SLAVERY AND HUMAN TRAFFICKING STATEMENT PURSUANT TO SECTION 54, PART 6 OF THE MODERN SLAVERY ACT 2015 (THE “ACT”)
This statement relates to the financial year ended 31 December 2016 and sets out the steps that Lion Capital LLP (“Lion Capital”, the “Firm” or “we”) has taken and intends to take to ensure that slavery and human trafficking is not taking place in its business or supply chains.
OUR STRUCTURE, BUSINESS AND SUPPLY CHAINS
The Firm is a global consumer-focused investor, with offices in London and Los Angeles. The Firm provides investment management services to various investment funds established in the United Kingdom (the “Funds”), which focus on making investments in Europe and North America.
As a private equity investor, our immediate supply chain is relatively short, consisting mainly of professional services firms.
The Funds that we manage invest in a number of portfolio companies. Though these portfolio companies do not form part of the Firm’s supply chain, we are committed to taking steps to confirm that each portfolio company’s management team understands any responsibilities it has under the Act and the need for it to put in place its own effective controls and training to protect against modern slavery being present in its own business and supply chains.
To this end, we have written to the management of those portfolio companies that we consider may be subject to the Act, to ensure that they understand their obligations under the Act. In addition, we have representation on each portfolio company board and, although not a standing agenda item, ensuring compliance with the Act and limiting the risk of modern slavery and human trafficking taking place in their business and supply chains remains a key consideration of the companies’ boards.
POLICY STATEMENT
In pursuit of best-in-class approach, Lion Capital is a signatory of the six UN supported Principles for Responsible Investment. The Firm is a responsible investment fund manager that strives to maintain the highest standards of integrity and professionalism in the conduct of its business. Lion Capital expects all of its portfolio companies and employees to comply with ESG-related legislation at a local, national and international level, including but not limited to applicable environmental, health and safety, anti-bribery and corruption and human rights legislation.
Lion Capital portfolio companies are actively involved in a collaboration project (“Not for Sale”) which raises awareness about human trafficking and, as an active board member of “Not for Sale”, in 2016 Lion Capital has promoted the prevention of human trafficking at various investor meetings and conferences.
OUR APPROACH TO DUE DILIGENCE
As part of the Firm’s standard investment due diligence process, Lion employs external advisers to conduct site visits, management interviews and public searches to diagnose any potential environmental/social liabilities, and ensure portfolio company compliance with Lion’s philosophy in these areas. At the point that a Fund acquires a portfolio
company, we ensure that such portfolio company’s management team is aware of their potential obligations under the Act.
We do not consider that the relationships within our immediate supply chain give rise to material risks in this area. However, we will be requiring key suppliers to confirm that their activities accord with the requirements of the Act.
We also have a dedicated Compliance Officer, who oversees the above process.
TRAINING
The Firm has provided details of this policy to all relevant staff. We ensure that all employees, on joining the Firm and periodically thereafter, review and familiarise themselves with the Firm’s policies to ensure that they can identify situations where there is a risk of modern slavery or human trafficking.
FURTHER STEPS
Additional steps that we intend to take in order to ensure that modern slavery and human trafficking is not taking place in our business or supply chains are:
- to develop and enhance existing policies (if any) or create new policies relating to slavery and human trafficking, in order to provide a framework for identifying and monitoring activities within our business and supply chains that may be in breach of such policies;
- to review our due diligence processes to ensure that they comply with our policies on slavery and human trafficking; and
- to review current training provided in respect of our policies and their implementation and ensure the applicable level of training is delivered to employees so that they are more effective in identifying the existence or risk of slavery and human trafficking as part of the investment due diligence process.
This statement is made in accordance with section 54(1) of the Modern Slavery Act 2015 and constitutes Lion Capital LLP’s slavery and human trafficking statement for the financial year ended 31 December 2016. It has been endorsed by the Operating Committee on behalf of the Firm.
Robert Darwent
Designated Member
30 June 2017
Lion Capital LLP (“Lion Capital” or the “Firm”) is a responsible investment fund manager that strives to maintain the highest standards of integrity and professionalism in the conduct of its business. The Firm encourages the furtherance of strong ethical and professional principles across all of its business activities, from its interactions with business owners and executives to its engagement of third-party advisors and its introduction to and ongoing partnership with institutions and individuals that commit capital to Lion Capital Sponsored Funds (“Investors”).
