Masataka Uo, Vice Chair of GSG Impact JAPAN and founder and CEO of Japan Fundraising Association, adds another perspective on place-based investment, explaining that Japan’s context is important to activating community participation. He says, “ Our local community context is different from that of Europe or the United States, but local governments here can play a crucial role. They can organize social impact bonds. We have the hometown tax incentive, which allows donors to receive a 100 percent tax deduction when donating to local governments, with the money designated for specific projects.” 48 Uo believes this model can make impact finance more accessible, adding, “By involving local governments, we can motivate more community members to participate in and support these projects. This is already happening in our society.” 49 Other national and local laws encouraging relocation to rural areas encompass working with community members in the investment process and emphasize that achieving local support for businesses is important to their shared success. One consistent issue emerging for entrepreneurs relocating, starting, or growing their businesses in new communities is they may have a difficult time building support from community members. Issues entrepreneurs can face include securing financial support from local banks, obtaining government permits, and finding employees. The national and local laws encouraging this relocation include The Regional Revitalisation Cooperation Team, created by Japan’s Ministry of Internal Affairs and Communications. 50 Local public bodies appoint people who have moved their residential registration from urban areas to underprivileged areas such as depopulated areas as Regional Revitalization Cooperation Team members. The team members live in the region for a fixed period and are involved in “regional cooperation activities” such as supporting regional revitalization through the development, sales, and public relations of local brands and local products. They engage in agriculture, forestry and fisheries, and support the lives of residents, and they also aim to settle down and become established in the region. Prefectural and Municipal Systems At a local level, each prefecture and municipality in Japan has its own system of support for new businesses, including subsidies for start-up costs (partially funded by public money), free management consulting from registered business experts, and courses on specific management topics such as cash flow and public relations. Why This Moment in Time Matters Japan is at a pivotal moment. It has spent a decade creating a robust impact investing ecosystem that has nurtured and grown, bringing financial investors to the field. It has created the mechanics for measuring impact through IMM and Theory of Change and
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Ten Years in the Making
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