NZAM Updates Signatory Requirements And Acknowledges "What Has Always Been The Case"

On October 29, the Net Zero Asset Managers (NZAM) initiative announced the completion of its comprehensive review, which it publicized in January of this year, to ensure that NZAM "remain[ed] fit for purpose in the new global context" amidst the growing regulatory pressure and political scrutiny. Following key signatory departures, NZAM decided to suspend its activities, including its tracking of signatory implementation and reporting, and remove its commitment statement and list of NZAM signatories, as well as their targets and related case studies, from its website.

Following its review, which involved a number of signatory and non-signatory asset managers and asset owners, NZAM announced that it had shared an updated commitment statement and a plan to resume its target and implementation activities and signatory listing in January 2026.

The updated commitment statement, which is not yet publicly available, is described by NZAM as reducing requirements for signatories and providing a "clearer foregrounding of what has always been the case: that the extent to which signatories can implement the actions set out in the Commitment Statement depends on a wide range of factors including clients, policies, and regulations adopted by governments and other actors."

NZAM expressly acknowledges that these factors include signatories' "fiduciary duties to consider how financial risks and opportunities presented by climate change may impact investment outcomes." In other words, the updated commitment statement reiterates the longstanding foundational premise that ESG investing practices are focused on financially material risks and opportunities in pursuit of improved long-term returns, fully consistent with managers' fiduciary duties.

Anti-ESG regulators and critics have long sought to paint a false portrait of ESG investing as being driven by furthering social and political agendas, based in part on imputing to asset managers certain public statements by climate initiatives like NZAM. After years of investigations and inquiries, however, the facts on the ground have simply not borne out this basic false premise of the anti-ESG movement. Asset managers engage with carbon-intensive companies to understand their risks and opportunities in light of the ongoing transition to a lower-carbon future, not to pressure companies to make changes in how they operate.

As described, the updated NZAM commitment statement should reduce the ability of ESG critics to claim it supports their false narrative. It dials back language that has been misread as prescriptive while keeping the Paris‑aligned ambition intact.

For example, like the prior commitment statement, the updated statement makes clear the importance of continuing efforts to limit global temperature increase to 1.5°C above pre-industrial levels, which is consistent with the goals of the Paris Agreement. The updated commitment statement, however, adds a reference to holding the increase in the global average temperature to well below 2°C above pre-industrial levels. The updated statement also removes references to 2050 "to reflect diverse jurisdictional realities and accommodate signatories from a wider range of markets."

In short, this is a pragmatic recalibration in the context of a fragmented policy environment and intensifying US political scrutiny rather than any wholesale retreat on climate ambition. The revisions seek to be globally inclusive and durable and avoid the imputation of one‑size‑fits‑all prescriptions that can create legal, antitrust, and reputational risk.

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