State and Local Governments and Impact Investing

This report examines the role and opportunities for state and local governments in impact investing. Despite clear benefits such as leveraging private and philanthropic funds for social and environmental goals, government actors have been largely absent from broader discussions. The paper argues for their increased engagement, highlighting how governments can stimulate growth, enhance governance capacity, and shift risks for innovative solutions. It outlines potential roles for governments, including driving market development and managing dynamic partnerships, providing a practical guide for policymakers.