The world is devoting more and more money to tackling climate change. Globally, climate finance investments increased by 26%, from $1.5 to $1.9 trillion, between 2021 and 2023. Private-sector climate finance reached $1 trillion for the first time the same year. Despite headwinds, finance continues to flow. While we have yet to see how cuts to overseas development assistance in 2026 will impact this trend long term, calls for increased climate finance have never been greater.

But getting more money flowing is only part of the equation. As climate finance increases, it is more important than ever to ensure that these investments are used effectively and actually achieve their intended objectives.

Part of the challenge is that climate finance is a complicated landscape, populated by a wide range of stakeholders with differing levels of power and influence. For those trying to access climate finance — or pushing for greater accountability in the space — it can be difficult to navigate. Yet there are clear steps that governments, donors and the private sector can take to help address these hurdles.

Open governance is key. To ensure the best outcomes, climate finance needs to be transparent, allowing stakeholders and civil society to see where funds are flowing; participatory, so that communities, especially those most impacted, have a say in the process; and accountable, so that there’s recourse when funds aren’t used as intended.

A new WRI report, published as part of the Green Accountability Platform, takes stock of the current landscape of climate finance governance and examines how to improve transparency, participation and accountability across finance sources to ensure that funds are truly aligned with achieving the world’s climate goals.

Transparency: Some Progress, but More to Be Done

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Transparency, Participation and Accountability in Financing Climate Action

This paper examines how sources of climate finance are integrating open governance principles of transparency, participation and accountability into their processes and pinpoints areas for improvement.

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Transparency is critical to ensuring that funds destined for climate action reach the intended projects. It helps build trust among stakeholders when all involved can clearly see where finance is flowing. And it is a starting point for pinpointing issues and holding institutions accountable for their policies and performance.

There are ongoing efforts to make climate finance flows more transparent. Some national governments, like in Peru and Colombia, are implementing climate‑budget tagging and systems that track funding from various sources. International organizations are also spearheading transparency efforts, including the OECD’s climate finance reporting and the UNFCCC’s Biennial Transparency Reports. And civil society initiatives continue to push for more granular disclosure of public budget information and government decision making. For example, BudgIT Foundation Senegal and the Climate Finance Group for Latin American and the Caribbean (GFLAC) use budget data and financial tracking to reveal inconsistencies in climate spending and push for funding designs with stronger climate and social benefits.

Yet, without stronger mechanisms to ensure transparency, climate finance risks falling short of its transformative potential — particularly in vulnerable countries where accountability and equitable distribution are most critical.

Our report offers recommendations to strengthen transparency not only in financial flows, but throughout the entire project cycle. This includes making project‑level climate finance data accessible to the public and ensuring that communities are actively involved in project design, implementation, and outcome‑focused consultations led by the project developer. Establishing open governance mechanisms — such as national committees, multi‑stakeholder roundtables, and regional or local commissions that formally include civil society organizations — can significantly increase transparency across the project cycle.  

Participation: Needs to Increase at All Levels

Many of the most consequential decisions about how climate finance is planned, allocated and used are still made through closed-door negotiations between governments and funders, with limited opportunities for public input. Our research found that while high-level strategies and reporting are often public, the point of project selection, when funding decisions are made, frequently remains opaque. And consultations can be on paper rather than practice. Communities near these projects are often consulted only after key choices have already been set in motion.

When participation comes later, projects start on weaker footing. Without local input, investments can overlook community priorities or underestimate social and environmental risks, leading to delays and other complications. In many countries, for example, infrastructure or renewable energy projects approved without early consultation have faced land-use disputes. This can force construction to pause and plans to be revised, turning preventable issues into costly setbacks for funders, communities and the climate.

These project-level gaps rarely arise in isolation. They are often the impact of limited participation in earlier policy and planning processes. Civil society organizations often struggle to engage in policymaking. Public entities may lack a legal mandate or proper outreach mechanisms to do so, and policy information is often prohibitively technical or inaccessible. This is an opportunity for governments to create clear consultation processes and present information in user‑friendly formats to ensure meaningful public participation.

