Conflicts management policy for investment research
This policy sets out how Fiske plc (“we” or “us”) identify and manage potential conflicts of interest in connection with its publication of investment research. This policy applies to all investment research published by us for distribution externally; for the avoidance of doubt, this does not include personal recommendations or advice provided to clients.
While we aim to provide investment research that is impartial in all cases, on occasion our investment research may not be deemed as such pursuant to the FCA rules. This policy highlights the circumstances where this may be the case. In such cases, the investment research will be clearly marked as “Not Impartial”, but, in all other respects, the substance of this policy will continue to apply to that investment research.
This policy supplements our general obligation to act with integrity and fairness in our dealings with clients and counterparties. It is issued pursuant to the requirements of the FCA’s conduct of business rules and does not create any third party rights or duties that would not already exist if the policy had not been made available nor does it form part of a contract between us and any other person.
Identification of Conflicts
- Conflicts of interest can arise in a number of ways in an entity carrying on investment activities with and for a variety of third parties. These conflicts can arise from duties and obligations owed to, inter alia, corporate finance clients, broking clients, private clients as well as our interests and those of our employees.
- We have developed a number of arrangements to help identify the existence of conflicts of interest within our business and to manage those interests effectively. The remainder of this policy sets out in further detail those arrangements, compliance with which is overseen directly by the Chief Executive and the Compliance Officer.
- Training is provided to personnel generally to raise their awareness of conflicts of interests and also on an ad hoc basis as required.
Organisation and Supervision of the Research Function
- We do not have a separate investment research department as such. We employ one individual under a contract for services to produce our investment research. That research analyst is supervised directly by and reports to the Chief Executive; any determination as to resourcing of the investment research function is made by the Chief Executive in conjunction with the Board of Directors.
- Investment research is produced on an ad hoc basis. The decision as to whether to cover a particular company in investment research is taken by the Chief Executive, exercising his discretion on a case-by-case basis. It may be that the company concerned has made a presentation to us, although this is not determinative as to whether a report will be published or its content (save where the document indicates that it is a report of the presentation). The fact that we may have previously issued investment research on a particular company does not mean that we will do so in the future.
Activities of Research Analysts
- The research analyst plays no part in our business activities other than in the production of investment research.
- The research analyst is required to comply with all policies and procedures of Fiske, including, in particular, personal account dealing rules. The research analyst is prohibited from dealing ahead of the publication of any investment research and may not carry out a transaction within a month of publication of investment research in a stock in respect of which we act as broker.
Remuneration of Research Analysts
- The research analyst is paid on a per report basis. There are no incentives based in the remuneration and no payments are dependent on the performance of Fiske either generally or in respect of particular mandates.
Inducements and Inappropriate Influences
- The research analyst has no office within Fiske and produces all reports from an external location. All information within Fiske is retained independently from the research function and vice versa.
- We do not accept, and do not allow the research analyst to accept, any inducement in respect of the publication of investment research or the content of that research.
- The investment research will be checked for factual accuracy by the Chief Executive and/or the Compliance Officer, although editorial control will remain with the research analyst.
- We do not establish a house view on any security or company the subject of investment research and the research analyst is entirely free to express his or her own views. The research analyst is required to certify that the views expressed are those of the research analyst.
- On occasion, the research analyst will communicate the investment research in draft to the subject company for comment. Comment from the subject company may extend beyond confirming factual details, although editorial control will remain with the research analyst. In such a case, the investment research will no longer be regarded as “impartial” and a disclosure to that effect will be included on the investment research.
- The research analyst is required to disclose to us any interests which he or she (or a member of his or her household) has in a security the subject of investment research. Where such an interest exists which may affect the impartiality of the research, the investment research will not be regarded as impartial and a disclosure to that effect will be included on the investment research.
- Investment research will state clearly on the front page whether it can be regarded as impartial for the purpose of the FCA rules or not.
- The investment research will disclose if the research analyst (or any member of his or her household) holds any interest in the company the subject of the relevant investment research.
Communication of Investment Research
- Investment research is distributed in a directed fashion, in that each report will only be sent to those persons for whom it is appropriate to receive it and in respect of whom we have a mandate to communicate such reports. However, all communications are made in a fashion which is fair and impartial in respect of the recipients. Accordingly, there is no preference given to any particular client.
- Investment research is made available within Fiske once published. There is no pre-disclosure of the investment research within Fiske other than for the purposes of determining the distribution and the approval of the report by relevant personnel and, in any event, Fiske personnel are not permitted to act on such investment research until an appropriate period has elapsed after distribution.
- The final determination as to when to distribute the investment research is at the discretion of the Chief Executive. In general, the investment research will be distributed when finalised, although the Chief Executive may withhold distribution where he judges it appropriate to do so (e.g. for legal or regulatory reasons); this discretion may not be exercised for reasons attributable to the content of the report.
Role of Chief Executive
It is acknowledged that the Chief Executive is involved in the supervision of the research analyst and the production and distribution of investment research, as well as being involved in other parts of our business. Given the nature and size of our business, it is standard practice that the Chief Executive should oversee all parts of the business and determine the overall strategy of Fiske. In doing so, the Chief Executive is required to, and does, maintain an independence of action in respect of the different business lines, including the research function. Accordingly, we are satisfied that the investment research function is an independent function and that the actions of the Chief Executive will not affect its ability to produce impartial investment research.