UK Stewardship Code Disclosure

Under the Financial Conduct Authority Rule COBS 2.2.3R, Platina is required to make a public disclosure in relation to the nature of its commitment to the UK Financial Reporting Council’s Stewardship Code (the “Code”).

The Code aims to enhance the quality of engagement between institutional investors and companies to assist in improving long-term returns to investors and the efficient exercise of governance responsibilities. It provides a set of principles and guidance for how institutional investors should perform their duties. It is to be applied by firms on a “comply or explain” basis.

The Code is directed in the first instance to institutional investors by which is meant asset owners and asset managers with equity holdings in UK listed companies.

The Financial Reporting Council (FRC) recognises that not all parts of the Code will be relevant to all institutional investors and that smaller institutions may judge some of the principles and guidance to be disproportionate. It is of course legitimate for some asset managers not to engage with companies, depending on their investment strategy, and in such cases, firms are required to explain why it is not appropriate to comply with a particular principle.

The seven Principles of the Code are that Institutional Investors should:

  1. Publicly disclose their policy on how they will discharge their stewardship responsibilities;
  2. Have and publicly disclose a robust policy on managing conflicts of interest in relation to stewardship;
  3. Monitor the Investee Companies;
  4. Establish clear guidelines on when and how they will escalate their stewardship activities
  5. Be willing to act collectively with other investors where appropriate;
  6. Have a clear policy on voting and disclosure of voting activity;
  7. Report periodically on their stewardship and voting activities.

Platina does not currently comply with the Code as it invests directly in European-wide renewable energy infrastructure projects and private equity investments in non-listed small- and medium-sized companies. Platina’s investment strategy is to add value over the medium to longer term. As such, Platina acts as an investment manager which principally invests in privately held equity investments; it does not currently invest in UK listed companies.

Although Platina seeks to align its approach with the broad aims of the Code, the provisions of the Code are primarily not relevant to the type of investment activity currently undertaken by Platina. Should any of these factors change, we will review our commitment to the Code at that time and make appropriate disclosure.

If further information is required on this subject, please contact Platina’s Compliance Officer at our London Office, the details of which can be found on this website.

Capital Requirements Directive

Pillar 3 Disclosure 2019

Platina Energy Partners LLP

1. Introduction

The Capital Requirements Directive (‘CRD’) establishes the regulatory capital framework governing the amount and nature of capital credit institutions and investment firms must maintain.

In the United Kingdom, the CRD has been implemented by the Financial Conduct Authority (‘FCA’) in its regulations through the General Prudential Sourcebook (‘GENPRU’), the Prudential Sourcebook for Banks, Building Societies and Investment Firms (‘BIPRU’) and the Interim Prudential Sourcebook for Investment Business (“IPRU (INV)”).

The CRD consists of three ‘Pillars’:

  • Pillar 1 sets out the minimum capital amount that meets the firm’s credit, market and operational risk capital requirement.
  • Pillar 2 requires the firm to assess whether its capital reserves, processes, strategies and systems are adequate to meet the requirements under Pillar 1 and further determine whether it should apply additional capital, processes, strategies or systems to cover any other risks that it may be exposed to.
  • Pillar 3 requires disclosure of specified information regarding the underlying risk management controls and capital position to encourage market discipline and to allow market participants to assess key information about our underlying risks, risk management controls and capital position.

The regulatory aim of the disclosures is to improve market discipline.

The rules in BIPRU 11 set out the provision for Pillar 3 disclosure. This document is designed to meet Platina Energy Partners’ Pillar 3 obligations.

The Pillar 3 disclosure document has been prepared by Platina Energy Partners LLP (‘Platina’ or ‘the Firm’) in accordance with the requirements of BIPRU 11 and is verified by the Firm’s Executive Committee. Unless otherwise stated, all figures are as at the 31 March 2019 financial year-end.

Pillar 3 disclosures will be issued on an annual basis after the year end and published as soon as practical.

We are permitted to omit required disclosures if we believe that the information is immaterial such that omission would be unlikely to change or influence the decision of a reader relying on that information for the purpose of making economic decisions about the Firm.

