Introduction 

This document embodies the Conflict of Interest Management Policy for IsimoVest Venture Capital Partners (Pty) Ltd.

Definitions 

“Conflict of interest” means any situation in which IsimoVest Venture Capital Partners (Pty) Ltd or its  representatives has an actual or potential interest that may, in rendering a financial service to a  client influence the objective performance of his, her or its obligations to that client;  or prevent IsimoVest Venture Capital Partners (Pty) Ltd or its representatives from rendering an  unbiased and fair financial service to that client, or from acting in the interests of that client,  including, but not limited to: 

  • The primary objectives of this Policy are:
    • To provide guidance on the behaviours expected in accordance with IsimoVest  Venture Capital Partners (Pty) Ltd standards;
    • To promote transparency and to avoid business-related conflict of interest;
    • To ensure fairness in the interests of employees and IsimoVest Venture Capital  Partners (Pty) Ltd;
    • To document the process for the disclosure, approval and review of activities that  may amount to actual, potential or perceived conflict of interest;
    • To provide a mechanism for the objective review of personal outside interests to prevent a representative from rendering an unbiased and fair financial service to  target company; or 

Mechanism for identifying Conflict of Interest: 

  • The mechanisms implemented to identify actual or potential conflicts of interests for the  FSCA are:
    • The management team of the FSCA conducts bi-annual reviews on all contracts held  with 3rd parties and re-examines whether this relationship influences the FSCA’s  objective performance towards its clients.
    • The management team of the FSCA conducts bi-annual reviews on all contracts held  with 3rd parties and re-examines whether this relationship influences the FSCA’s  ability to render fair and unbiased financial services towards its clients.
    • The management team of the FSCA conducts bi-annual reviews on all contracts held  with 3rd parties and re-examines whether this relationship influences the FSCA’s  ability to act in the interest of the client.
    • The management team of the FSCA conducts bi-annual reviews on all relationships  held with 3rd parties, where an ownership interest is present, and re-examines whether this relationship influences the FSCA’s objective performance towards clients.
    • The management team of the FSCA conducts bi-annual reviews on all relationships  held with 3rd parties where an ownership interest is present and re-examine  whether this relationship influences the FSCA’s ability to render fair and unbiased  financial services towards its clients.
    • Declarations are signed by all Key Individuals confirming the presence or absence of  any actual or potential conflict of interest on a bi-annual basis.
    • A list of all the FSCA’s associates is attached as an annexure hereto and is updated  annually.
    • A list of all parties in which the FSCA holds an ownership interest is attached as an  annexure hereto and is updated annually.
    • A list of all third parties that holds an ownership interest in the FSCA is attached as  an annexure hereto and is updated annually.
    • All gifts received from 3rd parties, with an estimated value of R500.00 or more, are  recorded in the FSCA’s gift register which is kept on the FSCA’s compliance file.  o All employees must disclose in writing to the management team of the FSCA on an  on-going basis, any conflicts of interest that they may become aware of. 
    • All records associated with the identification of an actual or potential conflict of  interests is kept on the compliance file which is available for inspection purposes.
  • The mechanisms implemented to identify actual or potential conflicts of interests for Representatives are:
    • Declarations are signed by all Representatives confirming the presence or absence  of any actual or potential conflict of interest on a quarterly basis.
    • All Representatives must disclose in writing to the management team of the FSCA on  an ongoing basis, any conflicts of interest that they may become aware of 

Resolving Conflict of Interest

The first and most important line of defence against conflict of interest or commitment must be by the key individuals and representatives themselves.
Throughout the process of rendering a service to an investee company, a Representative must apply his or her mind to answering the following questions:

  • “Is there any situation that exists that influences the objective performance of my obligations to an investee company”?
  • “Is there any situation that exists that prevents me from rendering an unbiased and fair financial service to the investee company”?
  • “Is there any situation that exists that prevents me from acting in the interest of the investee”?
    If the answer to any one of these questions is “no” – No further action would be required.
    If the answer to any one of these questions is “yes” – The following two questions must also be answered:
    • “Is the situation caused by an actual or potential relationship with a 3rd party”?
    • “Is the situation caused by an actual or potential financial or ownership interest”?
    • If the answer to any one of these questions is “yes” – An actual or potential conflict of interest has been identified.

Throughout the process of rendering a service to an investee company, a Key Individual must apply his or her mind to answering the following questions:

  • “Is there any situation that exists that influences the objective performance of the representative’s obligations to the investee company”?
  • “Is there any situation that exists that prevents the representative from rendering an unbiased and fair service to the investee company”?
  • “Is there any situation that exists that prevents my representative from acting in the interest of the investee company”?
    • If the answer to any one of these questions is “no” – No further action would be required.
    • If the answer to any one of these questions is “yes” – The following two questions must also be answered:
      • “Is the situation caused by an actual or potential relationship of the FSCA with a 3rd party”?
      • “Is the situation caused by an actual or potential financial or ownership interest of the FSCA”?
      • If the answer to any one of these questions is “yes” – An actual or potential conflict of interest has been identified.

Potential Conflict of Interest that could affect IsimoVest Venture Capital Partners (Pty) Ltd:

i. Directorships or other employment;
ii. Interests in business enterprises or professional practices;
iii. Share ownership;
iv. Beneficial interests in trusts;
v. Personal Account Trading;
vi. Professional associations or relationships with other organizations; vii.
vii. Personal associations with other groups or organizations, or family
relationships;
viii. Front running;
ix. Rebates;
x. Kickbacks; and
xi. Commission

Reporting a Conflict of Interest or Potential Conflict of Interest

IsimoVest Venture Capital Partners representative must disclose Conflict of interests to Clients in writing at the earliest reasonable opportunity, in writing, disclose to an investee company any conflict of interest in respect of that company including –
i. Measures taken to avoid or mitigate the conflict;

ii. Any ownership interest or financial interest that the provider or representative may be or become eligible for;

iii. The nature of the relationship or arrangements with a third party that gives rise to a COI in sufficient detail to enable the client to understand the exact nature of the COI.

At the earliest reasonable opportunity, IsimoVest Venture Capital Partners (Pty) Ltd and its representative must, in writing, inform an investee of the Conflict of Interest Management Policy and how it may be accessed.

Notification of an actual or potential conflict of interest should be made to a person with responsibility for the issue or area, such as the relevant management team, supervisor, general partner or key individual.

In accordance with an employee’s obligation to act in the best interest of his or her employer, it is not permissible for employees to engage in conduct that would amount to a conflict of interest with IsimoVest Venture Capital Partners (Pty) Ltd.

Staff that fail to disclose a potential or actual conflict of interest in accordance with this policy may be liable to disciplinary procedures as governed by relevant industrial awards or agreements.