Vanguard, the world’s second-largest mutual and exchange-traded fund manager, is pulling out of a major financial-sector alliance intended to help tackle climate change, the firm announced Wednesday. Vanguard, in a statement, said it will track its progress independent of the alliance, as an effort to provide “clarity” to its investors.
Environmental groups who follow pledges toward net-zero greenhouse emissions from the lifeblood of the economy — the financial services and banking sector — called the exit a major blow to the effort. These groups argued that such a move is kowtowing to “anti-woke” sentiment that claims investments focused on the impending clean-energy transition and other pro-climate actions only come at the expense of investment returns. The alliance, called the Net Zero Asset Managers (NZAM), was launched in late 2020 to encourage asset managers to hit a net-zero emission target by 2050 and help keep a rise in global temperature to 1.5 degrees Celsius. That’s a voluntary temperature goal agreed to at the pivotal 2015 Paris climate meetings and is seen as the marker key to slowing atmospheric warming, calming acidifying oceans, preventing coastal erosion, and limiting severe droughts and other deadly and expensive envir …