WH Ireland Limited and its affiliates (together “WHI” or the “Firm”) provide a wide variety of Private Wealth and Investment Banking products and services to a wide range of corporates, institutions and individuals. The Firm takes all reasonable steps to maintain and operate effective organisational and administrative arrangements to prevent, identify and manage situations which may arise in which a client’s interest could conflict or could be perceived to conflict with those of WHI or those of other WHI clients.
This document is designed to provide clients with a high level summary of the underlying conflicts of interest policies and arrangements WHI has in place, in the event it is unable to prevent conflicts.
2. Identifying conflicts of interest
A conflict of interest can be described as a situation in which someone in a position of trust has competing interests (professional and/or personal) which make it difficult to fulfil their duties fairly. Potential and actual conflicts of interest may arise between the Firm (including its subsidiary and affiliates, senior management, employees, agents and consultants) and its client and/or between one client of the firm and another client.
3. Managing conflicts of interest
WHI has taken all reasonable steps to ensure that it will act with the requisite degree of independence and manage potential and actual conflicts of interest giving rise to a material risk of damage to the interests of one or more of its clients. Examples of potential conflicts, and conflict management arrangements include, but are not limited to:
Example of potential conflict
Conflict management arrangement
|WHI could have access to inside information in some areas of the business which staff in other departments, who deal in the respective security either on behalf of their clients or in a principal capacity, could take advantage of.||It is important that WHI maintains robust information barriers in order to prevent improper access to inside information.
WHI have establish information barriers, known as “Chinese Walls”, which are administrative and physical barriers designed to restrict the flow of confidential information and to manage potential conflicts of interest.
|WHI could offer or receive inducements in respect of certain services, which could incentivise the recipients of the inducement to not act in the client’s best interests.||WHI has arrangements on inducements that set out the circumstances under which it and its employees may accept and provide inducements to and from third parties.
The Firm is required to disclose inducement arrangements to clients as and when they arise and prior to the provision of any relevant service. WHI and its employees may not pay or accept any fee or commission, or provide or receive any non-monetary benefit, in relation to the Firm’s activities with one or more clients that would impair the Firm’s duty to act in the best interests of its clients.
|Gifts and hospitality
|WHI and/or its employees could receive substantial gifts and entertainment (including non-monetary gifts) that may influence behaviour in a way that conflicts with the interests of the clients of the firm.||To ensure the integrity of WHI employees is not compromised a policy is in place which requires staff who give or receive gifts or hospitality to disclose them, and, for items of a higher value, seek pre-approval from the WHI Executive Board and Compliance.|
|Order handling||Client orders could be handled in a manner that may benefit the Firm and/or its employees or one client at the expense of other clients (e.g. the execution of proprietary orders could be given preference over client orders).||The Compliance department has established policies to ensure that, when executing client orders, a fair outcome for clients is achieved. In particular, requirements relating to fair and timely execution, fair allocation/aggregation and separation of principal and client trading, must be observed.|
|Personal account (PA) dealing
|Employees of the Firm could front run client orders with their own PA dealing activities.||Employees of WHI should avoid any personal transactions that may conflict with the interests of the Firm and its clients. WHI has a PA dealing policy that prevents employees from engaging in certain activities in order to avoid conflicts or employees benefitting improperly from the misuse of non-public information. Due to information barriers employees may not be aware of conflicts that exists elsewhere within the business, therefore employees of WHI may not deal in relevant financial instruments without obtaining prior approval from Compliance and their line manager.|
|The production and/or distribution of research by WHI could be used to the advantage of the Firm or some clients over other clients .WHI may provide research to the investment community, whilst also providing investment banking services to the subject company.||WHI publishes institutional research that is classified by the FCA as “non-independent research”. The research is produced in accordance with local regulations on research production and the Firm has implemented arrangements designed to ensure the integrity of research is of the highest standard, prevention of personal account dealings ahead and 24 hours after dissemination of publication and all clients receive research simultaneously.|
|Insurance Distribution Activities||Different Insurance product providers could pay different rates of commissions to WHI for the same product, sometimes by increasing the premium for the client.||WHI use a third-party comparison system to allow access to a wide range of providers and products across the market and generally select the outcome that is cheapest and most suited to the client’s needs, subject to there being sufficient due diligence available on the proposed product and/or provider. This is regularly reviewed and checked.|
|Remuneration||Employees could be incentivised to encourage inappropriate trading which has no discernible benefit for clients (e.g. advising a client to change their portfolios unnecessarily in order to increase commission. (“Churning”).||Remuneration of WHI employees are structured in a manner that discourages behaviour which is not in the best interests of clients and which promotes sound risk management practices, including conduct risk.|
|Corporate Finance||WHI could act for both the target firm and purchaser in a Merger or Acquisition.||WHI has a new business committee which reviews all new corporate finance transactions and clients. The NBC is designed to raise risk and conflict including mitigating factors.|
|Allocation||The Firm, in its capacity as placing agent may allocate shares according to the promise of future business.||WHI’s policies requires it to consider various factors when allocating client orders. Further the allocation list is signed off by an independent control function who is not part of the transaction deal.|
|Principal Positions||WHI may hold, trade, deal or provide market making (principal) activities in, securities bought or sold by or for a client.||Principal activities are segregated from the majority of the WHI trading activities in particular retail client trading. Market making procedures state that it’s trading is responsive to market demands as opposed to proprietary trading.|
Other examples include segregation of duties, appropriate supervision of employees and staff remuneration.
4. Disclosure of conflicts
Where specific measures are not adequate to ensure, with reasonable confidence, that material risk of damage to the interests of WHI clients will be prevented, WHI will clearly disclose the nature and sources of the conflicts of interest to the client. This will be done to allow the client to make an informed decision on whether to proceed with the service in the situation concerned.
Disclosure of conflicts of interest does not exempt WHI from the obligation to maintain and operate effective organisational and administrative arrangements. The use of disclosure without adequate consideration as to how conflicts could be managed is not permitted.
Ultimately, if WHI considers that a conflict of interest cannot be managed in an appropriate manner to ensure a client will be treated fairly, it may decline to act.
Further information on the above policy is available on request.