Last updated August 2026
1. Objective
The purpose of this document is to outline Capel Asset Management’s (“Capel”) policy to ensure that Capel, and its employees and contractors (“Employees”), pay due regard to the interests of each client (retail, professional or eligible counterparty) and manage any conflicts of interest fairly and effectively. This specifically applies when Capel has, or may have, an actual or perceived conflict of interest between:
• Capel and the duty owed to its clients;
• firms or affiliates connected to Capel and the duty owed to its clients; or
• the duties owed to one client and another.
This Policy describes the circumstances that could constitute or give rise to a conflict of interest and the principles to be followed to identify and manage such conflicts.
2. Scope
This Policy applies to all activities and processes that Capel performs.
3. Application
Capel maintains and operates effective organisational and administrative arrangements to ensure all appropriate steps are taken to prevent conflicts of interest from adversely affecting the interests of its clients (including end investors).
Capel does not provide services in a manner that advances one client’s interests unfairly over another’s. Capel does not treat its clients inequitably, nor deal in relation to a transaction in which Capel has a material interest, unless it has taken all appropriate steps to ensure the fair treatment of the client. Where these steps are not sufficient and all steps have been exhausted, the material interest is appropriately and clearly disclosed to the client. In some cases, Capel may decline to engage in an activity where there is a conflict of interest.
Capel will take all appropriate steps to identify conflicts of interest between itself (both personal staff interests and those of the firm) and any client, or between one client and another, that arise or may arise while providing any service to its clients and carrying on regulated activities or ancillary services.
Other Capel policies that relate to this document include the Stewardship Policy.
4. What are Conflicts of Interest?
Examples of potential conflicts include, but are not limited to:
• Capel making a financial gain or avoiding a financial loss at the expense of the firm’s customers.
• Capel having a financial or other incentive to favour the interests of one client or group of clients over the interests of another client.
• Capel carrying on the same or similar business as the client.
• The use of confidential customer or business information in a way which would be detrimental to the interests of Capel’s customers.
• Accepting gifts, hospitality, or an inducement which would be considered to have an actual or perceived effect on the integrity of a Capel employee and conflict with the interests of customers.
• Capel employees having external employment or personal interests that conflict with the interests of the firm or its clients.
Capel maintains a conflicts of interest register which details its business activities that may give rise to a conflict of interest and enables it to communicate, prevent, manage and monitor conflicts of interest that arise. Compliance is required to remain strictly neutral when advising on the management of conflicts.
Employees are required to apply this Policy to their everyday activities; to apply the relevant standards; and to escalate where they are unsure whether a conflict of interest has previously been identified and/or is being prevented, monitored or managed.
5. Identifying Conflicts of Interest
It is the responsibility of all Capel employees to promptly report any potential conflict of interest to Compliance.
Capel has established policies, procedures and training to support the preparation and maintenance of its conflicts of interest framework; to assist staff in identifying day-to-day business situations where a conflict may arise; and to set out the steps to be taken to either prevent or manage potential or actual conflicts.
Various arrangements have been established by Capel to achieve these objectives, in particular procedures for the governance and resolution of conflicts of interest, including:
• identification of actual, potential or perceived conflicts of interest through Capel’s conflicts management processes, insider list and, where necessary, internal systems used by business units, and the register of outside business interests;
• controls over the handling and flow of confidential and inside information; and
• general disclosure of the possibility of material interests to clients at an early stage of the relationship.
6. Internal Conflicts of Interest
Capel is an independent asset manager. Conflicts may arise where clients are also companies in which Capel invests, for example. In these circumstances, contentious issues are discussed with the relevant investment managers and documented.
In addition, there will be close engagement with the company concerned, including where the issue relates to a voting matter. In this instance, Capel will vote in the best interests of the funds or clients that hold an interest in the company, applying the principles of Treating Customers Fairly (“TCF”).
7. Information Barriers and Separation of Reporting Lines
Capel respects, and expects all Employees to respect, the confidentiality of information. Capel operates a “need to know” approach aimed at complying with all applicable rules relating to the handling of such information. Access to confidential information is restricted to those who have a proper need for it to discharge their responsibilities consistent with the legitimate interests of clients or the firm.
