Raghunandan Money – Investment Khushiyon Ka.

Policy on Conflict of Interest

Policy on Conflict of Interests

Introduction

SEBI vide its circular no. CIR/MIRSD/5/2013 dated August 27, 2013 issued a General Guidelines for dealing with Conflicts of Interest of Intermediaries, Recognized Stock Exchanges, Recognized Clearing Corporations, Depositories and their Associated Persons in Securities Market. SEBI decided to put in place comprehensive guidelines to collectively cover such entities and their associated persons, for elimination / avoidance of their conflict of interest and educating the Associated Persons as defined in Securities and Exchange Board of India.

SEBI guidelines intends Intermediaries and their Associated Persons to comply with the following –

  • high standards of integrity in the conduct of business;
  • fair treatment of clients and no discrimination amongst them;
  • not to deal in securities while in possession of material non published information;
  • not to communicate the material non published information
  • not to manipulate the demand for, or supply of, or to influence prices of, securities.
  • not to have an incentive structure that encourages sale of products not suiting the risk profile  of the clients;
  • not to share  client information for the personal interest;
  • avoidance of conflict of personal interest with the client and primacy of clients’ interest;
  • appropriate disclosure to the clients of possible source  or potential areas of conflict of interest;
  • reducing the opportunities for conflict through prescriptive measures;
  • appropriate restrictions on transactions in securities while handling a mandate of issuer  or client;

2. Policies and Internal Procedures to Identify and avoid or to deal or manage actual or potential  Conflict  of Interest

In order to strive for achieving management of conflict of interests, Raghunandan Capital Private Limited shall endeavor-

  • To promote high standards of integrity in the conduct of business of Raghunandan Capital Private Limited.
  • To ensure fairness of dealing with clients
  • To guide for identification, elimination or management of conflict of interest situations
  • To provide a mechanism for review and assessment of the policy(ies)  on  conflict  of interests

The  conflict  of interest policy  aims  to  ensure that  the  Company’s clients  are  treated fairly  and  at  the  highest level  of integrity and  that  their  interests are  protected at  all times. It also aims to identify conflicts of interest between:-

  • The Company and a Client
  • Relevant Person and a Client
  • A Company of the Group and a Client
  • Two  or  more  Clients  of the  Company in  the  course  of providing services  to  these Clients
  • A Company service provider and a Client

In addition it aims to prevent conflicts of interest from adversely affecting the interest of its Client.

Conflicts of Interest Policy sets out how:-

  • The Company will identify circumstances which may give rise to conflicts of interest entailing a material risk of damage to our Clients’ interests;
  • The Company has established appropriate mechanisms and systems to manage those conflicts;
  • The Company maintains systems designed to prevent damage to our Clients’ interests through identified conflicts.

 “Conflict  of Interest”

Conflicts of Interest can be defined in many ways, including any situation in which an individual or else is in a position to exploit a professional or official capacity in some way for their personal or corporate benefit. A conflict of interest is a manifestation of the moral hazard problem, particularly when a financial institution provides multiple services   and   the   potentially competing interests of those   services   may   lead to a concealment of information or dissemination of misleading information. A conflict of interest exists when a party to a transaction could potentially make gain from taking actions that are detrimental to the other party in the transaction.

Identification of Conflicts of Interests

The Company shall take adequate steps to identify conflicts of interest. In identifying conflicts of interest, the Company will take into account situations where the Company or an employee or a Relevant Person:

  • Is likely to make a financial gain, or avoid a financial loss, at the expense of the Client;
  • Has  an interest in the outcome of a service  provided to the Client  or of a transaction carried out  on  behalf  of the  Client,  which  is distinct from  the  Client’s  interest in that outcome;
  • Has a financial or other incentive to favour the interest of one Client over another;
  • Carries out the same business as the Client; or
  • Receives  from  a person other  than  a Client  an  inducement in  relation to  a service provided to a Client,  in the form  of monies, goods  or services,  other  than  the standard commission or fee for that service.

 Potential  Conflict  of Interest

In order to avoid, manage or deal with conflict of interest with the intermediary or the Associated Persons, it is important to identify the possible areas  of conflict  of interest. Raghunandan Capital Private Limited lists out the following potential conflict of interest that may affect the company:-

  1. Directorships or other employment;
  1. Interests in business enterprises or professional practices;
  1. Share ownership;
  2. Beneficial interests in trusts;
  • Personal Account Trading;
  • Professional associations or relationships with other organizations;
  • Personal associations with other groups or organizations, or family relationships;
  • Commission;
  • Where the company carries on the same business as a client;
  • Where  the company designs, markets or recommends a product or service  without properly considering all  our  other  products and  services  and  the  interest of all  our clients;
  • Where  the  company has  a  financial or  other  incentive to  favour the  interest  of another client or group of clients over the interests of a client;
  • Where  the company has an interest in the outcome of a service  provided to, or of a transaction carried out  on behalf  of, a client  which  is distinct from  that  client’s interest in that outcome;
  • Where the company is likely to make a financial gain or avoid a financial loss at the expense of a client; and
  • Where  the company receives,  or will receive, from the person other  than  a client an inducement in  relation to  the  service  provided to  that  client  in  the  form  of monies, goods  or services,  other  than  the standard commission or fee for that service;

Measures to avoid or to deal or manage actual or potential Conflict  of Interests(COI)

Conflict of interest should arise, it needs   to be managed promptly and fairly.  The Company puts in place following arrangements to ensure that:

