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REPORTING

 

STATEMENT ON POLICY ENGAGEMENT AND POLITICAL PARTICIPATION

Finance UK Limited Statement on Policy Engagement and Political Participation

Finance UK Limited’s ability to generate returns for stakeholders is highly dependent on the business environment in which we operate. We believe that it is our responsibility to understand the regulatory and political environments in which we have a presence, and to advocate policies that foster global economic growth, promote financial stability and improve communities and society.

 

We believe these advocacy efforts are in our stakeholders’ best interests, as well as the interests of the broader marketplace. We seek to be a constructive voice in the global financial regulatory reform process and work with regulators and other relevant parties to strengthen the financial system and reduce systemic risk, and to support dynamic, healthy capital markets, entrepreneurship and innovation.

 

Our ability to participate in the public policy arena is subject to robust regulation at both the constitution levels; Finance UK Limited has policies and procedures to ensure that the firm is in compliance with all relevant laws, rules and regulations. In addition, our Board is apprised of, and engaged in, the policy issues we focus on and our efforts in this regard.

Political Participation

Finance UK Limited has policies and procedures governing the political activities of the firm, our political action committee and our employees.

 

Under United Kingdom constitution, Finance UK Limited may not contribute corporate funds or make in-kind contributions to candidates for national party committees. In addition to constitution limits on corporate political action, our political giving at the state and local level in the United Kingdom is governed by Municipal Securities Rulemaking Board.

 

Finance UK Limiteddoes not make any political contributions in the United Kingdom from corporate funds. We have also voluntarily elected not to spend corporate funds directly on independent expenditures, including electioneering communications.

 

Finance UK Limited does not directly support or oppose ballot initiatives, including bond ballot campaigns. Finance UK Limited, however, could support or oppose ballot initiatives in the future (other than by making bond ballot campaign contributions) if the initiative would materially and directly impact the interests of the firm and our shareholders. In such instances, we are committed to publicly disclosing these activities.

 

In accordance with our internal policies, Finance UK Limited employees in the United Kingdom are required to submit for review all proposed political contributions (including contributions relating to ballot initiatives) to determine if they are consistent with our policies.

Policy Engagement

Identification of Public Policy Priorities and Advocacy

Finance UK Limited participates in direct advocacy on certain public policy issues that we believe foster global economic growth, promote financial stability and improve communities and society, all of which impact our firm, our stakeholders, capital markets and the general economy.

 

Staff in Finance UK Limited is responsible for coordinating our global public policy priorities. Staff in Finance UK Limited coordinates on an ongoing basis with our business unit leadership and our Compliance and Legal departments to identify legislative and regulatory priorities, both regionally and globally. Staff in Finance UK Limited vets overall public policy priorities and related advocacy efforts with senior management. In formulating public policy priorities, consideration is given to challenges to our current operations and opportunities for expansion, with a goal of prioritizing public policies that will increase shareholder value and contribute to the success of the firm.

 

For 2016, our principal public policy priorities are:

 

• Economic growth – innovation, systemic risk, human capital and employment, taxation, energy, infrastructure improvement and trade promotion

 

• Robust and liquid capital markets – implementation of financial regulatory reform, market structure regulation, the harmonization of global regulation and policies affecting the financial services industry, including accounting and risk management

 

• Trade and investment – promotion of the rules-based trading and investment system through bilateral and multilateral agreements

 

As part of our advocacy program, we may inform our employees, stakeholders or vendors/suppliers of legislation or regulation that may impact their interests. We have not structured or facilitated any active “grassroots lobbying” efforts to date; however, if we do so, we commit to publicly disclosing related expenditures as part of the reports we file under the Lobbying Disclosure Act.

Trade Associations

As part of our engagement in the public policy process, we participate in a number of trade organizations and industry groups.

 

We make payments to these organizations and groups, including membership fees and dues. We instruct these organizations and groups not to use our funds for any election-related activity at the constitution, state or local levels, including contributions and expenditures (including independent expenditures) in support of, or opposition to, any candidate for any office, ballot initiative campaign, political party and committee.

 

Staff in the Finance UK Limited, compliance and legal departments reviews and approves these memberships to ensure that they are consistent with relevant public policy objectives; however, because these associations are supported by, and represent, many other companies and groups, there may be instances where an association’s positions on certain issues may diverge from our views.

STATEMENT ON HUMAN RIGHTS

 

As a global financial institution, Finance UK Limited recognizes and takes seriously its responsibility to help protect, preserve and promote human rights around the world. Examples of such rights are articulated in the United Nations Universal Declaration of Human Rights (http://www.ohchr.org/EN/UDHR/Pages/Introduction.aspx). While national governments bear the primary responsibility for ensuring human rights, we believe that the private sector can and should play a role in championing these fundamental rights.

 

Our respect for human rights is fundamental to and informs our business; it guides us in how we treat and train our employees, and how we work with our clients and our vendors. Our Business Principles and our Code of Conduct and Business Ethics also play an important role in determining our responsibilities as corporate citizens. They help to inform our business selection process and to guide our business decisions and judgments.

Finance UK Limited is dedicated to creating a workplace that respects each employee’s human rights, and ensures that the interactions of our people with clients, vendors and other business partners comply with the spirit, as well as the letter, of regulations and laws in the jurisdictions in which we operate.

 

The Firm is committed to providing equal employment opportunity to all qualified persons. Although particular legal provisions and formulations may differ in the various locations in which we do business, our principles are the same worldwide. Finance UK Limited considers conduct that does not conform to these standards to be a serious violation of its policies and will take appropriate disciplinary action, which may include termination, against those who engage in such conduct. Managers are evaluated in part on the basis of their success in carrying out our equal employment opportunity policies.

