: in four of the 18 countries, there’s now a publicly-funded wholesaler to provide catalytic capital to impact-driven funds (following the model pioneered by Big Society Capital in the UK). Or perhaps they might choose to set up an impact stock exchange, as we’ve seen in Canada.

Second, governments can be an active participant in the market. I talked in my last blog about how governments around the world are now experimenting with social outcomes contracts – where impact investors provide up-front funding and support for social sector organisations delivering payment-by-results contracts. But more significantly, they can also look to incorporate impact across all their procurement decisions: for example, the Public Services (Social Value) Act 2012 in the UK requires public sector bodies to factor in broader social, economic and environmental considerations when awarding contracts (although there’s still work to be done to make this a reality).

Third, governments can have an important role as a market regulator. One important technicality here is clarifying the roles on fiduciary duty, so large institutional investors feel able to incorporate impact into their allocation decisions (without worrying that they might break the law by doing so). Or take Korea, where the government is introducing a new legal form to define impact businesses; in France, they’re using a similar structure to introduce fiscal incentives for impact businesses. Alternatively, governments might look at introducing standardised impact reporting rules, as is currently happening in Brazil.

Read more at Forbes