Low-carbon markets was worth US $33bn (£26bn) to London’s economy, the Carbon Disclosure Project (CDP) says in its latest report.
However, collaboration between public and private sectors was an essential ingredient needed to deliver economic growth and carbon cuts, it observed.
The findings examined the commitments made by 533 cities around the world.
The report, It takes a city: the case for collaborative climate action, added that the cities spread over 89 nations had identified more than 1,000 economic opportunities linked to climate change. Almost 300 cities featured in the report were also developing new business industries, such as clean technology.
CDP, formerly known as the Carbon Disclosure Project, describes itself as ‘an international, not-for-profit organization providing the global system for companies, cities, states and regions to measure, disclose, manage and share vital environmental information’.
The report was published by CDP and AECOM, an multinational engineering firm, and sponsored by Bloomberg Philanthropies.
Maia Kutner, head of cities at CDP, said that many cities were already collaborating with businesses so there was ‘no need to reinvent the wheel’ in order to get the two sides talking to each other.
‘Nearly two thirds of the cities globally are telling us that they are collaborating one way or another with the private sector on climate change already,’ she explained.
‘One very common way is to share knowledge; to convene these groups where they can share knowledge on how to reduce emissions and to how to adapt to climate change.’
She told BBC News: ‘In terms of how we can take it to the next level, what we are seeing is that cities have a growing appetite to deepen this collaboration and expand it.
‘Rather than the softer measures that we are seeing at the moment, such as knowledge sharing, they want to be participating in actual projects with companies to reduce emissions and working more with companies in order to attract private sector finance.’
A report commissioned by the mayor of London in 2013 suggested that the low-carbon sector was worth in excess of £25bn to the city, and had recorded ‘solid growth’ during the economic downturn.
Government figures estimate that the sector could double in size by the middle of the next decade.
Other UK cities highlighted as looking to benefit from reducing carbon emissions include Birmingham and Manchester.
Earlier this year, a report suggested that Leeds should be the first UK city to convert its gas grid to hydrogen to help meet carbon reduction targets.
Globally, the most popular carbon-reduction measure was finding ways to use energy more efficiently.
One important driver for the focus on reducing carbon emissions was the adoption of the Paris Agreement on climate change in December last year.
One of its goals was to limit the global average temperature rise to 2C (3.6F) above pre-industrialisation levels.
It hopes to achieve this by nations managing their national emissions in such a way to limit the volume of emissions at some point in the second half of the 21st Century to the same level that can be naturally absorbed by trees, soil and oceans (carbon sinks).
Ms Kutner observed: ‘Governments waking up to the fact that public sector money is not sufficient to finance the low carbon shift, national governments need to create the conditions where private sector investors feel more confident investing in cities.
‘We saw cities as a real voice of leadership in the run-up to Paris with many cities making a commitment that were often more ambitious than national governments. In fact, cities are continuing to show this leadership.’
She added: ‘In Europe, many cities have made commitments through the EU Covenant of Mayors, which was an initiative that has now been relaunched as the Global Covenant of Mayors in June.
‘This is more than 7,000 cities that are making commitments to cut their carbon emissions and reduce their energy use. This means that the voice of cities is really significant.’
Later this month, city planners and urban policy makers will gather in Quito, Ecuador, for the third UN Habitat summit, which is only held once every 20 years.
It will be the first time that this event will have been staged since the global population became an urban population for the first time in history, with more people living in towns and cities than in rural settings.