- The cornerstones of our research brand are integrity, credibility and trust
- Edison is committed to providing the highest quality investment research. Edison recognises that, individually and collectively, we are ultimately responsible for our research views and protecting the integrity of our research brand.
- Our research brand strives to be objective, insightful, financially rigorous, readable and timely.
- Our research must always reflect the informed view of our research analysts. In forming the informed view, our analysts strive to be diligent and thorough in their work, supporting their basis for opinions with appropriate levels of independent investigation, inquiry, analysis and judgement.
- We recognise that potential conflicts, both actual and perceived, may arise both internally within our firm as well as externally from corporate and investor clients. It is our responsibility to acknowledge and manage those conflicts in a way that protects our clients and our reputation.
- Procedures for managing potential conflicts of interest
- Edison Investment Research has no internal corporate finance or sale and trading business. Our business focuses on writing investment research. Our clients do however include corporate finance and/or sales and trading organisations.
- The Director of Research is available to all analysts with respect to any issue regarding actual or perceived conflict and/or inappropriate influences, whether from within or from external sources.
- The Director of Research is also the firm's designated Compliance Officer and reports directly to Edison Investment Research's Board of Directors.
- Supervision and management of analysts
- Analysts report to the Director of Research, and do not report to client corporate finance personnel or sales and trading personnel.
- Analysts are permitted to fact check research drafts with the management of the subject company and with other client counterparties.
- Prior to publication, the final research draft normally undergoes a dual review by an editor and a supervisory analyst. All research requires the Director of Research's approval prior to publication.
- Access to non-public information
- From time to time, Edison's analysts are given access to non public information. The firm has established controls such that the analysts receiving non-public information do so only in accordance with clear procedures that look to protect our clients' confidentiality and our research brand.
- Within the US issuers are expected to ensure that information provided to our analysts have been publicly disclosed pursuant to the requirements of Regulation FD. In the event that material non-public information is released to our analysts, the onus is on the issuer to release the information in a manner that is reasonably designed to effect a broad and non-exclusionary distribution of that information to the public in the United States prior to the release of our research report.
- These procedures include notification and approval from the Director of Research, the logging and reviewing of such approvals and the imposition of appropriate restrictions on the permitted activities of analysts concerned while the information remains non-public.
- Limitations on analysts' involvement in activities other than the preparation of research
- Analysts are not permitted to participate in sales pitches for corporate finance mandates for clients and are not permitted to make presentations or actively participate in road shows relating to a corporate finance transaction.
- Analysts are permitted to perform certain other roles where the firm believes that it would not compromise their independence or the appearance thereof:
- Discussing the merits of a proposed transaction with corporate finance clients.
- Discussing industry sector trends with corporate finance clients.
- Assisting in due diligence.
- Advising on market sentiment and pricing and structuring of securities offerings.
- Investor education relating to a corporate finance transaction.
- Education of the client's sales force relating to a corporate finance transaction.
- Participation in presentations at widely attended conferences.
- Analysts' remuneration
- Analysts are remunerated on a flat fee structure, with no part of an analyst's remuneration being related directly or indirectly to the views expressed in the research report.
- Analyst remuneration is determined exclusively by Edison Investment Research. Corporate finance clients have no input into the remuneration of Edison analysts.
- Certain analysts' remuneration may be linked to the overall performance of Edison Investment Research by means of a year-end bonus. Edison Investment Research employs a range of criteria in determining the year-end bonus, including:
- the quality and accuracy of the analyst's research
- the analyst's individual performance and productivity
- evaluations by clients other than corporate finance personnel
- the analyst's seniority, reputation and experience; and
- the market for hiring and retaining analysts.
- Policies concerning inducements given to analyst
- Analysts are not permitted to accept any remuneration or other benefit from an issuer or any other party in respect of the publication of research.
- Analysts are not permitted to accept any inducement for the production of favourable research.
- These restrictions do not preclude the acceptance of reasonable corporate hospitality in accordance with the firm's general policies regarding gifts and entertainment.
- Recording and monitoring analysts' personal interests and personal account dealing
- Prior approval is required for investments in private companies or private funds and also for any outside business activities such as directorships, or earned income from a source other than their employment at the firm. An analyst may not perform services for remuneration for a company covered by such analyst either on behalf of the firm or in a personal capacity.
- All Edison analysts (and household members of analysts) must obtain pre-approval from the Compliance Officer or a Director to buy or sell any publicly available equity securities and equity linked securities, including convertibles and derivatives, corporate bonds and any other comparable investment vehicle.
- Analysts (and household members of analysts) may not serve as an officer, director, employee or advisor to a company under coverage.
- Distribution and termination of coverage
- Edison Investment Research seeks to distribute its research on a non-permissioned basis by both hard copy and online mediums. Our research is distributed on as broad a basis as possible, using electronic platforms such as Bloomberg, Multex and First-Call.
- Edison Investment Research maintains a database of clients to whom it emails its research which is compliant with the Data Protection Act.
- In the event that research coverage is terminated and Edison has published forecasts, the firm publishes a final note stating that coverage has been terminated.
- Offering related research
- In accordance with common practice in the UK, from time to time, Edison Investment Research publishes research (commonly termed "pre-deal" research) prior to an offering of securities.
- Although not containing ratings or price targets, pre-deal research published by Edison Investment Research in these circumstances will be considered impartial research for the purposes of FCA 7.16.
- Decisions as to whether to provide pre-deal research are made by Edison Investment Research's management.
- Edison Investment Research has put in place procedures to:
- Prevent the promise of favourable coverage.
- Ensure the factual consistency of pre-deal research with any related prospectus or selling document, including procedures allowing review for factual accuracy by corporate finance clients and issuers.
- Disclose that the research has been provided by Edison Investment Research.
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