– Best Selection / Best Execution policy
– Conflict of Interests policy
– Voting policy
– 2011 Report on Intermediation Fees
– Customer complaints handling procedure
1. Best selection policy
All investment services providers should comply with the obligation to act in the best interest of their clients when executing orders resulting from investment decisions related to portfolio management.
To this end, in its capacity as a portfolio management company, Carmignac Gestion is required to take all reasonable measures to obtain the best possible result for its clients. Such measures comprise more specifically the obligation to select the intermediaries to which orders are transmitted for execution (brokers and financial counterparties) and whose execution policies guarantee the best possible result when executing orders sent on behalf of its clients.
In accordance with the regulations, CARMIGNAC Gestion has put in place an Order Execution Policy. The Order Execution Policy notably requires that the orders should be registered and treated in a timely and accurate manner, with regard to market conditions.
This Order Execution Policy is based on:
– a standardized process for the selection of brokers and financial counterparties;
– a process for the selection of the place of execution;
– an analysis of the reporting provided by the brokers and financial counterparties.
Carmignac Gestion uses a multi-criteria approach to select intermediaries guaranteeing best execution of orders.
The criteria applied are both quantitative and qualitative and depend on the markets for which the intermediaries provide services, in terms of geographical coverage (global, pan-European or local intermediaries) and financial instruments traded (intermediaries specialized in the equity, interest rate, convertible or derivatives markets).
Every criterion is subject to an assessment, which is allocated a weighting coefficient, thereby enabling an overall rating to be attributed, subsequently allowing all intermediaries analyzed to be ranked with a view to a potential modification of list of the intermediaries.
The analysis criteria notably cover the availability and proactiveness of the intermediaries, their financial stability, speed and quality of execution and transaction cost.
The intermediaries’ ratings are updated every year. Based on this, the list of selected intermediaries is also reviewed annually.
We will inform you of any major change to our selection policy by displaying an updated version of the selection policy on our website: www.carmignac.se
2. Conflicts of interest policy
In accordance with the regulations, Carmignac Gestion has established a conflicts of interest policy. Carmignac Gestion takes all reasonable measures to identify conflicts of interest that may arise in the course of providing its business activities.
As a result of the determination the situation of conflicts of interest, a mapping of conflicts of interest has been drawn up. This mapping identifies the circumstances that give rise or may give rise to a conflict of interest.
It makes it possible for Carmignac Gestion to identify and, if necessary, fairly manage any conflicts of interest that may arise in the course of carrying out its services, between its own interests and those of its clients or between the interests of a number of clients.
This notably involves identifying and scrutinising:
– the participation of an employee in one or more investment services offered by the management company;
– the separation of activities that may lead to potential conflicts (such as proprietary activities and those on behalf of third parties);
– the circulation of confidential or privileged information within the management company;
– corporate offices held by employees of the management company on a personal basis or as part of their professional activities;
– commission paid or received in connection with services or activities performed by or on behalf of the management company;
– the method by which employees are remunerated in connection with the distribution of financial products;
– benefits or gifts that employees of the management company may receive in connection with their professional activity;
– potential conflicts of interest relating to the procedure for selecting intermediaries and service providers;
– the introduction of an incident management procedure designed to protect the primacy of the client’s interests;
– the introduction of a procedure for personal transactions;
– the introduction of a procedure for giving gifts to and/or receiving gifts from clients and service providers.
3. Voting policy
Carmignac Gestion’s voting policy is set out in this document. Its effects are permanent and apply to the full range of UCITS managed by Carmignac Gestion. The voting policy details the general principles applicable for voting purposes.
a) Organisation of Carmignac Gestion for exercising voting rights
The management team is the body responsible for deciding how votes are to be cast. Decisions are taken either at management committee meetings, or individually, with regard to the principles set out in this “voting policy” document.
