MIFIDPRU Public Disclosure Statement – FYE 31 March 2024
1. INTRODUCTION & OVERVIEW
Hollyport Capital LLP (“Hollyport” or the “Firm”) is regulated by the Financial Conduct Authority (“FCA”) as a Markets in Financial Instruments (“MIFID”) firm and is subject to the rules and requirements of the FCA’s Prudential Sourcebook for MiFID Investment Firms (“MIFIDPRU”) Handbook. Under MIFIDPRU, the Firm is classified as a non-SNI firm. The Firm is required to comply with the disclosure requirements as set out in
MIFIDPRU 8.
2. RISK MANAGEMENT OBJECTIVES
Risk is an inherent part of the Firm’s business. Hollyport’s Management Committee recognizes the need to understand the risks the Firm faces in its business, and the industry in which it operates, and how to manage them effectively. The role of management is to balance these risks and make the best use of the Firm’s resources, both human and capital, so that the Firm can deliver on its strategy. The Firm reviews the risks facing various aspects of the business on an ongoing basis.
3. OWN FUNDS
Own funds (“capital resources”) is the aggregate of common equity tier 1 capital, net of any deductions. The Firm regularly monitors to ensure that its capital base is sound, as per MIFIDPRU 3.2.2(3). The composition of the Firm’s Own Funds as at 31 March 2024 was £537,000 of CET Tier 1 capital.
The Firm’s approach to assessing compliance with the overall financial adequacy rule is to undertake regular Internal capital Adequacy Risk Assessments (ICARA). As part of this ICARA process, the Firm is required to assess their capital and liquid asset requirements for risks of harm from their ongoing operations and make an assessment that they hold adequate capital and liquid assets to wind down the Firm in an orderly
manner without causing harm to the market or to clients.
The ICARA process sets out how the Firm identifies and monitors material potential harms that the Firm’s business may cause to clients and counterparties, the markets in which Hollyport operates, and the Firm itself. The Firm maintains a Wind Down Plan and has assessed the amount of own funds and liquid assets required to support an orderly wind down.
Own Funds Requirement for non-SNI Firm
Permanent Minimum Capital Requirement – £75,000
Fixed Overhead Requirement (utilising transitional provisions) – £481, 107
4. REMUNERATION DISCLOSURE
The Firm adheres to the FCA’s Remuneration Code as specified in SYSC19G, applying remuneration rules and guidance in a proportionate manner that reflects the size, internal organization and nature of the Firm, and scope and complexity of the activities it undertakes.
A. Firm Approach and Objectives of the Firm’s Financial Incentives
The Firm has formulated its remuneration policy and practices with reference to the guidance set out by the FCA. Hollyport considers the appropriate balance between fixed and variable remuneration and also seeks to avoid a conflict of interest between staff incentives and the best interests of customers.
The Firm’s financial incentives are designed to align risk and reward by:
Promoting sound and effective risk management;
Encouraging responsible business conduct;
Supporting positive behaviours and healthy firm cultures;
Limiting risk-taking;
Avoiding conflicts of interest; and
Being gender neutral, in line with the Equality Act 2010.
B. Governance and Decision-making Procedures
The Firm has implemented and maintains a Management Committee composed of the eight Partners who oversee and are accountable for the governance arrangements that ensure effective and prudent management of the Firm. The Firm conducts itself with integrity and in the interest of its clients.
John Carter – Founder, CEO
Steve Nicholls – Senior Investment Parter, Head of GP-Led Solutions
Ed Gay – Partner, COO
Richard Grindrod – Investment Partner
Mike Catts – Investment Partner, Head of New York Office
Catherine Badour – Partner, Head of Investor Relations
James Jupp – Investment Partner
Mei Chan – Partner, Head of Finance
The Firm has implemented and maintains a Remuneration Committee that oversees the
compensation of the business, following the procedures established by the Human
Resources Department. The overall variable remuneration pool and the variable
remuneration of individuals are subject to review and approval by the Remuneration
Committee. The Firm’s remuneration arrangements are reviewed regularly.
The Firm assesses all staff under its performance management process on an ongoing
basis, with an annual performance assessment outcome being used as a contributing
factor in the determination of remuneration.
C. Key Characteristics of Remuneration Policies and Practices
Hollyport’s Remuneration Policy is reviewed annually by the Compliance Department
and is approved by the Remuneration Committee.
The Remuneration Policy has been developed based on a number of key principles which are:
Remuneration should align to the Firm’s business drivers, corporate vision, and strategic priorities.
Remuneration should adhere to wider people management practices, and only reward results which support a positive employment culture and customer values.
Remuneration communications should be made simple, clear, and transparent for employees and shareholders.
At the Firm, total reward typically comprised a salary, additional benefits, and bonus or profit-sharing arrangements. Salaries are set in the context of affordability, external market considerations, internal relativities, and equal pay factors.
D. Fixed and Variable Remuneration
All staff receive fixed remuneration and are considered for discretionary variable remuneration.
The Firm reviews the base salary of staff on an annual basis, considering factors such as market information and individual performance.
All variable remuneration is dependent on the Firm’s overall financial result and takes into account current and future financial and non-financial risks. The amount of variable remuneration that is awarded to individuals is tied to individual performance, with reference to the Firm’s formal appraisal process. No variable remuneration is awarded to members of the management body who do not perform any executive function in the Firm.
E. Quantitative Remuneration
In accordance with MIFIDPRU 8.6, the Firm has identified its material risk takers in accordance with SYSC 19G.5. The Firm has eight staff classified as MRTs during the 2024 performance year. The total aggregate remuneration for the Firm for the year ended 31 March 2024 was £35,356,070.
MRTs // Other Staff
Total Remuneration – £27,124,724 // £8,231,346
Fixed Proportion – £2,945,238 // £4,507,262
Variable Proportion – £24,179,486 // £3,724,084
SMF // Other
Total Amount of Guaranteed Variable Remuneration – £0 // £0
No. of MRTs Receiving Guaranteed Variable Remuneration – £0 // £0
Total Amount of Severance Payments Awarded – £0 // £0
No. of MRTs Receiving Severance Payments – £0 // £0
Highest Amount of Severance Payment Awarded – £0 // £0
5. INVESTMENT POLICY
MIFIDPRU 8.7 requires a firm to make specific disclosures in respect of its investments in each company whose shares are admitted to trading on a regulated market and only in respect of those shares to which voting rights are attached, where the proportion of voting rights that the investment firm directly or indirectly holds exceeds the threshold of 5% of all voting rights attached to the shares issued by the company at the time of the meeting.
Where the 5% threshold is exceeded, MIFIDPRU 8.7 requires the following items to be
disclosed:
The proportion of voting rights attached to the shares held directly or indirectly by the firm, broken down by country or territory; and
A complete description of voting behaviour in the general meetings of companies in the shares of which are held in accordance with MIFIDPRU 8.7.4R, including:
an explanation of the votes; and b) the ratio of proposals put forward by the administrative governing body of the company that the firm has approved; and
An explanation of the use of proxy adviser firms; and
Voting guidelines regarding the companies the shares of which are held.
The Firm did not hold any holdings in respect of a company whose shares are admitted to trading in a regulated market in excess of the specific threshold.