Pension Protection Fund Responsible Investment Report 2020/21 10 Purpose and governance continued How we manage Our Con昀氀icts of Interest con昀氀icts of interest and Code of Conduct policies are reviewed We have taken all reasonable steps to annually. prevent potential or actual con昀氀icts of interest that could impact our members or stakeholders. In this section of the report, we’ve detailed the wide range of controls we’ve implemented to put the • Senior manager 昀椀tness and Stewardship Code 2020, putting the best interests of members and our proprietary checks best interests of clients and business 昀椀rst. We have implemented a version bene昀椀ciaries 昀椀rst. PPF Con昀氀icts of Interest and Code of the FCA’s Senior Managers and of Conduct policies Certi昀椀cation Regime. As part of this regime, the C&E team meet annually with senior managers to discuss Our formal Con昀氀icts of Interest and Code of Conduct policies set out their roles and responsibilities. This Taking action: principles and procedures for includes assessing any potential We have experienced a varying identifying, assessing and managing con昀氀icts and forms part of the annual level of disclosure from our fund assessment of their 昀椀tness and con昀氀icts. These policies are reviewed at managers on how they are least annually by the Compliance and proprietary to carry on their role. assessing and managing Ethics (C&E) team and approved by the stewardship-related con昀氀icts of Executive Committee (ExCo). Other checks, as part of this 昀椀tness interest. In an e昀昀ort to ensure and propriety assessment, include continuous improvement, we are • Register of con昀氀icts and outside performance review along with credit and background checks on a rolling looking to address this in the business interests coming year by asking our The C&E team maintains a register three-year basis with self-assessments carried out every year. managers to report more of employees’ con昀氀icts and outside business interests, which they review speci昀椀cally on their stewardship- at least once a year. We also share The C&E team maintains a register of • Rigorous procurement processes related con昀氀icts. Board members’ outside interests on all gifts and hospitality that have been When procuring new suppliers, we our website. accepted and declined, with regular are subject to the Public Contracts Outsourced stewardship provider reviews to make sure these are within Regulations 2015. Our dedicated • Ongoing training acceptable levels. Commercial Services team makes Our external stewardship provider, EOS, All employees receive training on sure new contracts follow the correct procurement process and are considers con昀氀icts when undertaking con昀氀icts of interest when they start We also publish Board member voting and engagement on our behalf, and as part of ongoing development. expenses quarterly on our site. awarded fairly, based on objective as part of its Stewardship con昀氀icts of They also sign to say they’ve read, criteria. interest policy. Under this policy, sta昀昀 understood and followed these • Personal accounts The Commercial Services team also report any potential con昀氀icts to the policies every year. Our Personal Account Dealing compliance team to be assessed and, policy requires all transactions to maintains an ongoing assurance when necessary, the register is updated. • Gifts and Hospitality policy programme for all our suppliers. be approved by line managers and The con昀氀icts of interest register is Our Gifts and Hospitality policy reviewed by senior management on a requires all employees to request the C&E team. If there’s a con昀氀ict Outsourced external management regular basis. between the employee, member or sign-o昀昀 from their line manager and PPF interests, we may create a list Our fund managers are assessed by a the C&E team before accepting gifts or of restricted investments that our dedicated Operational Due Diligence EOS has the right expertise, policies, hospitality over the value of £25. employees can’t invest in. (ODD) team who complete checks, research and resources to carry out day-to-day stewardship activities on our which include reviewing Con昀氀icts of Interest policies and monitoring them behalf. Therefore, if con昀氀icts of interest on an ongoing basis. We clearly were to arise (for example, with the reference our expectations in this area sponsoring entity of a scheme we are across all agreements and side letters. protecting) we would adopt an arm’s length approach and avoid overriding its Where there’s potential for any con昀氀icts decisions. However, we review voting of interest, we expect our external proposals ahead of AGMs and reserve agents to identify and manage these the right to amend any votes. under Principle 3 of the FRC’s UK