A n n u a l R e p o r t a n d A c c o u n t s 2 0 2 3
Contents
Strategic report
Strong foundations
Ashmore at a glance
Powerful convergence
Business model
CEO review
Specialist understanding
Three-phase strategy
The Emerging Markets story
Investment philosophy
Market review
Key performance indicators
Business review
Risk management
Section 172 statement
People & culture
Sustainability
TCFD
Governance
Board of Directors
Corporate governance report
Audit and Risk Committee report
Nominations Committee report
Remuneration report
Directors’ Remuneration policy
Annual Report on Remuneration
Statement of Directors’ responsibilities
Directors’ report
Financial statements
Independent auditor’s report
Consolidated financial statements
Company financial statements
Notes to the financial statements
Five-year summary
Alternative performance measures
Information for shareholders
Glossary
2
4
6
8
10
12
14
16
18
22
26
28
35
42
46
50
56
62
64
72
76
78
81
102
112
113
118
126
130
133
175
176
179
181
2023 highlights
AuM
AuM outperforming
benchmarks (3 years)
US$55.9bn
2022: US$64.0bn
-13% YoY
69%
2022: 28%
Net revenue
£196.4m
2022: £262.5m
-25% YoY%
Adjusted EBITDA
margin
54%
2022: 64%
Profit before tax
Diluted EPS
£111.8m
2022: £118.4m
-6% YoY
12.2p
2022: 12.6p
-4% YoY
Dividends per
share
16.9p
2022: 16.9p
Front cover - Mount Ama Dablam, Nepal
Pages 2 to 61 constitute the
Strategic report which was
approved by the Board on
5 September 2023.
Mark Coombs
Chief Executive Officer
5 September 2023
Ashmore’s purpose, as a specialist
Emerging Markets investment
manager, is to deliver long-term
investment outperformance for
clients and to generate value for
shareholders over market cycles.
Strong
foundations
Ashmore has managed
investments in
Emerging Markets on
behalf of its clients for
more than 30 years,
and has witnessed the
development of a large,
diversified and highly
attractive investment
universe.
Powerful
convergence
Emerging Markets are
following powerful and
well-established trends
of economic, political
and social convergence
with the developed
world. These provide
superior growth and
many investment
opportunities.
+ Read more on pages 2-3
+ Read more on pages 6-7
Specialist
understanding
The size, scale and
diversity of Emerging
Markets are often
misunderstood and
underappreciated.
This creates investment
opportunities, requiring a
specialist, active approach
to exploit inefficiency
and to deliver long-term
investment performance.
+ Read more on pages 12-13
Strong
foundations...
Ashmore has managed investments in Emerging Markets on behalf of
its clients for more than 30 years, and has witnessed the development
of a large, diversified and highly attractive investment universe.
Emerging Markets represent a highly diverse
set of more than 70 countries, with in excess
of US$75 trillion of tradable equity and fixed
income securities.
One of the most significant developments of
the past few decades is the growth of local
currency markets, allowing governments and
companies to fund in their domestic currency
and providing protection against external
shocks. In total, bonds issued in local
currencies represent 88% (equivalent to
US$34 trillion) of the total Emerging Markets
fixed income investment universe.
The underlying economies have delivered
strong growth over the past three decades,
resulting in emerging nations now generating
more than half of the world’s GDP.
Allocations to Emerging Markets are at levels
significantly below global benchmark weights,
providing for substantial AuM growth as
investors recognise the superior growth,
attractive returns and diverse investment
opportunities available across the asset classes.
Emerging Markets’ rising share of world GDP (%)
70
60
50
40
30
0
9
9
1
0
0
0
2
0
1
0
2
0
2
0
2
Emerging Markets
Developed Markets
Source: IMF WEO database (PPP basis)
A S H M O R E A T A G L A N C E
Ashmore’s distinctive
characteristics
...underpin the ability to continue to deliver long-term value
over market cycles for clients and shareholders.
Substantial long-term
opportunities
Emerging Markets are expected to continue to
deliver superior economic growth, underpinned
by powerful convergence trends, a propensity to
reform and structural changes such as a shift to
local currency funding. This growth profile, and the
consequent investment opportunities, support
Ashmore’s strategic focus on delivering long-term
growth and value for clients and shareholders.
+ Read more on pages 16-17
Emerging Markets consistently deliver superior
GDP growth (%)
8
7
6
5
4
3
2
1
0
-1
-2
-3
-4
-5
2
1
0
2
4
1
0
2
6
1
0
2
8
1
0
2
0
2
0
2
2
2
0
2
f
4
2
0
2
f
6
2
0
2
f
8
2
0
2
Premium
Emerging Markets
Developed Markets
Source: IMF WEO database
Three-phase strategy
Ashmore’s strategy is designed to capitalise on the
Emerging Markets growth opportunity, with three
distinct but complementary phases.
First, to raise developed world investors’ allocations
to Emerging Markets from profoundly underweight
levels; second, to diversify Ashmore’s business to
mitigate the impact of market cycles; and third, to
participate in the nascent but significant opportunity
to source capital from Emerging Markets’ investors
and deploy this across the broad Emerging Markets
investment universe.
Ashmore has made progress in all three phases, but
each has further substantial growth potential that
will allow the Group to continue to deliver value to
clients and shareholders over market cycles.
Establish Emerging Markets
asset classes
Ashmore is a specialist Emerging Markets
investor with more than 30 years’ experience.
Diversify investment themes
and sources of capital
Diversified revenue streams help to
mitigate the impact of market cycles.
Mobilise Emerging Markets capital
Ashmore’s growth potential is enhanced
through accessing rapidly growing pools of
investable capital in Emerging Markets.
1.
2.
3.
4
Ashmore Group plc Annual Report and Accounts 2023
Consistent investment
philosophy
Ashmore has implemented its investment philosophy
consistently and successfully since it launched its first
fund in October 1992.
Specialist, active investment management enables
Ashmore to exploit inefficiencies in a diverse set of
more than 70 emerging countries.
Ashmore has integrated the consideration of ESG factors
into its investment processes, providing a comprehensive
and consistent view of risks and opportunities.
+ Read more on pages 18-20
Macro
top-down
Proprietary
research & ESG
integration
A specialist,
active approach
to Emerging
Markets
Liquidity
obsessed
Bottom-up:
– credit/value
– equity/quality
growth
Active
management
Highly diversified
Ashmore’s AuM is diversified by investment theme, client type and client geography. Strategic objectives
focus on increasing the proportion of AuM in equities and alternatives themes, and increasing capital sourced
locally in Emerging Markets and through retail intermediaries.
Investment themes (%)
Client type (%)
Client geography (%)
20
External debt
33
Local currency
Corporate debt 12
21
Blended debt
11
Equities
3
Alternatives
+ Read more on pages 28-34
Central banks
Sovereign wealth
funds
Governments
Pension plans
21
20
1
23
Corporates/financial
institutions
22
Funds/sub-advisers 8
Intermediary retail
4
Foundations/
endowments
1
Americas
Europe
UK
Middle East & Africa
Asia Pacific
13
37
5
19
26
Resilient
& scalable
business model
Designed to operate over market
cycles, delivering long-term
investment performance and
value for shareholders
Ashmore’s business model is designed to operate as
AuM varies with market cycles, while providing a robust
operating platform to support the Group’s longer-term
strategic growth initiatives. This is achieved through:
– Investment committees with capacity to manage
substantially higher AuM levels.
– Focus on institutional mandates with retail capital sourced
through intermediaries.
– Cost discipline and flexible remuneration philosophy.
– Financial strength represented by a liquid, well-capitalised
balance sheet.
+ Read more on pages 8-9
Ashmore Group plc Annual Report and Accounts 2023
5
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS Powerful
convergence...
The Emerging Markets are following powerful and well-established
trends of economic, political and social convergence with the developed
world. Over time, these provide superior growth and many investment
opportunities, underpinning outperformance and the creation of value
for investors with appropriate allocations to Emerging Markets.
The end of the Cold War allowed the least
developed countries to pursue policy reforms,
instil better economic management and
improve the quality of institutional decision-
making, while introducing political structures
that provide greater accountability.
Within the long-term growth trends, there are
inevitably shorter economic and market cycles.
Ashmore’s investment processes and business
model are designed to manage through such
cycles and to create value for clients and
shareholders over the long term.
This has created a virtuous circle, whereby
capital is attracted to those countries successfully
following the convergence path, allowing for
further investment and beneficial reforms.
While not all countries are following the same
path, an expression of the aggregate impact of
these convergence trends is the consistently
rising wealth of the emerging world, with
growth in GDP per capita significantly
outpacing that in the developed world. Notably,
however, the absolute level (US$14,000) is still
only one-fifth that of the developed world, and
equivalent to the position of the developed
world in 1985, thereby underpinning further
convergence-driven growth in the future.
GDP per capita
1,000
850
700
550
400
250
100
0
8
9
1
0
9
9
1
0
0
0
2
0
1
0
2
0
2
0
2
Indexed
Emerging Markets
Developed Markets
Source: IMF WEO database
B U S I N E S S M O D E L
Resilience and scalability...
...from a consistent
business model
Ashmore’s business model supports its growth strategy and is designed
to create value for the Group’s stakeholders over market cycles.
...through a
distinctive
approach
While pursuing the longer-term strategic
benefits, the following characteristics provide
scalability over market cycles
Active investment management, with ESG
integration
Diversified client base
Financial strength
Cost discipline underpinned by flexible
remuneration philosophy
Long-term alignment of interests between
clients, employees & shareholders
Specialist focus
on Emerging
Markets…
The model capitalises on the
structural growth and investment
opportunities in Emerging
Markets to deliver positive
outcomes for Ashmore’s clients,
shareholders and employees as
well as recognising Ashmore’s
responsibilities to a broader set of
stakeholders including society.
8
Ashmore Group plc Annual Report and Accounts 2023
Resilience & scalability...
Ashmore’s experience of investing in Emerging Markets for more than
30 years means it has a business model that is designed to cope with
the full market cycle, from peak to trough.
Well-capitalised, liquid balance sheet
Ashmore has £705 million of financial resources, including £468 million
of cash, and no debt.
Investment committees and diverse client base
’No star’ culture and focus on diversified institutional clients, with retail
capital sourced through intermediaries.
Flexible remuneration philosophy
Ashmore’s employees have a salary cap and variable remuneration is
determined by profitability and performance, not formulae.
G
O
V
E
R
N
A
N
C
E
F
I
N
A
N
C
I
A
L
S
T
A
T
E
M
E
N
T
S
...delivering value
over the cycle
A proven business model that supports long-term growth objectives while
protecting returns and enabling investment over market cycles.
Clients
69% AuM outperforming over three years
Consistent implementation of investment
philosophy exploits market inefficiencies to
deliver long-term outperformance.
Employees
~40% employee equity ownership
Alignment of interests delivered through equity-
biased remuneration with five-year deferral period.
Communities >75 projects supported by
The Ashmore Foundation (see pages 54-55)
Ashmore donates 0.5% of profit before tax to
charities, including The Ashmore Foundation.
Shareholders 54% adjusted EBITDA margin
High operating margin and significant cash
generation (£112 million in FY2023) support returns
to shareholders.
Ashmore Group plc Annual Report and Accounts 2023
9
STRATEGIC REPORT
C E O R E V I E W
Consistent strategy
implementation
With the experience of more than 30 years of specialist investing,
Ashmore’s strategy is to capitalise on the long-term opportunities
in Emerging Markets, and its established business model responds to
the shorter-term impact of market volatility. Ashmore is delivering
outperformance for clients and is well-positioned for an ongoing
recovery in markets.
The past year provided encouraging evidence that the cyclical
recovery has begun across Emerging Markets, with higher asset
prices, an improving growth outlook, falling inflation and the benefits
of a weaker US dollar. There remains, however, a degree of
caution among some investors, particularly those in the US, given
macroeconomic concerns such as policy tightening by developed
world central banks and conflict or geopolitical tension in Europe
and Asia. Additionally, the largest Emerging Market, China,
needs to navigate the headwinds of lower consumer confidence
and demand following the reopening of its economy.
Against this backdrop, Ashmore has delivered meaningful
outperformance for clients and has continued to execute its long-term
growth strategy, and its business model remains appropriate to
manage the impact of market volatility. As has been experienced
in previous cycles, after a period of challenging market conditions
the Group’s financial performance naturally lags the turn in markets
and the delivery of investment outperformance. The Group started
this financial year with AuM of US$64 billion, which was more than
20% below the level of average AuM in the prior financial year and
therefore represented a notable revenue headwind for the current
year. There was encouraging momentum over the year with client
activity levels, net flows and investment performance higher in H2
compared with H1. Overall, lower average AuM resulted in a 35%
YoY decline in adjusted EBITDA, but as a result of lower losses on
the Group’s seed capital investments and higher interest earned on
cash balances, profit before tax was 6% lower and diluted EPS fell
by 4%. Consequently, the Board has recommended an unchanged
final ordinary dividend.