  1. There is a clear distinction between the different departments’ operations;
  1. No single person will gather conflicting information, thus counterfeiting or hiding information from investors is minimized;
  1. The Company’s employees are prohibited from investing in a financial instrument for which they have access to non-public or confidential information; iv. Transactions by the Company’s employees are neither performed nor executed by themselves.
  • Employees sign  a  contract of  employment  including  confidentiality clauses.   No associated person may disclose  inside  information to others,  except  disclosures made in accordance with  the  Company’s policies  and  procedures, to other  Company personnel or persons outside the  Company who  have  a valid  business reason for receiving such information;
  • Each department will control the flow of information where, otherwise, the risk of conflict of interest may harm the interest of a Client;
  • Relevant information is recorded promptly in a secure   environment to enable identification and management of conflicts of interests;
  • Adequate records are maintained of the services and activities of the Company where a conflict of interest has been identified;
  1. In certain jurisdictions appropriate disclosure may be made to the Client in a clear, fair and not misleading manner to enable the Client to make an informed decision;
  • There is a periodic review of the adequacy of the Company’s systems and controls.

Information barriers

The  Company  respects the  confidentiality  of  information  it  receives   regarding  its Clients  and  operates a “Need to Know”  approach and  complies with  all applicable laws in  respect of the  handling of that  information. Access  to  confidential information  is restricted to those  who  have  a proper requirement for the  information consistent with the  legitimate interest of  a  Client  of  the  Company. The Company operates internal organizational arrangements to avoid conflicts of interest by controlling, managing or restricting, as deemed appropriate, the flow of confidential information between different areas  of business or within a specific division or department.

 Disclosure to clients  of possible source or potential areas of conflict  of interest(COI):

i. Raghunandan Capital Private Limited or its associated persons should, in writing,

disclose  to a client  any  COI in respect of that client including –

  1. Measures taken to avoid or mitigate the conflict;
  2. Any ownership interest or financial interest that the provider or representative may be or become eligible for;
  3. 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.
  4. Raghunandan Capital Private Limited or its associated persons should, in writing, inform  a client of the policy on Management of Conflict of Interest and how it may be accessed.
  5. Intimation of an actual or potential COI should be made to a person with responsibility for the issue or area, such as the relevant management team, head of the department or key individual.
  6. Staff that fail to disclose  a potential or actual  COI in accordance with this policy may be liable to disciplinary procedures.
  7. Where there  is no other  way of managing a conflict, or where the measures in place do not sufficiently protect Clients’ interests, the conflict will be disclosed to allow the Client to make an informed decision on whether to continue using  our service in the situation concerned.

Policies and procedures

The Company has developed and implemented policies and procedures throughout its business to prevent or manage potential conflicts of interest. Our employees receive guidance and training in these   policies   and   procedures, and   they   are   subject   to monitoring and review processes.

Procedure to comply  with the policy

  1. Every staff member must have a copy of the Policy on management of Conflicts of Interest.
  2. If a potential COI arises, the transaction must first be discussed with management before entering into the transaction.
  3. All new employees shall be required to declare their outside interests when they join the firm.
  4. All staff maintaining personal trading accounts outside of the company is required to instruct their broker to send copy contract notes and periodic statements to the company for reconciliation purposes.
  5. The company Conflict of Interest Policy is located on the website www.acml.in and  is subject to annual review.

3. Internal code of conduct governing operations

Raghunandan Capital Private Limited and  Associated Persons shall  abide  by the  Code  of Conduct contained in the Schedule II of  the  Securities   and  Exchange Board  of  India  (Stock-Brokers and  Sub- Brokers)  Regulations, 1992, as  amended, for  accomplishment of the  objectives  of the SEBI Code.

4. Standards of appropriate conduct in the performance of the activities,

Raghunandan Capital Private Limited and its Associated Persons shall adopt the following standards of appropriate conduct in the performance of the activities.

  1. To place  the  client’s  interests first: Placing  the  client’s interests first is a hallmark of professionalism and  its Associated Persons to act honestly and  not place  personal gain or advantage before the client’s interests.
  2. To provide business services with integrity: Integrity requires honesty and sincerity in all business matters.
  3. To provide business services objectively:  Objectivity requires intellectual honesty and impartiality.
  4. To be  fair  and  reasonable in  all  business relationships & to  disclose  and  manage conflicts  of interest: Fairness  requires providing clients  what  they  are  due,  owed or should expect  from  a  business relationship, and  includes honesty and  disclosure  of material conflicts  of interest. It involves managing one’s own feelings, prejudices and desires to achieve a proper balance of interests. Fairness is treating others in the same manner that you would want to be treated.
  5. To   act    in    a   manner   that    demonstrates   exemplary   professional   conduct: Professionalism requires behaving with  dignity and  showing respect  and  courtesy to clients,   fellow   business  associates,  and   others    in   business-related activities, and complying with appropriate rules, regulations and business requirements.
  6. To maintain the abilities,   skills and knowledge necessary to provide business services competently:
  7. To protect the confidentiality of all client information: Confidentiality requires client information to be protected and maintained in such a manner that allows access only to those who are authorized.
  8. To provide business services diligently: Diligence requires fulfilling business commitments in a timely   and   thorough manner, and   taking   due   care in planning, supervising and delivering business services.

5. Communication of policies, procedures and code to all concerned

This Policy on management of Conflict of Interest offers general guidance in addition to policies and procedures and is not meant to replace any of those policies or procedures

6. Implementation and Review of policy of management on Conflict of Interest

This policy  shall come into effect from  the date  of approval of the Board  of Directors of the  company for  its  implementation so  as  to  provide  necessary guidance  enabling identification, elimination or management of conflict  of interest situations and  that  the same shall be reviewed and assessed annually by the company management.

For Raghunandan Capital Private Limited 

  Sd/- Director

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