Church of England Pensions Board quits Net-Zero Asset Owner Alliance

The Church of England Pensions Board (CEBP) has left the Net-Zero Asset Owner Alliance (NZAOA).

The £3.2 billion UK pension fund ($4.1 billion, €3.7 billion) withdrew its support from the UN-backed group, which is part of the Glasgow Financial Alliance for Net Zero (GFANZ), on Friday.

The Church Commissioners for England – the Church of England’s $10.3 billion endowment fund – will remain a member of the NZAOA.

Laura Hillis, director of climate and environment at the CEBP, told Responsible Investor: “The Church of England Pensions Board remains committed to achieving a net-zero target and continues to share the objectives of the NZAOA.”

The pension fund is an active founding member of the Net Zero Investment Framework and continues to co-chair the Paris Aligned Asset Owners (PAAO) steering committee. PAAO is the other GFANZ asset owner initiative.

Hillis said because of the size of the organisation a “clear focus on one initiative was needed”.

She added that the Pensions Board and NZAOA are still committed to collaborating on engagement due to their shared goals on net zero.

The asset owner is the third member to leave the alliance since its launch in 2019, with Australian superannuation fund CBUS withdrawing September 2022, and German insurer HanseMerkur departing in May this year.

This comes as the Net Zero Insurance Alliance saw more than half of its members exit in recent months, including insurance giants AXA and Allianz.

Last month, the Church of England’s pension fund and endowment also announced a big oil divestment, following a 2018 vote by the church’s decision-making body, which greenlit the divestment of fossil-fuel companies that were not aligned to the Paris agreement’s timeline by 2023.

NZAOA declined to comment on CEPB’s departure, but said it added a new member, Pensions Caixa 30, in June, and is due to announce an additional member next week.