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Shareholder Rights Directive II (SRD II) - Engagement Policy

As of 01/09/20 Tilney merged with Smith & Williamson, creating Tilney Smith & Williamson (TSW).

As an asset manager Tilney recognises the importance of taking a pro-active stewardship role, aiming to promote effective company engagement on governance issues, either through direct or indirect (funds) investments.

Tilney’s over-riding investment philosophy is to preserve and grow the real value of clients’ capital over time. Preservation of capital is enhanced by company, sector and fund selectivity, preferring those assets that are more resilient to economic cycles. We seek out good quality and well run companies for the long term. We aim to grow capital, seeking the best risk-adjusted returns, again identifying a limited number of fund managers and companies. We take a patient view to investment, focusing on business rather than share price risk and looking beyond short term market volatility.

We apply a number of investment principles to companies. These include economic and financial leverage; an operating franchise, with ‘difficult to replicate’ advantages whilst being resilient to change; relatively stable top line but with defensible margins leading to robust cash flows, facilitating progressive dividends. A fundamental understanding of a company’s reason for being is key to us making and maintaining an investment.

Investing in Direct Equities

Only companies on the Tilney internal Approved List (Approved List) of stocks (separate UK and International versions) are available for Direct Equity portfolios. Inclusion on the list is only after detailed analysis of the company’s market position, opportunities, operational and financial record, corporate activity and management. Valuation and quantitative assessments are also applied.

The Direct Equity team endeavour to meet the management of companies on the Approved List annually. This may be facilitated through a third party or direct contact. A central log of company meetings is maintained. Key objectives of these meetings are to ensure that the preserve and grow philosophy along with our investment principles are being adhered to. A meeting summary is recorded and maintained.

We constantly monitor companies that we are unable to meet, utilising external research as well as reviewing published company material. A monthly Stock Selection meeting reviews the appropriateness of Approved List holdings.

Investing in Funds

Top down asset allocation establishes the overall framework of the investment strategy and fund selection determines the instruments to implement this strategy. Funds are selected combining qualitative and quantitative techniques, adhering to our investment principles, to identify best-in-class managers. The funds should have clear objectives with a consistent process and long term horizon supported by a stable and well-resourced team with a high conviction, unconstrained approach to investment.

We constantly monitor the funds we invest in, meeting management teams annually. This is complemented by use of 3rd party databases (e.g. Morningstar, Lipper). A monthly Fund Selection meeting reviews funds’ on-going appropriateness. All fund managers on the Buy List are met on an annual basis with a meeting summary maintained and available for internal use.


All corporate actions, where shareholders have a vote, are monitored and duly considered. The Tilney Corporate Actions team circulates a voting schedule weekly which is centrally reviewed. While all corporate actions are considered, Tilney does not typically vote on ‘ordinary’ resolutions but will more broadly consider ‘extraordinary’ resolutions by engaging  the views of relevant Investment Managers or other interested internal parties before a decision on whether to vote is taken.

We will inform all Execution only and Advisory clients where they hold voting rights in EEA listed securities, unless they have specifically asked us not to.  We will facilitate any requests to vote for clients as long as the request is made within sufficient time to process any proxy vote request including none-EEA listed securities held by the client.  We do not need to notify clients of upcoming EGM and AGM voting opportunities where the stock is registered outside of the EEA, including UK.

The over-arching aim is to act in the “best interests of the client”. Tilney recognise that actual and potential conflicts of interest may arise in our engagement and voting. We have established policies, procedures and protocols to identify, escalate and manage such conflicts. Proportionality is considered based on client exposure and influence.

A link to Tilney’s Conflicts of Interest statement is available via the following hyperlink -

This policy will be reviewed annually and communicated to all portfolio managers.

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