Undiminished long-term growth and investment
opportunities in Emerging Markets
Irrespective of events in the short term, the longer-term potential
of Emerging Markets remains undiminished. Superior economic
growth is expected to continue as a result of powerful convergence
trends with the developed world. These trends are supported by
ongoing reforms, particularly the shift by larger countries to local
currency funding and high-quality policymaking that delivers better
economic management and greater resilience to external shocks.
The resulting investment opportunities for a specialist, active manager
10
Ashmore Group plc Annual Report and Accounts 2023
are diversified across an investment universe spanning more
than 70 emerging countries and with approximately US$75 trillion
of fixed income securities and equity market capitalisation.
Appropriate strategy to deliver long-term growth
The Group’s three-phase strategy is to capture these opportunities
while seeking to protect the Group from some of the more significant
challenges facing active asset managers such as the threat of
passive competition. Inevitably, given the cyclical nature of markets,
progress made in each of the three phases will vary.
Phase one
Risk aversion by some investors resulted in an adjustment to
allocations to Emerging Markets in the year, yet this was more
pronounced among developed world investors than those based
in Emerging Markets. Ashmore’s AuM from the latter increased
over the year by US$1.1 billion and from 27% to 33% of total AuM.
While interest rates have increased in both developed and emerging
countries, there is additional yield available in Emerging Markets
that helps to compensate for higher risk, whether perceived or actual,
and the merits of equity allocations are underpinned by the superior
growth prospects of emerging economies. Therefore, as the market
recovery continues, a broader range of investors is expected to
recognise and act upon the attractive investment opportunities
available in Emerging Markets fixed income and equities.
Phase two
Ashmore’s objective is to diversify its business and revenue streams
over time, and the current focus is on converting the strong equities
investment performance into client flows, with encouraging activity
levels picking up through the period; increasing alternatives AuM;
and delivering growth in intermediary retail assets as risk
appetite increases.
The AuM opportunity within each initiative is substantial, with
the potential to deliver a significantly larger and more diversified
business, thereby enhancing further the Group’s resilience to
market cycles.
Phase three
Ashmore has established a network of local asset management
operations across six emerging countries, from Colombia in the
west to Indonesia in the east. Collectively, they manage US$7
billion for domestic and international institutions and intermediary
retail investors. Importantly, they provide the Group with diversification
benefits, as seen tangibly this year with stable locally managed
AuM compared with a decline for the Group’s global business, and
access to significant long-term growth opportunities as each country
develops its capital markets and asset management industry.
Each business continues to develop according to its local strategy,
with listed equities outperformance, investment realisations and
further capital raising planned in Colombia; development of a
broader product range and client diversification in Saudi Arabia;
good investment performance and growing AuM in India; and
investment outperformance and successful management of
industry regulatory changes in Indonesia.
The success of Ashmore Indonesia illustrates the near-term
development opportunity in these businesses, and the potential
value creation for Ashmore’s shareholders. With the Group’s
support, the management team established a highly profitable
business of more than US$2 billion AuM, with significant employee
equity ownership and a listing on the local Jakarta Stock Exchange.
The business is currently valued at more than US$150 million.
Consequently, Ashmore has significant organic growth potential
available in each of these countries and will pursue opportunities to
expand the network over time.
Established business model to manage impact of
market volatility
Ashmore has experienced many different market environments in
more than 30 years of specialist investing in Emerging Markets
and, while every cycle is different, its business model is designed
to mitigate the impact of fluctuating AuM levels on its operational
and financial performance.
The Board took the decision to increase the proportion of profits
paid to employees in variable remuneration from 22.5% to 25.0%
of EBVCIT. While in absolute terms the bonus pool is 24% lower,
the higher percentage reflects the cumulative impact of three
years of mostly challenging market conditions and consequently
a significant reduction in AuM and pre-bonus profits. The Board
remains mindful of achieving an appropriate balance between overall
employee remuneration and the profits available to shareholders,
and has recommended an unchanged final ordinary dividend this year.
Delivering strong investment performance
As described in the Market review, Emerging Markets benchmark
indices delivered good returns for the year. In fixed income,
Ashmore’s value-based investment process delivered
outperformance through active management and adding positions
at attractive market levels over the past few years. Similarly, the main
equities strategies have navigated the market volatility of recent
years and delivered consistent outperformance, with a strong track
record over one, three and five years. Overall, 69% of the Group’s
AuM is outperforming benchmarks over three years, a significant
increase compared with 28% a year ago.
Ashmore has a well-established pattern of exploiting cyclical market
weakness through active management embedding significant upside
value in portfolios, and the subsequent market recovery leading
to outperformance for clients. While the drivers of each cycle are
different, Ashmore’s consistent approach has again delivered a similar
profile of investment performance in this cycle.
United Arab Emirates Pavilion, Dubai
Employees
In recent years, Ashmore’s employees have experienced
significant changes in working practices, high levels of market
volatility and a period of cyclically lower AuM and profits. Delivering
performance for clients is the responsibility of all colleagues, not
just the investment professionals, and therefore on behalf of the
Board, I would like to thank each of them for their steadfast
commitment to Ashmore’s purpose, their expertise and high levels
of professionalism, and maintaining the Group’s highly effective
team-based culture.
Positive outlook as the market cycle turns
There is mounting evidence that the negative cycle has turned
and, while the recovery may not be a straight line, it is well-supported
by improving fundamentals across the larger emerging countries,
although notably China faces some headwinds from lower consumer
confidence after reopening its economy. Some investors remain
cautious, but client activity levels are increasing and the combination
of positive performance and attractive valuations available across
Emerging Markets should drive capital flows over the medium
term, as has occurred after previous down cycles.
Ashmore is focused on pursuing its strategic growth objectives,
while managing the business appropriately to mitigate the impact
of market conditions and competitive pressures, and to deliver
upside through operating leverage as AuM grows as a
consequence of performance and client flows.
Ashmore remains highly profitable, is delivering outperformance
for clients and has a scalable operating platform, which means it
is well-positioned to benefit from the ongoing recovery in
Emerging Markets.
Mark Coombs
Chief Executive Officer
5 September 2023
Ashmore Group plc Annual Report and Accounts 2023
11
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS Specialist
understanding...
The size, scale and diversity of Emerging Markets are often
misunderstood and underappreciated. This creates investment
opportunities through the mispricing of assets, which therefore requires
a specialist, active approach to exploit inefficiency and to deliver
long-term investment performance.
Most capital markets are imperfect, but asset
prices in Emerging Markets frequently reflect
sentiment, which can be fickle and influenced
by misperceptions or inherent biases, rather
than underlying fundamentals. This is
compounded by relatively low index
representation, particularly in local currency
markets, and often a lack of comprehensive
sell-side coverage of securities.
The resultant price dislocations provide
significant investment opportunities for active
managers, but require deep understanding
and experience of the markets, together with
rigorous credit and financial analysis, in order
to recognise when value is available.
The integration of ESG factors into investment
processes is important, and recognises that the
emerging countries need capital for investment
in order to address some of the challenges
facing the world, such as how to achieve a just
climate transition.
Wide range of sovereign debt returns (%)
140
-30
Individual country return
Source: EMBI GD (12 months to 30 June 2023)
T H R E E - P H A S E S T R A T E G Y
Specialist understanding...
...supported by a
consistent strategy
Ashmore’s strategy is appropriate to capitalise on the substantial growth
opportunities available in Emerging Markets. Each of the three phases
has the potential to deliver further significant long-term growth in AuM
and profits, creating value for shareholders.
Established
Establish Emerging Markets asset classes
Ashmore is recognised as an established specialist
Emerging Markets manager, and is therefore
well-positioned to capture developed world investors’
rising allocations to the asset classes
Diversified
Diversify investment themes and developed
world capital sources
Ashmore is diversifying its revenues to mitigate the
impact of inherently cyclical markets. There is particular
focus on growing the equity and alternatives investment
themes, and raising capital through intermediary
retail channels
Local
Mobilise Emerging Markets capital
Ashmore’s growth potential is enhanced through
accessing rapidly growing pools of investable capital
in Emerging Markets
14
Ashmore Group plc Annual Report and Accounts 2023
Opportunity
Progress in FY2023
Potential sources of risk
Ashmore Group plc Annual Report and Accounts 2023
15
–Developed world investors hold more than US$100 trillion of assets and yet are profoundly underweight Emerging Markets: target allocations are less than 10% compared with global benchmark weights of approximately 10% to 30% –Sentiment towards, and fundamental performance of, Emerging Markets –Long-term investment performance –Potential constraints on longer-term growth such as competition –Long-term investment performance –Managing the development of local asset management platforms in Emerging MarketsRead more on pages 35-41 –The long-term Emerging Markets allocation opportunity remains substantial, but risk aversion by some investors based on cyclical factors has affected client flows –The Emerging Markets investment universe continues to grow and diversify, and Ashmore strives to be at the forefront of accessing new market opportunities as they arise –Diversifying revenue streams provides greater stability through the cycle –Focus on converting strong equities investment performance to client flows, with increasing activity levels through the period –Demand for IG strategies continues, particularly from European and Asian clients –Intermediary retail AuM impacted by recent market cycle, but stable at 4% of Group AuM –Industry AuM in Emerging Markets is growing twice as fast as the developed world –This presents a significant growth opportunity in local asset management platforms, as well as cross-border Emerging Markets opportunities over the longer termRead more on pages 16-17 & 22-25 –The local platforms delivered a solid performance with stable AuM –AuM sourced from clients domiciled in Emerging Markets increased by US$1.1 billion, and from 27% to 33% of Group AuMRead more on pages 28-34GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS T H E E M E R G I N G M A R K E T S S T O R Y
Growth, reforms and
diversification
Emerging Markets have historically, and justifiably, been associated
with high growth, but their development also delivers improvements
in institutional decision making and the asset classes offer significant
diversification benefits.
Emerging countries’ share of
world GDP
58%
Proportion of world population
living in an emerging country
84%
Emerging countries’ share of
world FX reserves
72%
Structural shift to local currency funding (US$ trillion)
40
35
30
25
20
15
10
5
0
0
1
0
2
1
1
0
2
2
1
0
2
3
1
0
2
4
1
0
2
5
1
0
2
6
1
0
2
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
Local currency corporate
Local currency government
External debt corporate
External debt government
Source: Bank of America, BIS, Bloomberg
Superior growth
In recent decades, Emerging Markets have delivered superior
growth compared with the developed world. This is expected to
continue as powerful economic, political and social convergence
trends mean emerging countries are becoming more wealthy,
with steadily rising GDP per capita (from a relatively low level),
and are better able to manage external shocks.
The positive long-term outlook is also underpinned by Emerging
Markets’ dominant share of economic resources, such as:
– 58% share of world GDP, on a PPP basis;
– approximately US$10 trillion of FX reserves, representing 72%
of the world total; and
– 84% of the world’s population lives in an emerging country.
The strong relative growth delivered by Emerging Markets will
continue to put upward pressure on their aggregate weight in
global market indices, from current levels of approximately 10%
(equities) to 30% (bonds). In this context, developed world
investors, who typically have a target allocation of less than 10%,
are profoundly underweight these increasingly important markets.
Structural reforms
The willingness to reform is an important factor in the long-term
success of an emerging country. Arguably the most significant
development of the past few decades has been the shift from
external to local currency funding, supported by improvements
in the quality and effectiveness of monetary and fiscal policymaking.
Although many commentators continue to believe that developing
countries fund their deficits in US dollars, the typical model for
a larger country is not to rely solely on external financing but to
establish local capital markets with the long-term support of domestic
investors such as pension funds. Indeed, local currency markets
dominate fixed income Emerging Markets, with US$34 trillion of
bonds outstanding, representing 88% of the investment universe.
16
Ashmore Group plc Annual Report and Accounts 2023
Ulun Danu temple, Bali
Local currency funding provides a buffer against external shocks,
albeit that it requires effective monetary and fiscal policies to ensure
that other risks, such as inflation, do not undermine the advantages.
Over the past few years, many countries have successfully followed
an orthodox monetary policy path in the face of significant broader
economic and geopolitical challenges, underlining the resilience
that can be achieved by implementing effective long-term reforms.
Diversification benefits
Although it is convenient to use the label ‘Emerging Markets’,
this can often and unfairly mask the fact that there are more than
70 developing countries with investable equity and fixed income
markets. Over the longer term this set of countries will benefit
from the structural growth trends described, but at varying rates
of progress and always in the context of shorter-term economic
cycles and the potential impact of world events.
This therefore provides a wide range of potential opportunities for
the active investor, and particularly in those periods when sentiment,
misperception or other biases have a short-term influence on asset
prices rather than each country’s specific set of economic and
political circumstances.