Lion Capital acknowledges its obligations to its Investors and, in addition to applicable laws, rules and regulations that govern investment firms, Lion Capital has implemented this Code of Conduct (“Code of Conduct”) to set forth certain guiding principles governing its interactions with its Investors and other related matters.
This Code of Conduct sets forth the expected standard of ethical and legal behaviour applicable to all Lion Capital Executives, emphasises the necessity of adherence to the highest standards of compliance and regulation and imposes requirements relating to transparency and accountability. All Lion Capital Executives are signatories to this Code of Conduct, which supplements the Firm’s Compliance Manual. Breach of this Code of Conduct is a serious matter for any such person and may lead to disciplinary action and, ultimately, termination of their employment with or membership of the Firm, as applicable.
Given the variety and complexity of the arrangements relating to Lion Capital, its business, investments, Investors and other stakeholders, this Code of Conduct necessarily only serves as a guide to the principles to be applied in any particular scenario. In case of any doubt, personnel should seek advice from the Firm’s Compliance Officer (Richard Lewis) or Lyndon Lea to ensure their actions comply with both the letter and spirit of this Code of Conduct.
Capitalised terms used herein and not otherwise defined, have the meanings given in Section 7.
SECTION 1: CONFLICTS OF INTEREST
Lion Capital holds itself to the highest standard of conduct with respect to its interactions with Investors. In furtherance of this goal, Lion Capital prohibits activities which may contribute to or do not adequately address any conflict of interest between itself and its Investors.
Specifically, Lion Capital will not engage in:
- “revolving door” employment practices with respect to former employees of its Investors, to include employing or compensating in any way any executive, employee or fiduciary of an Investor for two years after termination of such person’s relationship with the Investor;
- the pursuit of any direct or indirect financial, commercial or business relationship with any Investor official, executive, employee or fiduciary, an employee or fiduciary of an investment adviser or consultant to an Investor, or any Relatives of such persons;
- the extension of improper gifts to Investor officials, executives, employees or fiduciaries in breach of section 4 of this Code;
- the misuse of confidential information supplied by Investors, but will use every effort to protect all sensitive or confidential Investor information and will use such information only for performing the services for which Lion Capital has been engaged.
Lion Capital is mindful of conflicts that may arise between itself and its Sponsored Funds and complies with both the governing agreements of these Funds in this regard and the regulatory rules and principles applicable to the Firm and its personnel.
All Executives are obliged to disclose to the Compliance Officer any material transaction or relationship that could give rise to a conflict of interest and may not enter into any such transaction unless and until it has been approved by the Firm.
Personal dealing and conflicts of interests are also specifically addressed by the Firm’s Compliance Manual.
SECTION 2: USE OF THIRD PARTIES TO SECURE INVESTOR COMMITMENTS
Lion Capital has used and is likely to continue to retain third parties in an advisory and/or fund-raising capacity to assist it in raising funds (“Placement Agents”). When engaging a Placement Agent, Lion Capital will enter into a written contract that specifies the scope of services to be performed and the fee arrangement. In addition, Lion Capital will only engage Placement Agents who adhere to (i) the Invest Europe 2017 Guidance for Placement Agents, as the same may be amended from time to time and (ii) this Code of Conduct insofar as it pertains to Placement Agents.
A. General Placement Agent Standards
Lion Capital will only retain a Placement Agent that:
- is registered and/or authorised with, and regulated by, as applicable, appropriate regulatory bodies in each jurisdiction in which it undertakes regulated activities;
- possesses the licenses or certifications required by legal, governmental, regulatory or self-regulatory organisations to which the Placement Agent or its representatives are subject;
- is in the habitual, systematised business of soliciting capital commitments from prospective Investors; and
- operates in an environment with established compliance and oversight processes.
Furthermore, Lion Capital will only engage a Placement Agent that:
- maintains high standards of probity, integrity and professionalism in the conduct of its business;
- performs reasonable due diligence in respect of potential Investors commensurate with the scope of its engagement;
- does not make or offer to make any payments or provide other consideration or benefit directly or indirectly with a view to inducing a prospective Investor to enter into contractual negotiations with Sponsored Funds; and
- employs appropriately qualified staff, authorised and supervised commensurate with the capacity in which they are employed and the jurisdictions in which they operate.
