The Listing Rules require that the Directors must “comply or explain” against the UK Corporate Governance Code. In addition the Disclosure Guidance Transparency Rules require the Company to: (i) make a corporate governance statement in its annual report and accounts based on the corporate governance code to which it is subject or with which it voluntarily complies; and (ii) describe its internal control and risk management arrangements. The Board has agreed to comply with the AIC Code of Corporate Governance (the “AIC Code”) produced by the Association of Investment Companies (“AIC”), except as set out below. The FRC has confirmed that compliance with the AIC Code would satisfy an investment company’s obligations to comply with the UK Corporate Governance Code.
The GFSC’s “Finance Sector Code of Corporate Governance” (the “GFSC Code”) applies to all companies that hold a licence from the GFSC under the regulatory laws or which are registered or authorised as collective investment schemes, which includes the Company. Companies which report against the AIC Code are deemed to meet the requirements of the GFSC Code.
The Directors recognise the value of the AIC Code and believe that reporting against the provisions and recommendations of the AIC Code will provide Shareholders with better information. Accordingly, the Company has taken appropriate measures to ensure that the Company complies with the AIC code.
The UK Corporate Governance Code includes provisions relating to:
- the role of the chief executive;
- executive Directors’ remuneration; and
- the need for an internal audit function.
For the reasons set out in the AIC Code, and as explained in the UK Corporate Governance Code, the Board considers that these provisions are not relevant to the Company’s position, being an externally managed investment company. In particular, all of the Company’s day-to-day functions are outsourced to third parties. As a result, the Company has no executive Directors, employees or internal operations. The Company has, therefore, not reported on these provisions.