Market inefficiencies provide opportunities
The fundamental factors described above provide substantial support
for the long-term evolution of Emerging Markets, and underpin the
potential for attractive investment returns from the asset classes.
However, such development does not occur linearly over time
nor in isolation from world events. Therefore, volatility in economic
indicators, political events, market inefficiencies and shifts in investor
sentiment provide opportunities for an active manager such as
Ashmore to deliver long-term performance for its clients.
Indonesia: a case study of
successful policy
implementation
Indonesia is one of the larger and most
successful emerging countries, with a well-
managed economy, attractive demographics
and rapidly developing capital markets.
Effective fiscal and monetary policies
Like many other countries, the Indonesian
authorities adopted an aggressive monetary
policy stance and provided fiscal stimulus in
2020, but then began to consolidate the fiscal
deficit early and subsequently delivered
consistent results. The IMF expects the deficit to
be less than 1.5% of GDP in 2023, reducing from
6.1% in 2020, 4.5% in 2021 and 2.3% in 2022.
Structural reforms
The necessary economic stimulus did not
detract from the pursuit of reforms, continuing a
comprehensive programme set out in 2015. The
Indonesian government continues to implement
labour market, tax and investment policy reforms
to support future economic development.
Ashmore Group plc Annual Report and Accounts 2023
17
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS I N V E S T M E N T P H I L O S O P H Y
Delivering investment
performance for
clients
Ashmore has successfully implemented its investment philosophy for
more than 30 years, over which time it has delivered outperformance
over market cycles for clients. Ashmore’s specialist approach to active
management in Emerging Markets has long-standing characteristics
that are relevant to both fixed income and equities.
Significant investment universe
External debt
US$39 trillion
of Emerging Markets bonds in issue
US$34 trillion
of Emerging Markets debt is in local currencies
US$37 trillion
of Emerging Markets equity market capitalisation
Invests in debt instruments issued by sovereigns and
quasi-sovereigns and denominated in foreign currencies.
Local currency
Invests in local currencies and local currency-denominated
debt instruments issued by sovereigns, quasi-sovereigns
and companies.
Corporate debt
Invests in debt instruments issued by public and private
sector companies.
Blended debt
Asset allocation across the external debt, local currency
and corporate debt investment themes, measured
against tailor-made blended indices.
Equities
Invests in equity and equity-related instruments
including global, regional, country, small cap, frontier
and multi-asset opportunities.
Alternatives
Invests in private equity, healthcare, infrastructure, special
situations, distressed debt and real estate opportunities.
18
Ashmore Group plc Annual Report and Accounts 2023
Investment committees
At the core of the philosophy is a committee-based approach to
managing client portfolios. This provides a highly institutionalised,
team-based framework that results in a ‘no star’ culture in which
no individual is single-handedly responsible for investment
decisions or client portfolios.
Inefficient asset classes
The Emerging Markets fixed income and equity asset classes are
large and diversified, but also remain relatively inefficient. There is
relatively low index representation and security prices can be heavily
influenced over short time periods by factors other than underlying
economic, political and company fundamentals. Consequently,
Ashmore actively manages client portfolios to exploit these
inefficiencies and to generate long-term outperformance.
Proprietary research
Ashmore’s long history of specialising in Emerging Markets and
its extensive network of relationships means that proprietary
research is an important source of investment ideas. These insights
are shared across asset classes, but importantly there is no
‘house view’ that has to be followed by the investment teams
when constructing portfolios. This supports the diversification
benefit of managing a range of strategies in multiple distinct
investment themes.
Importantly, Ashmore’s independent local office investment teams
in countries such as Colombia, Saudi Arabia, India and Indonesia
provide valuable ‘on the ground’ insights to the global equity and
fixed income ICs, including macro and company analysis and trading
intelligence. In turn, the local offices benefit from the ICs’ global
macro views and other research to consider as inputs to their
own independent investment processes.
Ashmore’s Emerging Markets investments
and worldwide network
Emerging Markets invested
Ashmore presence
Medina, Al Madinah Province, Saudi Arabia
Ashmore Group plc Annual Report and Accounts 2023
19
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS I N V E S T M E N T P H I L O S O P H Y ( C O N T I N U E D )
Active management
Ashmore has delivered meaningful alpha through active management
and the expression of high conviction ideas in portfolios. The poor
index representation of fixed income and equity Emerging Markets
means that alpha can be generated both through active risk
against benchmark weights and through investing in off-benchmark
securities. The latter does not necessarily mean instruments are less
liquid or have significantly different risk characteristics, it simply
means that they do not conform to the strict eligibility criteria of
the benchmark index provider.
The Group’s global operating hubs in New York, London and
Singapore provide round-the-clock trading capabilities and Ashmore
has a wide range of strong, well-established counterparty trading
relationships.
Importantly, given that the majority of Emerging Markets securities
are issued, owned and traded locally, these relationships include
local brokers as well as global investment banks. Hence, as liquidity
increasingly moves to local trading venues within Emerging Markets,
Ashmore’s portfolio managers are well positioned to source liquidity
when executing trading decisions.
Focus on liquidity
Understanding market liquidity has always been central to Ashmore’s
investment processes, since the investment teams must decide
on specific securities to trade and seek to execute any portfolio
changes promptly. In addition to pre and post-trade compliance
oversight, the ICs review execution outcomes to ensure that they
comply with the agreed decisions.
ESG integration
Ashmore recognises that being a responsible investor brings
with it a duty to act in a manner that benefits wider society.
This responsibility is particularly acute in the markets in which
Ashmore invests and operates, with the need to balance ESG
factors with the financial wellbeing of Emerging Markets
sovereigns and clients.
Investment committees structure
Fixed income
IC
Equities
IC
Local offices
Investment
teams
(sub ICs)
Allocation
Investment
teams
(sub ICs)
– External debt
– Local currency
– Corporate debt
– Blended debt
– All cap
– Active
– Frontier
– Multi-asset
ESG integration
20
Ashmore Group plc Annual Report and Accounts 2023
Ashmore has integrated the analysis of ESG factors into its
fixed income, equities and alternatives investment processes,
which reflects its philosophy that the incorporation of non-financial
factors is essential to building a robust understanding and
assessment of an issuer. Over time this should improve investment
performance, promote better business models, and help foster
more sustainable economic development. Ashmore’s ESG
research is primarily proprietary in nature, based on third-party
data supplemented by research visits and meetings with issuers.
Therefore, in accordance with the Group’s ESG Policy, analysis of
ESG factors is integrated into the investment processes in a similar
way to how Ashmore assesses macroeconomic risk, financial
performance and credit metrics.
More information on Ashmore’s responsible investment approach
can be found in its Sustainability Report, available on the
Group’s website.
Ashmore’s private equity
healthcare initiative
Ashmore, in partnership with King’s College Hospital
London, is developing a network of world-class tertiary
care hospitals in Emerging Markets. The combination
brings together Ashmore’s experience in private equity
transactions, including in the healthcare industries
in South Asia, MENA and Latin America, with King’s
long-established world-class clinical expertise.
The initiative targets investments in countries with
the following characteristics:
– Growing and ageing population with increasing
middle class
– Increasing prevalence of non-communicable
lifestyle diseases
– Increasing government reliance on private sector
to deliver healthcare
– Rising medical tourism
– Affinity for western healthcare standards
The partnership built a 105-bed hospital and a range of
clinics in the United Arab Emirates (Dubai), and is currently
developing a similar project in Saudi Arabia (Jeddah) while
evaluating the potential of other Asian countries.
The Museo Soumaya Museum, Mexico
Ashmore Group plc Annual Report and Accounts 2023
21
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS M A R K E T R E V I E W
A stronger year in
Emerging Markets
Conditions in Emerging Markets improved over the year, leading
to fixed income returns of 6% to 11% and outperformance versus
developed markets, and equities delivered a positive return of 2%.
Near-term returns are underpinned by attractive valuations and further
improvement in cyclical factors against a backdrop of structural growth.
After a weak first quarter in common with global capital markets,
Emerging Markets rallied over the subsequent nine months to
deliver positive returns for the year overall. This reflects the benefit
of sound and effective monetary policies, lower debt levels than
developed countries, tighter sovereign and corporate spreads over
the period, and the positive impact of a weaker US dollar on local
currency returns.
The year was characterised by the continued tightening of policy
rates by central banks in response to high inflation, banking failures
in the US and Europe, and ongoing conflict or geopolitical tension
in Europe and Asia. Several important economic indicators
underpinned the rally in Emerging Markets asset prices:
– GDP growth across Emerging Markets is expected to be
significantly higher than in the developed world.
– After more than two years of tighter monetary policy, inflation
is falling in Emerging Markets and interest rates are now higher
than expected CPI inflation. The inflection point in the rates cycle
has been reached, the credibility of most central banks is high,
and monetary policy easing by Emerging Markets central banks
is possible in the foreseeable future.
– The US dollar has enjoyed a prolonged bull run, which appears
to have ended in 2022 as the weak underlying fundamentals in
the US economy, and the prospect of a recession and correction
in the equity market, put downward pressure on the currency.
The sections below present the recent performance and prospects
for each of the main fixed income and equity asset classes.
External debt
The EMBI GD delivered a positive return of 7.4% over the 12
months, and the index spread over US Treasuries tightened
by 110bps to 430bps. Although the first quarter saw a material
drawdown (-4.6%) due to high inflation and hawkish central banks,
the index delivered positive returns in each subsequent quarter.
By region, Eastern Europe, Africa and Latin America performed well,
while Asia and the Middle East lagged the index.
The HY index spread briefly exceeded 1,000bps early in the period,
which historically is a level from which substantial positive returns
are achieved over the following 12 months. Indeed, HY assets
outperformed over the 12 months with a return of 11.8%
compared with 3.4% for the IG index.
Some higher-yielding countries, such as Egypt and Sri Lanka,
face challenges, but each situation is specific to the country in
question and the path for each – in terms of avoiding default,
undertaking a credible restructuring, or remaining in limbo without
access to markets – depends as much on the domestic capacity for
reform as it does on the global macro environment. The investment
opportunity in each situation will be determined by the extent to which
the various scenarios have been priced by bond and equity markets.
The US rate cycle is approaching its peak and the external debt asset
class is set to outperform given its still wide spread by historical
standards, a yield in excess of 8%, and substantial diversification
available in an index comprising 69 countries and with 51% of
bonds rated IG.
22
Ashmore Group plc Annual Report and Accounts 2023
Sovereign external debt spread over US Treasuries (bps)
750
625
500
375
250
125
0
1
1
0
2
2
1
0
2
3
1
0
2
4
1
0
2
5
1
0
2
6
1
0
2
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
3
2
0
2
Source: J.P. Morgan
Local currency
The GBI-EM GD performed well with a return of 11.4% over the
year, mostly through a rally in local markets with only 1% coming
from stronger Emerging Markets currencies against the US dollar.
The asset class has benefited from the early and effective
monetary policy tightening pursued by many countries’ central
banks over the past couple of years, which has delivered macro
stability and anchored inflation expectations in those countries,
and also provided a path for policy easing in the foreseeable future.
The index returns were particularly strong in Latin America and
Eastern Europe, while Asia lagged. Weaker performance in the
Middle East and Africa reflected the country-specific challenges
in Egypt and South Africa.
The outlook for the US dollar is important to investor perceptions
and performance of the local currency asset class. After a prolonged
bull run, several factors point to a period of weakness in the US
dollar, including large fiscal deficits, imbalanced external accounts
and overly expensive currency and stocks, particularly in the context
of a potential recession. For context, the trade-weighted real value
of the US dollar peaked in 2022 only 10% below the 1985 Plaza
Accord level and above the level reached around the dot-com
bubble, thus representing one of the highest levels that the currency
has seen in the past 50 years. In contrast, Emerging Markets
currencies trade at attractive real effective exchange rate valuations.
Notwithstanding the returns delivered over the past 12 months,
the local currency asset class continues to offer substantial value
with an attractive yield of more than 6%, accelerating GDP growth
and the potential for interest rate cuts in many of the 20 countries
in the index if inflation continues to trend down.
Al Tijaria Tower, Kuwait City, Kuwait
Positive real local rates delivered by effective
monetary policy (%)
12.0
10.0
8.0
6.0
4.0
2.0
0.0
0
2
c
e
D
1
2
r
a
M
1
2
n
u
J
1
2
p
e
S
1
2
c
e
D
2
2
r
a
M
2
2
n
u
J
2
2
p
e
S
2
2
c
e
D
3
2
r
a
M
3
2
n
u
J
Policy rate
EM CPI
2024 CPI Survey
Source: Ashmore, Bloomberg, J.P. Morgan
Ashmore Group plc Annual Report and Accounts 2023
23
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
M A R K E T R E V I E W ( C O N T I N U E D )
Corporate debt
Lower historical net leverage in EM IG credit versus peers
The CEMBI BD performed similarly to the sovereign market,
with an investment return of 5.7% over the year supported
by a tightening of spread from 400bps to 320bps. HY bonds
outperformed with a return of 9.9% compared with 2.5% for
IG bonds. In terms of regions, corporate assets performed
strongly in Eastern Europe, with returns closer to the overall index
performance in Latin America, Africa, Asia and the Middle East.
