ESG Statement
Financial Advisors shall publish on their websites information about their policies on the integration of sustainability risks in their investment advice or insurance advice.
Neox Capital Ltd (the “Company” or “NEOX”) has conducted a review of the latest version of the MiFID Suitability Guidelines, the EU Regulations, and the relevant update to the Maltese Investment Services Rules. To comply with the new requirements, it has updated its Suitability Policy and Procedures Document (the “Suitability Document”), creating a new Section 5 entitled “Sustainability Preferences and the Sustainability Questionnaire” and updating other sections of the Suitability Documents.
The Company has also created its Sustainability Questionnaire which supplements the Company’s Client Fact-Find document, and which focuses specifically on sustainability preferences. This questionnaire is used as a tool to collect the client’s sustainability preferences and related information.
The Company has updated its conflicts of interest policy providing for greenwashing risks and introduced the sustainability concept in its product governance documentation. Reference to the sustainability preferences was also included in other sections of the Company’s Suitability Document, namely: (Section 1) – The suitability assessment, (Section 2) – Conducting suitability assessment on the portfolio as a whole, (Section 4) – Client profiling and data collection, (Section 6) – Matching, (Section 7) – The suitability statement, (Section 10) – Record-keeping, and (Section 12) – Training and education.
These concepts are also entrenched in the Company’s SFDR policy.
Financial advisers shall publish and maintain on their websites: (a) information as to whether, taking due account of their size, the nature and scale of their activities and the types of financial products they advise on, they consider in their investment advice or insurance advice the principal adverse impacts on sustainability factors; or (b) information as to why they do not to consider adverse impacts of investment decisions on sustainability factors in their investment advice or insurance advice, and, where relevant, including information as to whether and when they intend to consider such adverse impacts.
Pursuant to SFDR, the Company is required to disclose in a proportional manner how sustainability factors are integrated into the investment decisions and the assessment of the likely impacts of sustainability risks.
In terms of SFDR, NEOX is also required to publish and maintain on its website: (a) information as to whether, taking due account of their size, the nature and scale of their activities and the types of financial products they advise on, they consider in their investment advice or insurance advice the principal adverse impacts on sustainability factors; or (b) information as to why they do not to consider adverse impacts of investment decisions on sustainability factors in their investment advice or insurance advice, and, where relevant, including information as to whether and when they intend to consider such adverse impacts.
Due to its small size, business and investment strategy, the adverse impact of the Company’s investment decisions on the sustainability factors is of an extremely limited nature.
Neox is sensible to the climate challenges and the sustainable development objectives of the Paris Agreement. The Company is also committed to the promotion of the employees’ well-being and work-life balance. Initiatives have been taken and continue being developed to promote the personal and professional development of employees and the Company’s officials. The Company has also put in place a robust governance structure to ensure high standards of its management and employees’ ethical behaviour.
The Company has a strong commitment to considering sustainability risks as part of this general business strategy and its investment advisory activities. While the Company is strongly committed to the promotion of environmental, social and governance factors, it has decided not to consider the adverse impacts of its investment decisions on sustainability factors in its investment advice.
The above decision is the consequence of a cost-benefit analysis, and motivated by the following factors:
- Size of the Company. The Company presently has less than 5 employees.
- Assets under Advisory.
While the Company does not currently consider sustainability adverse impacts, the Company is committed to transparency and provide other relevant sustainability disclosures. These may include information on our engagement efforts, adherence to industry standards and guidelines, and any positive contributions we make to sustainable practices within our investment portfolios. Additional information can be found in the Company’s SFDR policy.
The Company continuously reviews and assesses its investment processes and regularly evaluates the feasibility of integrating sustainability adverse impacts into the Company’s decision-making. NEOX remains committed to staying abreast of developments in the market and regulatory landscape, and we will reassess our approach should the circumstances change. Any future changes or updates to our consideration of sustainability adverse impacts will be promptly communicated via the Company’s website and to our clients.
Financial market participants and financial advisers shall include in their remuneration policies information on how those policies are consistent with the integration of sustainability risks and shall publish that information on their websites.
Article 5 of SFDR requires NEOX to include in its remuneration policies information on how such policies are consistent with the integration of sustainability risks and shall publish that information on its website. A Sustainability risk is defined as an environmental, social or governance event, which if it occurs, causes a material negative impact on the value of the investments advised by the Company.
The Company does not currently adopt a remuneration policy which integrates sustainability risks, except to the extent described below. The Company’s remuneration policy provides for a fixed remuneration and may award employees with a variable discretionary bonus on an annual basis. Remuneration levels are justified according to the performance of the individual concerned.
Variable remuneration is awarded following a performance assessment based on quantitative as well as qualitative (non-financial) criteria. The variable remuneration is based on key performance assessment criteria.
The Company regularly evaluates the feasibility of integrating sustainability risks into its decision-making process. It remains committed to staying abreast of developments in the market and regulatory landscape and will reassess its approach should the circumstances change.