The UK Stewardship Code (“the Code”) was published in July 2010 by the Financial Reporting Council (“FRC”), the UK’s independent regulator responsible for promoting high-quality corporate governance and reporting to encourage investment.

The Code aims to enhance the quality of engagement between institutional investors and companies to help improve long-term prosperity for shareholders and the efficient exercise of governance responsibilities. The Code sets out good practice on engagement with investee companies and is to be applied by firms on a “comply or explain” basis.

The FRC recognises that all parts of the Code may not be relevant to all institutional investors and that smaller institutions may judge some of the principles and guidance to be disproportionate. It is legitimate for some asset managers not to engage with investee companies, depending on their investment strategy, and in such cases, firms are required to explain why it is not appropriate to comply with a principle.

The seven principles of the Code require institutional investors to:

  • Publicly disclose their policy on how they will discharge their stewardship responsibilities;

  • Have a robust policy on managing conflicts of interest in relation to stewardship which should be publicly disclosed;

  • Monitor their investee companies;

  • Establish clear guidelines on when and how they will escalate their stewardship activities;

  • Be willing to act collectively with other investors where appropriate;

  • Have a clear policy on voting and disclosure of voting activity; and

  • Report periodically on their stewardship and voting activities.

Mayne Capital (UK) Ltd does not currently comply with the Code because its investment activities concern foreign exchange and related instruments, and as such, it does not currently invest in UK listed companies.

Therefore, although the firm supports the objectives set out within the Code, the provisions are not deemed to be relevant to the type of investment strategies and trading currently undertaken by the firm. Should any material changes occur to our strategies that would make the Code relevant, we will review our commitment to the Code at that time and make appropriate disclosure.