The Net-Zero Asset Owner Alliance (NZAOA), formally the "United Nations-convened Net-Zero Asset Owner Alliance", is a group of institutional investors that own assets on behalf of beneficiaries, mainly pension funds and insurance companies, and that commit to transitioning their investment portfolios to net-zero greenhouse gas emissions by 2050, consistent with a maximum temperature rise of 1.5°C. It was launched in September 2019 at the UN Secretary-General's Climate Action Summit in New York with twelve founding members, among them Allianz, which managed about US$2.4 trillion between them.
The alliance is convened by the UN Environment Programme Finance Initiative (UNEP FI) and the Principles for Responsible Investment (PRI). It differs from groups of asset managers because its members are "asset owners": the institutions that ultimately hold the money and hire managers. Its targets are framed around the Paris Agreement and draw on the climate science of the Intergovernmental Panel on Climate Change.
The NZAOA in plain terms
Imagine a group of homeowners who each own several rental flats. They agree that, over 30 years, every flat they own will stop burning fossil fuels for heat, and that every five years they will publish a target for how far along they should be. They do not do the building work themselves; they tell their letting agents and builders what they expect.
Alliance members are the homeowners in this picture. They own the investments, set the targets and push the fund managers, companies and policymakers they deal with. The point is that the owners of capital, not just the people who manage it, commit to a path and report on it publicly.
Commitments and targets
Each member makes an individual commitment, approved at board level, to net-zero portfolio emissions by 2050. To make that measurable, the alliance publishes a Target-Setting Protocol, which asks members to set interim targets every five years in four areas:
- Sub-portfolio targets. Cuts in emissions or emissions intensity for asset classes such as listed equities, corporate bonds and real estate. For 2025 the protocol set a range of 22% to 32% below 2019 levels, and for 2030 a range of 40% to 60%.
- Sector targets. Intensity targets for high-emitting sectors such as oil and gas, utilities, steel and transport.
- Engagement targets. Commitments to engage a set of high-emitting companies and the asset managers that run members' money, through corporate engagement and stewardship.
- Financing transition targets. Commitments to increase investment in climate solutions, such as renewable energy, which members may hold through green bonds, infrastructure funds or direct ownership of projects backed by power purchase agreements.
According to UNEP FI, 79 signatories with about US$9.4 trillion in assets under management had set Paris-aligned 2025 targets. Members report annually, and the alliance publishes progress reports aggregating the results.
Policy work and other activities
Beyond targets, the alliance publishes position papers aimed at asset managers, companies and governments. These have included expectations for how managers should vote and engage on climate, calls for carbon pricing, positions on thermal coal and on oil and gas, and guidance on measuring emissions in sovereign debt and private markets. Members are expected to use their proxy votes and manager selection to support these expectations. The alliance also recommends that members report in line with the Task Force on Climate-related Financial Disclosures (TCFD) framework, now carried forward in the ISSB's IFRS S2.
It belongs to a wider family of net-zero finance alliances. Climate Action 100+ is an engagement initiative aimed at companies, while separate alliances for banks, insurers and asset managers were brought together under the Glasgow Financial Alliance for Net Zero in 2021.
Criticism and challenges
Net-zero alliances have come under pressure from several directions. In the United States, Republican state attorneys general and members of Congress have argued that coordinated climate commitments could breach antitrust law or conflict with fiduciary duty, and several financial firms have left net-zero groups since 2023. The Net-Zero Insurance Alliance, a separate UN-convened group, lost most of its members in 2023 and was later wound up. JPMorgan Chase, Citigroup and other large US banks left the Net-Zero Banking Alliance between December 2024 and January 2025.
From the other side, campaigners argue that portfolio decarbonisation can be achieved by selling high-emitting holdings rather than reducing real-world emissions, and that intensity targets can fall while absolute emissions rise. Measuring financed emissions also depends on corporate data that is incomplete, especially for Scope 3 emissions and private markets. The alliance has responded by placing more weight on engagement and transition financing than on divestment, and by revising its protocol over time. Critics and supporters alike tie its credibility to whether members' portfolios show measurable reductions, and to how the alliance fits with broader sustainable investing practice.