In addition, we may omit required disclosures where we believe that the information is regarded as proprietary or confidential. In our view, proprietary information is that which, if it were shared, would undermine our competitive position. Information is considered to be confidential where there are obligations binding us to confidentiality with our customers, suppliers and counterparties.

We have made no omissions on the grounds that the information is immaterial, proprietary or confidential.

2. Scope and Application

Platina Energy Partners LLP is authorised and regulated by the FCA and as such, is subject to minimum regulatory capital requirements. The Firm is a Full-scope UK Alternative Investment Fund Manager (‘AIFM’) and is categorised by the FCA for Prudential Regulatory purposes both as a Collective Portfolio Management Investment firm (‘CPMI’ firm) and a BIPRU firm.

The Firm is not a member of a group and so is not required to prepare consolidated reporting for prudential purposes.

3. Risk Management

Platina’s approach to risk management is predicated on the need to manage the full range of risks facing Platina including operational, business, liquidity, credit and market risks. Platina’s overriding aim in this area is to minimise the risks to its clients, its counterparties and other stakeholders and to ensure it remains in full compliance with regulatory and legal requirements.

The Firm has established a risk management process in order to ensure that it has effective systems and controls in place to identify, monitor and manage risks arising in the business. The risk management process is overseen by the Chief Risk Officer (‘CRO’), with the Senior Management team taking overall responsibility for this process and the fundamental risk appetite of the firm. The Compliance Officer has responsibility for the implementation and enforcement of the Firm’s risk principles.

Senior Management meets on a regular basis and discusses current projections for profitability, cash flow, regulatory capital management, business planning and risk management. Senior Management engage in the Firm’s risks through a framework of policy and procedures having regard to the relevant laws, standards, principles and rules (including FCA principles and rules) with the aim to operate a defined and transparent risk management framework. These policies and procedures are updated as required.

The Senior Management team has identified that business, operational, market and credit are the main areas of risk to which the Firm is exposed. Annually the Senior Management team formally review their risks, controls and other risk mitigation arrangements and assess their effectiveness.

A formal update on operational matters is provided to the Executive Committee on a regular basis. Management accounts, which demonstrate continued adequacy of the firm’s regulatory capital, are reviewed on a regular basis.

Appropriate action is taken where risks are identified which fall outside of the Firm’s tolerance levels or where the need for remedial action is required in respect of identified weaknesses in the Firm’s mitigating controls.

3.1 Business Risk

Business risk is the risk of loss inherent in Platina’s operating, business and industry environment. Changes in Platina’s business could include the acute risk to income posed by falling or volatile income; the broader risk of Platina’s business model or strategy proving inappropriate due to macro-economic, geopolitical, industry, regulatory or other factors and the risk that the Firm may not be able to carry out its business plan and desired strategy.

The Firm’s revenue is reliant on the management fees received from the existing funds under management and its ability to launch new funds/obtain new mandates. As such, the risk posed to the Firm relates to a decline in revenue and adverse market conditions hindering the launch of new funds. Poor performance, service, adverse market conditions and political upheaval can also impact revenues and hinder the ability to acquire new revenue streams.

The Firm’s exposure to business risk is mitigated by the high levels of capital held by Platina, which ensure operating expenses coverage for a meaningful period. Exposure to business risk is further mitigated by the use of fund redemption restrictions.

Given the scale of the decrease in revenues that would be required in order to threaten Platina’s ability to meet its capital requirements, senior management do not currently consider it appropriate to hold further capital within the Firm in order to mitigate against this eventuality.

3.2 Operational Risk

Operational risk refers to the risk of loss resulting from inadequate or failed internal processes, people, and systems, or from external causes (deliberate, accidental or natural). Events may be manifested as direct financial losses or indirectly in the form of revenue forgone as a result of business suspension. They may also result in damage to reputation causing longer term financial consequences. The operating environment includes cash controls, technology and systems, legal and compliance, accounting, administration, valuation and reporting.

