Conflicts of Interest Policy and Procedure January 2018

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Contents Introduction ............................................................................................................................................ 4

Conflicts of Interest (COI) - requirements under MiFID ......................................................................... 4

What is now required under MiFID II? ................................................................................................... 5

1 COI - Policy ...................................................................................................................................... 6

1.1 Introduction ............................................................................................................................ 6

1.2 General Policy ......................................................................................................................... 6

1.3 Purpose ................................................................................................................................... 6

1.4 General Guidance ................................................................................................................... 6

1.5 Examples of potential COI ....................................................................................................... 7

1.6 Identifying and Managing COI: ............................................................................................... 8

2 Procedures ...................................................................................................................................... 9

2.1 Reporting a COI ....................................................................................................................... 9

2.1.1 Reporting Process: .......................................................................................................... 9

2.2 Recording ................................................................................................................................ 9

2.3 Escalation ................................................................................................................................ 9

2.4 General Disclosures ................................................................................................................. 9

3 Types of COI .................................................................................................................................. 10

3.1 Best Execution, Order Handling & Execution Arrangements ................................................ 10

3.1.1 COI Mitigation: .............................................................................................................. 10

3.2 Personal Account Dealing ..................................................................................................... 11

3.2.1 COI Mitigation: .............................................................................................................. 11

3.3 Gifts and Entertainment ....................................................................................................... 12

3.3.1 COI Mitigation: .............................................................................................................. 12

3.4 Merrion Capital Group entities ............................................................................................. 12

3.4.1 Organisational Chart: .................................................................................................... 13

3.4.2 Potential COI ................................................................................................................. 13

3.4.3 COI Mitigation: .............................................................................................................. 13

3.5 Intermediaries ....................................................................................................................... 14

3.5.1 COI Mitigation: .............................................................................................................. 14

3.6 Chinese walls ......................................................................................................................... 14

3.6.1 COI Mitigation: .............................................................................................................. 15

3.7 Remuneration ....................................................................................................................... 15

3.8 Product Governance ............................................................................................................. 15

4 Compliance ................................................................................................................................... 16

4.1 Compliance Responsibility .................................................................................................... 16

4.2 Compliance Management of COI .......................................................................................... 16

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4.3 Compliance Monitoring Program.......................................................................................... 16

4.4 Annual Training ..................................................................................................................... 16

4.5 Disclosure and Annual Confirmation of COI ......................................................................... 17

4.6 Board & Sub-Committees ..................................................................................................... 17

4.7 Record-keeping and reporting .............................................................................................. 17

Appendix I ............................................................................................................................................. 18

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Introduction

Conflicts of Interest (COI) - requirements under MiFID

This Policy must be read in conjunction with the Regulations as listed below (or as amended) and accompanying Guidance. The Policy does not purport to be a full or legal interpretation of the Regulations and accompanying Guidance. Merrion Stockbrokers Limited (“MSB”) its employees and directors must comply with the provisions of the Regulations, not just those provisions referred to in this policy. Where individual regulations are quoted, this policy is intended to act as a high-level guideline. In the event of any difference or discrepancy between the procedures and the Regulations, the provisions of the Regulations will prevail. Under S.I. No. 60/2007 - European Communities (Markets in Financial Instruments Directive) Regulations 2007, the firm is required to maintain and operate effective organisational and administrative arrangements with a view to taking all reasonable steps designed to prevent a COI, as identified under Regulations 33, 39, 74, 75 and 78 from adversely affecting the interests of the firm's clients.

MiFID I required firms to consider and identify where conflicts may arise in the course of the firm’s business between:

• the firm (including its managers, employees) or any person directly/indirectly linked to the firm, and its clients; and

• between different clients of the firm. It also required the firm to:

• maintain and regularly update a record of these actual and potential conflicts; • put in place organisational and administrative structures to prevent such conflicts from

adversely affecting the interests of clients, and document this in a COI policy; and • where these organisational / administrative measures do not allow a firm to have

reasonable confidence that the risk of damage to clients’ interests will be prevented, to make adequate disclosure to the appropriate clients.

