Relaunch of Net Zero Asset Managers Initiative Seeks to Avoid Legal and Political Backlash, Hedge Fund Law Report

Partner Elizabeth Goldberg spoke with Hedge Fund Law Report about the relaunch of the Net Zero Asset Managers Initiative and its revised commitments, which place greater emphasis on asset managers’ fiduciary duties, client mandates, and investment objectives.

Liz noted that the updated framework makes clear that participating managers are not expected to pursue environmental, social, and governance (ESG) goals at the expense of their legal obligations to investors.

“The reference to fiduciary duty in the Statement acknowledges that, in seeking to fulfill ESG commitments, a manager should not do things at odds with clients’ best interests, such as on voting a proxy in a way that might be better for the commitment – but not better for returns,” she said.

For managers considering whether to participate, Liz advised, “For any managers wrestling with whether to join or leave the Initiative, it would be appropriate to engage in a thoughtful analysis of the pros and cons.”

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