# AI for Climate Finance: Agentic Retrieval and Multi-Step Reasoning for Early Warning System Investments

arXiv: https://arxiv.org/abs/2504.05104 · HTML: https://mlsanity.com/paper/2504.05104/

## Key facts

- Cited by 3 papers in the map (data through 14 Oct 2026).
- Placed in Reasoning for agents, planning and code, one of 17 directions in LLM reasoning.
- Builds on 9 of its 22 references that are in the map.
- First posted on arXiv 7 Apr 2025.

## Placed in

- LLM reasoning / [Reasoning for agents, planning and code](https://mlsanity.com/lr/reasoning-for-agents-planning-and-code/)
- Retrieval-augmented generation / [Legal and financial RAG](https://mlsanity.com/rag/legal-and-financial-rag/)
- LLM agents and tool use / [Financial trading and forecasting agents](https://mlsanity.com/agents/financial-trading-and-forecasting-agents/)

## Builds on (most cited first, 9 of 9)

- [Learning Transferable Visual Models From Natural Language Supervision](https://mlsanity.com/paper/2103.00020/) (2021)
- [Self-Consistency Improves Chain of Thought Reasoning in Language Models](https://mlsanity.com/paper/2203.11171/) (2022)
- [Longformer: The Long-Document Transformer](https://mlsanity.com/paper/2004.05150/) (2020)
- [The Rise and Potential of Large Language Model Based Agents: A Survey](https://mlsanity.com/paper/2309.07864/) (2023)
- [Large Language Model based Multi-Agents: A Survey of Progress and Challenges](https://mlsanity.com/paper/2402.01680/) (2024)
- [TabFact: A Large-scale Dataset for Table-based Fact Verification](https://mlsanity.com/paper/1909.02164/) (2019)
- [Large Language Model-Based Agents for Software Engineering: A Survey](https://mlsanity.com/paper/2409.02977/) (2024)
- [Active Prompting with Chain-of-Thought for Large Language Models](https://mlsanity.com/paper/2302.12246/) (2023)
- [Late Chunking: Contextual Chunk Embeddings Using Long-Context Embedding Models](https://mlsanity.com/paper/2409.04701/) (2024)

## Built on by (most cited first, 3 of 3)

- [A Survey of Context Engineering for Large Language Models](https://mlsanity.com/paper/2507.13334/) (2025)
- [A Survey of LLM-based Deep Search Agents: Paradigm, Optimization, Evaluation, and Challenges](https://mlsanity.com/paper/2508.05668/) (2025)
- [Agent Benchmarks Fail Public Sector Requirements](https://mlsanity.com/paper/2601.20617/) (2026)

## Abstract (arXiv)

Tracking financial investments in climate adaptation is a complex and expertise-intensive task, particularly for Early Warning Systems (EWS), which lack standardized financial reporting across multilateral development banks (MDBs) and funds. To address this challenge, we introduce an LLM-based agentic AI system that integrates contextual retrieval, fine-tuning, and multi-step reasoning to extract relevant financial data, classify investments, and ensure compliance with funding guidelines. Our study focuses on a real-world application: tracking EWS investments in the Climate Risk and Early Warning Systems (CREWS) Fund. We analyze 25 MDB project documents and evaluate multiple AI-driven classification methods, including zero-shot and few-shot learning, fine-tuned transformer-based classifiers, chain-of-thought (CoT) prompting, and an agent-based retrieval-augmented generation (RAG) approach. Our results show that the agent-based RAG approach significantly outperforms other methods, achieving 87% accuracy, 89% precision, and 83% recall. Additionally, we contribute a benchmark dataset and expert-annotated corpus, providing a valuable resource for future research in AI-driven financial tracking and climate finance transparency.