State Street Corporation, the world’s fourth-largest asset manager, has withdrawn its U.S. investment division from the Net Zero Asset Managers (NZAM) initiative, scaling back its participation in the global climate coalition even as the group moves to ease its membership rules.
The firm did not specify the reason for the decision, but said its European and UK entities would remain part of NZAM to continue serving clients with net-zero investment objectives.
“We determined to redefine our membership in NZAM to our European entities in order to support those clients who have net-zero investment goals and objectives,” a State Street spokesperson said.
The move by State Street Global Advisors, which oversees $5.4 trillion in assets, follows similar withdrawals by other major U.S. fund managers including Vanguard, BlackRock, and J.P. Morgan Asset Management, reflecting mounting political pressure in the U.S. over environmental, social and governance (ESG) investing.
Launched in 2020 to promote climate-aligned investing, NZAM has recently relaxed its requirements to retain members. It will no longer mandate that signatories set interim emissions targets or commit to achieving net-zero portfolio emissions by 2050. Instead, participants are encouraged to provide clients with information to assess climate-related risks.
A spokesperson for NZAM said, “We welcome its UK and European arms remaining committed signatories to the initiative.”
State Street declined to reveal what proportion of its global assets would still fall under NZAM’s framework, but said its European and UK operations remain “subject to fiduciary duties” and operate independently in investment decisions.
The statement may also address concerns raised in ongoing litigation in Texas, where the state’s attorney general has sued State Street, BlackRock, and Vanguard, alleging collusion on climate issues. Most of the claims were allowed to proceed in August.
Among other U.S. signatories, T. Rowe Price said it would review its membership during a three-month evaluation period granted by NZAM.
“Whether we do so or not, we remain committed to making investment and stewardship decisions with an understanding of all material risks and opportunities, including those relating to climate and the environment,” said Maria Elena Drew, the firm’s Global Head of Sustainability.
Wellington Management also confirmed it is reassessing its position, stating, “We maintain the belief that material ESG issues, including climate considerations, can affect the long-term value of assets we invest in; therefore, it is in our clients’ best financial interests for us to analyse them.”
NZAM plans to publish an updated list of signatories in January 2026, ahead of global climate talks in Brazil, where investor alignment on decarbonisation remains a contentious issue.
