The Partnership is authorised and regulated by the Financial Conduct Authority as a Collective Portfolio Management Investment (‘CPMI’) Firm and, so, it is subject to FCA Rules on remuneration. These are contained in the FCA's Remuneration Code located in the SYSC Sourcebook of the FCA’s Handbook.
CPMI Firms are required make a remuneration disclosure in respect of the whole of their business, i.e. both MIFID and AIFMD. The specific requirements of the AIFMD remuneration disclosure are set out in the Annual Report of the AIF(s).
The Remuneration Code (‘the RemCode’) covers an individual’s total remuneration, fixed and variable. The Partnership incentivises staff through a combination of the two.
Our policy is designed to ensure that we comply with the RemCode and our compensation arrangements:
- are consistent with and promotes sound and effective risk management;
- do not encourage excessive risk taking or risk-taking which is inconsistent with the risk profiles or instruments of incorporation of the AIFs we manage;
- include measures to avoid conflicts of interest; and
- are in line with the Partnership’s business strategy, objectives, values and long-term interests.
Enshrined in the European remuneration provisions is the principle of proportionality. The FCA has sought to apply proportionality in the first instance by instituting two tests. Firstly, a firm that is significant in terms of its size must disclose quantitative information referred to in BIPRU 11.5.18R at the level of senior personnel. Secondly, that a firm must make disclosure that is appropriate to the size, internal organisation and the nature, scope and complexity of their activities.
The firm is not ‘significant’ (that is to say has relevant total assets <£50bn*) and so makes this disclosure in accordance with the second test (BIPRU 11.5.20R(2)).
* average total assets on the last three accounting dates.
Application of the Requirements
We are required to disclose certain information on at least an annual basis regarding our Remuneration policy and practices for those staff whose professional activities have a material impact on the risk profile of the firm. Our disclosure is made in accordance with our size, internal organisation and the nature, scope and complexity of our activities. The Partnership’s full Remuneration Policy is available at the request of investors.
Summary of the Policy
- The Partnership’s policy has been agreed by the Senior Management in line with the Remuneration principles laid down by the FCA.
- Due to the size, nature and complexity of the firm, we are not required to appoint an independent remuneration committee.
- The Partnership’s policy will be reviewed as part of annual process and procedures, or following a significant change to the business requiring an update to its internal capital adequacy assessment.
- The Partnership’s ability to pay bonus is based on the performance of the Partnership overall and derived after its fund’s returns have been calculated by client appointed third party administrators.
- Individuals are rewarded based on their contribution to the overall strategy of the business.
1. Investment Generation
2. Investment Trading
3. Sales & Marketing
- Other factors such as performance, reliability, effectiveness of controls, business development and contribution to the business are taken into account when assessing the performance of the senior staff responsible for the infrastructure of the firm.
Aggregate quantitative information on remuneration broken down by significant business division (where such business divisions exist):
Investment Management and Trading
Aggregate compensation expense for 2015 financial year: £162k
Aggregate compensation expense for 2015 financial year: £56k
Based on general proportionality, firms with distinct business divisions should provide this disaggregated information but may exclude this where no such divisions exist. For the purposes of alternate investment management firms, it is normally deemed appropriate to consider the functions of investment management and trading as being within the same business division.
Aggregate quantitative information on remuneration, for staff whose actions have a material impact on the risk profile of the firm/of those staff of the Firm who are fully or partly involve in the activities of the AIF:
Aggregate compensation expense for 2015 financial year: nil
Others/ (If applicable)
Aggregate compensation expense for 2015 financial year: £218k
Partnership profits allocated to members of the LLP are normally disclosed in aggregate in the report and accounts.
We may omit required disclosures where we believe that the information could be regarded as prejudicial to the UK or other national transposition of Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data.
We have made no omissions on the grounds of data protection.