Did sustainability collaborations fail in 2025?

If 2023 and 2024 were characterised by a clampdown on sustainable finance collaborations, 2025 was the year the industry finally formulated its response.

It wasn’t exactly a display of defiance, though.

After a quiet period at the start of the year – which insiders describe as “playing dead” – the Net Zero Asset Managers Initiative (NZAM) unveiled a new set of rules for its members in October.

From now on, there will be no need to set 2030 targets or commit to align with net zero by 2050 in order to be part of the initiative.

The decision will allow investors to fend off allegations from US Republicans that they are conspiring to influence corporate behaviour, which could breach antitrust laws.

October also saw the Net-Zero Banking Alliance (NZBA) confirm it was ceasing operations altogether.

The same accusations faced by members of NZAM triggered an exodus from the initiative, which eventually rendered it unviable.

Its guidance can still be used by individual banks, but there won’t be any formal coordination between them.

The demise of NZBA (and the Net-Zero Insurance Alliance, which shuttered in 2024 for the same reasons), coupled with the decision to loosen NZAM’s membership criteria, leaves the Net Zero Asset Owners Alliance (NZAOA) as the last meaningful net-zero collaboration standing.

So far, it has remained steadfast and lost only a handful of participants – largely because most of its members are European pension funds, which aren’t exposed to the US courts.

Departures from other influential investor bodies like Climate Action 100+ have also slowed in 2025.

US Republicans haven’t finished their assault on investor collaborations, though, and it’s clear the clampdown will continue in one form or another in 2026.

Most recently, a Securities and Exchange Commission (SEC) chief suggested that investors who vote in line with recommendations from proxy advisors could be considered to be acting as part of a group.

IPE wrote recently about US Republican commissioner Mark Uyeda’s claim that such investors are essentially collaborating with their peers by following the same off-the-shelf advice, and should therefore be treated as strategically-influential activists under SEC rules.

While the comments are not official SEC guidance, they hint at the regulator’s continued appetite to use accusations of collaboration as a means of clamping down on shareholder rights.

All this means it’s the portfolio companies themselves that are undertaking the boldest sustainability collaborations going into 2026.

Just last month, a group of major European pharmaceutical companies wrote to their suppliers outlining “minimum sustainability targets” and expectations for the coming years.

And even more recently, Dutch brewing giant Heineken updated its widely-acclaimed sustainability strategy to emphasise the role of collaboration with peers, saying it “can’t do this alone”.

Risks

The trend is not without its own risks, though.

Over the summer, Brazil’s competition authority, CADE, moved to suspend the Soy Moratorium – a long-standing agreement among companies not to buy soybeans from deforested land in the Amazon rainforest – arguing it might constitute “an anticompetitive agreement among competitors”.

The case suggests the Republican playbook in the US may be being adopted by conservatives in other jurisdictions to take on non-financial companies.

But elsewhere, there are efforts to restore confidence in sustainability collaborations.

Most recently, Australia’s competition watchdog published guidance to help companies stay on the right side of the law when cooperating to achieve environmental and social objectives.

The UK, the Netherlands and the EU have all developed similar documents to reassure the private sector. And the International Chamber of Commerce published a major guide to the topic in November.

For investors, 2025 has continued to be a bruising year when it comes to collaborating – and the attacks aren’t fully over.

But for those initiatives still intact, there is a realisation that policy advocacy will be a less legally fraught topic for coordination in 2026.

NZAOA and the Paris Aligned Asset Owners initiative have both identified lobbying as a key lever to accelerate the transition to a low-carbon economy, for example.

“Coalitions are evolving,” noted a recent report by the Climate Policy Initiative, adding that many are “shifting their focus from targets and exclusions to promoting credible transition pathways and climate toolkits for institutions”.

“In a context of policy volatility and political backlash, working together to remove policy barriers will allow them to maintain the levels of ambition required.”