Danish pension fund PKA has withdrawn as a member of the Net-Zero Asset Owner Alliance (NZAOA), the fourth exit from the initiative and the first in more than a year, Responsible Investor can reveal.

The €59.1 billion fund, which manages four pension plans within the social and healthcare sectors, joined the NZAOA in March 2021 and withdrew its support from the UN-backed group, which is part of the Glasgow Financial Alliance for Net Zero (GFANZ), on 31 August.

A spokesperson for the pension fund told RI that it had decided to withdraw from the alliance to “focus on the Institutional Investors Group on Climate Change (IIGCC) and its Paris Aligned Asset Owners (PAAO) initiative, to maximise the impact of our resources and collective efforts in climate and biodiversity”.

PAAO is the other GFANZ asset owner initiative which is co-ordinated by IIGCC.

The spokesperson added that, while PKA has been a member of multiple climate action investor initiatives, as climate action and reporting are scaling up, “we have chosen to dedicate our efforts to IIGCC, where we have been a prominent member for years and where we wish to continue playing a leading role”.

As part of its NZAOA membership, PKA set portfolio, engagement and climate solutions investments targets.

The goals were to reduce Scope 1 and 2 carbon intensity of listed equities, corporate bonds and real estate portfolios by 29 percent by 2025; actively take part in Climate Action 100+ and evaluate all the companies included in the initiative by end-2023 and consider divesting from those without a Paris-aligned strategy; and ensure 15 percent of AUM is in green investments by 2025 and 20 percent by 2030.

The spokesperson told RI that the fund’s ambitions and targets in the area of climate action and CO2-reduction “remain the same”.

NZAOA declined to comment on PKA’s departure.

The asset owner is the fourth member to leave the alliance since its launch in 2019. Australian super fund CBUS exited in September 2022, German insurer HanseMerkur left in May last year, and the Church of England Pensions Board withdrew the following June.

The UK and Australian pension funds also cited resource strain as a reason for exiting the initiative, with CEPB adding that the decision had been made because a clear focus on one asset owner initiative was needed.

Like PKA, CEPB maintained its membership of PAAO, where its chief responsible investment officer Adam Matthews is a member of the steering group.

Danish pension funds Lægernes Pension, Pension Danmark and PKA were all in the same position as CEPB last summer, holding memberships of both NZAOA and PAAO.

Lægernes Pension and Pension Danmark remain members of NZAOA. The Danish pension fund sector is also represented by AkademikerPension, Danica Penison, Industriens Pension, P+ Pension Fund for Academics, PFA and PKA.

Dewi Dylander, PKA’s former head of sustainable investments and deputy executive director, represented the pension fund on the PAAO steering group.

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