• The disclosure must be in a durable medium and contain sufficient detail of the general nature and/or sources of the conflicts that may arise; and the steps that may be taken to mitigate/manage the conflicts; so that the clients can make an informed decision before conducting business with the firm.

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What is now required under MiFID II?

The revised Markets in Financial Instruments Directive 2014/65/EU (known as "MiFID II") comes into force for all investment firms in the EU on 3rd January 2018. MiFID II outlines specific requirements for the firm’s COI policy. These requirements include:

• The firm shall establish, implement and maintain an effective COI policy set out in writing and appropriate to the size and organisation of the firm and the nature, scale and complexity of its business. This policy should consider the firm’s group structure and any potential conflicts of interests.

• The COI policy must identify, with reference to the specific investment services and activities and ancillary services carried out by or on behalf of the investment firm, the circumstances which constitute or may give rise to a conflict of interest entailing a risk of damage to the interests of one or more clients

• The firm must specify procedures to be followed and measures to be adopted in order to prevent or manage such conflicts.

• The firm’s COI procedures shall be designed to ensure that relevant persons engaged in different business activities involving a COI carry on those activities at a level of independence appropriate to the size and activities of the firm and the group, and to the risk of damage to the interests of clients.

• Effective procedures to prevent or control the exchange of information between relevant persons engaged in activities involving a risk of a conflict of interest where the exchange of that information may harm the interests of one or more clients;

• The separate supervision of relevant persons whose principal functions involve carrying out activities on behalf of, or providing services to, clients whose interests may conflict, or who otherwise represent different interests that may conflict, including those of the firm;

• The removal of any direct link between the remuneration of relevant persons principally engaged in one activity and the remuneration of, or revenues generated by, different relevant persons principally engaged in another activity, where a conflict of interest may arise in relation to those activities;

• Measures to prevent or limit any person from exercising inappropriate influence over the way in which a relevant person carries out investment or ancillary services or activities;

• Measures to prevent or control the simultaneous or sequential involvement of a relevant person in separate investment or ancillary services or activities where such involvement may impair the proper management of conflicts of interest.

• Investment firms shall ensure that disclosure to clients, pursuant to Article 23(2) of Directive 2014/65/EU, is a measure of last resort that shall be used only where the effective organisational and administrative arrangements established by the investment firm to prevent or manage its conflicts of interest in accordance with Article 23 of Directive 2014/65/EU are not sufficient to ensure, with reasonable confidence, that risks of damage to the interests of the client will be prevented.

• The firm shall assess and periodically review, on an at least annual basis, the COI policy take all appropriate measures to address any deficiencies.

This Policy will also take note of the firm’s participation in a Thematic Review of COI and the ensuing risk mitigation plan (RMP) issued by the CBI alongside the general “Dear Chairman” letter issued to all investment firms: Thematic Review of Conflicts of Interest 25 February 2016. This policy will consider both the good and bad practices identified during these thematic inspections.

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1 COI - Policy

1.1 Introduction

The firm conducts its business in accordance with MiFID and the expectations of the Central Bank of Ireland (‘Central Bank’) that conflicts of interest should be avoided, and managed appropriately where they cannot be avoided. The regulatory requirements under MiFID I require the firm to establish and maintain an effective organisational model that actively monitors conflicts of interest so as to ensure that the best interests of the client are not negatively impacted. The client’s interest will be paramount in the event that a COI is identified.

Under the MiFID II requirements, if a COI cannot be appropriately mitigated or effectively managed through its own organisational or administrative arrangements, then the firm may decide not to offer that particular service or product offering to the client.