Early and intentional engagement can lead to better results, too. WaterAid Bangladesh shows what this can look like in practice: In some low-income communities in the country, residents face unreliable access to potable water and seasonal flooding. When technical solutions are developed without proper consultation, they can be poorly sited, unaffordable to maintain or underused. By contrast, WaterAid Bangladesh has demonstrated how involving communities throughout the project cycle, from needs assessment through to design, construction and monitoring, can lead to water and sanitation investments that better reflect local priorities and reach the most vulnerable households.

Expanding participation across the climate finance system, from international funds to national planning and project implementation, can help ensure that climate investments drive positive impact. When communities have a voice in how resources are prioritized and delivered, investments are more likely to address real risks, avoid unintended harms and be sustained after funding ends. This means providing dedicated resources for participation, embedding engagement at policy and project levels, and supporting community-level outreach throughout the project cycle.

Accountability: Currently Low, but with Opportunities to Build on Existing Systems

Transparency and participation are key pillars of good open governance — but they only work well when paired with accountability mechanisms. To drive real change in climate finance systems, civil society organizations and other stakeholders need viable pathways to ensure that projects are carried out as planned and achieve the intended results.

Most existing mechanisms to hold governments accountable were not designed specifically for climate finance, limiting their application and posing a challenge to good open governance in this field. Yet there is no need to reinvent the wheel: Climate finance can build on and expand the use of established mechanisms to strengthen oversight and complete the cycle — from transparency and participation to accountability.

Some accountability tools stem from broader regulatory and institutional frameworks that, while not specifically tailored for climate change, have significant potential to strengthen oversight for climate finance.

Supreme audit institutions, for example, can scrutinize the use of public funds and assess whether climate-related expenditures align with stated objectives. The European Court of Auditors evaluated the 2018 EU Sustainable Finance Action Plan to determine whether it was implemented effectively and directing capital toward sustainable investments. It found that, while the action plan established important tools, such as the EU taxonomy and new disclosure requirements, its implementation was uneven and insufficient to spur change. As a result, the European Court of Auditors recommended stronger oversight. The findings helped strengthen accountability for the plan.

Similarly, court systems provide a legal avenue to challenge mismanagement, enforce compliance, and uphold commitments made by governments or private entities. In 2023, Taiwan faced a corruption investigation involving several Yunlin County council members and local officials accused of taking bribes connected to a major wind energy development project. Those facing charges were ultimately convicted and given jail terms.

Finally, as always, understanding the informal norms, relationships and incentives that shape who exercises power — the political economy — is key. Scholarship on adaptation projects in Bangladesh has demonstrated that corruption in local adaptation projects was reduced when influential households found it was in their interest to monitor public officials and contractors.

By leveraging these existing mechanisms, climate finance can benefit from established traditions of accountability, ensuring that diverse sources of finance — public, private, domestic and international — are held to consistent standards.

Climate Finance Governance as a Catalyst for Impact

As global climate investments reach unprecedented levels, the world cannot afford for these resources to fall short of their potential. Evidence from the Green Accountability Platform shows a simple truth: Climate finance is only as strong as the governance behind it. Transparency builds trust, participation ensures local relevance, and accountability keeps climate action on track. When any of these pillars is weak, funding risks being misdirected or misaligned with community and climate needs.

Fortunately, meaningful progress is within reach. Governments, international funders and private‑sector actors can continue to strengthen transparency through better disclosure, create space for early and continuous public participation, and leverage established accountability systems to monitor whether climate commitments translate into real outcomes on the ground. These improvements are not just good governance practices — they are essential conditions for delivering resilient communities, equitable transitions and genuine emissions reductions.

As climate finance continues to grow, so must our commitment to stewarding it responsibly.

To learn more about these recommendations and the path forward, read WRI’s new report.