Drawing on an extensive national-level dataset spanning 80 countries from 2000 to 2023, we examine the impact of international climate finance on sustainable economic growth in the developing countries. Our findings indicate that both mitigation and adaptation funding significantly promote overall green growth. We incorporate the Polity V democracy index, which assesses the degree to which executive leaders are elected through open, multi-party, and competitive elections, operate under institutional constraints, and face competitive political participation. The results highlight that climate finance delivers stronger environmental outcomes when aligned with higher levels of democratic governance in recipient countries. These insights suggest that policymakers should focus on enhancing institutional capacities and tailoring financial strategies to local governance contexts.