1.2 General Policy

All employees of the firm must comply with this Policy in order to avoid COI that may arise in their day-to-day responsibilities and also to ensure that they act honestly and fairly and in the best interests of the firm’s clients at all times. The firm will try and use its organisational and administrative arrangements to mitigate any potential or actual COI as far as possible to avoid detriment to a client. Any COI relating to a client will be disclosed prior to a business service being provided to a new client and any disclosures will be personalised to the client’s own unique circumstances.

1.3 Purpose

The purposes of the COI policy include:

• To adopt measures to permit, as far as possible, the avoidance of the actual occurrence of any COI;

• To establish mechanisms and procedures that permits the identification of any perceived/potential COI;

• To determine how to manage any COI that cannot be avoided, and to keep impacted clients duly informed;

• To appropriately document for internal use the steps to be taken by the firm in a case of COI;

• To comply with the firm’s regulatory obligations in relation to COI.

1.4 General Guidance

For the purposes of identifying the types of COI that arise in the course of providing investment and/or ancillary services; and whose existence may damage the interests of a client, the firm shall take into account, by way of minimum criteria, whether the firm or a relevant person, or a person directly or indirectly linked by control to the firm, is in any of the following situations, whether as a result of providing investment or ancillary services:

• the firm or that person is likely to make a financial gain, or avoid a financial loss, at the expense of the client;

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• the firm or that person has an interest in the outcome of a service provided to the client or of a transaction carried out on behalf of the client, which is distinct from the client's interest in that outcome;

• the firm or that person has a financial or other incentive to favour the interest of another client or group of clients over the interests of the client;

• the firm or that person carries on the same business as the client;

• the firm or that person receives or will receive from a person other than the client an inducement in relation to a service provided to the client, in the form of monetary or non-monetary benefits or services.

1.5 Examples of potential COI

The firm defines a COI as any situation, or perceived situation, in which either the firm and/or its employees or directors (including all Non-Executive Directors) have interests, financial or otherwise, which could possibly corrupt their motivation in the firm’s provision of its services.

Areas of perceived/potential concern include:

• The provision of investment research;

• Proprietary trading;

• Staff personal account dealing;

• Portfolio management;

• Gifts & Entertainment / Inducements;

• Corporate Finance dealing and investment structuring;

• Intra-group relationships ▪ e.g. Merrion Stockbrokers & Merrion Investment Managers (MIM)

• Corporate Governance

The below examples are COI which may arise in relation to investment services provided by the firm:

• The firm may engage in business and trading activities for its own account and/or client accounts whilst other clients are active in relevant markets at the same time;

• The firm provides investment research to an entity, to which it also provides an advisory service;

• The firm may provide advisory or discretionary services to clients and the firm may also recommend or sell products issued by itself or related companies;

• The firm receives or provides gifts or entertainment or inducements, that may influence behaviour in a way which potentially conflicts with the interests of clients;

• The firm is the discretionary portfolio manager for more than one client or fund; in particular in respect of issues related to allocation.

• The firm may recommend that a client invests in a product or fund which is manufactured or distributed by another member of the firm’s group. On the basis of this recommendation the firm may receive an intra-group inducement.

• The Corporate Finance function may structure an EIIS or equivalent investment on behalf of a corporate entity for a fee, this product may in turn be sold to the firm’s retail clients generating a commission payable by the client.

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1.6 Identifying and Managing COI:

To avoid COI and manage them appropriately where they cannot be avoided, the firm has adopted the following arrangements to ensure that:

• Merrion Group entities operate with appropriate independence from one another.

• All employees and directors are subject to the firm’s Personal Account Dealing Policy & Procedure.

• There are effective procedures in place to control the flow of information where, otherwise, the risk of a COI may harm the interests of a client;

▪ e.g. The firm’s Research Team.

• Compliance Monitoring will act as a “second line of defence” mechanism and will be completed in line with the annual risk-based Compliance Monitoring Plan.

