Bath/Head Office & Unquoted Equity Team:
London Office & Quoted Equity Team:

Investor Information

Principal Risks

The Board considers the following as the principal risks facing the Company. Mitigation of these risks is sought and achieved in a number of ways as set out below:

Market risk

The Company is exposed to UK market risk due to fluctuations in the market prices of its investments. The Investment Manager actively monitors economic performance of investee companies and reports regularly to the Board on a formal and informal basis. The Board formally meets with the Investment Manager on a quarterly basis when the portfolio transactions and performance are discussed and reviewed.  The Company is substantially dependent on the services of the Investment Manager’s investment team for the implementation of its investment policy.  The Company may hold a proportion of the portfolio in cash or cash equivalent investments from time to time. Whilst  during positive stock market movements the portfolio may forego notional gains, during negative market movements this may provide protection.

Discount volatility

As with many investment trust companies, discounts can fluctuate significantly. The Board recognises that, as a closed ended company, it is in the long-term interests of shareholders to reduce discount volatility and believes that the prime driver of discounts over the longer term is performance. The Board, with  its advisers, monitors the Company’s discount levels and shares may be bought back should it be thought appropriate  to do so by the Board.

Regulatory risks

A breach of Companies Act regulations and Financial Conduct Authority (“FCA”) rules may result in the Group’s companies being liable to fines or the suspension of either of the Group companies from listing and from trading on the London Stock Exchange. The Board, with its advisers, monitors the Company’s and SCZ’s regulatory obligations both on an ongoing basis and at quarterly Board meetings.

Financial risk

The financial situation of the Group is reviewed in detail at each Board meeting and monitored by the Audit Committee. New developments in accounting standards and industry related issues are actively reported to and monitored by the Board and its advisers, ensuring that appropriate accounting policies are adhered to.