In this week’s edition of Economy and Society:
- Net Zero Asset Managers Initiative relaunches without net-zero deadline
- State Street withdraws U.S. arm from Net Zero Asset Managers Initiative
- ExxonMobil warns climate rule could end its operations in EU
- SBTi releases report linking climate targets to stronger performance
- ISS and Glass Lewis to provide faith-based proxy-voting options
On Wall Street and in the private sector
Net Zero Asset Managers Initiative relaunches without net-zero deadline
What’s the story?
The Net Zero Asset Managers Initiative announced on Oct. 30, 2025, that it will resume operations after pausing earlier this year to review its climate commitments. The investor coalition—which once included more than 325 firms managing over $57 trillion—said it has deleted language in its commitment statement that required members to aim for net-zero greenhouse-gas emissions by 2050. The updated commitment statement asks members to set their own targets and stewardship strategies while continuing annual progress reporting.
Why does it matter?
The change signals a retreat from coordinated, time-bound emissions goals among major asset managers. It comes amid heightened political pressure in the U.S. over ESG (environmental, social, and governance) investing standards, which have prompted legal scrutiny and high-profile withdrawals from climate alliances. Analysts say the move could weaken consistency in how global firms measure and disclose climate progress.
What’s the background?
Formed in 2020, NZAM initially required signatories to align portfolios with net-zero by 2050 and to report interim targets. It suspended operations in early 2025 after firms such as BlackRock left, citing regulatory uncertainty and anti-ESG pushback following President Donald Trump’s (R) election. The initiative plans to re-list signatories and resume implementation support in January 2026.
State Street withdraws U.S. arm from net-zero asset managers group
What’s the story?
In early November 2025, State Street announced that its U.S. business would withdraw from the NZAM while its European and U.K. divisions remain members. The company will shift its NZAM signatory status so it applies only to its European entities. The move follows a similar step by BlackRock in early 2025, when it transferred its NZAM membership from BlackRock Inc. to BlackRock International.
Why does it matter?
The decision illustrates how global asset managers are differentiating their climate commitments by region. It reflects diverging political and regulatory environments between the United States and Europe regarding ESG investing and participation in collective net-zero initiatives.
What’s the background?
The decision was announced the same day the NZAM relaunched following a months-long suspension. BlackRock left the group in early 2025, citing legal and political scrutiny tied to its climate affiliations, while Vanguard had exited in 2022 after opposition from several Republican state officials.
ExxonMobil warns climate rule could end its operations in EU
What’s the story?
At the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) on Nov. 3, 2025, executives from ExxonMobil warned they may stop doing business in Europe over the European Union’s Corporate Sustainability Due Diligence Directive. The proposed law would require companies to address human-rights and environmental risks across their supply chains, with potential fines of up to 5% of global revenue. Exxon CEO Darren Woods said the measure would have “disastrous consequences,” and would make it "impossible to stay there.” Qatar’s energy minister and QatarEnergy CEO Saad al-Kaabi said his company has contingency plans to halt European gas shipments if the legislation goes into effect.
Why does it matter?
ExxonMobil and QatarEnergy are two of Europe’s largest liquefied natural gas suppliers. Both expanded deliveries after Russia’s substantial reduction in gas exports following its 2022 invasion of Ukraine, making them central to Europe’s energy security. Their warnings highlight a clash between Europe’s sustainability agenda and its reliance on foreign suppliers, especially as the EU finalizes the law’s terms
What’s the background?
The CSDDD seeks to make large companies legally responsible for environmental and human-rights harms throughout their supply chains. The European Parliament and member states are negotiating final revisions, expected by year-end. The governments of the United States and Qatar have urged European leaders to reconsider, citing energy-supply risks.
SBTi releases report linking climate targets to stronger performance
What’s the story?
The Science Based Targets Initiative (SBTi) released a report on Nov. 3, 2025, claiming that companies setting science-based climate goals experience reputational, strategic, and operational benefits. The survey of 171 firms with validated targets found that 95% reported reputational gains, 90% said their climate ambition increased, and 86% said decarbonization efforts accelerated. The report, titled “The Impact of Science-Based Targets on Business,” also cited improved investor relations, supply chain alignment, and resilience against regulatory changes.
Why does it matter?
The report underscores SBTi’s argument that climate action benefits business performance as well as environmental outcomes. Despite ongoing scrutiny from Republican officials, the group says nearly 11,000 companies worldwide have adopted or committed to its targets—representing about one-quarter of global revenue. The findings support SBTi’s broader claim that science-based climate targets drive competitiveness, investor confidence, and long-term growth.
What’s the background?
In July 2025, Florida Attorney General James Uthmeier (R) opened a state investigation into SBTi, alleging deceptive trade practices and antitrust violations. In August, 23 Republican attorneys general sent a joint letter warning that SBTi’s standards could violate antitrust and consumer protection laws. Those probes reflect a broader Republican effort to challenge ESG-oriented organizations and their influence over corporate behavior.
In the spotlight
ISS and Glass Lewis to provide faith-based proxy-voting options
What’s the story?
Two professors at the Catholic University of America said Institutional Shareholder Services (ISS) and Glass Lewis—which control most of the U.S. proxy-voting market—will introduce guidelines aligned with U.S. Catholic bishops’ investment principles. Andrew Abela and Nicholas Schmitz, of the Catholic University of America, said they helped develop new policies reflecting Church teaching on life, dignity, and the environment. The guidelines are expected next spring.
Why does it matter?
If implemented, the collaboration would mark a rare faith-based adaptation of proxy-voting services used by institutional investors. The authors said the new policies would allow Catholic investors to ensure their shareholder votes reflect Church teachings on moral and social issues, including abortion, gender transitions, and environmental stewardship.
What’s the background?
The U.S. Conference of Catholic Bishops updated its investment guidelines in 2021, urging Catholics to avoid holdings that conflict with Church teaching and to promote human dignity and the common good. ISS and Glass Lewis have previously offered “Catholic” proxy policies that critics said diverged from those standards, incorporating elements like board diversity requirements and gender identity language that some observers argued were inconsistent with the bishops’ moral framework.