• There are appropriate controls in place to identify and manage inter-group board memberships and external business interests;

• Relevant information is recorded promptly on secure systems to enable identification and management of COI;

• Appropriate personalised disclosure may be made to a client in a clear, fair and not misleading manner; in order to enable the client to make an informed decision as to whether to continue with the investment service or transaction;

• Appropriate employee & compliance escalation processes are in place and complied with where a COI has been identified;

• Adequate records are maintained of the services and activities of the firm where a COI has been identified. Gifts and Entertainment/ Conflict Registers are maintained and regularly monitored to ensure incentives and other COI do not manipulate procurement and decisions;

• Where necessary, staff may be asked to avoid working on a specific transaction or participating in the management of a perceived/potential COI. In such an event, the potential or actual COI is reported to the Compliance function. The employee concerned must then step back from any related decision making to ensure complete independence in a client’s dealings with the firm are maintained for any conflicted employee;

• Implementation of ad hoc transaction-specific “Chinese Walls” or other additional information segregation methods following consideration of all the facts available to relevant management;

• Escalation to the Audit & Compliance Committee; which has responsibility for the strategy of the firm and an appreciation of the relationship and reputation risks that may arise;

• If a COI cannot be appropriately mitigated, then the firm will ultimately decline to act for a client in that situation and will not provide any investment service or product offering.

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2 Procedures

2.1 Reporting a COI

Where an employee, director or non-executive director becomes aware of any perceived/potential or actual COI, they must report the conflicts of interest to the firm’s Compliance function using the shared e-mail inbox: compliance@merrion-capital.com

2.1.1 Reporting Process:

When an employee or director is aware or notified of an actual or potential COI, the employee or director must, as soon as possible provide a complete report on the actual or potential COI, along with any relevant documentation and send it to: compliance@merrion-capital.com

All existing and newly identified COI will be escalated to the firm’s management, Audit & Compliance and Risk Committees and the Board; via the Register at the next relevant committee meetings.

To ensure that the COI procedures are being followed and that logged COI are reviewed at least on an annual basis, Compliance will circulate the COI Register to the relevant Head of Department for review and to ensure that there has been no change in the mitigating controls or actual COI recorded. Any change will be recorded in the Register and circulated for discussion at the next appropriate Board or Committee Meeting.

2.2 Recording

All identified COI are recorded on the firm’s COI Register as set out in Section 2.1. above. Compliance will review the any newly identified COI with functional management and co-ordinate an investigation of the issue; resulting in the COI Register being updated with the final root cause, resolution and/or mitigation and any control improvements. Compliance will maintain original and scanned copies of any relevant documents.

2.3 Escalation

Any COI will be escalated to the firm’s management and the Audit & Compliance Committee for review. This may be overridden by the immediate calling of an ad-hoc meeting of any of the Committees or Board if deemed necessary by Compliance, where a material COI has been identified and impacts upon the regulated activities of the firm.

2.4 General Disclosures

The firm’s general COI policy will be referred to in the Terms of Business (‘TOB’), which is provided to all clients prior to the provision of investment services. The summarised COI policy will be made available to all clients and interested third parties via the firm’s website.

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3 Types of COI

The firm has already identified instances in which a COI may arise during the course of providing investment services to clients. In accordance with the regulations and expectations of the Central Bank that COI should be avoided, and managed appropriately, where they cannot be avoided. The firm has outlined these below and recorded them on the firm’s COI Register. The following COIs have been identified and mitigated against in line with MiFID regulations.

3.1 Best Execution, Order Handling & Execution Arrangements

Within MSB, the methods of executing client orders are well established in order to treat clients fairly, act with honesty and integrity and taking all reasonable steps to achieve the best possible result for clients are of the highest priority for all staff members. These Execution Arrangements are in place to ensure that the practice and methods of executing client orders are outlined and will be adhered to with a view to obtaining best execution.

