Capturing Fundamental Change

Information Statement on How Our Remuneration Policy is Consistent with the Integration of Sustainability Risks

Sustainable Finance Transparency

The European Union has introduced a series of legal measures requiring firms that manage investment funds to provide transparency on how they integrate sustainability considerations into the investment process with respect to the investment funds they manage.

Our Approach to Sustainable Investment

At Volt, we believe that investors, and asset managers that invest on their behalf, have a responsibility to make their investments in a way that effectively supports a sustainable society.

At the core of our commitment to help our clients achieve their financial objectives is a conviction that this can be achieved by investing responsibly.

What is a Sustainability Risk?

In this context a sustainability risk is considered to be an environmental, social or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of an investment.

Information on How Our Remuneration Policy is Consistent with the Integration of Sustainability Risks

Regulatory Requirements in relation to our Remuneration Policy

Volt is required to ensure that its remuneration arrangements are such that they do not circumvent the remuneration rules set out in the Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers, as amended (”AIFMD”) and related regulatory guidance.

We have prepared a remuneration policy (the ”Remuneration Policy”) to outline how it adheres to the remuneration requirements set out in AIFMD and to demonstrate how it has established and applies remuneration policies and practices that are consistent with, and promote, sound and effective risk management.

The Remuneration Policy provides a clear direction and policy regarding Volt’s remuneration policies and practices consistent with the principles in AIFMD.

Scope of Remuneration

Remuneration, for these purposes, consists of all forms of payments or benefits made directly by, or indirectly, but on behalf of Volt, in exchange for professional services rendered by individuals at the AIFM who have a material impact on the risk profiles of the funds being managed (”Identified Staff”).

Fixed remuneration means payments or benefits without consideration of any performance criteria.

Variable remuneration means additional payments or benefits depending on performance or, in certain cases, other contractual criteria.

Variable Remuneration

Variable remuneration is an important tool to incentivise staff. It also gives Volt flexibility such that, in years where Volt performs poorly, variable remuneration may be reduced or eliminated and the capital of Volt can be preserved. In some circumstances, however, variable remuneration, if inappropriately structured, can lead to excessive risk taking as staff may be incentivised to keep taking risk to maintain or increase their variable remuneration.

In deciding the mix between fixed and variable remuneration of Identified Staff, we are mindful of the need to ensure that the basic pay of staff is adequate to remunerate the professional services rendered taking into account, inter alia, the level of education, the degree of seniority, the level and expertise and skills required. Volt is an asset management business, and its revenues are based on the amount of assets it manages and its revenues may therefore be more volatile than other types of businesses. Variable remuneration allows Volt to reduce the risk that its capital base is eroded due to the need to pay fixed remuneration cost should assets under management decline.

Remuneration Process

The factors that are taken into account in deciding the quantum of the variable remuneration in any given period are as follows:

  • performance of the individual;
  • performance of the funds being managed ;
  • the profit that Volt made during the previous year; and
  • other factors as may be determined from time to time by the board of directors of Volt (the ”Board”).

In addition, and specifically in consideration of how Volt integrates the consideration of sustainability risks into the remuneration process, the following factor is also taken into account where Volt integrates sustainability risks into its investment decisions:

  • the extent to which the individual has (i) embodied the principles; and (ii) adhered to the fundamental process based elements that are each contained in any ESG policy statement of Volt from time to time.

It is recognised in relation to each of the factors listed above (and the last one in particular), that, where relevant, these factors may be considered and applied subjectively to an individual, dependent on their role within Volt.

Finally, as an overriding and discretionary factor, Volt will ultimately be mindful of the need to ensure that the remuneration policy promotes sound and effective risk management, does not encourage risk taking that is inconsistent with the risk profiles of the funds and is consistent with Volt’s approach to the integration of sustainability risks.

Variable remuneration awards must in all cases be aligned with the Volt’s business strategy, objectives, core values, any ESG principles and the best interests of Volt.