City Rating Methodology
Open, inclusive, diverse cities are more competitive: they encourage innovation, they attract high-skilled workers, and they are better at growing high-value businesses.
A comprehensive look at what makes cities open, inclusive, and competitive.
LGBTQ+ inclusion sends a clear signal that a city is an open, progressive and dynamic place to do business.
This report presents a broad base of data that supports these assertions. It covers a wide range of questions about cities: how easy is to do business? How “network ready” is the city? Is it corruption-free? Is there a healthy “innovation ecosystem”? What is the quality of living like? Are LGBTQ+ people welcome, and what is their legal status?
We have synthesized this data into the Open For Business City Ratings. It combines 27 individual indicators from a number of well-respected data sources to produce a picture of which cities are open, progressive and competitive – and which are not.
For policymakers
seeking to boost the economic performance of their city, the index can help them to benchmark their performance against competing cities.
For businesses
considering possible new locations for offices or operations, the index can help evaluate differences between cities.
For individuals
thinking about relocating to another city, the index can help them to think about what they are looking for and how they might fit in.
Methodology in detail
METHODOLOGY
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The purpose of the ratings is to combine economic factors with elements that measure inclusion of the LGBTQ+ community in a city. The 2020 City Ratings were used as the starting point to preserve as much consistency as possible, to enable comparisons over time. A handful of data sources used in the 2020 City Ratings were not updated due to various reasons. In this case, we identified an acceptable substitute that would create as much comparability as possible. The ratings model is split into two main categories: economic competitiveness and LGBTQ+ inclusiveness.
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The team created a list of cities that would be included in the ratings. Cities were chosen based on which were included in all selected datasets. To avoid skewing the index in favour of any geography, only a maximum of 5 cities are included per country. The exception is the United States, which includes 10 cities. This is due to the size of the US economy and population. In the 2025 edition, we added four new cities: Kigali, Kampala, Krakow and Bridgetown, as Open for Business has operating programmes in all of them. The final list includes 149 cities.
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The next step is to standardize the data to a scale of 1 to 10 to create a comprehensive output to compare each city. The following equation normalizes each individual indicator in which it was better to have a high score:
Observed Outcome Rescaled = (Observed outcome - lowest outcome / Highest outcome - lowest outcome) x10
And for each individual indicator in which it was better to have a low score, the following equation was used:
Observed Outcome Rescaled = 1 - (Observed outcome - lowest outcome / Highest outcome - lowest outcome) x 10
This normalisation methodology was adopted from Opportunity Nation’s 2016 Opportunity Index.
Once the data was normalized to a 10-point scale, the arithmetic mean of the scores across all included cities was calculated. If the mean was below 3.0, the “Highest Outcome” variable above was substituted with the 90th percentile value. All cities with values higher than the 90th percentile received a “10” for that metric. If the mean was above 7.0, the “Lowest Outcome” variable above was substituted with the 10th percentile value. All cities with values lower than the 10th percentile received a “0” for that metric. This was to ensure sufficient variation in values to differentiate cities on each individual indicator.
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Once the City Ratings 2025 were finalised, the research team conducted a series of interviews with regional experts to fully understand the context and nuances of each region. The main narrative and analysis of the report was peer-reviewed by Open for Business’s Research Advisory Board.
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Each of the two categories are equally weighted as 50% of the overall score. Each individual indicator weight is available in the table below.
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Once each city had a composite 10-point score (10 being the highest, 0 the lowest), it was awarded a rating, similar to a credit rating. The purpose of rating cities instead of ranking them is to not dictate a definitive ranking on each city. We understand that there is no one-size-fits all approach to city competitiveness. Additionally, we want the ratings to start a conversation on the various components that make a city a good place to do inclusive business – something that will be easier to do without focusing on the minutiae of weightings and scores.
Individual indicators and weightings
METHODOLOGY
Economic Competitiveness
Economic Performance is comprised of tree indicators that approximate a city’s wealth, its home nation’s wealth and competitiveness.
| Metric | Level of Data | Source | Year | Description | Weight |
|---|---|---|---|---|---|
| City GDP Per Capita | City | Oxford Economics Global Cities Index | 2023 | City-level nominal GDP per capita data is sourced from the Oxford Economics Global Cities Index. | 6.00% |
| Economic Resilience | National | FM Global Resilience Index | 2024 | The FM Global Resilience Index is the only tool that compiles economic, supply chain and risk quality data on nearly 130 countries to evaluate resilience around the world. | 8.00% |
| City GDP growth | City | Oxford Economics Global Cities Index | 2024 | Annual city-level GDP growth rates (%, constant prices) are taken from the Oxford Economics Global Cities Index. | 6.00% |
Innovation is comprised of two indicators that approximate a city’s and its home nation’s potential for innovation
| Metric | Level of Data | Source | Year | Description | Weight |
|---|---|---|---|---|---|
| City innovation potential | City | 2thinknow | 2023 | This metric is a measure of a city's potential for innovation, as determined by 2thinknow's Innovation Cities Index. There are 500 cities analyzed and ranked. The index uses 188 quantitative and qualitative indicators. | 10.0% |
| National innovation potential | National | World Intellectual Property Organization | 2024 | The Global Innovation Index combines 81 indicators exploring a broad vision of innovation, including political environment, education, infrastructure and business sophistication. It measures the innovation potential of 81 indicators. | 10.0% |
Business Environment is comprised of five indicators that approximate how supportive a city is for businesses to flourish
| Metric | Level of Data | Source | Year | Description | Weight |
|---|---|---|---|---|---|
| FDI inflows per capita | National | World Investment Report (UNCTAD) | 2023 | This metric measures how much foreign direct investment flowed into a country in 2023. It is a measure of how attractive the country is to foreign investment and capital. The value is divided by the national population to normalize the values. | 5.75% |
| Networked readiness | National | Portulans Institute | 2023 | The Network Readiness Index is a composite index constructed with three levels. The primary level consists of four pillars that make up the fundamental dimensions of network readiness. Each of the fundamental pillars divides into additional sub-pillars that constitute the second level. The third level consists of individual indicators distributed across the different sub-pillars and pillars of the primary and secondary levels. All indicators used within the NRI belong to a pillar and a sub-pillar. | 4.75% |
| % Tradable Services of GDP | National | World Bank | 2023 | Tradable services as a percentage of GDP measures the share of GDP generated by exportable service sectors, including retail, transport, finance, and tourism. This indicator reflects the importance of tradable services in economic diversification and international competitiveness. | 4.75% |
| Strength of auditing and reporting standards | National | World Competitiveness Ranking (IMD), Global Competitiveness Index (WEF) | 2024/2020 | The 2024 IMD World Competitiveness Ranking's question "Auditing and accounting practices are adequately implemented in business". This is meant to measure the robustness of internal standards, which improve ease of doing business. For those ccountries, where IMD data was unavailable, the WEF Global Competitiveness Index (2020) results on auditing and reporting standards were used. | 4.75% |
Human Capital is comprised of four indicators that approximate a city’s level of education and proclivity to attract skilled individuals.