The firm has an obligation to provide ‘best execution’ to all of its professional and retail clients. Best Execution is defined under MiFID II as taking all “sufficient steps” to achieve the best possible result for a client on a consistent basis. In achieving best execution, various factors are taken into account depending on the nature of the order, client and financial instrument. These factors and the weighting given to each factor will vary for each order depending on the relevant circumstances that exist at the time of the order receipt and execution. In the circumstances where the firm executes client orders, with the firm as principal, the firm undertakes to ensure that the client receives the best possible result. Aggregation of orders is undertaken in accordance with the firm’s Best Execution, Order Handling & Execution Arrangements Policy to ensure that no client is disadvantaged.

For the firm‘s specific arrangements, please refer to the Best Execution, Order Handling & Execution Arrangements Policy located on the firm‘s intranet under the policies and procedures section for all staff.

3.1.1 COI Mitigation:

• When the firm gives investment advice or deals in a discretionary capacity; the firm, or some person connected with the firm, may have an interest, relationship or arrangement that is material in relation to the investment, transaction or service concerned. However, the firm’s employees are required to disregard any such interest, relationship or arrangement when making any recommendations to a client.

• All employees are subject to the firm’s internal procedures, which prohibit them from taking advantage, for the benefit of themselves, clients, or any other person, of any unpublished price-sensitive information.

• Corporate Finance/Research are physically separated from the Sales/Trading floor in order to enhance the functional separation of these departments and control the flow of information, in relation to unpublished price-sensitive information.

• Corporate Finance/Research personnel are prohibited from discussing engagements or perceived/potential engagements.

• Analysts work in a separated part of the main Sales/Trading floor.

• Dealing personnel are independent of Corporate Finance/Research. Dealers have no access to research reports prior to dissemination to clients, nor is advance notice given to traders of the intention to release reports.

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• All decisions to invest in a principal capacity from the firm’s perspective are made independent of the firm’s fund managers and discretionary fund managers (Portfolio Management).

• Analysts are free to express their own views in research reports, free from pressure and control by subject companies or by staff in any other business area.

• Trading by any member of staff in the shares of active Corporate Finance clients is forbidden, other than in the most exceptional circumstances.

• Analysts provide services to Sales and Trading staff via internal emails, morning meetings and sales meetings. In providing these services, analysts do not disclose the contents or timing of research ahead of distribution to investment clients.

• All staff members should receive training on COI and their obligations to act in the best interest of their clients.

3.2 Personal Account Dealing

All personnel are bound by the requirements of the firm’s Personal Account Dealing Policy. All transactions undertaken are approved and monitored by the firm’s Compliance Department. Every employee has a duty of transparency to the firm regarding their personal trading; and shall inform Compliance of any such trading. Compliance regularly monitors adherence with the Personal Account Dealing Policy as part of the annual risk-based Compliance Monitoring Plan. Compliance will report any findings or issues of such monitoring and any corrective action to be taken in this regard to the Audit & Compliance Committee.

It is the Compliance function’s obligation to inform the firm’s CEO and the competent authority (Central Bank) and any other relevant regulator (such as ESMA) of any discovered breach of this requirement.

For the firm‘s specific Personal Account Dealing policy, please refer to the current version of the policy located on the firm‘s intranet under the Policies and Procedures section for all staff.

3.2.1 COI Mitigation:

• All employees are bound by the Personal Account Dealing Policy & Procedures.

• All employee trades require Compliance pre-approval, without exception.

• Compliance conducts post-trade Market Abuse analysis through the Transactzar system in order to detect any potential negative behavioural issues, such as insider dealing or front running.

• Compliance will conduct periodic monitoring in line with the annual risk-based Compliance Monitoring Plan, to ensure that only pre-approved transactions have taken place.

• Trading rules apply not only to employees, but also to any transaction from which the employee may benefit; i.e. their spouse, or relative, etc.

• Specific holding timeframes are in place to allay against intra-day trading. These time frames are outlined in the Personal Account Dealing Policy.