Default rates are low in Latin America, Africa and Middle East
(less than 1%) and comparable to the US market. Higher default
rates have been experienced due to policy tightening in China
and as a consequence of the war in Ukraine, but it appears that
overall default rates may have peaked in this cycle.
This asset class has characteristics that are superior to the equivalent
US credit markets and, after a repricing of assets during the current
interest rate cycle, underpin the relative value available in Emerging
Markets corporate debt. These characteristics include:
– The index is highly diversified with more than 750 issuers across
63 countries. More than half (58%) of the bonds in the index are
rated IG.
– Companies in Emerging Markets tend to have lower leverage
compared with US and European peers, because management
teams have a more conservative approach given the need to
compensate for higher perceived country risk. Net leverage in
the IG market is less than 1.5x EBITDA, compared with 2.5x
to 3.5x in the US and Europe. There is a similar picture in the
HY market, with net leverage of around 2x in Emerging
Markets compared with 3.5x to 5x in the US and Europe.
– Despite lower leverage, Emerging Markets IG bonds offer
a significant spread pick-up of 100bps per turn of leverage,
compared with equivalent-rated US high-grade issuers.
– Similarly, the HY index offers an attractive yield of 9.5%,
which despite the lower leverage is a point higher than
the US HY market.
The above factors, when combined with the positive outlook for
corporate earnings as a consequence of accelerating GDP growth
and a supportive technical position given subdued new issuance,
mean that the corporate debt asset class is well-positioned to
deliver further positive returns over the medium term.
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
2
1
0
2
3
1
0
2
4
1
0
2
5
1
0
2
Emerging Markets
Source: Bank of America
Equities
6
1
0
2
US
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
Europe
The MSCI EM index rose by 1.8% over the year, with the impact
of tighter financial conditions in the first quarter and weaker than
expected Asian economic data in the final quarter holding back
returns compared with the fixed income markets. Frontier Markets
were a little weaker (MSCI Frontier -2.8%), but small cap markets
performed better, with the MSCI EM Small Cap index rising 13.3%.
After a challenging period in many countries, the outlook for equity
market performance is positive. Importantly, aggregate GDP growth
in emerging countries is expected to accelerate over the next few
years, and consequently the premium to developed world growth
will expand. Historically, there has been an understandable correlation
between the relative performance of equity markets and economic
growth differentials, which therefore provides a firm underpin to
the asset class.
Against this backdrop of accelerating economic growth, the return
opportunity in Emerging Markets equities reflects a combination
of secular growth opportunities, particularly in Asian countries such
as India and Indonesia, and other markets trading at substantial
discounts to their history and fair value, for example in Latin America
and China. Earnings growth expectations are modest, and in this
context the substantial price/earnings ratio discount at which
Emerging Markets equities trade to developed markets (11.0x
compared with 18.5x for the S&P500) appears unjustified and
supports outperformance of the asset class over the medium term.
24
Ashmore Group plc Annual Report and Accounts 2023
Given the historical strong correlation, equities should benefit from
an expansion of the relative economic growth rate, and a weaker
US dollar will support returns from this asset class for many
developed world investors. Similarly, local currency bond returns
will be underpinned by the monetary easing cycle in many
countries together with dollar weakness.
IG sovereign and corporate markets offer meaningful yield
enhancement compared with the developed world, and provide
a lower-risk alternative for investors that remain concerned about
aspects of the global macro environment. At the HY end of the
market, distressed credits offer potentially significant recovery
upside as the economic cycle turns.
Given the global macro challenges of the past few years, and
the ongoing war in Europe and geopolitical tension in Asia, there
is understandably an element of risk aversion among some investors,
particularly those in the US. However, a broader set of investors
increasingly recognises the opportunities represented by the superior
growth prospects and attractive yields available across Emerging
Markets. As has been seen in previous cycles, an increase in capital
flows and investment supports economic growth in the developing
world and can therefore lead to further asset class outperformance.
Equities relative performance (x) correlated with
economic growth potential (%)
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0.0
0
0
0
2
1
0
0
2
2
0
0
2
3
0
0
2
4
0
0
2
5
0
0
2
6
0
0
2
7
0
0
2
8
0
0
2
9
0
0
2
0
1
0
2
1
1
0
2
2
1
0
2
3
1
0
2
4
1
0
2
5
1
0
2
6
1
0
2
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
f
3
2
0
2
f
4
2
0
2
EM equities relative performance
EM growth premium
Source: IMF WEO database, MSCI
Outlook
The structural drivers of growth in Emerging Markets are intact
and underpinned by ongoing reforms in Asia, Latin America and
Africa together with dominance over the world’s natural resources
and the supply chains necessary for energy transition. This is
reflected in the continued superior GDP growth expected when
compared with the developed world. However, this growth potential
is not reflected in current valuations, providing investors with an
opportunity to participate in the ongoing recovery in asset prices
after a challenging few years in capital markets outside the US.
From a cyclical standpoint, there are several factors that should
explicitly support the performance of Emerging Markets:
– Inflation is falling and interest rates are peaking following early
and effective monetary policy tightening by Emerging Markets
central banks, well ahead of the Fed and other developed world
policymakers.
– China has a renewed focus on delivering economic growth and
consequently is providing significant monetary and fiscal stimulus
to its economy, which will have both a domestic impact but also
a broader positive effect on trade. Policy choices must also recognise
the need to navigate the headwinds of lower consumer confidence
and demand following the reopening of its economy.
– After a prolonged bull run, the US dollar appears to have peaked
in late 2022. Objectively, it is still overvalued, partially as a result
of significant flows into the US equity market that is also vulnerable
to a correction given its high valuation and the potential for a
recession in a lagged response to tighter financial conditions.
With this backdrop, the near-term outlook for the main Emerging
Markets asset classes is positive.
Ashmore Group plc Annual Report and Accounts 2023
25
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS K E Y P E R F O R M A N C E I N D I C A T O R S
Driving
performance
Performance measure
Relevance to strategy and
remuneration
Assets under management
The movement between opening
and closing AuM provides an indication
of the overall success of the business
during the period, in terms of subscriptions,
redemptions and investment performance.
The average AuM level during the period,
combined with the average fee margins
achieved, determines the Group’s
management fee revenues.
Investment performance
The proportion of relevant AuM that
is outperforming benchmarks on a gross
basis, over one year, three years and five
years. The gross basis reflects the largely
institutional nature of the client base,
typically with the ability to agree bespoke
fee arrangements. Funds without a
performance benchmark, for example
overlay strategies, are excluded.
Ashmore’s strategy seeks to capitalise
on the growth trends across Emerging
Markets to deliver AuM growth over time.
Growth in AuM is a vesting performance
condition for Executive Directors.
Ashmore’s success is dependent
on delivering investment performance
consistent with clients’ objectives,
who typically look at performance
over the medium to long term.
Investment performance is a
vesting performance condition
for Executive Directors.
Five-year trend
Assets under management
Investment performance
(AuM outperforming over three years)
US$55.9bn
69%
2023
2022
2021
2020
2019
55.9
64.0
94.4
83.6
91.8
3
2
0
2
2
2
0
2
1
2
0
2
0
2
0
2
9
1
0
2
67
69
49
45
28
48
96
57
79
9
17
74
90
97
97
26
Ashmore Group plc Annual Report and Accounts 2023
1 year
3 years
5 years
Adjusted EBITDA margin
This measure provides a meaningful
assessment of the Group’s operating
performance, excluding the mark-to-
market volatility of FX translation
and seed capital-related items.
Diluted EPS
Profit attributable to the equity holders
of the parent company divided by the
weighted average number of all dilutive
potential ordinary shares.
Delivering a high profit margin demonstrates
the benefits of Ashmore’s global operating
platform, enables investment in future
growth opportunities, supports cash
generation to sustain a strong balance
sheet, and provides for attractive returns
to shareholders.
The earnings per share reflect the overall
financial performance of the Group during
the period and represent an aspect of
value creation for shareholders.
Growth in diluted EPS compared with
benchmark indices is a vesting
performance condition for
Executive Directors.
Balance sheet strength
Ashmore maintains a strong balance sheet
over the Emerging Markets cycle. This is
measured by the financial resources
available to the Group, which are then
compared with the Group’s capital
requirement to provide an excess
capital ratio.
A strong balance sheet enables Ashmore
to build a diversified client base, provides
opportunities for investment to grow the
business including the seeding of funds,
and supports the Group’s dividend policy.
Adjusted EBITDA margin
Diluted EPS
Excess capital ratio
54%
2023
2022
2021
2020
2019
0
54
64
66
68
66
10
20 30 40 50 60 70 80
12.2p
2023
12.2
2022
12.6
2021
34.2
2020
25.7
2019
0
25.0
5
10
15
20
25
30
35
774
530
774%
3
2
0
2
2
2
0
2
1
2
0
2
0
2
0
2
81
705
125
789
156
765
147
703
391
377
Capital requirement (£m)
Financial resources (£m)
Excess capital ratio (%)
Ashmore Group plc Annual Report and Accounts 2023
27
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS B U S I N E S S R E V I E W
Successfully
managing a cycle
Adjusted EBITDA margin of 54% reflects opening AuM below last year’s
average level, mitigated by effective cost management. With higher
interest income and seed capital returns, diluted EPS is 12.2 pence, 4%
lower YoY, and the balance sheet remains robust with £705 million of
capital resources including more than £450 million of cash.
Assets under management
AuM declined by 13% over the year to US$55.9 billion, with the
movement attributable to net outflows of US$11.5 billion, offset
by positive investment performance of US$3.4 billion, delivered in
each of the six investment themes. Reflecting the opening AuM
level of US$64.0 billion, average AuM was 30% lower than in the
prior year at US$58.2 billion (FY2022: US$83.6 billion).
Gross subscriptions of US$7.2 billion represent 11% of opening
AuM, lower than in the prior year primarily as a consequence
of cautious investor sentiment reflecting concerns over the
macroeconomic backdrop in global markets (FY2022:
US$13.1 billion, 14% of opening AuM).
Subscriptions were strongest in the external debt, local currency
and equities investment themes, particularly as clients recognised
that Emerging Markets central banks are ahead of their developed
world counterparts in tackling inflation, and the US dollar appears to
have peaked in 2022. External debt inflows were a combination of
existing client top-ups and continued product development to
capture the intrinsic value available in HY markets, and there were
new institutional clients in local currency and equities.
Gross redemptions of US$18.7 billion, or 29% of opening AuM,
were lower than in the prior year (FY2022: US$26.6 billion, 28%
of opening AuM) and include US$2.3 billion of overlay/liquidity
redemptions (FY2022: US$6.0 billion), but remain relatively high
as a consequence of global macro concerns and market volatility,
particularly in the first half of the year, meaning some investors
shifted allocations in favour of traditionally perceived safe havens.
This risk aversion was particularly evident in developed world
investors, reflected in a lower proportion of AuM from clients in the
Americas and the fact that Ashmore’s Emerging Markets-domiciled
clients increased from 27% to 33% of Group AuM.
£m
Net management fees
Performance fees
Other revenue
Foreign exchange
Net revenue
Losses on investment securities
Change in third-party interests in consolidated funds
Personnel expenses
Other expenses excluding depreciation and amortisation
EBITDA
EBITDA margin
Depreciation and amortisation
Operating profit
Finance income/(expense)
Share of profit from associates
Profit before tax
Diluted EPS (p)
28
Ashmore Group plc Annual Report and Accounts 2023
FY2023
Reported
183.2
5.1
2.7
5.4
196.4
(44.3)
19.3
(66.2)
(24.6)
80.6
41%
(3.2)
77.4
33.9
0.5
111.8
12.2
Reconciling items:
Seed capital
(gains)/losses
–
–
–
–
–
44.3
(19.3)
–
1.3
26.3
–
–
26.3
(18.0)
–
8.3
0.6
FX translation
(gains)/losses
–
–
–
(1.0)
(1.0)
–
–
0.3
–
(0.7)
–
–
(0.7)
–
–
(0.7)
(0.1)
FY2023
Adjusted
183.2
5.1
2.7
4.4
195.4
–
–
(65.9)
(23.3)
106.2
54%
(3.2)
103.0
15.9
0.5
119.4
12.7
FY2022
Adjusted
243.5
4.5
2.9
6.3
257.2
–
–
(72.3)
(20.6)
164.3
64%
(3.1)
161.2
1.6
1.3
164.1
18.7
Clients
Ashmore’s clients are predominantly a diversified set of
institutions, representing 96% of AuM (30 June 2022: 95%),
with the remainder sourced through intermediary retail channels.