B. Restrictions on Placement Agents with Respect to Public Pension Funds
Lion Capital will not directly or indirectly hire, engage, utilise, retain or compensate any person or entity, including but not limited to any Placement Agent, lobbyist, Solicitor, intermediary or consultant, to directly or indirectly communicate for any purpose with any official, executive, employee or fiduciary of a Public Pension Fund in connection with any transaction or investment between Lion Capital and the Public Pension Fund where to do so would violate, or would cause Lion Capital or any of its Executives to violate, any laws, rules, regulations, policy statements or codes of conduct applicable to any such Public Pension Fund. Where appropriate this restriction shall include but shall not be limited to:
- introducing, finding, referring, facilitating, arranging, expediting, fostering or establishing a relationship with, or obtaining access to a Public Pension Fund.
- soliciting an investment from a Public Pension Fund; or
- influencing or attempting to influence the outcome of any investment or other financial decision by a Public Pension Fund.
For further clarity, the foregoing restrictions do not apply to:
- any Executive of Lion Capital who is acting within the scope of his or her normal professional duties on behalf of Lion Capital;
- any person or entity whose sole basis of compensation from Lion Capital is the actual provision of legal, accounting or other professional advice, services or assistance that is unrelated to any solicitation, introduction, finding, or referral of clients to Lion Capital or the brokering, fostering, establishing or maintaining of a relationship between Lion Capital and a Public Pension Fund; or
- lobbying of a government or legislature on issues unrelated to investment or other financial decisions by Public Pension Funds or their Advisors.
SECTION 3: RESTRICTIONS ON CAMPAIGN CONTRIBUTIONS AND SOLICITATIONS
Lion Capital’s policies on campaign contributions and solicitations are designed to (i) protect the integrity of Lion Capital’s fundraising activities pertaining to its Sponsored Funds by avoiding conflicts or the appearance thereof with politically connected Investors, (ii) prevent any Lion Capital Executive from attributing their personal political activities to Lion Capital and (iii) ensure that Lion Capital complies with applicable restrictions and limits on political contributions and gifts made by employees to any officeholders, candidates for office, and political action committees throughout the world.
In connection with the foregoing principles, Lion Capital does not make (nor encourage any Lion Capital Executive to make) Contributions to Officials and Public Pension Fund Officials. Any Lion Capital Executive wishing to make such a contribution privately must have this pre-cleared with the Compliance Officer.
Lion Capital Executives engaged in personal political activity (e.g., election campaign work, solicitation of contributions), that are not prohibited by this Code of Conduct, must not attribute such activity to Lion Capital. Lion Capital’s name, facilities, property and resources (including e-mails) may not be used in connection with political activities.
Contributions to any political organisation must be disclosed to, and approved by, the Compliance Officer.
New Executives of Lion Capital will be required to disclose to the Compliance Officer all Contributions to any political organisation made by such Executive within two years prior to joining Lion Capital or such longer period of time as may be determined by the Compliance Officer.
SECTION 4: GIFTS AND BUSINESS ENTERTAINMENT
It is the general policy of Lion Capital to not provide any of its Investors or prospective Investors with Gifts. Notwithstanding the foregoing, it is understood that Lion Capital may hold periodic meetings of (i) some or all of its Investors or (ii) members of its Funds’ Investor Advisory Boards (or equivalent bodies) and attendees at such meetings may receive meals, accommodation, refreshments, participation in customary business-related activities (e.g., a round of golf) and Portfolio Company or Lion Capital branded items (such items limited to a value of $100 in each case).
In addition to the foregoing, Lion Capital may provide Business Entertainment to certain Investors (such as individual Investors) who are not subject to the same conflicts of interest considerations as other Investors. Any such entertainment above a de minimis value must be approved by the Compliance Officer. While any Business Entertainment provided to such Investors must be in accordance with the spirit of this Code, it is recognised that such Investors are not subject to the same constraints as individuals who themselves are subject to fiduciary obligations. Nonetheless, no Gift which is (or may be construed as) not customary business practice, or the purpose of which is to gain an unfair business advantage, shall be given or received by the Firm or any Executive.
SECTION 5: DISCLOSURES TO INVESTORS OR PROSPECTIVE INVESTORS
Upon request by any Lion Capital Investor, Lion will disclose all relevant information related to its engagement of Placement Agents and the qualifications of its Executives engaged in the solicitation of Investor commitments. Lion Capital will also provide a prospective Investor with the same information during such prospective Investor’s due diligence process, subject to such prospective Investor agreeing to customary confidentiality and non-disclosure agreements.
SECTION 6: EDUCATION AND TRAINING
All Lion Capital Executives must sign this Code of Conduct as an affirmation of their commitment to the standards and principles detailed within. Lion Capital will train all new relevant Executives on the requirements set out in the Code within a reasonable time of their joining of the Firm. On an annual basis, the Compliance Officer shall review the requirements set out within this Code with all of the Firm’s Executives and require a certification from each Executive attesting to their completion of the review.