• All employees are required to self-declare annually, that they have no COI regarding proposed or undertaken trades.

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3.3 Gifts and Entertainment

The firm has adopted a Policy & Procedure relating to the giving and receiving of business gifts and entertainment. The firm restricts the giving and receiving gifts, entertainment or minor hospitality to ensure that no conflicts of interest might arise on the basis of an inducement. The firm encourages staff to discuss any such offer of a gift or hospitality from any client or perceived/potential client with the Compliance Department or their senior manager; so that guidance may be given on whether it would be appropriate to accept such a gift.

Failure to comply with the firm’s Gifts & Entertainment Policy may result in disciplinary procedures, leading up to and including dismissal from the firm. An extreme breach of this policy may be viewed as Gross Misconduct and can be subject to summary dismissal. For the firm‘s specific Gifts & Entertainment Policy please refer to the current version of the policy located on the firm‘s intranet under the Policies and Procedures section for all staff.

3.3.1 COI Mitigation:

• All employees, directors & non-executive directors are prohibited from accepting or offering or agreeing to accept/offer any form of a gift in return for doing or not doing something in relation to the discharge of their duties and responsibilities or for showing or not showing favour in relation to those duties.

• All employees, directors & non-executive directors may accept or offer gifts outside of the above clause (e.g. entertainment, lunch, pens, calendars, cups, umbrellas, etc.) as long as they are not above the firm’s non‐material limit of €50.

• All employees, directors & non-executive directors must get pre-approval for any gifts offered or received above the firm’s non‐material limit of €50 from a director or alternate director where applicable.

• For gifts or entertainment higher than the firm’s high value gifts limit of €250, pre–approval of the CEO is required.

• Under no circumstances can an employee, director or non-executive director of the firm accept or offer a personal gift of cash; irrespective of its size.

3.4 Merrion Capital Group entities MiFID II states that the firm’s COI policy will be appropriate to the size and organisation of the firm and the nature, scale and complexity of its business. It further states that the COI policy should take into account the firm’s group structure and any potential conflicts of interests that may arise from this structure.

The firm is 100% owned by Merrion Capital Holdings Limited. Merrion Capital Holdings is majority owned by management and staff and Somers Limited and Forbes Street Investments Limited as significant investors. The firm is one of four operational entities of the Merrion Capital Holdings. Three of the entities are regulated by the CBI:

• Merrion Stockbrokers Limited – MiFID investment firm;

• Merrion Fund Management Limited – Non-UCITS management company;

• Merrion Capital Investment Managers Limited – investment manager.

• Merrion Corporate Finance Limited is not regulated by the CBI.

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3.4.1 Organisational Chart:

Circumstances may arise where different lines of business or different companies within the Merrion Group may be providing services to the same client, which could create a perceived/potential COI. The firm is mindful that it operates within a group structure and ensures the strict physical and commercial separation between the firm and other group entities. This separation includes “Chinese Walls”.

3.4.2 Potential COI Examples of potential COI within the group could include (but are not limited to) the below:

• The firm may recommend that a client invests in a product or fund which is manufactured or distributed by another entity within the firm’s group. On the basis of this recommendation the firm may receive an intra-group inducement. The firm will need to disclose the group relationship to the client along with details of any inducement received.

• The Corporate Finance function may structure for example an EIIS or equivalent investment on behalf of a Corporate client for a fee. This product may in turn be sold to the firm’s retail clients generating a commission payable by the client. The firm will need to ensure that any potential COI is documented, mitigated and disclosed to the retail client.

• Due to the nature and scale of the group businesses, an employee of one group entity may take a position in another group entity. In this case, the potential COI and the mitigation will need to be documented.

3.4.3 COI Mitigation:

• Intercompany relationships between the Merrion Capital Group entities are managed on an arm’s length and on standard commercial terms.

