Net Zero Asset Owners Alliance

The Net-Zero Asset Owner Alliance (NZAOA) is a UN-convened coalition of institutional investors—primarily pension funds, insurers, and sovereign-style asset owners—that have pledged to align their investment portfolios with a pathway to net-zero greenhouse gas emissions by 2050, consistent with the Paris Agreement's 1.5°C temperature goal.

The Alliance was launched in September 2019 at the UN Secretary-General's Climate Action Summit in New York. It is convened by the UN Environment Programme Finance Initiative (UNEP FI) and the Principles for Responsible Investment (PRI), in partnership with WWF and the Mission 2020 campaign. Founding members included Allianz, CalPERS, Caisse des Dépôts, and Swiss Re, among others.

Members commit to:

• Setting intermediate portfolio decarbonisation targets every five years, beginning with 2025 targets covering scope 1, 2, and (where material) scope 3 emissions of investee companies.
• Publishing progress reports annually.
• Engaging investee companies, asset managers, and policymakers to drive real-economy emissions reductions rather than relying solely on divestment.

The Alliance publishes a Target-Setting Protocol, periodically revised, which standardises methodologies for emissions accounting, sub-portfolio coverage (listed equity, corporate bonds, real estate, infrastructure), and engagement thresholds. It is one of several sectoral bodies under the broader Glasgow Financial Alliance for Net Zero (GFANZ), launched ahead of COP26 in 2021 and chaired by Mark Carney.

The Alliance has faced both political and methodological pressures. In 2023–2024, several large insurers and asset managers exited related net-zero groupings amid US Republican-led scrutiny over alleged antitrust and fiduciary-duty concerns, though NZAOA itself—being composed of asset owners rather than managers—has generally retained its core membership. Critics from climate NGOs argue targets remain insufficiently stringent on fossil-fuel financing, while critics from the political right argue the commitments constrain returns. The Alliance frames its approach as fiduciary risk management against systemic climate risk rather than ethical exclusion.