The Middle Office Actif team is responsible for managing and monitoring resolutions tabled. It supports the asset management team with a view to facilitating the exercise of votes (monitoring alerts, requesting voting documents, returning documents filled in and signed by managers, etc.)
b) Principles used to determine how voting rights are exercised
Carmignac Gestion exercises the voting rights attached to the securities held by the UCITS it manages, where there is a risk of companies changing their strategy. It may be evidenced by:
– a risk of a change in the majority of shareholders;
– a risk of a merger / acquisition;
– a risk of a change in the management team;
– a risk of restructuring, etc...
Once these risks have been identified, Carmignac Gestion’s aim is to act with respect to companies in which the funds hold significant positions. To this end, it votes whenever one of the following conditions has been met:
– Carmignac Gestion holds more than 2% of the capital of the company, through the portfolios under management
– the position represents more than 5% of a fund’s assets
c) Voting rights policy
Carmignac Gestion’s voting policy aims to favour the exclusive interests of UCITS’ investors. As such, and with regard to voting in companies falling within the scope of the application of this policy, the votes cast by CARMIGNAC GESTION will favour:
– the establishment of a basis for effective corporate governance;
– shareholders’ rights and the main functions of holders of capital;
– fair treatment of shareholders;
– the role of different stakeholders in corporate governance;
– transparency and distribution of information;
– the responsibility of the Board of Directors.
d) Procedures designed to identify, prevent and manage conflicts of interest likely to impact the free exercise of voting rights
Carmignac Gestion’s compliance code defines the conflicts of interest potentially involving members of the management team.
e) Method of exercising voting rights, such as physical attendance at AGMs, use of proxies without specifying the name of the representative, or the use of postal voting.
Voting rights are mainly exercised by postal voting.
f) Reports to clients on voting rights
A report is published once a year, within four months of the end of each financial year. It provides quantitative and summary information on how voting rights were exercised over the prior year. It is available upon request from the management company.
4. 2012 report on intermediary fees
Where the management company has recourse to order execution and investment decision support services and the intermediary fees for the prior financial year exceeded EUR 500,000, it draws up a document entitled “Report on intermediary fees”.
a) Use of order execution and investment decision support services in 2012
Over 2012, Carmignac Gestion had recourse to order execution and investment decision support services under split commission agreements.
b) Breakdown of intermediary fees between order execution and investment decision support
Intermediary fees for receiving and sending and for executing orders: 34%
Intermediary fees for order execution and investment decision support: 66%
This breakdown covers all assets held in UCITS and discretionary management.
c) Percentage of fees paid back to third parties in 2011 under split commission agreements
The fees paid back to third parties for the settlement of order execution and investment decision support services under split commission agreements represented 6.7% of intermediary fees paid in 2012 on equities and equity securities.
d) Measures taken to prevent or deal with potential conflicts of interest when selecting service providers.
The selection of service providers and their assessment is duly governed by the intermediary selection policy and the conflict of interest policy.
5. Customer complaints handling procedure
CARMIGNAC GESTION has implemented and maintains an operational procedure to quickly and efficiently process complaints made by its clients. Any complaint may be referred to CARMIGNAC GESTION, 24 place Vendôme, Paris, France. The management company will acknowledge receipt of the complaint within a maximum of ten working days from the date it was received, unless a response has been issued to the client in the intervening period. Except in duly justified exceptional circumstances, a response will be issued to the client within two months of receipt of the complaint. In the event of an ongoing dispute, the client may contact a mediator, such as the AMF Ombudsman, at the following address: Autorité des marchés financiers, The AMF Ombudsman, 17 place de la Bourse, 75082 PARIS CEDEX 02. The AMF mediation request form and the Mediation Charter are available online at http://www.amf-france.org.
CARMIGNAC GESTION S.A.
Société anonyme (public limited company), portfolio management company (AMF authorisation no. GP 97-08 of 13/03/1997) registered in the Paris Trade and Companies Register under number 349.501.676, with a share capital of €15,000,000
Registered office: 24, place Vendôme, 75001 Paris
Chairman of the Board of Directors: Mr Edouard CARMIGNAC
Publications Director: Mr Eric Helderlé
Hosted by: L'île des Médias - 15 rue de la Banque - 75002 – Paris