Trinity Street Asset Management LLP: Engagement Policy

Introduction

This document summarises the policy of Trinity Street Asset Management LLP and its affiliated companies (“Trinity”) and our approach to investee engagement and how it meets the requirements of the Shareholders Rights Directive (SRDII). The policy covers all client funds and accounts for which Trinity serves as investment manager or adviser, and outlines how Trinity monitors and engages with investee companies, as well as how the nature of these engagement activities are disclosed.

As a longstanding investor Trinity recognises the importance of ongoing investee engagement in its investment strategy. In our experience effective stewardship promotes high standards of corporate governance and has been proven to add value and to the success of companies. Through effective stewardship Trinity aims to deliver long-term performance for clients.

UK Stewardship Code

Trinity has supported the principles of the 2012 Stewardship Code, the standards of best practice that it represents and, where possible, looks for similar standards across its investable universe. For more information on Trinity’s position on the 2012 Stewardship Code, please refer to the statement on the Trinity website (http://www.trinitystreetam.com/compliance.html#steward). As of the date of this policy, Trinity is reviewing the content of the 2020 UK Stewardship Code.

Integrating investee engagement

As an active manager, Trinity believes that stewardship helps to safeguard and enhance the risk-adjusted returns of clients’ investments. Furthermore, good corporate governance supports the alignment of the interests of company management with those of its investors. Where possible Trinity seeks to maintain constructive dialogue with company management. Stewardship activities are undertaken by the investment team as part of the ongoing engagement with companies.

Initially, as part of the investment decision making process, Trinity’s investment team will review company documents and third-party research and undertake meetings with management. These reviews are documented and discussed by Trinity’s portfolio managers and wider investment team. The outcome of these discussions will have a direct impact on investment decisions and portfolio construction, and will inform the nature of ongoing dialogue and engagement with a company. This initial process sets out the foundations of Trinity’s approach to stewardship and the basis of its relationship post-investment.

Monitoring investee companies on relevant matters

Trinity has established policies and procedures on when and how it will manage its activities in order to protect and enhance the shareholder value of investee companies.

Trinity’s investment team will correspond directly on relevant, material topics. These include both financial and non-financial performance and risks. As part of the ongoing monitoring of companies, discussions with companies will focus on governance, strategy, capital structure and allocation, in the areas listed below as appropriate:

Financial

Corporate strategy
Capital allocation
Management structures
Balance sheet efficiency
Cash generation
Sustainability of returns
Competitive advantage / risks
Regulatory risks

Corporate Governance

Transparency and disclosure
Governance structures
Minority interests fair representation
Public reporting
Management accessibility
Long-term incentive schemes

While historically corporate governance has been the focus of non-financial performance and risk dialogue, environmental and social factors and their improvement are increasing areas of focus of investee engagement , see examples below.

Environmental

Global impact and emissions
Local impact and water and waste management
Incidents of environmental pollution
Energy management
Use of green energy
Polices and innovations to limit negative impact

Social

Customer welfare
Human rights and community relations
Labour practices and health and safety
Supply chain management
Materiality of philanthropy spend
Product quality and safety

Trinity’s monitoring typically includes:

• Meetings with company management and directors
• On -site company visits
• Monitoring company announcements
• Reviewing company interim and annual results
• Attending capital market meetings
• Attending meetings with external research providers to validate investment recommendations
• Reviewing external research

Trinity expects companies to comply with local regulations and governance codes. Company boards should seek to satisfy the reasonable expectations of customers, investors and employees, as well as acting in a way that demonstrates their responsibility to wider society, to ensure long term prosperity for all.

Conducting dialogue with investee companies

Trinity’s dialogue with investee companies takes place during the life of the investment and can cover any issue that may affect a company’s ability to deliver long term performance and to create shareholder value.

Dialogue with companies is undertaken by the investment team, through but not limited to the following methods:

• Email exchanges with company management
• Meetings with senior management
• Company site visits
• Participation in roadshows

The Trinity investment team seeks to engage positively with companies to address any issues through discussions and agreement.
Trinity expects investee companies to respond to requests in a timely manner. Where companies fail to respond or to appropriately engage in dialogue on the issues raised, the investment team may review its investment decision in consideration of the materiality of he issue and its impact on the long-term success of the company.

Where appropriate, Trinity logs and records the detail of engagement activities, including the final outcome.

Exercising voting rights and other rights attached to shares

Trinity’s investment team aim to vote on all proxies presented to them. Where concerns arise the investment team seeks to address these through engagement with company management and other key stakeholders.

Subject to mandate restrictions, Trinity is generally responsible for voting proxies and taking decisions in connection with proxy voting with respect to equity shares held by or on behalf of clients where it serves as investment manager or adviser.

Where Trinity is given responsibility for proxy voting, it will take reasonable steps under the circumstances to ensure that proxies are voted in the best interests of its clients.

Trinity considers its prior experience with similar proxy proposal, its perception of the motivation behind a proxy proposal, the manner in which the proxy proposal is structured, and other facts and circumstances related to the proposal.

Cooperating with other investors

Trinity is willing to engage and act collaboratively with other investors, where appropriate and in the interests of clients, and permitted by regulations. In deciding whether to not to engage or act collectively with other investors, Trinity will consider a range of factors, including:

• the sensitivity of the issue being discussed
• if, by acting collaboratively, the engagement is likely to be more effective
• the alignment of other investors with Trinity’s objectives
• the impact of the collective engagement on the ongoing relationship with the investee company

Communicating with relevant stakeholders of the investee companies

In addition to collaborating with other investors, in appropriate circumstances Trinity will communicate and cooperate with relevant stakeholders who bring together companies to engage and discuss focused issues.

Managing actual and potential conflicts of interest in relation to the firm’s engagement

Trinity has in place a policy to identify and manage conflicts of interest that may arise between it and its clients and between different clients. All Trinity staff are required to have an understanding of conflicts of interest, and to raise actual or potential conflicts of interest with the Trinity Compliance Officer.

DATE of Policy: 22 March 2023