Shareholder Rights Directive II

Policies and Disclosures

The aim of the amended Shareholder Rights Directive 2017/828 (“SRD II”) is to enhance the position of shareholders by increasing transparency in the investment chain and encouraging long-term shareholder engagement between listed companies and shareholders.

Various aspects of SRD II apply to the management companies, Alternative Investment Fund Managers, and investment firms within GAM Holding AG that manage portfolios and fall under the definition of Asset Manager in SRD II (hereafter referred to as “GAM” or “we”).

Under SRD II, we are required to:

1) Develop and disclose an Engagement Policy that describes how we integrate shareholder engagement in our investment strategy.

2) Disclose, on an annual basis, how the engagement policy has been implemented, including a general description of voting behaviour, an explanation of the most significant votes and the use of the services of proxy advisors. These disclosures are made in our Stewardship Report.

3) Disclose, on an annual basis, how our investment strategy and implementation thereof complies with the arrangements we may have with our institutional investors, whether on a discretionary client-by-client basis or through a relevant GAM fund, and how it contributes to the medium to long-term performance of the assets of the institutional investor or of the fund. These SRD II disclosures for institutional investors in the relevant GAM funds include the following:

1 Key material medium to long-term risks associated with the investments

Please refer to the prospectus of the fund in which you are invested for information on the applicable material risks. The prospectuses are accessible through our fund list.

2 Portfolio composition

Portfolio composition is disclosed within the audited financial statements of each fund which are accessible through our fund list.

3 Turnover

The turnover ratios of our equity funds can be found here.

4 Turnover costs

The transaction costs associated with the turnover of all instruments for each GAM fund is available on described as “EMT ex-post transaction costs” under the MiFID ExPost section of each fund.

5 The use of proxy advisors

The GAM Corporate Governance and Voting Policy outlines our corporate governance expectations for companies and approach on key voting issues. We retain the services of a proxy advisor (Institutional Shareholder Services (ISS)) to assist in implementing and administering proxy voting. ISS provides written analysis for each company resolution based on the GAM Corporate Governance and Voting Policy, but the ultimate voting decision is made by GAM.

6 Securities Lending

GAM has a securities lending program for several of its funds. When shares are on loan, GAM is contractually unable to exercise voting rights for these shares and does not recall shares which are out on loan, for upcoming shareholder meetings. 

7. Whether and if so, how GAM make investment decisions based on evaluation of medium to long-term performance of the investee company, including nonfinancial performance

Please refer to our Responsible Investment Policy for this information.

8 Conflicts of Interests

How GAM manages conflicts of interest in relation to engagement activities – including making proxy voting decisions – is explained in our Engagement Policy.

The following are examples of potential or perceived conflicts of interest that could arise regarding GAM’s engagement activities:

 - a company selected for engagement is a client of GAM or is an associate of a client of GAM

 - GAM has voting rights in a company that is a client of GAM or is an associate of a client of GAM

 - GAM has voting rights in a company that has a significant shareholding in GAM 

 - a GAM portfolio manager or a person connected to the portfolio manager (e.g. a spouse) has an outside activity associated with a company held in a client investment portfolio over which the portfolio manager may exercise voting rights

 - in the course of legitimate investment activities, a GAM portfolio manager has gained inside information in relation to a company for which the portfolio manager may exercise voting rights on behalf of a client

 - a GAM portfolio manager has a personal relationship with an employee or a non-executive director of a company over which the portfolio manager may exercise voting rights.

In such circumstances, GAM will take steps in accordance with its Group Conflicts of Interest Policy and Corporate Governance and Voting Policy to advance clients’ best interests in relation to companies in which GAM invests on behalf of clients. 

There were no instances in the year ended 31 December 2020 in which a conflict arose that prevented GAM from engaging with a company or making a proxy voting decision on behalf of clients.