The principal way in which Capel structures its business to manage conflicts of interest is through the maintenance of information barriers. These are designed to restrict information flows between different areas of Capel. Information barriers and other measures enable Capel and its Employees to carry out business on behalf of clients without being influenced by other information held within the firm that may give rise to an actual or potential conflict of interest.
8. Insider and Restricted Lists
Capel has in place secure and confidential systems to record material information to assist in the identification and management of potential conflicts of interest. The Compliance function is responsible for maintaining the Restricted List. These lists assist with the maintenance and monitoring of information barriers by tracking the flow of non-public information within Capel, enabling it to identify and manage potential conflicts of interest arising from different departments and investment teams before, during and after investment transactions.
By means of these lists, and the requirement for personal account deals to be pre-cleared, Compliance can check whether the firm or its employees will make transactions in exchange-traded securities in respect of which Capel has inside information, or which would prejudice clients’ interests. Although unlisted investments are not technically covered by the Market Abuse Regulation (“MAR”), a restricted list is also kept for unquoted investee companies.
9. Inducements
MiFID and its implementing legislation contain rules prohibiting Capel or its Employees from paying or receiving any fee, commission or non-monetary benefit in relation to the provision of a MiFID service to a client (an “Inducement”), unless such payment or receipt falls within an exception.
An inducement may create a conflict of interest where the payment or receipt of the inducement would distract Capel from its obligations to serve the best interests of its client.
To closely monitor potential conflict of interest scenarios relating to inducements, Capel has established a Gifts, Inducements and Entertainment Policy that all Employees are required to follow and comply with.
9.1. Accepting and Making Gifts and Entertainment
Employees are generally not permitted to accept any inducements, privileges or advantages where the value exceeds a predefined threshold of £100, without the prior approval of Compliance. Employees are also forbidden from demanding personal inducements or advantages from clients or business partners, or from accepting or making cash or cash-equivalent gifts in any amount during the course of business.
10. Personal Account Dealing
Rules on personal account dealing restrict transactions in securities and derivatives made by Capel’s employees (and connected persons) for their own account, or for the account of third parties by way of power of attorney or legal representation. Permission will not be given to deal in a company’s securities or derivatives if that company is on the insider list, or if dealing would prejudice client interests.
11. Fair Allocation, Aggregation of Orders and Internal Crossed Trades
Capel’s Allocation Policy requires orders to be allocated fairly among clients, having regard to investment restrictions, client instructions or restrictions, and the availability of investable assets.
Capel is not authorised to deal on its own account and does not hold FCA “dealing as principal” permission. Order aggregation and allocation therefore relate only to situations involving multiple client orders. When aggregating and allocating multiple client orders, Capel will ensure that:
• the aggregation of orders is intended to work to the advantage of any client whose order is to be aggregated and allocated; and
• the aggregation and allocation procedures enable fair allocations to be made where the volume and price of an aggregated order determines allocations, or where there are partial executions (i.e. sequentially and proportionately).
Capel has procedures to prevent the reallocation of orders between clients where there is potential for detriment to any client.
Capel may seek to execute all or part of an order by undertaking an agency cross-transaction (i.e. a transaction where it matches, at the same price and on the same terms, the buy and sell orders of two or more clients for whom it is acting as agent). Capel will only undertake such a transaction if it is beneficial to both parties and has been executed at a fair price. All relevant scenarios are set out in the Internal Cross Trade Policy. Internal crosses are transacted in the market and are fully transparent.
12. Changes to Existing Conflicts of Interest
It is the responsibility of all employees to promptly report any changes to existing conflicts of interest to Compliance. Examples of changes that require Compliance to be notified include, but are not limited to:
• a change in personal circumstances, such as a change to an existing held directorship; and
• changes in policies and procedures that impact Capel’s management of a conflict of interest.
13. Preventing and Managing Conflicts of Interest
Conflicts of interest are either prevented or managed in a way that ensures clients’ interests are not adversely affected. This means that a conflict of interest is managed so that all clients are treated fairly and Capel conducts its business with integrity and high ethical standards, in accordance with proper market practice.
