Managing conflicts of interest

We believe it is a fundamental requirement to act in the best interests of our clients and/or beneficiaries, by identifying and managing any conflicts of interest. This is central to our duty of care.

It’s important for our clients to know that we will use all reasonable endeavours to identify conflicts, manage them effectively and treat our clients fairly. We have a comprehensive Conflicts of Interest Policy which reflects both the nature of our business activities and our ownership structure, including any potential conflicts arising from our ownership by Prudential plc.

  • Our staff are required to complete annual conflicts of interest training to ensure they understand all potential conflicts that could arise in their roles
  • Our staff are aware of the process for identifying and reporting conflicts, so that they can be managed appropriately
  • Where a conflict arises, it’s identified and reported in line with the wider M&G Group Conflicts of Interest Policy, and an appropriate plan for mitigating the conflict is agreed
  • Our objective is to ensure that any conflicts are identified and managed appropriately to ensure our clients’ best interests are served

Download the M&G conflicts of interest disclosure statement

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More about conflicts of interest

​Identifying conflicts of interest at M&G 

In identifying the conflicts of interest that may arise when providing services to our clients, we take into account the following:

  • Whether any M&G entity is likely to make a financial gain, or avoid a financial loss, at a client’s expense (firm versus client conflict)
  • Whether a client is disadvantaged or makes a loss when an employee or other person connected to an M&G entity makes a gain (individual versus client conflict)
  • Whether a client makes a gain or avoids a loss where another client makes a loss or is disadvantaged (client versus client conflict)
  • Whether an M&G entity, employee or fund benefits at the expense of another M&G entity or fund (intra group conflict)

We also closely monitor and manager conflicts that arise from the personal activities of employees, such as outside appointments, involvement in public affairs, personal political donations and personal investments.

Examples of other potential conflicts 

A conflict of interest potentially arises where:

  • An employee or director of any Prudential group company is also a director of a company in which M&G invests
  • M&G invests in a company that is a client of M&G
  • M&G invests in a company that is a significant distributor of M&G products
  • In such instances, M&G may be conflicted, for example, in the way it deals with the directors and/or company management, votes on their election and votes on remuneration policies that might apply to them

Where a potential conflict arises, it is reported in line with the wider M&G Group Conflicts of Interest Policy, and an appropriate plan for mitigating the conflict is agreed. In determining the appropriate mitigation we consider a number of factors such as the relationship with individuals and the extent to which the relationship could be managed by individuals who are not conflicted, the materiality of any contracts, and the risks of the potential conflict to client interests.

Sometimes the interest of clients may diverge on issues we are voting on, for example, where segregated mandates are being managed alongside a retail fund, or where clients within the same fund have different views.

When this happens we’re able to vote shares differentially and will assess the voting of shares against each client mandate. Where client interests diverge, then we will vote accordingly, but this is a rare event. Generally, we vote by proxy at general meetings on all holdings held in active funds. On occasion we will attend a general meeting if our clients’ interests are best served by us doing so.

Conflicts arising from M&G's ownership of Prudential plc shares  

M&G is a wholly owned subsidiary of Prudential plc. M&G funds or segregated mandates may from time to time invest in shares of Prudential plc. Within the Prudential group there are also companies that invest as principal in investments in which M&G may also invest for clients.

Two conflicts arise:

  • Firstly, as Prudential is M&G’s parent, M&G may be inclined to favour investment in Prudential
  • Secondly, M&G may have access to information about Prudential’s corporate actions and investment decisions regarding their principal investments

To manage these conflicts, both companies ensure the operations and investment decisions are kept separate and independent. The flow of information between Prudential and M&G is carefully controlled. M&G’s investment decisions to buy and sell such shares, and whether or how to vote in relation to those shares, will always be made solely in the interest of our clients. The rationale for voting in a specific way is recorded to ensure transparency on any voting decision.

M&G's approach to stewardship

Explore all the ways in which we comply with the UK stewardship code