MIFIDPRU Disclosure

1. Introduction and Context

Sona Asset Management (UK) LLP (“the Firm” or “Sona”) is authorised and regulated for investment management activities in the UK by the Financial Conduct Authority (“FCA”) and is classed as a Collective Portfolio Management Investment Firm (“CPMI”) Alternative Investment Fund Manager (“AIFM”) under the UK Alternative Investment Fund Management Directive (“AIFMD”), with permissions to undertake activities within the scope of the UK Markets in Financial Instruments Directive (“MIFID”).

The FCA’s Investment Firm Prudential Regime (“IFPR”) is a framework governing prudential requirements for investment firms. The IFPR comprises of revised rules on capital requirements, internal capital and risk assessment, liquidity requirements, governance, remuneration, and reporting and disclosure requirements. As a UK CPMI, Sona is subject to the prudential requirements of IFPR contained in the MIFIDPRU Prudential sourcebook for MIFID investment firms.

MIFIDPRU broadly categorises firms as Small and Non-Interconnected firms (“SNI”), or non-SNI firms. The SNI designation is based upon quantitative thresholds. Sona is classified as a SNI firm and as such is only required to disclose of quantitative and qualitative information in respect of the firm’s remuneration arrangements.

2. Remuneration

2.1. Qualitative Disclosures

2.1.1. Approach to remuneration

• The Firm has implemented a remuneration policy that promotes sound and effective risk management and does not encourage risk taking which is inconsistent with the risk profiles, rules or instruments of the fund’s that the Firm manages.
• In order to support the Firm’s long-term business strategy, the Firm has adopted a top-down remuneration framework. This ensures that variable remuneration is only paid from risk adjusted profits based upon the performance of the business as a whole, the relevant business line and the individual, and only after the Firm’s liquidity and capital requirements have been considered.
• The Firm has also adopted policies and procedures aimed at mitigating any potential conflicts that may arise between staff members and the Firm, staff members and the funds it manages and between one client and another. The Firm also maintains a Conflict of Interests Register which includes potential conflicts relating to remuneration, as well as the procedures the Firm has implemented to mitigate these conflicts. The Firm applies this Principle on a Firm-wide basis.
• All staff receive fixed remuneration and all staff are eligible to receive variable remuneration.

2.1.2. Governance

The Firm’s Governing Body, its Executive Committee, is responsible for the total process of risk management, which includes remuneration risk. The Governing Body set the risk profile and risk tolerance of the Firm and its related policies and procedures. In addition, the Governing Body ensures that the Firm has implemented an effective, ongoing process to identify risk, to measure its potential impact against a broad set of assumptions and subsequently to ensure that risks are actively managed. The Governing Body has appointed a Remuneration Committee to oversee all aspects of governance and risk management in relation to remuneration.

2.1.3. Objectives of financial incentives

The objective of the Firm’s remuneration arrangements is to ensure the Firm retains premium talent and ultimately is able to deliver high-quality investment services to its clients.

2.1.4. Overview of incentives

Fixed remuneration includes the following:

• Fixed salary
• Pension
• Other employment benefits

Components of variable remuneration are:

• Discretionary bonuses
• Carried interest

The firm has a deferral framework whereby any compensation provided above a certain threshold is deferred into a flagship fund. One third vests every year, over three years. Upon vesting, payments are made to individuals or in some circumstances fund interests can be transferred into their own name.

2.1.5. Components of remuneration

The Remuneration Committee balances the fixed and variable component of remuneration of the Firm’s Remuneration Code Staff, such that the fixed component represents a sufficiently high proportion of the total remuneration to allow the operation of a fully flexible policy, on variable remuneration components, including the possibility to pay no variable remuneration component.

2.1.6. Financial and non-financial performance:

In establishing the Firm’s top-down remuneration framework, the Remuneration Committee will take into consideration the performance of:

• The Firm overall;
• The business line; and
• The individual (both financial and non-financial).

The Firm is dedicated to ensuring that individuals are not remunerated for exceeding the risk tolerances of the Firm. When assessing individual performance, the Firm takes account of financial as well as non-financial criteria.

The Firm’s non-financial criteria may include risk management, responsible business conduct and client service, alignment with the Firm’s strategy and values, compliance with the Firm’s policies and procedures and meeting any other non-financial targets.

2.2. Quantitative Disclosures

The table below sets out the split between fixed and variable remuneration for the financial year end March 2025.