Segregated accounts represent 81% of AuM (30 June 2022: 81%).
Ashmore’s principal mutual fund platforms are in Europe and the
US, which in total represent AuM of US$5.7 billion in 43 funds.
The European SICAV range comprises 31 funds with AuM of
US$4.8 billion (30 June 2022: US$5.4 billion in 30 funds) and
the US 40-Act range has 12 funds with AuM of US$0.9 billion
(30 June 2022: US$1.0 billion in 12 funds).
Investment performance
As at 30 June 2023, 67% of AuM is outperforming over one year,
69% over three years and 49% over five years (30 June 2022:
45%, 28% and 48%, respectively).
Characteristically, as markets have started to recover from oversold
levels, Ashmore’s investment processes have delivered meaningful
outperformance. In addition to the consistently strong relative
performance in local currency, IG and equities strategies, there has
been a notable improvement in some of the other, higher yielding
fixed income strategies.
Current valuations across the Emerging Markets asset classes
underpin additional recovery performance in coming periods,
and the inherent value in Ashmore’s portfolios support the
delivery of further outperformance for clients.
Consistent with the rally in markets from the September lows,
Ashmore’s investment performance and net flow momentum
improved in the second half of the financial year. Positive
investment performance of US$2.6 billion in H2 compares with
US$0.8 billion in H1, and net outflows approximately halved from
US$7.6 billion in H1 to US$3.9 billion in H2.
The total net outflow for the period of US$11.5 billion (FY2022:
US$13.5 billion net outflow) comprises a net outflow from retail
clients of US$0.7 billion (24% of opening intermediary retail
AuM), reflecting the typically shorter investment horizon, and net
redemptions from institutional clients of US$10.8 billion (18% of
opening institutional AuM).
Ashmore’s local offices continued to perform well and illustrated
the benefits of diversification. Total AuM was stable at US$7.0
billion (30 June 2022: US$6.9 billion) with only modest net
outflows of US$0.3 billion. As described in the CEO review, these
businesses have significant growth potential as they participate
in the development of independent domestic asset management
industries, and there are opportunities to expand the network over
time to enhance the strategic and financial benefits to the Group.
AuM movements by investment theme
The development during the period of AuM by theme is shown
in the table below. The local currency investment theme includes
US$6.3 billion of overlay/liquidity funds (30 June 2022:
US$7.2 billion).
AuM as invested
The charts on page 30 show AuM ‘as invested’ by underlying
investment theme, which takes account of the allocation into the
underlying asset classes by multi-asset and blended debt funds
and of crossover investment by certain external debt funds.
The Group’s AuM remain geographically diverse and broadly
consistent with recent periods, with 37% of AuM invested in Latin
America, 29% in Asia Pacific, 13% in Eastern Europe and 21% in
the Middle East and Africa.
Investment theme
External debt
Local currency
Corporate debt
Blended debt
Fixed income
Equities
Alternatives
Total
AuM
30 June
2022
US$bn
14.4
20.6
6.8
14.4
56.2
6.3
1.5
64.0
Gross
subscriptions
US$bn
1.7
2.7
0.2
0.7
5.3
1.9
–
7.2
Gross
redemptions
US$bn
(5.7)
(6.0)
(0.6)
(4.0)
(16.3)
(2.3)
(0.1)
(18.7)
Net flows
US$bn
(4.0)
(3.3)
(0.4)
(3.3)
(11.0)
(0.4)
(0.1)
(11.5)
Performance
US$bn
0.6
1.5
0.1
0.8
3.0
0.3
0.1
3.4
AuM
30 June
2023
US$bn
11.0
18.8
6.5
11.9
48.2
6.2
1.5
55.9
Ashmore Group plc Annual Report and Accounts 2023
29
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS B U S I N E S S R E V I E W ( C O N T I N U E D )
Ashmore’s diverse investment themes and clients
2023 (%)
AuM by investment theme
2022 (%)
External debt
Local currency
Corporate debt
Blended debt
Equities
Alternatives
External debt
Local currency
Corporate debt
Equities
Alternatives
20
33
12
21
11
3
31
40
15
11
3
AuM as invested
AuM by client type
External debt
Local currency
Corporate debt
Blended debt
Equities
Alternatives
External debt
Local currency
Corporate debt
Equities
Alternatives
21
32
11
24
10
2
33
38
17
10
2
Central banks
21
Sovereign wealth funds 20
1
Governments
23
Pension plans
Corporates/financial
institutions
Funds/sub-advisers
Intermediary retail
Foundations/
endowments
22
8
4
1
Central banks
15
Sovereign wealth funds 22
Governments
2
27
Pension plans
Corporates/financial
institutions
Funds/sub-advisers
Intermediary retail
Foundations/
endowments
25
3
5
1
AuM by client geography
13
Americas
37
Europe
UK
5
Middle East and Africa 19
26
Asia Pacific
19
Americas
32
Europe
UK
6
Middle East and Africa 17
26
Asia Pacific
30
Ashmore Group plc Annual Report and Accounts 2023
Financial review
Revenues
Opening AuM and average AuM were 23% and 30%, respectively,
below the average AuM of the prior year, and this lower level of
AuM delivered the 25% fall in net revenue to £196.4 million. On an
adjusted basis, excluding FX translation effects, net revenue fell by
24% to £195.4 million.
Net revenue
Net management fees
Performance fees
Other revenue
FX: hedges
Adjusted net revenue
FX: balance sheet translation
Net revenue
FY2023
£m
183.2
5.1
2.7
4.4
195.4
1.0
196.4
FY2022
£m
243.5
4.5
2.9
6.3
257.2
5.3
262.5
Net management fee income declined by 25% to £183.2 million.
This reflects the lower average AuM and a net management fee
margin of 38bps (FY2022: 39bps), partially offset by the benefit of
a lower average GBP:US$ rate in this period. At constant FY2022
exchange rates, net management fee income reduced by 32%.
The slight decline in the net management fee margin YoY reflects
the positive effects from investment theme mix and large mandate
flows offset by the impact of market performance over the year
(stronger performance in lower margin strategies and accounts)
and competition and other mix effects.
Performance fees of £5.1 million (FY2022: £4.5 million) were
realised in the year, and delivered by a range of funds in the local
currency, blended debt and alternatives investment themes.
Approximately US$12 billion of the Group’s AuM, or 21% of the
total, is eligible to earn performance fees at 30 June 2023. The
Group continues to expect its diverse sources of net management
fee income to generate the majority of its net revenues.
Translation of the Group’s non-Sterling assets and liabilities,
excluding seed capital, resulted in an unrealised FX gain of
£1.0 million (FY2022: £5.3 million gain). The Group’s effective
hedging programme and the active management of FX exposures
during the period meant that realised and unrealised hedging
gains of £4.4 million were delivered (FY2022: £6.3 million gain).
Therefore, the Group recognised a total FX gain of £5.4 million
in revenues (FY2022: £11.6 million gain).
Other revenue of £2.7 million was comparable to the prior year
(FY2022: £2.9 million).
The table below summarises the net management fee income,
performance fee income and net management fee margin by
investment theme.
Operating costs
Total operating costs of £94.0 million (FY2022: £98.5 million)
include £1.3 million of expenses incurred by seeded funds that are
required to be consolidated (FY2022: £1.4 million), as disclosed
in note 20. On an adjusted basis, taking into account the impact
of seed capital and the proportion of the accrual for variable
compensation that relates to FX translation gains, operating costs
were reduced by 4% compared with the prior year. Adjusted
operating costs fell by 7% at constant FY2022 exchange rates.
Staff costs
Other operating costs
Depreciation and amortisation
Operating costs before VC
Variable compensation (VC)
VC accrual on FX gains/losses
Adjusted operating costs
Consolidated funds costs
Add back VC on FX gains/losses
Total operating costs
FY2023
£m
(31.4)
(23.3)
(3.2)
(57.9)
(34.8)
0.3
(92.4)
(1.3)
(0.3)
(94.0)
FY2022
£m
(27.8)
(20.6)
(3.1)
(51.5)
(45.6)
1.1
(96.0)
(1.4)
(1.1)
(98.5)
Investment theme
External debt
Local currency
Corporate debt
Blended debt
Fixed income
Equities
Alternatives
Total
Net management fees
Performance fees
Net management fee margin
FY2023
£m
32.5
43.0
16.2
46.8
138.5
29.5
15.2
183.2
FY2022
£m
46.7
54.9
26.0
69.3
196.9
33.1
13.5
243.5
FY2023
£m
–
3.3
–
1.1
4.4
–
0.7
5.1
FY2022
£m
2.0
0.8
–
1.3
4.1
0.4
–
4.5
FY2023
£m
31
28
30
44
33
58
144
38
FY2022
£m
35
27
37
46
35
58
138
39
Ashmore Group plc Annual Report and Accounts 2023
31
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS B U S I N E S S R E V I E W ( C O N T I N U E D )
Staff costs increased by 13% to £31.4 million, of which nearly half
was due to the lower average GBP:US$ rate. There was also the
impact of wage inflation in certain locations and a 1% higher
average headcount. The underlying increase in staff costs was
primarily in the first half of the year, with costs in the second half
being broadly flat on the first half.
Other operating costs, excluding consolidated fund expenses and
depreciation and amortisation, increased by 13% to £23.3 million.
FX movements account for approximately half of the increase and
the remainder was due to the full year impact of returning towards
more normal levels of business travel and office occupancy.
Ashmore accrued charitable donations of £0.5 million (FY2022:
£0.6 million), equivalent to 0.5% of profit before tax.
Variable compensation has been accrued at 25% of EBVCIT,
resulting in a charge of £34.8 million. The higher proportion of
profits reflects the point in the cycle, where Ashmore is delivering
investment outperformance for clients as markets recover, but
the financial performance lags with the impact of lower average
AuM levels. In absolute terms, the charge is 24% lower than in
the prior year (FY2022: £45.6 million) and consistent with the fall
in adjusted net revenue.
The combined depreciation and amortisation charges for the period
of £3.2 million were similar to the prior year.
Adjusted EBITDA
The impact of the lower revenue base, partially mitigated by lower
operating costs, means that adjusted EBITDA declined by 35%
from £164.3 million to £106.2 million. This delivered an adjusted
EBITDA margin of 54% for the year (FY2022: 64%).
Finance income
Net finance income of £33.9 million (FY2022: £2.1 million finance
expense) includes gains relating to seed capital investments, which
are described in more detail below. Excluding such items, net
interest income for the period of £15.9 million increased compared
with the prior year (FY2022: £1.6 million) due to the benefit of
higher market interest rates on the Group’s cash deposits.
Seed capital
The following table summarises the principal IFRS items in the
accounts to assist in understanding the financial impact of the
Group’s seed capital programme on profits. The seed capital
investments generated realised gains of £2.4 million and an
unrealised mark-to-market loss of £10.7 million, to give an
aggregate loss of £8.3 million for the year (FY2022: £49.9 million
loss). This comprises a £15.3 million loss in respect of consolidated
funds (FY2022: £40.5 million loss) and a £7.0 million gain in respect
of unconsolidated funds (FY2022: £9.4 million loss).
Impact of seed capital investments on profits
Consolidated funds (note 20):
Fair value losses on investment
securities
Change in third-party interests in
consolidated funds
Operating costs
Investment income
Sub-total: consolidated funds
Unconsolidated funds (note 8):
Market return
FX
Sub-total: unconsolidated funds
Total seed capital gains/(losses)
– realised
– unrealised
Profit before tax
FY2023
£m
FY2022
£m
(44.3)
(61.3)
19.3
(1.3)
11.0
(15.3)
5.7
1.3
7.0
(8.3)
2.4
(10.7)
16.5
(1.4)
5.7
(40.5)
(10.6)
1.2
(9.4)
(49.9)
0.1
(50.0)
Statutory profit before tax was 6% lower at £111.8 million (FY2022:
£118.4 million) as a consequence of the decline in adjusted EBITDA
mitigated by lower losses on seed capital investments and the
benefit of higher interest rates on finance income.
Taxation
The effective tax rate of 22.6% (FY2022: 22.4%) is slightly higher
than the blended UK corporation tax rate of 20.5% for the year
(FY2022: 19.0%) due to the geographic mix of the Group’s profits
in the period, the valuation of deferred tax assets relating to
share-based remuneration and the impact of seed capital gains
and losses. Note 12 to the financial statements provides a full
reconciliation of this difference compared with the UK
corporation tax rate.
The Group’s current effective tax rate, based on its geographic mix
of profits and prevailing tax rates, is approximately 19% to 20%.
Earnings per share
Basic EPS for the period fell by 7% to 12.4 pence (FY2022:
13.4 pence) and diluted EPS declined by 4% from 12.6 pence
to 12.2 pence.
On an adjusted basis, excluding the effects of FX translation,
seed capital-related items and relevant tax, diluted EPS was 32%
lower at 12.7 pence (FY2022: 18.7 pence).
