Statement in Relation to the Shareholder Rights Directive II



The Second Shareholder Rights Directive (“SRD”), which took effect in the UK on 10 June 2019, aims to improve shareholder engagement and increase transparency around stewardship. The Firm invests in listed equities and as such we are required to disclose and make publicly available our policies on how we engage with other shareholders and the companies that we invest in, and how our strategies create long-term value.



The UK Stewardship Code (the “Code”) was established by the Financial Reporting Council in 2010. UK authorised asset managers have been required under the rules of the Financial Conduct Authority to produce a statement of commitment to the Code or to explain why it is not appropriate to its business model.

Unlike SRD, which applies to investments in listed equities globally, the Code focuses on investments in UK companies only.

The Firm’s response to the Code detailed in a separate statement, which is available here.



The investment objective of the Firm is to preserve capital and generate attractive, risk-adjusted returns over the mid- to long-term. The Firm regards risk as the probability of permanent capital impairment, rather than daily price fluctuations.
The Firm employs its value investing approach to identify long and, when appropriate, short investment opportunities where the prevailing market price differs substantially from the intrinsic value of the business. The Firm regards the purchase of shares as becoming an owner, rather than buying a trading instrument, and this is reflected in the time horizon that the Firm typically applies to evaluate business fundamentals and realise value. The Firm's analysis seeks to identify businesses that can generate long term growth and attractive returns on capital, while the investment thesis typically targets the realisation of value over a 3-5 year time period.

We are required to either:

  • publicly disclose an Engagement Policy and a public statement on an annual basis on how the Engagement Policy has been implemented; or
  • publicly disclose a clear and reasoned explanation of why the Firm has chosen not to make these disclosures.

The Firm has elected to publicly disclose its Engagement Policy and this is set out in Section 4 below.

This Statement is reviewed annually and updated where necessary to reflect changes in circumstances and actual practice. Should the Firm’s position change we will review our commitment to SRD and make appropriate disclosure at that time.



The Firm’s Engagement Policy is set out below:

(a)   How the firm integrates shareholder engagement in its investment strategy

  • As part-owners of our portfolio companies, where appropriate, we proactively meet with management throughout the organization and exercise our shareholder rights at AGMs. In certain situations we might engage with the board directly, if we believe it would be beneficial for the company and its stakeholders. We focus particularly on independent board oversight and the alignment of management incentives with shareholders.

(b)   How the firm monitors investee companies on relevant matters, including:

  • Strategy
  • Financial and non-financial performance and risk
  • Capital structure
  • Social and environmental impact and corporate governance

For each investee company, strategy, financial and non-financial performance and risk, capital structure and social and environmental impact and corporate governance, including culture and remuneration, are all evaluated as part of the research process before investment, then monitored and evaluated as part of the ongoing investment process. The CIO reviews all assessment processes which are undertaken periodically or as new information is made available.

Assessments include a review of quarterly financial information as released, listening to management calls and attending investor days as appropriate. Independent industry experts may be used in certain cases, as part of both the initial assessment and ongoing evaluation process. As part of the monitoring process, further interactions with the investee company may be held through the investee companies’ investor relations teams where appropriate.

Monterone’s mission is to be an active owner of companies that create sustainable value for our investors. In addition to traditional financial and operational considerations, ESG factors can have a material impact on the earnings power of companies, given their influence on consumer behavior, government regulation and the costs of doing business. As a result, we believe it is important to incorporate ESG factors into our research process to identify new investment opportunities and reduce the risk of permanent capital impairment. Monterone has an ESG policy which is available from Phillip Chapple ( on request.

(c)   How the firm conducts dialogues with investee companies

  •  The Firm will have dialogue with investee companies if it is deemed beneficial for the company and its stakeholders. In all interactions, the Firm is always mindful of the potential trading restrictions which would be caused by the receipt of non-public information.
  • On-site visits to investee companies are often made as part of both pre-investment diligence and the ongoing review of existing investee companies.

(d)   How the firm exercises voting rights and other rights attached to shares

  • As a fiduciary, the Firm owes each of its clients a duty of care and loyalty with respect to services undertaken on the client’s behalf, including proxy voting. To this end, the Firm takes all reasonable steps to vote proxies in the best interest of its clients.
  • The Firm has a Proxy Voting Policy that – amongst other things – sets out the Firm’s general approach when voting on behalf of its clients.
  • The Firm generally votes proxy proposals, amendments, consents or resolutions relating to client securities, including interests in private investment funds, if any, (each a “proxy”) in accordance with the following guidelines:

    - The Firm will generally support a current management initiative, if our view of the issuer’s management is favourable
    - The Firm will generally vote to change the management structure of an issuer, if it would lead to an increase in shareholder value; an
    - The Firm will generally vote against management, if there is a clear conflict between the issuer’s management and shareholder interest.

The Proxy voting policy is available to clients/fund investors/other stakeholders upon request from

(e)   How the firm cooperates with other shareholders, and communicates with relevant stakeholders of the investee companies

Where appropriate, and if it is deemed beneficial for the company and its stakeholders, the Firm may engage with other shareholders of an investee company as part of shareholder group forums, informal groups, participation in AGM/EGMs and joint shareholder meetings with a company. These avenues are only used in the cases where they are deemed appropriate, beneficial and consistent with the Firm's investment stewardship objectives.


(f)   How the firm manages actual and potential conflicts of interests in relation to the firm’s engagement

The Firm has a documented Conflicts of Interest Policy. The Firm is required to manage conflicts of interest fairly, both between the Firm and its clients as well as between one client and another client. As applicable, the Firm is also required to identify conflicts of interest between an investor in a fund managed by the Firm and other investors, funds managed by the Firm, other clients of the Firm or the Firm itself.
The Firm’s policy is to take all appropriate steps to maintain and operate effective organisational and administrative arrangements to identify and to prevent or manage potential and actual conflicts of interest in the Firm’s business.
With specific reference to the Firm’s engagement with listed companies, the Firm has identified that conflicts of interest may arise in the following situations:

  • Aggregation and allocation of orders
  • Investing (different strategies and mandates)
  • Proxy voting (as detailed above)
  • Use of research
  • Remuneration


Any conflicts will be escalated to and discussed by the Firm’s governing body prior to voting.



The Firm’s makes the following annual disclosure for the year ended 31st December 2023.

The Firm participated in 12 shareholder meetings during the year ended 31st December 2023, amounting to 234 voteable items. The Firm casts its votes through third-party proxy agents & does not use a proxy voting adviser.

During the year, the Firm has endeavoured to vote in shareholder meetings where possible. Whilst the recommendation of management was considered in all cases, the Firm always voted in the best interests of its clients.

Voteable Items: 234
With Management: 227
Against Management: 7
Abstained from voting: 30

The Firm typically voted with management during the year but voted against where remuneration packages or the incentivisation structure was deemed negative to shareholder interests.