| Metric | Level of Data | Source | Year | Description | Weight |
|---|---|---|---|---|---|
| Quality of living | City | Mercer | 2023 | The Mercer Quality of Living Survey evaluates quality of living based on data from 231 cities on 39 factors including political, economic, environmental, personal safety, health, education, transportation and other public services. | 5.00% |
| Inflow of university students | National | UNESCO | 2023 | The total inflow of students attending university in a certain country. This measures the openness of a country to foreigners and the quality of a country's higher education institutions. | 5.00% |
| Years of schooling | National | World Bank / UNESCO | 2023 | Average number of completed years of education of a country’s population aged 25 years and older, excluding years spent repeating individual grades. | 5.00% |
| Number of top 500 universities per capita | National | Times Higher Education | 2024 | The number of universities ranked in the top 500 universities in the world by Times Higher Education, divided by a country’s population which comes from the World Bank. | 5.00% |
Entrepreneurship is comprised of three indicators that approximate a city’s level of entrepreneurial activity and how supportive its home nation is of new businesses.
| Metric | Level of Data | Source | Year | Description | Weight |
|---|---|---|---|---|---|
| Ease of starting a business | National | Business Ready report (World Bank), Doing Business Report (World Bank) | 2024/2020 | Countries are scored on a scale from 0 to 100 based on their ease of business entry for local firms. The assessment evaluates 65 indicators across three dimensions: regulatory framework, public services, and operational efficiency. | 6.67% |
| Global Entrepreneurship Monitor Adult Population Survey | National | Global Entrepreneurship Monitor | 2023 | Response to the survey question "You would not start a business for fear it might fail" (% of those agreeing there are good opportunities locally) This is meant to measure the popular attitudes toward entrepreneurship. | 6.67% |
| Number of companies headquartered | City | Crunchbase | 2024 | Crunchbase is a knowledge platform for investors, companies, researchers, and journalists. It compiles a database of companies that are based in each city around the world, drawn from input from 3400 global investment firms and a large community of executives, entrepreneurs, and investors. | 6.67% |
LGBTQ+ Inclusion
Legal Situation is comprised of five indicators that approximate the legal situation for LGBTQ+ people and the indicators that create a strong foundation for LGBTQ+ inclusion, such as lack of corruption, strong civil liberties, and press freedom.
| Metric | Level of Data | Source | Year | Description | Weight |
|---|---|---|---|---|---|
| LGBT+ legal status | City | Equaldex, ILGA, municipality websites, Global Trans Rights Index | 2024 | The legal rights that LGBT+ people have in a city. This measure incorporates the following aspects of the law: Same-sex acts, Same-sex marriage, Right to change legal gender, Same-sex adoption, LGBT+ discrimination protections in goods and services, LGBT+ discrimination protections in employment, Conversion therapy | 10.0% |
| Rule of law | National | World Bank | 2023 | According to the World Bank, "Rule of Law captures perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, property rights, the police, and the courts, as well as the likelihood of crime and violence. Estimate gives the country's score on the aggregate indicator, in units of a standard normal distribution, i.e. ranging from approximately -2.5 to 2.5." | 10.0% |
| Corruption perception | National | Transparency International | 2023 | The Corruption Perceptions Index "scores and ranks countries/territories based on how corrupt a country’s public sector is perceived to be. It is a composite index, a combination of surveys and assessments of corruption, collected by a variety of reputable institutions." | 10.0% |
| Civil liberty | National | Freedom House | 2024 | The Freedom in the World report scores each country on a scale from 0 to 4 for each of 15 civil liberties indicators. This provides an overall view of the strength of a country's civil liberties. | 10.0% |
| Press freedom | National | Reporters without Borders (RSF) | 2024 | The World Press Freedom Index is determined by analyzing responses of experts to a questionaire devised by RSF. This is combined with reports of abuse against the press to create a holistic score. | 10.0% |
Social Attitudes is comprised of four indicators that approximate a city’s and its home nation’s attitudes toward LGBTQ+ people. The Williams Institute’s Global Acceptance Index is used as a national indicator of attitudes and their trend over time.