Answering the narrow version, because the broad one does not have a single answer. FLOW is the relevant trial and it reported a meaningful reduction in kidney-disease progression and related death in people with type 2 diabetes and chronic kidney disease. The mechanism looks to be a mixture of reduced albuminuria, better glycaemia and blood pressure, and a probable direct anti-inflammatory effect on the glomerulus. Separately, eGFR is genuinely noisy during rapid weight loss — a small early dip is common and usually haemodynamic rather than damage.
Correct me if the detail matters more than I have assumed.