The Financial Conduct Authority (“FCA” or “regulator”) in the Prudential sourcebook for MiFID Investment Firms in the FCA Handbook (“MIFIDPRU”) sets out the detailed prudential requirements that apply to First Eagle Investment Management Ltd (“FEIM Ltd” or the “Firm”). Chapter 8 of MIFIDPRU (“MIFIDPRU 8”) sets out public disclosure rules and guidance with which the Firm must comply, further to those prudential requirements.

FEIM Ltd is classified under MIFIDPRU as a small and non-interconnected MIFIDPRU investment firm (“SNI MIFIDPRU Investment Firm”). As such, the Firm is required by MIFIDPRU 8 to disclose information regarding its remuneration policy and practices.

The purpose of these disclosures is to give stakeholders and market participants an insight into the Firm’s culture and to assist stakeholders in making more informed decisions about their relationship with the Firm.

The Firm’s annual report has been prepared by FEIM Ltd in accordance with the requirements of MIFIDPRU 8 and is verified by the Firm’s Management Body.

Overview

As an SNI MIFIDPRU Investment Firm, FEIM Ltd is subject to the basic requirements of the MIFIDPRU Remuneration Code (as laid down in Chapter 19G of the Senior management arrangements, Systems and Controls sourcebook in the FCA Handbook (“SYSC”)). The purpose of the remuneration requirements is to:

• Promote effective risk management in the long-term interests of the Firm and its clients;
• Ensure alignment between risk and individual reward;
• Support positive behaviours and healthy firm cultures; and;
• Discourage behaviours that can lead to misconduct and poor customer outcomes.

The objective of FEIM Ltd’s remuneration practices is to establish, implement and maintain a culture that is consistent with, and promotes, sound and effective risk management and does not encourage risk-taking which is inconsistent with the risk profile of the Firm and the services that it provides to its clients.

In addition, FEIM Ltd recognises that remuneration is a key component in how the Firm attracts, motivates, and retains quality staff and sustains consistently high levels of performance, productivity, and results. As such, the Firm’s remuneration philosophy is also grounded in the belief that its people are the most important asset and provide its greatest competitive advantage.

FEIM Ltd is committed to excellence, teamwork, ethical behaviour, and the pursuit of exceptional outcomes for its clients. From a remuneration perspective, this means that performance is determined through the assessment of various factors that relate to these values, and by making considered and informed decisions that reward effort, attitude, and results.
 

Characteristics of the Firm's Remuneration Policy and Practices

Remuneration at FEIM Ltd is made up of fixed and variable components. The fixed component is set in line with market competitiveness at a level to attract and retain skilled staff. Variable remuneration is paid on a discretionary basis.

Performance Criteria: variable compensation is based on overall assessment of an individual’s contribution to the Firm and indirectly, the First Eagle Group. Such contribution takes into account The Firm’s financial performance as well as the financial performance of each business unit, and the financial and non-financial performance of the individual in contributing to the Firm’s success. Neither the Firm nor the First Eagle Group base variable compensation awards on specific criteria. On an annual basis, the Remuneration Committee of the First Eagle Group determines compensation parameters for each department within the Group. Group department managers approve annual fixed and variable compensation amounts within such parameters, in consultation with the Remuneration Committee. All staff members are eligible to receive variable remuneration.The fixed and variable components of remuneration are appropriately balanced: the fixed component represents a sufficiently high proportion of the total remuneration to enable the operation of a fully flexible policy on variable remuneration. This allows for the possibility of paying no variable remuneration component, which the Firm would do in certain situations, such as where the Firm’s profitability performance is constrained, or where there is a risk that the Firm may not be able to meet its capital or liquidity regulatory requirements.
 

Governance and Oversight

The Management Body is responsible for setting and overseeing the implementation of FEIM Ltd’s remuneration policy and practices. In order to fulfil its responsibilities, the Management Body:

• Is appropriately staffed to enable it to exercise competent and independent judgment on remuneration policies and practices and the incentives created for managing risk, capital, and liquidity.
• Prepares decisions regarding remuneration, including decisions that have implications for the risk and risk management of the Firm.
• Ensures that the Firm’s remuneration policy and practices take into account the public interest and the long-term interests of shareholders, investors, and other stakeholders in the Firm.
• Ensures that the overall remuneration policy is consistent with the business strategy, objectives, values, and interests of the Firm and of its clients.

FEIM Ltd’s remuneration policy and practices are reviewed annually by the Management Body.t

Quantitative Remuneration Disclosure

The Firm is required to disclose certain information on at least an annual basis regarding its Remuneration Policy and practices for those staff whose professional activities have a material impact on the risk profile of the Firm. FEIM’s disclosure is made in accordance with its size, internal organisation and the nature, scope and complexity of its activities.

Senior management is responsible for setting the Remuneration Policy Statement for all staff and the Compliance Officer is a member of the senior management team. No external consultants have been engaged on remuneration matters.

The Firm’s policy will be reviewed as part of its annual process and procedures or following a significant change to the business requiring an update to its internal capital adequacy assessment.

For the financial year 1 January to 31 December 2023, the total amount of remuneration awarded to all staff was £671,657, of which £371,251 comprised the fixed component of remuneration, and £300,406 comprised the variable component. For these purposes, ‘staff’ is defined broadly, and includes, for example, employees of the Firm itself, Directors and Senior Management Function personnel.

Under COBS 2.2.3R of the FCA Handbook, the Firm is required to make a public disclosure in relation to the nature of its commitment to the UK Financial Reporting Council's Stewardship Code (the "Code").

Adherence to the Code is voluntary. The Code sets out a number of principles relating to engagement by investors with UK equity issuers. Investors that commit to the Code can either comply with it in full or choose not to comply with aspects of the Code, in which case they are required to explain their non-compliance.

At present, the Firm does not engage in investment management activity. Therefore, while the Firm generally supports the objectives that underlie the Code, it does not consider it appropriate to conform to the Code at this time.

In addition, because the Firm does not engage currently in investment management activity, and in accordance with COBS 2.2B.5 (2), the Firm has chosen not to comply with the requirements imposed by the Shareholder Rights Directive with regard to developing and publicly disclosing an engagement policy.