Under Rule 2.2.3R of the Financial Conduct Authority’s (“FCA”) Conduct of Business Sourcebook (“COBS”), Skerryvore Asset Management Ltd (the “Firm”) to the extent that it is managing investments for a professional client (as defined by the FCA), is required to disclose on its website the nature of its commitment to the UK Financial Reporting Council's Stewardship Code (the "Code") or, where it does not commit to the Code, explain the rationale for this choice based on the Firm’s investment approach.
The Code is a voluntary code aimed at enhancing the quality of engagement by asset managers and owners with corporate issuers and sets out 12 principles relating to how investment and stewardship is integrated, including environmental, social and governance (collectively, “ESG”) issues.
The UK Stewardship Code sets out, through 12 principles, the best practice in engaging with investee companies which the Financial Reporting Council (“FRC”) believes institutional investors, by which is meant asset owners and asset managers with equity holding in UK listed companies, should use as guidance. The principles can be summarised as follows:
Purpose and governance |
01. Purpose, strategy and governance 02. Governance, resources and incentives 03. Conflicts of interest 04. Promoting well-functioning markets 05. Review and assurance |
Investment approach |
06. Client and beneficiary needs 07. Stewardship, investment and ESG integration 08. Monitoring managers and service providers |
Engagement |
09. Engagement 10. Collaboration 11. Escalation |
Rights and responsibilities |
12. Exercising rights and responsibilities |
Consequently, while the Firm generally supports the objectives that underlie the Code, the provisions of the Code are not considered to be appropriate to the activities currently undertaken by the Firm. The Firm has therefore chosen not to commit to the Code at this time. If the Firm’s activities change in such a manner that the provisions of the Code become relevant, the Firm will amend this disclosure accordingly.
Shareholder Rights Directive II
Under COBS 2.2B.5R, the Firm is required to either develop and publicly disclose an engagement policy that meets the requirements of the Shareholder Rights Directive (“SRD II”) or to publicly disclose a clear and reasoned explanation of why it has chosen not to develop an engagement policy that meets the SRD II requirements.
The Firm’s engagement & proxy voting policy and guidelines are set out here.
This policy document summaries the approach taken by the Firm with regards to investee engagement and how the requirements of SRDII are met, and covers all client funds and segregated accounts, collectively the ‘clients’, for which the Firm service as investment manager or adviser and had voting discretion over the client’s assets.
As long-term investors with a fiduciary duty to be responsible stewards of its clients’ capital the Firm looks to maximise returns and in doing so address any sustainability risks to overall performance from investee companies.
Please click here to access Skerryvore’s 2024 Sustainability Review, which provides greater insight into how the investment team have been thinking about and assessing sustainability issues for the businesses that have been considered, invested in, and engaged with during the 12 months to 30 June 2024 (the “period”). Page 22 of the 2024 Sustainability Review sets out the corporate engagements during the period.
For further details on any of the above information please contact either clients@skerryvoream.com or compliance@skerryvoream.com