Capel’s approach to preventing or managing conflicts of interest may include one or more of the following actions:
13.1. Management
Capel has implemented internal controls and undertakes monitoring to assist with complying with the relevant mitigation technique or regulatory requirement relating to conflicts of interest management.
13.2. Termination / Avoidance
Some conflicts of interest may have such a potential impact on the firm or its clients that the only way to adequately manage them is to avoid them entirely. In such cases, disclosing the conflict of interest and imposing internal controls may not be considered adequate, and the activity to which the conflict relates may need to be terminated or avoided.
13.3. Disclosure
Where a conflict of interest cannot be managed through Capel’s internal controls with reasonable confidence that the risk of damage to the client’s interest will be prevented, the conflict is disclosed. This is a measure of last resort and must not be used as a means of managing a conflict.
Where Capel discloses a potential conflict of interest to a client (or third party, if applicable), the disclosure, made before undertaking business for the client, will:
• set out the general nature or sources of the conflict of interest, or both;
• set out the steps taken to mitigate those risks;
• where required, be provided in a durable medium;
• clearly state that internal controls are insufficient to prevent or manage the conflict with reasonable confidence that the risk of damage to the client’s interests will be prevented;
• describe the conflict of interest and explain the risks to the client arising from it; and
• include sufficient detail, having regard to the nature of the client, to enable that client to take an informed decision regarding the service in the context in which the conflict of interest arises.
14. Conflicts of Interest Register
Capel maintains a conflicts of interest register to enable it to communicate, prevent, manage and monitor conflicts of interest that arise. Compliance is required to remain strictly neutral when advising on the management of conflicts.
15. Roles and Responsibilities
Compliance is responsible for ensuring this Policy is reviewed at least annually and disseminated to all employees.
It is the responsibility of every Employee to comply with this Policy and any related policies and procedures, and to escalate any breaches or potential breaches to Compliance. A breach of this Policy may lead to disciplinary action.
Employees with any doubt about the interpretation or application of this Policy should contact Compliance.
16. Training
Capel provides, and expects relevant Employees to attend, regular training on conflicts management and related topics. This training is critical in ensuring that Employees are able to identify and escalate conflicts of interest, and are aware of the processes by which conflicts are identified, escalated and resolved. Appropriate resources are dedicated to building awareness of conflicts of interest and developing Employees’ knowledge and understanding.
17. Monitoring and Reporting
From time to time, Compliance will undertake reviews to check the effectiveness of Capel’s conflicts of interest policy and procedures. Compliance regularly monitors staff dealing activities and investment management activity, and the firm’s systems and controls are subject to periodic review and audit. Management information relating to the identification and management of conflicts of interest is reviewed by Capel’s Executive Board.
18. Non-Exhaustive List of Specific Examples of Conflicts of Interest
Below is a non-exhaustive list of specific examples of transactions and activities at Capel that give rise to conflicts of interest requiring appropriate management, mitigation or prevention:
• A Family Member or Close Personal Relationship has an interest in a transaction or activity where either a client or Capel also has an interest, and the Employee favours the Family Member or Close Personal Relationship;
• as a result of excessive or lavish gifts or entertainment provided to an Employee, that Employee’s judgement is improperly influenced, or the Employee engages in improper conduct;
• Capel holds a proxy for a client and votes the shares in a way that reflects Capel’s interests, or those of another client, rather than those of the first client;
• Capel allocates a new issuance of debt or equity securities and favours certain client investors to the detriment of Capel’s issuer client and/or other client investors, in return for benefits or promises of reciprocal business;
• an Employee carries out excessive trading on a client account largely to generate commissions that benefit the Employee and Capel;
• stewardship activities give rise to specific actual or potential conflicts, such as voting on the appointment of a company director with whom Capel has an existing commercial or other significant relationship;
• investment managers have differing views and priorities for engagement;
• Capel sells assets held on its own books to a fund it manages, which is not in the best interests of the fund and its investors;
• the views of internal portfolio managers differ from each other or from the Responsible Investment (“RI”) team, and a negative stance from the RI team affects other interactions with the company; and
• an Employee who administers a client account that includes real estate assets selects an appraiser for the real estate in a way that results in a benefit for Capel and a detriment to the client.