• Chinese & Ethical walls in place to separate the Merrion Capital Group entities e.g. Merrion Investment Managers (’MIM’) and Merrion Corporate Finance are separated in different offices from the firm.

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• Reporting lines are kept separate where possible to ensure appropriate segregation of employee duties. If this is not possible due to firm resources any potential COI should be documented in COI log.

• All products and investment services provided by the firm to clients must be suitable and appropriate to the client’s needs and requirements. When recommending a product produced or manufactured by a group entity the PM must clearly document the suitability of this product for the client. The firm must also clearly disclose the group relationship and any inducement received for selling the product.

• In line with MiFID II there should be clear segregation between the staff that are involved in both the structuring, manufacturing or producing a product and those whom sell the product to retail clients.

• Physical office separation exists between the constituent Merrion Capital Group entities.

• Clearly defined roles within the firm; e.g. MIM sales, MSB traders.

• No crossover of IT system access or shared files.

3.5 Intermediaries

Where the firm distributes products or services to retail clients through an intermediary, the firm must not require the intermediary to introduce a specified level of business from consumers in order to retain an appointment from that regulated entity. Furthermore, where a product producer distributes its products to consumers through an intermediary and pays commission to an intermediary based on levels of business introduced, the product producer must be able to demonstrate that these arrangements:

(i) do not impair the intermediary’s duty to act in the best interests of consumers; and (ii) do not give rise to a COI between the intermediary and the customer.

3.5.1 COI Mitigation:

• The Intermediary agreement and Terms of Business do not contain any provision for the intermediary to introduce a specified level of business.

• All fees and commissions are agreed in advance of any product offering to clients via the Intermediary.

• The Intermediary conducts the client suitability and appropriateness assessment and will assess if the product is suitable for the client.

3.6 Chinese walls

The firm must ensure that there is separation between the different business entities within the group, in relation to information which could potentially give rise to a COI. The firm has established policies, procedures and physical arrangements (i.e. Chinese walls), designed to manage confidential information and prevent the unintentional transfer and exploitation of inside information. All staff should understand that where Chinese walls have been set up, they are required, according to this policy. Chinese Walls separate areas that have access to inside information from those who do not have such access. As such, Chinese walls are designed to operate as barriers to the passing of inside and confidential information.

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3.6.1 COI Mitigation:

• Physical separation of MSB, Merrion Investment Managers and Merrion Corporate Finance.

• IT System separation of MSB and Merrion Investment Managers.

• Employees within a function protected by Chinese walls have a duty to ensure that the Chinese walls are not breached; either deliberately or inadvertently.

• Where such arrangements are in place, an employee working within such a function is prohibited from communicating any confidential or inside information to any employee outside the specific function, without prior approval from Compliance.

• Known or suspected breaches of Chinese walls must be referred to Compliance immediately.

3.7 Remuneration Remuneration practices are being reviewed by the firm in line with MiFID II and Proportionality

obligations. As part of this review potential COI will be considered. Any COI identified will be mitigated

and noted in the firm’s COI log.

3.8 Product Governance

Product Governance practices are being reviewed by the firm in line with MiFID II manufacturing and

distribution obligations. As part of this review potential COI will be considered. Any COI identified will

be mitigated and noted in the firm’s COI log.

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4 Compliance

4.1 Compliance Responsibility

In terms of identifying, monitoring and managing any perceived/potential or actual COI within the firm, the Compliance Department has the following responsibilities:

• Define and outline scenarios, relationships and situations that may create perceived/potential COI.

• Assess in conjunction with Business Unit owners all products, activities, and trading for perceived/potential COI.

• Identify emerging and perceived/potential conflicts of interest and assess their impact.

• Log and record all perceived/potential or actual conflicts on the firm’s COI Register.

• Management of employee, director and non-executive director annual declaration for COI.

• Mitigation strategy for emerging, perceived/potential and actual COI.

