"But obviously they have to be followed up," he said.
GFANZ, which counts roughly 500 members representing more than $135 trillion in assets, was hailed as a milestone at the COP26 climate summit last year. But now, "it's become apparent that some who made impressive pledges did not immediately begin to put in place a practical plan to fulfill those pledges," Mr. Gore said.
"Investors and others are sniffing out greenwashing more readily these days," said Mr. Gore, a founding partner and chairman of Generation Investment Management. "And the pressure is going to grow."
Against that backdrop of growing scrutiny, GFANZ has now seen its first official defections. Bundespensionskasse AG, an Austrian pension fund based in Wien, quietly exited last month, according to the GFANZ unit to which it reports. And the departure of A$70 billion ($47 billion) Construction & Building Unions Superannuation Fund, known as Cbus, was made public earlier this month by the suballiance to which it belonged.
"We made the difficult decision to focus our resources on our internal climate change activities," a spokesman for Melbourne, Australia-based Cbus told Bloomberg. "We support the important work that the alliance is doing and wish all members the best in their endeavors."
GFANZ has sought to build credibility while remaining a voluntary alliance without binding rules that might frighten off members. But as it tries to introduce stricter standards, cracks are becoming visible. For some members there's a growing realization that they may fail to meet the goals set out by the alliance, while others have expressed fear the organization's requirements for decarbonization could make them legally vulnerable.
Last week, it emerged that Wall Street heavyweights J.P. Morgan Chase & Co., Bank of America and Morgan Stanley were considering a possible exit from GFANZ. That was followed by a clarification of the GFANZ criteria, giving financial firms scope to set weaker fossil fuel finance targets, and ostensibly easing tensions behind the scenes.
For some, the development was a red flag. It "calls into question how genuine their commitment was to net zero in the first place," said Jeanne Martin, head of the banking program at ShareAction, a non-profit that promotes responsible investment. "Ultimately, this is indicative of the limits of leaving urgent climate action up to banks and other voluntary initiatives."