HÖEGH CAPITAL PARTNERS

Scope and purpose

This disclosure relates to Höegh Capital Partners Limited, which is classified as a small and non-interconnected (SNI) MIFIDPRU Investment Firm and is therefore required under MIFIDPRU 8.6 to disclose information relating to remuneration policies and practices.

In accordance with the rules, the disclosures herein are appropriate to the size, internal organisation, nature, scope, and complexity of the Firm’s activities.

Frequency of disclosure

Unless otherwise stated, all figures are as at 31 December 2023, the Company's financial year end, in accordance with the rules set out in chapter 8 of MIFIDPRU. MIFIDPRU 8 disclosures are published annually concurrently with the Annual Report and Accounts in accordance with regulatory guidelines.

Location

MIFIDPRU 8 disclosure report is available on the Firm's website at: https://www.hoegh.co.uk/

Copies of the above also are available on request by writing to us at office@hoegh.co.uk.

Approach to remuneration

Base salaries provide pre-determined, non-revocable compensation paid to individuals throughout the year, irrespective of Firm or individual performance. Base salaries and benefits constitute a significant proportion of the Firm’s total remuneration. This fixed element is based on the professional experience and responsibility within the Firm of an individual.

The Firm may at its complete discretion award bonuses which are based on individual performance as well as the Firm’s underlying profitability. The bonus does not form part of individual’s contractual remuneration. The size of the bonus pool is linked to the overall performance of the Firm and client assets size and performance. The employee incentive payment is linked to the contribution of the individual to such performance. Bonuses are discretionary and will diminish or disappear in the event of poor business or individual performance. When considering individual performance, the Firm considers both financial and non-financial metrics. In order not to incentivise unacceptable risk taking, fixed remuneration comprises a significant proportion of staff remuneration.

To enhance alignment with client asset performance, the Firm also runs a Long Term Incentive Plan (LTIP), which is made available to (i) the CEO, (ii) senior members of the Investment Team from start 2023 and (iii) the COO from start 2024. The LTIP is linked to specified client asset performance and will only be paid if there is positive performance on the relevant client’s assets. The Arts Alliance Division team (“AAA”) have a similar LTIP scheme linked to the performance of the specific subset of client assets on which the AAA team specifically advise.  

The board of the Firm and a dedicated compensation committee, the ACC, monitor salary levels against the level of variable (discretionary or LTIP) remuneration.

Objective of financial incentives

The objective of providing financial incentives is to attract and retain suitably qualified and motivated staff, promote behaviour that is aligned to the Firm’s long-term interests, strategic objectives, and ethical standards. Financial incentives are used to reward individual performance, subject to sufficient liquidity and regulatory capital being available within the Firm.   

Governance and decision-making procedures

The Firm is required to implement and maintain remuneration policies, procedures and practices for all directors and employees that are consistent with and promote sound effective risk management.

The policy is intended to cover all aspects of remuneration and has been created in accordance with the MIFIDPRU Remuneration Code (SYSC 19G). 

The remuneration practices and policies are intended to:

• promote sound risk management practices in alignment with the Firm’s risk management principles;
• discourage risk taking that is inconsistent with the Firm’s risk appetite or risk management policies and principles;
• control fixed costs by ensuring that remuneration expense varies according to profitability and does not place undue constraints on the Firm’s ability to maintain its capital base;
• link remuneration to the Firm’s financial and operational performance as well as individual performance; 
• provide competitive, but not excessive, levels of remuneration compared to peer Firms of appropriate size, scope, and complexity; and
• promote a positive culture towards risk management and compliance.

The remuneration practices and policies are intended to support the Firm’s business strategy, long term interests and values, and to ensure that risk taking does not exceed the Firm’s tolerated level of risk.

Periodic benchmarking ensures that remuneration at individual level is not unreasonable or disproportionate to the amount, nature, quality, and scope of the work performed. 

The remuneration policy outlines the criteria used to assess the performance of the Firm and of individual staff members. The Firm’s performance is assessed against its overall financial performance and employee retention rates.

In assessing the performance of individual staff members, the Firm takes into account financial and non-financial criteria. Non-financial criteria includes:

(a) performance in line with firm strategy or values;

(b) adherence to the firm’s risk management and compliance policies; and

(c) achieving objectives as set in the previous year’s annual appraisal.

Diversity Statement

At Höegh Capital Partners Limited, we are committed to providing equal employment opportunities and treatment for all candidates and employees. We are determined to create a work environment free from discrimination. Most importantly, we pride ourselves on our culture, where differences are valued at all levels of the organisation. We believe diversity of thought and background drives innovation and our holistic approach to recruiting allows us to create a diverse and inclusive network of employees across the entirety of the business.

Höegh Capital Partners Limited will not tolerate any forms of discriminatory practices or behaviour, and we aim to ensure that all employees, candidates, clients, customers, suppliers and visitors are not treated less favourably, victimised or harassed on the grounds of any Protected Characteristics. Our commitment to diversity and inclusion remains a top priority and we continuously aim to improve our working environment to ensure all employees have the support, resources and equity they need to be successful in their roles. In addition, we are dedicated to making reasonable adjustments for all candidates where possible throughout the application process to ensure fairness and standardisation. If you are an applicant and you have any questions or concerns about conduct that may not conform to these standards, we encourage you to escalate your concerns to our Human Resources team, which we will treat with the utmost sensitivity.