In the current climate crisis and in the face of massive challenges, every positive development in the climate fight is worth celebrating. On this front Oxfam welcomes recent positive news from the World Bank. The Bank has amended its climate finance assessment and reporting methods, reflecting Oxfam's recommendations. And these changes represent an important precedent and promise greater clarity on climate finance allocation and spending, enhancing the ability of researchers and affected communities to obtain accurate information for monitoring and accountability. Let's remember that the Bank is the largest single conduit of climate finance – providing US$ 42.6 billion in Fiscal Year 2024.

What was missing from the Bank’s climate finance reporting?

To understand the problems with the Bank’s climate finance reporting, it's essential to grasp how the Bank estimates its climate finance. As each project the Bank will finance is approved by its board, staff at the Bank assess all the activities in the project (using an agreed upon methodology) to calculate which activities qualify as “climate finance”. The total value of these activities across the annual portfolio constitutes the Bank's annual climate finance.

Oxfam identified two primary issues with this approach:

1. Partial assessment: Climate finance is estimated when a project is approved, not when it is completed. Projects often change during implementation, but, historically, the Bank did not reassess climate finance based on actual expenditures. This means the Bank’s climate finance claims reflect intended financing (in Bank parlance this is termed ex-ante reporting), not actual financing (which would be termed ex-post reporting). Consequently, basic information about the Bank’s climate finance, including which activities get financed and how much climate finance is delivered in each country, remains unknown.
2. Lack of granularity of Reporting: Each World Bank project is comprised of components, which are comprised of sub-components, which are themselves comprised of activities. Historically, the Bank has only systematically provided information on their climate finance at the project level – broken down by mitigation and adaptation finance. This is a problem because it is at the level of sub-components and the activity that issues of qualifying for climate finance are determined. The Bank reports climate finance at the project level, not at the activity level where climate qualification is determined. This makes public oversight of project implementation and tracking of claimed climate finance on the ground impossible. Effectively, under this approach, the public had no choice but to accept the Bank’s estimates at face value.

Oxfam’s Research and Advocacy

To highlight these issues, Oxfam produced two research reports estimating the potential inaccuracies in the Bank’s climate finance claims due to the lack of granularity in the Bank's reporting and timing of their assessment. The first report examined data from FY20 and found that the Bank’s climate finance claims could be off by as much as $7 billion or 40% of the Bank’s claimed climate finance for that year. The second report estimated that, on average, actual climate finance expenditures could differ from budgeted climate finance expenditures by between 26-43%, between 2017 and 2023. This difference amounts to between $24.28 – $41.31 billion in climate finance, which is effectively untracked in terms of its impact on climate. This does not mean any money is missing or has been misused; rather, we don’t know for sure whether it was spent on activities that qualify as climate finance. These two Oxfam reports served to quantify the inadequacies of the Bank’s climate finance reporting and raise awareness of the issue. The scale of these numbers made clear that these reporting issues were too large to ignore, which opened a space for Oxfam to discuss solutions with the Bank's climate unit and top decision-makers.

The Bank’s Response

Partly in response to Oxfam’s advocacy, the Bank announced significant changes:

• Improved granular reporting: For all projects with climate finance approved after April 1st, 2025, the Bank will publish their calculations and justifications for climate finance at the sub-component level.
• Reporting at the end of the project: For projects closing after July 1st, 2025, the Bank will analyze and report ex-post assessments of climate finance, detailing the climate qualifying activities actually supported after project completion.

These steps are important and commendable, especially given the Bank’s existing data management challenges. The swift implementation of ex-post reporting is particularly important not only for accountability reasons but critically to move towards outcome and impact reporting and ensure the quality of climate actions financed with limited climate resources. By implementing this important change, the World Bank effectively becomes a leader on transparency of climate finance reporting not only among all Multilateral Development Banks but also bilateral climate finance contributors.

Remaining Challenges

Despite these improvements, challenges persist. An important remaining issue relates to data storage and access. Most data are stored in project-associated PDFs, making large-scale analysis difficult. To address this the Bank should collect all this new climate finance data into a central climate finance database that is publicly available, easy to search and in a machine-readable format that facilitates the use of the data. Additionally, while reporting at the sub-component level is a positive step, the implementation details will determine whether the public can fully understand and assess climate finance expenditures. For this, the Bank should make additional efforts to also publish climate finance data at the activity level for each project – a level of granularity that allows for an independent audit of both the application of the method and an on-the-ground assessment of projects.

Encouragement for Future Actions

Oxfam commends the Bank’s willingness to continue improving its climate finance reporting and hopes that the Bank's leadership sets a precedent that other Multilateral Development Banks and bilateral climate financiers will follow. We urge other actors working on climate finance issues to use this new data to enhance accountability and ensure effective climate action, particularly in less industrialized countries with significant needs and minimal responsibility for the climate crisis.