• Management of monitoring programmes to regularly and periodically review and assess evolving business conditions and relationships that may create a COI.

• Implement controls to prevent, detect, deter, and report COI; including the implementation of policies and procedures and the Code of Conduct.

• Ensure annual staff COI training.

4.2 Compliance Management of COI

Once a COI has been identified, the Compliance function must consider how it should be dealt with before conducting any further business to which the COI might be relevant. Compliance must consider:

• Whether the firm requires any legal advice to determine how to proceed.

• Whether to immediately escalate the matter to senior management and /or the Audit and Compliance Committee and/or the Board.

• Whether conflicted individual/s may be required to leave the meeting/s during the discussion/s on the conflict.

• If required, how a conflicted individual should be segregated from further involvement in a conflicted matter.

4.3 Compliance Monitoring Program

In addition to the daily management of COI, the Compliance function will carry out monitoring in line with the risk-based Compliance Monitoring Plan. This plan will be revised annually and will focus on areas identified as part of the firm’s Risk Control Self-Assessment process and in line with this policy.

4.4 Annual Training

All employees, directors and non-executive directors are required to undertake mandatory annual Compliance training in relation to the firm’s COI internal rules and the requirement to act in the best interests of the client. Compliance will provide COI training to personnel on an annual basis as part of the firm’s Training Programme. Furthermore, training literature will be made available to all parties as a reference guide to COI training.

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4.5 Disclosure and Annual Confirmation of COI

All employees and directors are required to provide Compliance with an annual declaration of COI; (Please see Appendix I). The annual COI confirmation will act as a self-certification for COI. On an annual basis, all employees and directors will be notified that the COI Policy & Procedures are available on the Intranet Site for review and they will all be required to complete and sign an acknowledgment and disclosure form. All completed forms will be maintained for review by the HR Department.

4.6 Board & Sub-Committees The firm has a main Board Committee and three board sub-committees, Audit & Compliance, Risk and Remuneration. COI has been added as a permanent standing agenda item for each committee meeting as a re-occurring agenda item for all members to review. This will provide all members and attendees at these meetings to have the opportunity to disclose any new or existing COI.

4.7 Record-keeping and reporting The firm shall maintain and regularly update a record of the kinds of investment or ancillary service or investment activity carried out by or on behalf of the firm, in which a COI entailing a material risk of damage to the interests of one or more clients has arisen or, in the case of an ongoing service or activity, may arise. The firm’s Compliance Department will manage and update the COI Register in line with its regulatory obligations. Compliance will also keep a record of all COI in relation to investment or ancillary services or investment activity carried out, which have been identified as amounting to a current or perceived/potential material risk of damage to the interests of one (or more) of the firm’s clients. The firm is committed to full transparency in its activities and in doing so, logs all relevant failures in the processes and perceived/potential/actual COI perceived or actual, are recorded on the firm’s COI Register.

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Appendix I

Annual Declaration of Agreement

to the firm’s Conflict of Interest Policy

I, …………………………………………………………… (BLOCK CAPITALS), hereby confirm that I have received a copy of the firm’s Conflict of Interest Policy & Procedures document. I also confirm that I have read and understood the firm’s policies and procedures in relation to Personal Account Dealing, and Gifts & Entertainment. Furthermore, I agree to be bound by these policies & procedures* as well as any relevant regulation, pursuant to the activities of the firm. * Conflict of Interest: Policy and Procedures (3.1) * Personal Account Dealing: Policies and Procedures (1.03) * Gifts & Entertainment: Policies and Procedures (1.02) Also, I confirm the following to the firm: Are you aware of any conflict(s) of interest which might have an impact on your role with the Firm?

Yes No

If yes, please provide details:

I hereby declare that this is an accurate and complete declaration of all conflicts of interest in relation to my role with the firm. I undertake to inform the firm of any changes to this declaration or of any other conflicts of interest which may arise during my employment.