(Bloomberg) -- A climate ETF started by a group of major financial institutions is set to close after less than a year because none of the backers pitched in with anticipated funding.

The Impact Shares MSCI Global Climate Select ETF (ticker NTZO) launched in November at the United Nations’ COP26 summit in Glasgow, and since then has accumulated only about $3 million of assets.

Unless the exchange-traded fund can show a pathway to amassing $100 million -- the breakeven amount to offset costs of running the product -- by the end of June, it will likely liquidate, according to Ethan Powell, founder of Impact Shares, which manages ETF.

NTZO was touted as a key deliverable by the group of financial institutions, whose leaders make up the Global Investors for Sustainable Development Alliance (GISD). The collective, consisting of 30 members, was convened by the United Nations to come up with solutions to increase investment in sustainable development.

But after time and resources were spent creating and publicizing the ETF, its impending closure is an example of corporate partnerships falling short in living up to their ambitions to fight climate change, according to early investors in the fund.

“I’m discouraged that you get these high-profile companies and the CEOs involved in an organization that they say trumpets $16 trillion of firepower, and they didn’t contribute a dime,” said Jim Healy, an initial investor and a former Credit Suisse banker. “It’s a failure of collective action.”

The ETF, which tracks a custom index from MSCI Inc., excludes companies that profit from fossil fuels and invests in companies that have set emissions-reduction targets.

While the fund -- which includes many well-known large-cap names -- isn’t the most high-impact product, it’s well-designed and low risk, said Sudip Thakor, another initial investor and former Credit Suisse banker. If “large financial institutions can’t even ensure the success of a product that’s this easy of a lift, how can we feel confident about them doing anything truly difficult?”

Healy and his wife initially invested $1 million and Thakor allocated about $500,000 when the fund launched. The two former colleagues said they understood that after they provided the initial funding to get the fund listed, institutional capital would follow.

Of the companies involved with GISD, they were told of three that had made commitments: Bank of America Corp. was willing to provide up to $50 million in seed capital and Citigroup Inc. up to $12.5 million, but they each couldn’t make up more than 25% of the fund. Banco Santander SA was willing to invest up to $50 million, but it couldn’t make up more than 5% of the ETF.

In the US, broker-dealers can be subject to greater regulation once they own more than 25% of a fund’s outstanding shares. With so little assets in the ETF, the banks that had made commitments were hamstrung.

• Bank of America said “we stood by ready to provide seed capital on the basis that the ETF would be able to gather sufficient volume from long-term institutional investors, consistent with terms of our commitment and applicable regulatory limitations.”
• Citigroup said it’s “committed to supporting the Alliance, demonstrated as such through our willingness to provide seed capital for the NTZO ETF contingent on preset criteria and regulatory requirements.”
• Santander said “our investments follow strict due diligence processes to ensure we comply with our legal and fiduciary obligations, and we will only invest when we are confident those obligations have been met.”

Healy and Thakor hoped other financial institutions involved with the GISD, which include asset managers and insurance companies, would also commit capital. The Financial Times first reported in February about the risk of the fund closing.

Ultimately, Healy and Thakor said they urged GISD members to invest multiple times, but after seeing that none did, they opted to close out their positions in February.

“These collectives or alliances seem to provide a venue for positive media coverage while absolving them of any direct responsibility,” Thakor said.

GISD is chaired by Standard Chartered Chairman Jose Vinals and the group CEO of the Johannesburg Stock Exchange, Leila Fourie. Both executives declined to comment.

The UN said it “continues to support innovative finance solutions” that advance the objectives of the GISD, and it “will continue to support those efforts when called upon.”

Healy remains disappointed about the fate of the fund.

“These are some of the most powerful institutions in the world, so imagine what they could do if they pulled together and created a vehicle to support net zero,” he said. “To the extent they tried to do it and failed, it’s just a real indictment.”

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