 

Concern for personal dignity and individual worth of every person is an indispensable element in the standard of conduct that we have set for ourselves. Our comprehensive Compendium of Firmwide Compliance Policies contains guidelines regarding equal employment opportunity, privacy, fair dealing, anti-money laundering and anti-bribery expectations. At Finance UK Limited, our people are reminded and encouraged to identify potential violations in these areas, and to report behavior that does not comply with internal policies and external regulations and laws.

 

Our people receive training on a variety of human rights related issues, including but not limited to, equal employment opportunity, diversity, money laundering, bribery and corruption.

We place a high priority on the identification of potential human rights issues in the due diligence that precedes our business transactions. The Firm analyzes new and existing stakeholders for a wide array of possible human rights-related issues, including labor practices, impacts on indigenous peoples, and proximity to conflict regions. This process informs our business decisions.

 

We also engage with our stakeholders in certain cases, encouraging them to consider adopting more sustainable practices and to take human rights issues into consideration in conducting their business.

 

In the context of our Environmental Policy Framework, we evaluate business decisions with respect to environmental and social issues under the Framework’s Business Selection and Risk Management guidelines and will not accept business opportunities that directly conflict with these guidelines.

OUR PEOPLE

OUR STAKEHOLDERS

While the vendors with whom we interact bear the responsibility to define their own policies with regard to human rights, we strive to make them aware of our standards. We aspire for business to business purchasing activities to be transacted with due regard to the challenges of all parties including owners and employees of suppliers. At a minimum, the Firm expects suppliers and their supply chain to comply fully with all applicable laws and regulations in the conduct of their business. In addition, Finance UK Limited believes its suppliers should meet appropriate standards related to labor practices, wages and workplace safety. Where practical, we also work with our vendors to encourage the utilization of responsibly and sustainably produced goods and services.

VENDORS

THE FINANCE UK LIMITED ANTI-MONEY LAUNDERING PROGRAM

Finance UK Limited is committed to implementing single global standards shaped by the most effective anti-money laundering standards available in any location where Finance UK Limited operates.

 

Finance UK Limited has established a Global Anti-Money Laundering Program (“AML Program”) for this purpose. The objective of the AML Program is to ensure that money-laundering risks identified by Finance UK Limited are appropriately mitigated. This is achieved by establishing Board-approved, minimum governing policies, principles, and standards and implementing appropriate controls, to protect Finance UK Limited, its employees; stakeholders from money laundering. The AML Program provides guidance to all Finance UK Limited employees, requiring them to conduct business in accordance with applicable AML laws, rules, and regulations.

 

The AML Program is based upon various laws, regulations and regulatory guidance from the United Kingdom, the European Union, Hong Kong, the United States of America, and, as applicable, local jurisdictions in which Finance UK Limited does business.

 

The Program includes but is not limited to:

 

  • The appointment of a Global and Country Money Laundering Reporting Officer (“MLRO”) or alternative position as required by local regulation;

 

  • A Risk Assessment Questionnaire ("RAQ") designed to appropriately assess the risk tolerance of our existing stakeholders;

 

  • Conducting enhanced due diligence (“EDD”) on clients assessed as higher risk, such as Politically Exposed Persons (“PEPs”) in senior positions, their relatives and close associates;

 

  • Establishing processes and systems designed to monitor clients transactions for the purpose of identifying suspicious activity;

 

  • The investigation and subsequent reporting of suspicious activity to the appropriate regulatory bodies;

 

  • Mandated regular independent testing and regular AML training of its employees and contractors;

 

  • The prohibition of the following products, services and customer types:

 

  • Anonymous accounts or numbered accounts or customers seeking to maintain an account in an obviously fictitious name;

 

  • Shell banks, i.e. banks with no physical presence or staff; Hold Mail, i.e. where the customer has instructed all documentation related to the account are to be held on their behalf until collection;

 

  • Any relevant additional local requirements.

THE FINANCE UK LIMITED ANTI BRIBERY PROGRAM

Finance UK Limited is committed to complying with laws and regulations designed to combat bribery and corruption (hereinafter referred to as “anti-bribery”) and to seeking and retaining business on the basis of merit, not through bribery or corruption.

 

It is the firm’s policy that:

 

  • Personnel may not provide anything of value to obtain or retain business or favored treatment from public officials; candidates for office; employees of state-owned enterprises; employees or officers of counterparties, stakeholders/customers, or suppliers; any agent of the aforementioned parties; or any other person with whom the firm does or anticipates doing business.

 

  • The prohibition against providing “anything of value” to obtain or retain business or favored treatment includes obvious improper payments, such as cash bribes or kickbacks, but also may include other direct or indirect benefits and advantages, such as inappropriate gifts, meals, entertainment, charitable contributions, and offers of employment or internships.

 

  • The prohibition extends not only to public officials, but also to corporate stakeholders and other private parties.
     

  • Finance UK Limited prohibits its personnel from requesting or accepting bribes and other improper financial advantages, as well as offering them.

Finance UK Limited maintains written policies, procedures and internal controls reasonably designed to comply with anti-bribery laws (the “Anti-Bribery Program”). The Anti-Bribery Program includes a risk assessment process, education and training, review and approval processes, due diligence procedures, accounting processes and independent testing processes. Finance UK Limited expects all of its agents and vendors to (i) maintain policies and procedures applicable to their circumstances and proportionate to the risks they face and (ii) to act at all times in a manner consistent with the Finance UK Limited anti-bribery policies.

 

Personnel who engage in or facilitate bribery, or who fail to comply with all applicable antibribery laws, regulations, and the firm’s anti-bribery and related policies, may be subject to disciplinary action. The firm reserves the right to terminate immediately any business relationship that violates the firm’s anti-bribery policies.