1. Hermes Remuneration Policy

Our remuneration policy is designed to attract, motivate, retain and reward employees regardless of gender, ethnicity, age, disability or any other protected characteristic.

Our philosophy is to reward individual contribution, as demonstrated by the delivery of long-term sustainable results that are aligned with our business strategy, values, behaviours and which serve the best interests of our clients and shareholders while enabling the business to grow to its potential.

Through focusing on long term awards, our incentive pay strategies encourage employees to act like long term shareholders and support our performance and partnership culture to create a sustainable business, discouraging excessive or concentrated risk taking and avoids conflicts of interest

Individual and organisational performance is transparently and rigorously assessed against a combination of financial (multi-year) and non-financial targets in order to determine appropriate total compensation that will attract and retain our key talent.

2. Reward strategy principles

These principles form the basis of our approach to performance and behaviour-linked total compensation. The principles of our remuneration policies, procedures and practices are:

• To be aligned with business strategy, objectives, values and long-term interests of Hermes and its clients as reflected in the Hermes pledge
• To provide competitive total remuneration potential, designed to attract, retain, motivate and reward employees that deliver outstanding long-term performance and corporate behaviours.
• To promote sound and effective risk management.
• To ensure remuneration is linked to investment, business, personal performance and corporate behaviours measured over the short, medium and long term.
• To differentiate and reward strong performance and demonstration of corporate behaviours and to proactively manage poor performance and behaviours not aligned to the corporate values.
• To deliver reward programs which are transparent, simple to administer and affordable to the Company.
• To deliver compensation and benefit strategies which have the oversight and approval of our Remuneration Committee.

3. Identified staff

Regulation requires the Company to identify the categories of staff whose professional activities have a material impact on the risk profile of the Company.

The identified staff for the Company are identified in accordance with the Hermes Group Remuneration Policy.

4. Remuneration committee

The Remuneration Committee is constituted as a Committee of the Board of Hermes Fund Managers Limited.  Membership of the Remuneration Committee is formed by the Chairman of Hermes and other Directors (both Executive and Non-Executive) who are appointed in line with the business needs of the organisation.

The UCITS Directive requires self-managed investment companies that are significant in terms of their size, their internal organisation and the nature, scope and complexity of their activities to establish a remuneration committee. Having considered these criteria, the Company has determined to establish a separate remuneration committee for the UCITS entity.

5. Annual review

On an annual basis the Board will review the terms of this Remuneration Policy and assess whether its overall remuneration system operates as intended and is compliant with the obligations on remuneration policy as set out in the AIFMD and the UCITS Directive. The Remuneration Policy will be updated by the Board as and when required.

6. Effective date

The effective date of this Policy is 2019.