Climate disclosure emerges as funding lever for cities

Cities are using climate disclosure to unlock funding and attract investor interest despite tight budgets, new global data on city reporting shows.

The latest release of climate and environmental data from CDP, global environmental disclosure system, highlights how cities are increasingly treating disclosure not as a compliance exercise but as a strategic tool to prioritise investment, strengthen project pipelines and access external finance.

More than 1,000 cities, states and regions now disclose through the platform, representing over one billion people globally.

In 2025, 122 sub-national governments received an A score, accounting for 15 percent of those assessed. While most A List cities remain in Europe and North America, there is a consistent presence from the Global South, demonstrating that transparency and structured reporting are being used to support delivery even under fiscal pressure.

Katie Walsh, Director for Cities, States and Regions at CDP, said cities in emerging markets are showing how disclosure can help make financing needs visible and actionable.

“A-List cities in the Global South demonstrate that comprehensive disclosure combined with well-developed project pipelines and structured implementation pathways can attract finance even amid fiscal constraints,” she told Cities Today.

CDP’s Global Snapshot 2025 shows that 54 percent of projects in emerging markets and developing economies remain in early development stages, highlighting the need for preparation and technical support. Walsh said disclosure plays a critical role in elevating infrastructure needs and connecting cities to targeted assistance.

“Through CDP disclosure, infrastructure needs are elevated to receive additional support,” she said, pointing to CDP’s partnership with the Global Covenant of Mayors to support applications to the World Bank and European Investment Bank’s City Climate Finance Gap Fund.

“Between 2023 and 2024, 110 cities from Latin America to Africa were involved in getting additional support, with 10 cities from the Global South advancing through to the Gap Fund,” she added.

Beyond access to finance, the data suggests disclosure is also shaping how cities prioritise limited resources. Walsh said cities that quantify the outcomes of climate action are significantly more likely to move from planning to implementation.

“The evidence from cities shows that those which can quantify the outcomes from their climate actions–like how it improves air quality, increased energy security and job creation–take twice as much action as cities that don’t measure the results,” she said.

She cited examples from the US where disclosure has informed investment decisions, including energy efficiency retrofits across municipal facilities in Phoenix and green infrastructure projects in Atlanta’s flood-prone Proctor Creek watershed, which secured US$14 million through an Environmental Impact Bond.

Walsh said budget constraints, limited technical capacity and resources remain barriers for some cities, but leading mayors and sustainability teams are reframing disclosure as an enabler rather than a burden.

“Disclosure provides the foundation for attracting investment, securing technical assistance, and delivering economic and social benefits that outweigh the initial effort required,” she said, adding that New Orleans has used disclosure to embed climate risk assessment across city operations and improve coordination between departments.

As markets increasingly price climate risk into investment decisions, Walsh said transparent, decision-ready data is reshaping how cities engage with private capital.

“By making vulnerabilities and action plans visible, cities are positioning themselves as credible partners for private capital seeking to deploy resources in climate-resilient infrastructure,” she said.

Image: Shao-chun Wang | Dreamstime.com