SECTION 7: SELECTED DEFINITIONS
“Business Entertainment” means meals, sporting, theatre, concert and other events requiring tickets, travel, accommodation, conferences and other forms of ordinary course entertainment.
“Compliance Officer” means the designated Compliance Officer of Lion Capital or any other member who performs the functions of a compliance officer.
“Contribution” means any gift, subscription, loan, advance, or deposit of money or anything of value made for:
(i) The purpose of influencing any election for office;
(ii) Payment of debt incurred in connection with any such election; or
(iii) Transition or inaugural expenses of the successful candidate for any such election.“Covered Person” means any person or entity that does business with or potentially could conduct business with or on behalf of Lion Capital and includes without limitation Lion Capital’s investors, portfolio companies, vendors, service providers, law firms, investment banks, broker dealers, accounting firms and consultants.
“Executive” means any partner, member, employee or other officer of the Firm.
“Gift” means any object, services, or other item of value (including tickets to an event unless the donor and recipient both attend the event) given or received by an Executive to or from a Covered Person.
“Government Entity” means a country or a state, or political subdivision of such country or state, including:
(i) Any agency, authority, or instrumentality of the country or state or a political subdivision of such;
(ii) Plan or pools of assets controlled by the country or state or a political subdivision of such or any agency, authority or instrumentality thereof; and
(iii) Officers, agents, or employees of the country or state or political subdivision of such or any agency, authority or instrumentality thereof, acting in their official capacity.
“Lobbying” shall mean, for the purposes of this Code of Conduct, any attempt to directly or indirectly influence a determination by a (1) Public Pension Fund Official, (2) Official, (3) any fiduciary of a Public Pension Fund, (4) Public Pension Fund Advisor, or (5) any other person or entity working in cooperation with any of the above, related to a procurement of investment management or advisory services by a Public Pension Fund, including without limitation a determination by a Public Pension Fund to place an investment with the Firm
“Official” means any person (including any election committee for the person) who was, at the time of a Contribution, an incumbent, candidate or successful candidate:
(i) For an elective office of a Government Entity, if the office is directly or indirectly responsible for, or can directly influence the outcome of, the Public Pension Fund’s investment with or engagement of the Firm; or
(ii) For any elective office of a Government Entity, if the office has authority to appoint any person who is directly or indirectly responsible for, or can directly influence the outcome of, the Public Pension Fund’s investment with or engagement of the Firm. Communication with an Official includes communications with the employees and advisors of such Official.
“Placement Agent” means any third party intermediary that is directly or indirectly hired, engaged, utilised, retained or compensated (regardless of whether upon a fixed, contingent or any other basis) or otherwise given any other tangible or intangible item or benefit having monetary value by the Firm for facilitating the placement of an investment in a Sponsored Fund. A Placement Agent does not include a bona fide Executive or any person whose sole basis of compensation from the Firm is the actual provision of legal, accounting or other professional advice, services or assistance unrelated to soliciting, introducing, finding, or referring clients to the Firm or attempting to influence in any way an existing or potential investment in or business relationship with the Firm.
“Public Pension Fund” means any retirement plan established or maintained for its employees (current or former) by the government of any country or political subdivision thereof, or by any agency or instrumentality of any of the foregoing.
“Public Pension Fund Advisor” means any external firm or individual engaged by a Public Pension Fund to assist in the selection of investments or investment management or advisory services for the Public Pension Fund.
“Public Pension Fund Official” means any elected or appointed trustee or other official, staff member or employee whose official duties involve responsibility for a Public Pension Fund.
“Relative” means a person related by blood or affinity (including a domestic partner) who resides in the same household. A person adopted into a family is considered a relative on the same basis as a natural born family member.
“Solicitor” means any person or entity who in any way, directly or indirectly, solicits, finds, introduces or refers any client to the Firm, including without limitation any intermediary, consultant, broker, introducer, referrer, finder, public- or government-relations expert, or marketer. A Solicitor does not include any bona fide Executive or any person whose sole basis of compensation from the Firm is the actual provision of legal, accounting or other professional advice, services or assistance that is unrelated to any solicitation, introduction, finding, or referral of clients to the Firm or the brokering, fostering, establishing or maintaining a relationship between the Firm and a Public Pension Fund.
“Sponsored Fund” means an investment fund sponsored, managed or advised by the Firm or its affiliat
