Introduction

The Financial Conduct Authority (“FCA” or “regulator”) in its Prudential sourcebook for MiFID Investment Firms (“MIFIDPRU”) sets out the detailed prudential requirements that apply to Alter Domus Fund Services (UK) Limited (ADFS or the ‘Firm’). In particular, Chapter 8 of MIFIDPRU (“MIFIDPRU 8” or the “public disclosures requirements”) sets out public disclosure obligations with which the Firm must comply, further to those prudential obligations.

ADFS is classified under MIFIDPRU as a small and non-interconnected investment firm (“SNI MIFIDPRU investment firm”) and is regulated by the FCA under firm reference number 629864. ADFS is a fund administration and transfer agency services provider primarily to Alternative Investment Funds. ADFS’s remuneration policy adheres to the requirements of SYSC 19G and MIFIDPRU 8 for MIFIDPRU firms. As such ADFS is required to disclose information regarding the Firm’s 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.

This document has been prepared by ADFS in accordance with the requirements of MIFPRU 8 and is verified by Board. Unless otherwise stated, all figures are as of the 31 December 2024 financial year-end.

Remuneration Policy and Practices

As an SNI MIFIDPRU investment firm, ADFS is subject to the basic requirements of the MIFIDPRU Remuneration code.  The purpose of the requirements on remuneration 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 ADFS Remuneration Policy is consistent with and promotes sound effective and sustainable risk management and does not encourage risk-taking which might be inconsistent with the risk profile, rules or instruments of incorporation of the AIFs under administration. The Remuneration Policy reflects the company’s objectives for good corporate governance as well as sustained and long-term value creation.

The Remuneration Policy reflects the objective for good corporate governance as well as sustained and long- term value creation. It aligns with the interests of the clients and the Alternative Investment Funds (AIFs) they administer and the interest of investors in the AIFs in order to avoid conflicts of interest.

AD Group’s core values are to ‘Succeed with speed, Take charge together, adapt with authority, reimagine the results’ and are principles which guide conduct. AD Group is a business with a long history of compliance and governance at its core and has a well established global handbook, policies and procedures which support its strategy.

Characteristics of the remuneration policy and practices

The design of the Firm’s remuneration system is consistent with the objectives set out in the Firm’s strategy and aims at:

• A proper balance of variable to fixed remuneration
• The measurement and definition of bonus pool
• The attribution of individual variable remuneration, based on targets for good performance levels and not based on the accounts an employee is working on.

The amount payable to staff is determined via their contribution to ADFS’s performance over the relevant period and on achieving their individual performance objectives.    

Remuneration can be divided into fixed remuneration and variable remuneration. Fixed Remuneration is in principle non-performance related. Variable Remuneration consists in all performance related remuneration that is not Fixed Remuneration. Variable Remuneration can consist of annual performance and target related bonus payments and other specific variable remuneration instruments.

The Company promotes a performance-based culture and as such rewards their employees through Variable Remuneration. Variable Remuneration is designed to attract, retain and motivate its employees without encouraging the taking of inappropriate risk.

Governance and Oversight

ADFS is governed by the Alter Domus Group wide arrangements.

The Supervisory Board of the Alter Domus Group, in its supervisory function, is required to approve and annually review the Remuneration Policy and for overseeing its implementation. This responsibility is delegated to the Remuneration Committee. The Remuneration Committee is established by Alter Domus Group in Luxembourg which is the Group’s main office. It ensures that the Group’s remuneration policy and practices are appropriately implemented and aligned with Alter Domus’ overall corporate governance framework, corporate culture, risk appetite and related governance processes.

The Remuneration Committee is composed in such a way that the members collectively have sufficient knowledge, skills and experience in the field of remuneration. This includes knowledge about mechanisms to align the remuneration structure of the company with Alter Domus Group risk profiles and capital structure.

The Remuneration Committee is responsible for the review of the Remuneration Policy and practices and for ensuring that the results of the review are followed up.

Quantitative Remuneration Disclosures

For the financial year 31 December 2024, the total amount of remuneration awarded to all staff was £2,983,524 of which £2,653,731 comprised the fixed component of remuneration and £329,793 comprised the variable component.  For these purposes, ‘staff’ includes, employees, directors, temporary staff and secondees.