32
Ashmore Group plc Annual Report and Accounts 2023
Balance sheet
Ashmore’s consistent approach is to maintain a strong and liquid
balance sheet over market cycles, enabling it to support the
commercial demands of current and prospective investors, and
to take advantage of strategic development opportunities.
As at 30 June 2023, total equity attributable to shareholders of
the parent was £898.8 million (30 June 2022: £945.0 million).
The Group has no debt.
The level of capital required to support the Group’s activities,
including its regulatory requirements, is £80.6 million. As at 30
June 2023, the Group had total capital resources of £704.8 million,
equivalent to 99 pence per share, and therefore representing an
excess of £624.2 million over the Board’s level of required capital.
Cash
Ashmore’s business model delivers a high conversion rate of
operating profits to cash. Based on operating profit of £77.4 million
for the period (FY2022: £119.2 million), the Group generated
£111.6 million of cash from operations (FY2022: £182.1 million).
The operating cash flows after excluding consolidated funds
represent 105% of adjusted EBITDA (FY2022: 113%).
Cash and cash equivalents by currency
Sterling
US dollar
Other
Total
30 June
2023
£m
374.0
71.1
33.5
478.6
30 June
2022
£m
273.1
247.9
31.0
552.0
Excluding cash held in consolidated funds, the Group’s cash
and cash equivalents reduced by £73.7 million to £468.3 million
(30 June 2022: £542.0 million), principally due to new seed capital
investments. There was an increase in the proportion of cash held
in Sterling following the sale of US dollars for Sterling at attractive
levels in the first half of the year.
Seed capital investments
The Group’s seed capital programme has delivered growth in
third-party AuM with approximately US$6 billion of AuM in funds
that have been seeded, representing 11% of total Group AuM.
During the year, the Group made new investments of £63.9 million
and profitably realised £24.6 million from previous investments.
The unrealised mark-to-market loss on the portfolio was
£19.8 million, meaning that the market value of the Group’s seed
capital investments increased to £291.5 million (30 June 2022:
£272.0 million).
Subscriptions in the period were focused on developing new funds
in the external debt, local currency and equities themes, including
providing access to the Group’s local asset management
capabilities.
The ability to redeem seed capital was facilitated by successful
realisations by funds in the alternatives theme, particularly in
respect of infrastructure-related investments in Latin America,
and matching client flows into equity funds managed locally
in Saudi Arabia.
The mark-to-market reduction in value was due to changes in
asset valuations in alternatives funds, predominantly in the first half
of the year, with positive returns delivered by funds in the fixed
income and equities themes.
The diversified mix of seed capital investments means that the
underlying fund portfolios, some of which are consolidated under
IFRS 10, have exposure to a range of Emerging Markets asset
classes, including sovereign and corporate fixed income, listed
equities, private equity, real estate and infrastructure, and a wide
array of industries including education, energy, financials,
healthcare, industrials, basic materials, transport and utilities.
Ashmore has integrated the consideration of ESG factors into its
investment processes, which therefore means the Group’s seed
capital investments are in funds that are scored in accordance with
Ashmore’s proprietary ESG methodology and may contribute to
Ashmore’s involvement in industry initiatives such as Climate
Action 100+, NZAMI and UN PRI.
Seed capital market value by currency
US dollar
Colombian peso
Other
Total market value
30 June
2023
£m
240.1
19.7
31.7
291.5
30 June
2022
£m
222.4
19.0
30.6
272.0
As at 30 June 2023, two-thirds of the Group’s seed capital is held
in funds with at least monthly dealing frequency, such as SICAV
or US 40-Act mutual funds. Ashmore has also made seed capital
commitments to funds of £8.9 million that were undrawn at the
period end, giving a total value for the Group’s seed capital
programme of approximately £300 million.
Goodwill and intangible assets
At 30 June 2023, goodwill and intangible assets on the Group’s
balance sheet totalled £86.9 million (30 June 2022: £90.9 million).
The movement in the period is primarily the result of an FX
revaluation loss in reserves of £3.9 million (FY2022:
£10.5 million gain).
Shares held by the EBT
The EBT purchased £15.6 million of ordinary shares during the
period in anticipation of the vesting of employee share awards.
Consequently, at 30 June 2023, the EBT owned 50,834,683
ordinary shares (30 June 2022: 55,512,301 ordinary shares),
representing 7.1% of the Group’s issued share capital (30 June
2022: 7.8%).
Ashmore Group plc Annual Report and Accounts 2023
33
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS B U S I N E S S R E V I E W ( C O N T I N U E D )
Foreign exchange
The majority of the Group’s fee income is received in US dollars
and it is the Group’s policy to hedge up to two-thirds of the notional
value of budgeted foreign currency-denominated net management
fees. Foreign currency assets and liabilities, including cash, are
marked to market at the period end exchange rate with
movements reported in either revenues or OCI.
Movements in the GBP:US$ and other exchange rates over the
period increased net management fees by 7%, increased operating
costs by 3%, and resulted in a translation gain in net revenue of
£1.0 million on the Group’s foreign currency assets and liabilities
and a £1.3 million mark-to-market gain on the Group’s seed capital
investments.
Included in OCI is an unrealised FX translation loss on non-Sterling
assets and liabilities of £26.2 million (FY2022: £80.2 million gain),
which, in addition to the goodwill movement described above,
mainly comprises £11.5 million on the value of seed capital
investments and £7.6 million on the Group’s cash balances.
Dividend
The Board’s policy is to pay a progressive ordinary dividend over
time, taking into consideration factors such as the prospects for the
Group’s earnings, demands on the Group’s financial resources, and
the markets in which the Group operates.
The Board recognises the importance of the ordinary dividend to
shareholders and, taking into consideration the profit for the year,
the substantial cash flows delivered, the strength of the balance
sheet, the positive near-term outlook as described in the CEO
review and the substantial medium-term growth opportunities
available to Ashmore, it has recommended a final dividend of 12.1
pence per share.
If approved by shareholders, the dividend will be paid on
8 December 2023 to all shareholders on the register on
3 November 2023.
Tom Shippey
Group Finance Director
5 September 2023
34
Ashmore Group plc Annual Report and Accounts 2023
R I S K M A N A G E M E N T
Embedded risk
management culture
Ashmore recognises that its strategy and business model have inherent
risks, with the potential for harm to the firm, its clients and the markets
in which it operates. Therefore, the Group identifies, evaluates and
manages principal and emerging risks through an established and
effective internal control framework supported by an embedded risk
management culture.
The Group’s three-phase strategy
is designed to create value for
shareholders over cycles by
capitalising on the powerful
economic, political and social
convergence trends across
Emerging Markets.
The Group executes its strategy
using a distinctive business
model, and identifies, evaluates
and manages the emerging and
principal risks inherent in this
business model.
The Board has ultimate
responsibility for the Group’s
strategy. It formally reviews the
strategy at least annually and
receives updates at each
Board meeting.
The Board is responsible for risk
management, although it has
delegated authority to carry out
day-to-day functions to Executive
Directors and specialised
committees, such as the RCC.
Read about Ashmore’s
strategy on pages 14-15
Read about Ashmore’s
business model on pages 8-9
Read Ashmore’s governance
report on pages 64-71
Read about Ashmore’s
principal risks on pages
40-41
The Executive Directors oversee the key risks and controls and the
risk management process on a day-to-day basis, and there is an
organisational structure with clearly defined lines of responsibility
and delegation of authority.
There are established policies and procedures to enable the Audit
and Risk Committee and ultimately the Board, through its regular
meetings, to monitor the effectiveness of the risk management
and internal control systems. These systems cover all identified
internal and external strategic, operational, financial, compliance
and other relevant risks, including the Group’s ability to comply
with applicable laws, regulations and clients’ requirements.
The main features of the Group’s risk management and internal
control systems are described below, covering the Group’s key
policies, specialised committees, business processes, and
verification and confirmation activities.
Overview of Ashmore’s risk management and
internal control systems
In accordance with the Code, the Board is ultimately responsible
for the Group’s risk management and internal control systems and
for reviewing their effectiveness. Such systems and their review
are designed to manage, rather than eliminate, the risk of failure to
achieve business objectives, and can provide only reasonable and
not absolute assurance against material misstatement or loss.
Within the Group’s over-arching corporate governance framework,
through which the Board aims to maintain full and effective control
over appropriate strategic, financial, operational and compliance
issues, an internal control framework has been established, against
which the Group is able to assess the effectiveness of its risk
management and internal control systems.
The Group’s system of internal control is integrated into the
Group’s strategy and business model and embedded within its
routine business processes and operations, and a strong control
culture includes clear management responsibility and accountability
for individual controls.
The internal control framework provides a process for identifying,
evaluating and managing the Group’s emerging risks and principal
risks, and has been in place for the year under review and up to the
date of approval of the Annual Report and Accounts. The process is
regularly reviewed by the Group’s Audit and Risk Committee and
accords with the Guidance.
Ashmore Group plc Annual Report and Accounts 2023
35
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R I S K M A N A G E M E N T ( C O N T I N U E D )
1. Policies
The Board seeks to maintain a strong
corporate culture, employing high
standards of integrity and fair dealing in the
conduct of the Group’s activities,
compliance with both the letter and the
spirit of relevant laws and regulations,
and standards of good market practice
across Ashmore’s activities.
Ashmore’s compliance approach underpins
these objectives, setting out principles to
guide employees, officers and Directors
when conducting a wide range of business
practices to act with integrity. The
Compliance Manual provides employees
with relevant information concerning the
Group’s regulatory environment, to enable
all employees to carry out their
responsibilities in accordance with
applicable laws and regulations and
client guidelines.
2. Committees
The Board has overall responsibility for
risk management, but it has delegated
authority to carry out day-to-day functions
to the Executive Directors and specialised
committees, of which the main ones are
described below.
The Investment Committees and their
sub-committees meet weekly, monthly or
quarterly depending on investment theme,
and ensure that clients’ funds are managed
in accordance with the agreed investment
strategy and policies.
The ESG Committee has oversight
of Ashmore’s responsible investing
framework and focuses on the appropriate
implementation of all elements of this
framework across Ashmore’s corporate
strategy and investment management
activity. This committee is also relevant
to operational and governance activities.
The Pricing Oversight Committee
supervises the effectiveness of pricing
policies for all investments held in
Ashmore sponsored funds where a reliable
pricing source is available. This includes
the responsibility to ensure that appointed
third-party pricing agents carry out the
agreed pricing policy faithfully and manage
the pricing sources appropriately.
Additionally, the Board and its committees
are responsible for a number of policies
covering the topics below:
– Seed capital
– Dividend
– Market abuse
– Diversity, equality and inclusion
– Tax
– Corporate FX and liquidity
risk management
– Directors’ remuneration
– Non-audit services
To support its risk management and
internal control framework, Ashmore has a
number of policy documents, effective at
the Group and/or local business levels, with
which all relevant employees are expected
to comply. These policies serve as controls
and/or mitigants in relation to principal and
emerging risks, and include:
– Anti-bribery and corruption
– Anti-money laundering
– Conflicts of interest
– Contact with regulators
– Data protection
– ESG
– Information security
– Media
– Valuation and pricing
– Whistleblowing
The Best Execution Committee reviews
the effectiveness of trading practices
across asset classes and has oversight
of the regular compliance testing of
trade execution.
The Research Oversight Committee
addresses governance, oversight and
review of third-party research procured
by Ashmore.
The Pricing Methodology and Valuation
Committee has oversight of the valuation
methodologies used for fund investments
that cannot be readily priced using
external sources.
The RCC is responsible for internal
control and for assessing the impact
of Ashmore’s activities on the firm’s
regulatory and operational exposures.
The Operating Committee reviews
the Group’s financial and operating
performance to focus on delivery of the
Group’s key strategic objectives and
implementation.
The Foreign Exchange and Liquidity
Management Committee is responsible
for the oversight and management of the
Group’s foreign currency cash flows and
balance sheet exposures, including the
appropriate level of hedging, and ensures
the Group meets its liquidity requirements.
The IT Steering Group ensures that the
Group’s IT strategy is aligned with its
strategy and objectives, and has
responsibility for implementing, managing
and supporting the Group’s IT systems
and projects.
The Product Committee has responsibility
for product governance including the
launch, amendment, periodic review
and closure of funds, and also including
TCF and implementation of the FCA’s
Consumer Duty principle.
The GIPS Committee acts as the Group’s
primary decision-making body in relation
to any changes to the existing set of
investment performance composites, and
approving the creation of new composites.
The Awards Committee has
delegated authorities from the Board’s
Remuneration Committee to oversee
certain remuneration matters, including
employee remuneration and contracts
of employment.
The Disclosure Committee is responsible
for considering the assessment of
confidential information, determining
whether it constitutes inside information,
and taking appropriate action in accordance
with prevailing market regulations.