The Firm places strong reliance on the operational procedures and controls that it has in place in order to mitigate operational risk and seeks to ensure that all personnel are aware of their responsibilities in this respect.

Platina continues to develop its corporate risk assessment and the Firm’s Risk Management Policy is reviewed regularly to ensure the operational risks to which the Firm is exposed have been identified and effective controls put in place to mitigate those risks and to maintain acceptable risk levels.

Further mitigation against operational risk is provided by adequate professional indemnity insurance, where single claims are covered for up to £2,500,000, exceeding the required 0.7% of total AIF assets under management and aggregate cover of £2,500,000, exceeding the required 0.9%. The excess of £25,000 is held in Own Funds.

3.3 Credit Risk

Credit risk is the risk of financial loss if a client, fund or counterparty fails to meet its contractual obligations. As Platina does not provide credit to clients, its exposure to credit risk is limited to accrued fees and management fees are drawn quarterly from the funds managed, mitigating credit risk. The Firm therefore considers that there is little risk of default by its clients and the limited degree of credit risk exposure is further mitigated by the individual funds’ deeds and governing documents.

All bank accounts are held with large international credit institutions.

Given the nature of the Platina’s exposures, no specific policy for hedging and mitigating credit risk is in place.

3.4 Market Risk

Market risk is defined as the risk of loss resulting from fluctuations in market variables, such as interest rates, foreign exchange rates, equity and commodity prices or an issuer’s credit worthiness.

The Firm takes no market risks other than foreign exchange risk in respect of cash balances held in currencies other than GBP.

Hedging strategies may be used from time to time to mitigate against potential foreign exchange losses and these are monitored by the Chief Financial Officer.

3.5 Liquidity Risk

The Firm is required to maintain sufficient liquidity to ensure that there is no significant risk that its liabilities cannot be met as they fall due or to ensure that it can secure additional financial resources in the event of a stress scenario.

The Firm retains an amount it considers suitable for providing sufficient liquidity to meet the working capital requirements under normal business conditions. The firm has always had sufficient liquidity within the business to meet its obligations and there are no perceived threats to this, given the cash deposits held. Additionally, it has historically been the case that all management fees are settled promptly, thus ensuring further liquidity resources are available to the Firm on a timely basis. The cash position of the firm is monitored by the Chief Financial Officer on a regular basis.

4. Capital resources and requirements

The firm is a limited liability partnership, whose capital arrangements are established in its partnership deed.

Under the FCA rules, Platina’s prudential categorisation is:

  • Collective Portfolio Management Investment (CPMI) Firm; and
  • Prudential sourcebook for Banks, Building Societies and Investment Firms (BIPRU) Firm.

As a CPMI firm, Platina is required to hold own funds and liquid assets in excess of the higher of the following:

  1. €125,000 + 0.02% of AIF AUM > £250m; and
  2. The sum of credit risk and market risk requirements; or
  3. The Fixed Overheads Requirement (‘FOR’) which is essentially 25% of the Firm’s operating expenses less certain variable costs.


At 31 March 2019




Tier 1 Capital £833,000
Deductions £0
Tier 2 Capital £0
Deductions £0
Capital Resources £3,100,000
Tier 3 Capital £0
Deductions £0
Total Capital £3,933,000


Platina has undertaken an ICAAP to determine whether it needs any further regulatory capital due to the operational, business, credit, market and other risks it faces, this is Platina’s Pillar 2 requirement. As part of the ICAAP, Platina considered risks to capital combined with stress testing and scenario analysis of operational and business risks as well as an assessment of costs to wind down the business. This analysis concluded that Platina has adequate capital to withstand unexpected losses arising from these risks. As at the date of this report Platina has a surplus of capital resources over its Pillar 1 and Pillar 2 capital resources requirement.

Satisfaction of capital requirements

Since Platina’s ICAAP (Pillar 2) process has not identified capital to be held over and above the Pillar 1 requirement, the capital resources detailed above are considered adequate to continue to finance Platina over the next year. No additional capital injections are considered necessary and Platina expects to continue to be profitable.