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Ashmore Group plc Annual Report and Accounts 2023
3. Processes
Underpinning the policies and committees,
the following business processes are
components of Ashmore’s risk management
and internal control framework.
Risk management and compliance
The Risk Management and Control
function maintains a matrix of principal and
emerging risks, comprising key strategic
and business, client, treasury, investment
and operational risks, and considers the
likelihood of those risks crystallising and
the resultant impact. Senior management
and the employees responsible for the
risks and associated controls/mitigants
review the matrix quarterly. Ashmore
identifies the inherent risk within each
business activity, and assesses the
adequacy and mitigating effect of existing
processes to determine a current residual
risk level for each activity. On the basis that
the Group may employ further mitigants
and/or controls over time, it defines a
target residual risk for each activity and
tracks progress to target as appropriate.
The Audit and Risk Committee and/or
the Board receive regular compliance,
risk and internal audit reports, while the
Board receives regular financial and other
management information related to the
control of expenditure against budget and
the making of investments, and for
monitoring the Group’s business and
its performance.
The RCC analyses KRI statistics on a
monthly basis. The KRIs indicate trends
in the Group’s risk profile, assist in the
reduction of errors and potential financial
losses, and facilitate dealing with a
potential risk situation before an
event occurs.
4. Verification
The following activities are intended to
provide the Board with independent
verification of the effectiveness of the
Group’s risk management and internal
control systems.
Internal Audit is responsible for reviewing
the Group’s assurance map and providing
an independent assessment of assurance
to the Audit and Risk Committee on an
annual basis. The assurance map
documents the interaction of the first,
second and third lines of defence with
regard to the controls and mitigants
relating to the Group’s principal risks.
The Compliance function’s responsibilities
and processes include ensuring that the
Group meets its regulatory obligations;
integrating regulatory compliance
procedures and best practices within the
Group, including a compliance monitoring
programme that covers all relevant areas of
the Group’s operations and the results of
which are reported to the RCC; identifying
any breach of compliance with applicable
regulations; and real-time monitoring of
client mandate investment restrictions.
Operational and governance
Ashmore has a defined operational
framework and organisational structure
with appropriate delegation of authority
and segregation of duties and
accountability, that have regard to
acceptable levels of risk.
The Risk Appetite Statement describes
the types and levels of risk that the Group
is prepared to take in pursuit of its strategic
objectives. The Board reviews the RAS in
line with Ashmore’s strategy, business
model, financial capacity, business
opportunities, regulatory constraints and
other internal and external factors and,
through the ARC, regularly reviews risk
metrics reported against the RAS.
The Group’s planning framework includes
a Board approved strategy. The Board
reviews and challenges the strategy
annually, and it receives updates on
progress against strategic objectives at
each scheduled Board meeting.
Ashmore is subject to the FCA’s Senior
Managers and Certification Regime,
which requires allocation of specific
responsibilities to individuals and the
recording of this through a management
responsibilities map and individual job
descriptions.
Financial controls are in place to ensure
accurate accounting for transactions,
appropriate authorisation limits to contain
exposures, and reliability of data
processing and integrity of information
generated.
The Group’s Finance function, managed
by appropriately qualified accountants, is
responsible for the preparation of the
financial statements. Executive Directors
and other parties review the statements,
and the process includes challenge by the
Audit and Risk Committee and the Board.
The Finance function works in conjunction
with the Group’s auditors and other
external advisers to ensure compliance
with applicable accounting and reporting
standards, prevailing regulations and
industry best practice.
The Board reviews and approves a detailed
and comprehensive annual budget.
Board members receive monthly
management information including
accounts and other relevant reports,
which highlight financial and operational
performance against budget/forecast and
the prior year period.
Ashmore has procedures and thresholds
governing the appraisal and approval of
corporate investments, including seeding
of funds and purchase of own shares, with
detailed investment and divestment
approval procedures, incorporating
appropriate levels of authority and regular
post-investment reviews.
The Group’s external auditor independently
reviews the control systems pursuant to
ISAE 3402 annually.
The Board, through the Audit and Risk
Committee, receives half-yearly updates
from the Group’s external auditor, which
include any control matters that have come
to the auditor’s attention.
The Internal Audit function undertakes a
programme of reviews of systems,
processes and procedures as agreed with
the Audit and Risk Committee, reporting
the results, together with its advice and
recommendations, to the Audit and
Risk Committee.
The external auditor expresses an opinion
on the annual financial statements and
reviews the condensed set of financial
statements in the half-yearly financial
report, and also reviews management’s
approach to reporting operating results and
financial resources.
Ashmore Group plc Annual Report and Accounts 2023
37
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS R I S K M A N A G E M E N T ( C O N T I N U E D )
5. Confirmation
The Board has conducted an annual review
and assessment of the effectiveness of
the Group’s risk management and internal
control systems, and has not identified any
significant failings or weaknesses during
this review.
In conducting this review, the Board and/or
Audit and Risk Committee have considered
periodic reports on compliance and risk
matters, including reports provided by the
Internal Audit function, and the annual
report on risk management and internal
control processes from the Group’s RCC.
The Board and/or Audit and Risk
Committee received these reports
throughout the year and up to the latest
practicable date prior to the approval of the
Annual Report and Accounts. The Board is
satisfied that appropriate planned actions
continue to be effective in improving
controls as the Group develops, and its
overall assessment of the control
framework continues to be satisfactory.
Principal and emerging risks, controls and mitigants
The table on pages 40 and 41 summarises those principal risks that the Group has assessed as being most significant currently, together
with examples of associated controls and mitigants. Reputational and conduct risks are common to most aspects of Ashmore’s strategy
and business model.
Ashmore’s internal control framework considers the assessment and management of emerging risks alongside its principal risks, current
examples of which are:
– the impact of inflation;
– geopolitical and sanctions risks; and
– ESG risks including regulatory and industry focus on potential greenwashing, legal uncertainty and litigation risks arising from the
industry’s differing interpretation of ESG regulation, and the impact of ESG factors on investors’ decisions to invest in Emerging Markets.
Three lines of defence
The Group has three lines of defence against unintended outcomes arising from the risks it faces.
1st
2nd
3rd
First: Risk ownership
This rests with line managers, whether they are in portfolio management, distribution or support functions.
The senior management team takes the lead role with respect to implementing and maintaining appropriate
controls across the business.
Second: Risk control
This is provided by the Risk Management and Control department, including the Group’s Principal Risk Matrix,
and Group Compliance, including the compliance monitoring programme.
Third: Independent assurance
Group Internal Audit is the third line of defence and provides independent assurance over agreed risk
management, internal control and governance processes as well as recommendations to improve the
effectiveness of these processes.
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Ashmore Group plc Annual Report and Accounts 2023
Longer-term viability statement
In accordance with Provision 31 of the
Code, the Directors have assessed the
current position and prospects of the
Group over a three-year period to
June 2026, which is consistent with the
planning and stress testing timeframe
used under the ICARA regime.
The Directors have made a robust
assessment of the principal and
emerging risks implicit in the business
model, alongside the associated
controls and mitigants, as presented
in more detail on pages 35 to 41.
The Board regularly reviews the
Group’s strategy and prospects, and
management presents qualitative
and quantitative assessments of the
principal risks to the Audit and Risk
Committee quarterly. Regular
management reporting to the Board
against each risk allows the Directors
to assess the effectiveness of the
controls in place. The Board reviews
regularly the Group’s Risk Appetite
Statement.
The Board reviews regular information
in respect of the prospects and financial
planning of the Group, which includes a
three-year detailed financial forecast
alongside severe but plausible
scenario-based downside stress testing.
The stress tests include the impact of
investment underperformance, failure
to comply with regulations, breach of
client mandate guidelines or
restrictions, a substantial decline of up
to half the Group’s AuM and ineffective
third-party services. Consequently, the
Board regularly assesses the amount
of capital that the Group is required
to hold to cover its principal risks,
including the amounts required under a
range of severe stress test scenarios.
The Group delivers a high level of
profitability together with healthy cash
flows, has a strong balance sheet and
has a robust liquidity position, meaning
that it is able to withstand the financial
impact of the range of stress testing
scenarios. Consequently, the Directors
have a reasonable expectation that
the Group will be able to continue in
operation, meet its liabilities as they fall
due and maintain sufficient regulatory
capital over the next three years.
Ashmore Group plc Annual Report and Accounts 2023
39
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS R I S K M A N A G E M E N T ( C O N T I N U E D )
Principal risks and associated controls and mitigants
Description of principal risks
Examples of associated controls and mitigants
Strategic and business risks (Responsibility: Board of Directors)
Long-term downturn in Emerging Markets
fundamentals/technicals/sentiment, and impact
of broader industry changes (including ESG) on
Ashmore’s strategy and business model
– Group strategy is reviewed and approved by a board with relevant
industry experience
– Diversification of investment capabilities and products
– Ashmore has a strong balance sheet with no debt
– ESG and specialised committees meet regularly
– The Board reviews diversity data on a semi-annual basis
Market capacity issues and increased competition
constrain growth
– Experienced Emerging Markets investment professionals with deep
market knowledge
Failure to understand and plan for the potential
impact of investor sentiment, climate change and
sustainability regulations on product preferences
and underlying asset prices (including effects of
transition to a low-carbon economy)
– Periodic investment theme capacity reviews
– Emerging Markets asset classes continue to grow, increasing the size of
Ashmore’s investable universe
– Oversight by ESGC, which covers corporate and investment activities, and
scoring of all issuers for E, S and G factors
– Head of Responsible Investment and ESG Policy provides updates to the Board
– NZAMI membership and participation in industry working groups to prepare for
net zero commitments
Client risks (Responsibility: Product Committee and RCC)
Inappropriate marketing or ESG strategy and/or
ineffective management of existing and potential
fund investors and distributors, including impact
of net outflows and fee margin pressure
– Regular Product Committee meetings review product suitability
and appropriateness
– Experienced distribution team with appropriate geographic coverage
– Investor education to ensure understanding of Ashmore investment themes
and products
– ESGC includes distribution team members
Inadequate client oversight including alignment
of interests
– Global distribution team appropriately structured for institutional and
intermediary retail clients
– Monitoring of client-related issues including a formal complaints
handling process
– Compliance and legal oversight to ensure clear and fair terms of business and
disclosures, and appropriate client communications and financial promotions
Treasury risks (Responsibility: CEO and GFD)
Inaccurate financial projections and hedging of
future cash flows and balance sheet
– Defined risk appetite, and risk appetite measures updated quarterly
– Group FX hedging policy and FX and Liquidity Management Committee
Investment risks (Responsibility: Group ICs)
Downturn in long-term performance
– Consistent investment philosophy over nearly 30 years and numerous market
cycles, with dedicated Emerging Markets focus including country visits and
network of local offices
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Ashmore Group plc Annual Report and Accounts 2023
Description of principal risks
Examples of associated controls and mitigants
Operational risks (Responsibility: RCC)
Inadequate security of information including cyber
security and data protection
Failure of IT infrastructure, including inability to
support business growth
Legal action, fraud or breach of contract
perpetrated against the Group, its funds
or investments
Insufficient resources, including loss of key
employees, inability to attract employees, and
impact of remote working, which hampers growth
or the Group’s ability to execute its strategy
Lack of understanding and compliance with global
and local regulatory requirements, as well as
conflicts of interest and not treating customers
fairly, and financial crime, which includes money
laundering, bribery and corruption, leading to high
level publicity or regulatory sanction
Inadequate oversight of Ashmore overseas offices
– Information security and data protection policies, subject to annual review
including cyber security review
– Cyber Security Working Group meets quarterly
– Employees receive online training
– Appropriate IT policies with annual review cycle
– IT systems and environmental monitoring
– Group IT platform incorporates local offices
– Independent Internal Audit function that considers risk of fraud in each audit
– Anti-money laundering and anti-bribery and corruption policies, also required for
service providers
– Whistleblowing policy including independent reporting line and Board sponsor
– Due diligence on all new, and regular reviews of existing, service providers
– Insurance policies in place with appropriate cover
– Committee-based investment management reduces key man risk
– Appropriate Remuneration policy with emphasis on performance-related pay
and long-dated deferral of equity awards
– Regular reviews of resource requirements and updates provided to the Board
– Annual review of remuneration and benefits including benchmarking
against industry
– Annual Culture and Conduct report to the Board
– Regulatory Development Steering Group and compliance monitoring
programme, which covers financial crime risks such as money laundering
and bribery
– Compliance policies covering global and local offices, for example global
conflicts of interest and inducements policies
– Anti-money laundering and anti-bribery and corruption policies
– Conduct risk and organisational culture indicators are considered
on a monthly basis by the RCC and on a semi-annual basis
by the Board
– ESGC has oversight of regulatory and reporting requirements
– Compliance function manages sanctions restrictions
– GFD has oversight responsibility for overseas offices, and RCC has oversight of
the operating model with annual reviews. Senior employees take local board/
advisory positions
– Dual reporting lines into local management and Group department heads, with
adherence to Group policies
– Local risk and compliance committees held and RCC receives updates
– Internal Audit reviews, and annual governance reviews reported to RCC
Inappropriate oversight of market, liquidity, credit,
counterparty and operational risks
– Group risk management policies, reviewed regularly
– Monthly reviews of market and liquidity risk
– Quarterly reviews of principal risks, counterparties and credit risk
Ashmore Group plc Annual Report and Accounts 2023
41
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS S E C T I O N 1 7 2 S T A T E M E N T
Delivering for
Ashmore’s stakeholders
In accordance with the Companies
Act (as amended by the Companies
(Miscellaneous Reporting) Regulations
2018), the Directors provide this
statement describing how they have
had regard to the matters set out in
section 172(1) of the Act, when
performing their duty to promote the
success of the Company. Further
details on key actions in this regard
are also contained within the Corporate
governance report on pages 62 to 71
and the Directors’ report on pages 113
to 117.
Clients
Ashmore is a specialist Emerging
Markets investment manager and
manages US$55.9 billion of
assets as at 30 June 2023.
Ashmore manages a wide range
of investment strategies and
products, organised under a
number of broad Emerging
Markets investment themes, for
a diversified institutional and
intermediary retail client base.
96%
AuM from institutional clients
Section 172 factor
Relevant disclosures
Page
The likely consequences
of any decision in the long term
The interests of the
Company’s employees
The need to foster relationships
with clients, suppliers and others
The impact of the Company’s
operations on communities and
the environment
– Company purpose
– Business model
– Strategy
– People & culture
– Sustainability
– Remuneration report
– Business model
– Business review
– Sustainability
– Directors’ report
– Sustainability
– TCFD
The Company’s desire to maintain
a reputation for high standards
of business conduct
– Risk management
– Sustainability
– Audit and Risk Committee report
The need to act fairly as between
members of the Company
– Stakeholder engagement
– Annual General Meeting
1
8
14
46
50
78
8
28
50
113
50
56
35
50
72
42
117
What matters to this group?
Clients are central to Ashmore’s business
and a primary focus is understanding
clients’ needs, tailoring investment
strategies to suit their objectives, and
reporting on outcomes in a transparent
manner.
Clients’ needs can change over time and
understanding and responding to these
needs is central to Ashmore’s success.
Liability profile, applicable regulations, and
additional targets and objectives in relation
to climate change are just a few examples
of matters that impact on clients’
investment objectives. Ashmore seeks to
partner with clients to guide them through
these changes, and to evolve its services
to meet these changing requirements.
In the process, Ashmore builds long-term,
collaborative, mutually beneficial client
relationships based on trust.
Engagement and outcomes
Ashmore’s global distribution team works
closely with its dedicated portfolio
managers to service clients. The distribution
team engages with current and prospective
clients to learn about their requirements
and build lasting relationships.
Clients are provided with a comprehensive
suite of reporting, which evolves to meet
client needs, regulatory requirements and
industry standards, for example through
the extension of the availability of Carbon
Reporting during the year, as well as the
recently introduced reporting on
engagements with issuers of equity and
fixed income securities, and statistics on
proxy voting. Specifically for UK retail
customers, serviced through
intermediaries, Ashmore has implemented
the provisions of the UK Consumer Duty
regulations, including assessments of costs
versus expected investment outcomes for
such UK retail customers. Similar fair
value assessments are required by EU
regulations. These assessments are now
an integral part of Ashmore’s product
design and approval process.
Ashmore publishes details of its
engagements and proxy voting activities
for equity and debt portfolios in its
Sustainability Report and details of its
engagement with issuers of equity and
fixed income securities and the outcomes
in its Engagement Report, both available
on the Group’s website. Ashmore was
also accepted as signatory to the UK
Stewardship Code in February 2023.
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Ashmore Group plc Annual Report and Accounts 2023
Shareholders
The support of Ashmore’s
shareholders, with an
appropriately long-term
investment horizon, is important
to enable Ashmore to fulfil its
strategic growth ambitions.
c.40%
Equity owned by employees, giving
strong alignment of interests
Employees
Ashmore’s experienced, diverse
and dedicated employees are
central to the firm’s culture and
underpin its successful business
model.
316
Employees across 11 offices
What matters to this group?
Shareholders require a clear and consistent
communication of Ashmore’s strategy and
business model, and information on
Emerging Markets to provide context for
Ashmore’s development.
Shareholders appreciate the strong
alignment of interests with employees,
achieved through long-term equity
ownership.
Ashmore’s growth strategy and resilient
business model underpin the delivery of
long-term value to shareholders over
market cycles.
Engagement and outcomes
Ashmore seeks to build direct relationships
with shareholders and potential investors
through a comprehensive investor relations
plan with a focus on managing roadshows
and other interactions in-house.
The Executive Directors meet regularly
with investors and the Board focuses on
accountability and constructive shareholder
engagement opportunities, including being
responsive to shareholder requests
for engagement.
Ashmore’s Executive Directors and senior
management held more than 135 virtual
and physical meetings during the year, and
the Chair of the Board held a number of
meetings with significant institutional
shareholders to discuss their governance
views and other considerations.
Ashmore organised a comprehensive
governance roadshow for the Chair of the
Remuneration Committee, covering c.75%
of the institutional shareholder register and
the main proxy advisers, which enabled the
Chair to discuss proposed changes to the
Directors’ Remuneration policy and other
matters ahead of the triennial policy vote
at the 2023 AGM.
What matters to this group?
Ashmore’s employees are a critical asset
and central to delivering long-term value for
clients and shareholders. Employees’
strong work ethic, commitment and
expertise are key factors enabling Ashmore
to meet the needs of other stakeholders.
Ashmore’s diverse group of employees
seek opportunities for career development
and training, and to be suitably motivated
and rewarded with competitive pay and
benefits. Employees come from a wide
range of cultures and 37 nationalities.
Embracing diversity and inclusion in
attracting, retaining and developing
employees is central to Ashmore’s culture.
Engagement and outcomes
Ashmore engages with its employees in a
variety of ways. The Board receives a
Culture and Conduct dashboard, which
gives the Directors clear metrics across a
range of employee related topics, together
with a Human Resources update at each
scheduled meeting. The Board continues
to meet employees face-to-face through its
regular ‘meet the teams’ sessions, chaired
by Ashmore’s Non-executive Director
responsible for workforce engagement,
who gathers feedback and encourages the
sharing of views. During the year, the
Remuneration Committee reviewed the
benefits offered to employees and
enhancements were made to encourage
and support employee development and
further education, family friendly benefits
and employee retention over the
longer term.
Ashmore is focused on offering
opportunities at all different career stages,
such as through the addition of further
family-friendly benefits for maternity and
paternity care and a menstrual and
menopause policy during the year. For
early careers, Ashmore took part in the
10,000 Black Interns programme for the
first time in 2023 and the successful
graduate programme continues.
Employees receive regular newsletters on
business developments and opportunities,
as well as briefing sessions on business
strategy and results. Ashmore’s employees
take part in off-site team building exercises,
including a summer social at which
London-based employees were joined by
representatives from other Ashmore
offices, as well as charity events and
fundraising events focused on supporting
The Ashmore Foundation.
Ashmore Group plc Annual Report and Accounts 2023
43
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS S E C T I O N 1 7 2 ( C O N T I N U E D )
Society
Ashmore engages with its
corporate and sovereign issuers
to understand the issues relevant
to them and the society in which
they operate. The Ashmore
Foundation focuses on partnering
with non-profit organisations to
promote positive social,
environmental and economic
change in communities in which
the Group operates, and to offset
the Group’s GHG emissions.
Regulators
Regulatory oversight of
Ashmore’s investment
management operations and
funds and adherence to global
regulatory standards is a
critical part of Ashmore’s
governance framework.
21
Regulators overseeing
Ashmore’s activities
activities with issuers focused on climate
change such as asking for increased
disclosure of GHG emissions and efforts to
understand the issuers’ approach to
climate action.
The Ashmore Foundation made over
US$350,000 of grants focused on
promoting social and economic
opportunities for women and young
people, as well as donations to support
organisations delivering emergency relief
services for the humanitarian crisis in
Turkey.
The Group offset its FY2022 CO2e through
The Ashmore Foundation’s partnership
with Plant Your Future in the Peruvian
Amazon, which delivers positive
environmental outcomes while
simultaneously realising societal and
economic benefits for communities.
Throughout the year engagement with the
FCA was focused on monitoring regulatory
developments and implementation of the
UK Consumer Duty which is relevant to
Ashmore’s UK retail client base.
Engagement with other regulators
including in the United States and EU,
centred primarily around standard financial
regulatory reporting, investor protection,
governance, culture and sustainability risk
and greenwashing and the oversight of
third parties. Ashmore also completed
regulatory questionnaires on topics such as
the FCA Practitioner Questionnaire and the
FCA Financial Resilience Survey, and
provided opinions to help inform regulatory
views, as well as keeping itself appraised
of the Wholesale Data Market Study and
other relevant matters.
What matters to this group?
Ashmore invests across Emerging
Markets, and consequently, there is a wide
variety of sustainability concerns relevant
to issuers. Ashmore uses its ESG
scorecard to identify which considerations
are material to each issuer and engages
with the issuers on these where relevant.
The Ashmore Foundation engages with
stakeholders to make a positive and
sustainable difference to social and
economic issues affecting women, young
people and disadvantaged communities in
Emerging Markets. Underpinning the work
of the Foundation is a focus on
environmental sustainability and partnering
with stakeholders to create long-term
impact, build gender equity and encourage
systemic change.
Engagement and outcomes
Ashmore is a public signatory to several
related industry initiatives and forms part of
a growing universe of responsible
investment-minded investors. Over
FY2023, the majority of the engagement
What matters to this group?
As a global business, Ashmore works to
establish positive, collaborative
relationships with regulators in the
jurisdictions in which it operates. A
constructive and engaging regulatory
relationship enables Ashmore to meet the
growing regulatory requirements around
the world, ensuring it adheres to the rules
and standards within each jurisdiction to
protect clients and shareholders, as well as
providing insight into future regulatory
requirements where appropriate.
Ashmore manages its business to comply
with relevant international and local
requirements and to be able to meet the
needs of its clients and shareholders.
Engagement and outcomes
Regulatory engagement and
understanding, including assessing how
changes will impact Ashmore and its
clients, are regularly considered by the
Board and its committees, and Ashmore’s
senior management and compliance teams
hold meetings with regulators to foster
strong working relationships and discuss
particular projects or regulatory
requirements.
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Ashmore Group plc Annual Report and Accounts 2023
Third-party service
providers
Ashmore’s operating platform
relies in part on high-quality
service providers.
300+
Suppliers
What matters to this group?
Ashmore recognises the importance of the
services it provides to its clients and has
made investments over many years in
systems, people and processes to ensure
operational resilience, utilising a global
network of external suppliers to
supplement its own infrastructure and
expertise.
Ashmore is committed to regularly
reviewing its operational resilience and
making the necessary adjustments.
Engagement and outcomes
Ashmore performs an annual business
impact analysis exercise, aligned to the
FCA’s requirement for operational
resilience.
As part of this exercise, Ashmore identifies
its important business services and maps
out the processes that enable those
services to function. It then determines
how much disruption those important
business services could tolerate and tests
their ability to endure that disruption to set
their impact tolerances. The resultant
self-assessment document is then subject
to review and approval by the Board. The
most recent self-assessment was
approved in May 2023.
Ashmore also undertakes regular BCP
testing and has developed documentation
to assist in incident response. Ashmore is
committed to the fair treatment of its
suppliers who are viewed as key
stakeholders. The Board approved the
Group’s Modern Slavery Statement as well
as the Supplier Code of Conduct.
Ashmore Group plc Annual Report and Accounts 2023
45
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS P E O P L E & C U L T U R E
Distinctive
team-based culture
Ashmore’s team-based culture is evident across the firm and instilled
and maintained by factors such as the Group’s performance-based
remuneration philosophy with an emphasis on long-term equity
ownership, a robust compliance and risk management framework,
and a clear ‘tone from the top’ imparted by the Board of Directors
and senior management.
Length of service (%)
Employee age range (%)
< 4 years
4-9 years
10-15 years
>15 years
18-24
25-34
35-44
45-54
55+
40
31
25
4
6
23
38
24
9
Defining and maintaining culture
Culture is ultimately a reflection of common beliefs and behaviours,
and therefore is of utmost importance in a firm whose employees
are one of its key assets. Ashmore’s culture is appropriate for a
specialist asset management firm operating in distinctive markets
with significant long-term growth potential. Importantly, the culture
aligns the interests of employees, clients, shareholders and other
stakeholders over the longer term; it supports and reinforces the
principal features of the business model; and it underpins the
achievement of the Group’s strategic objectives.
Ashmore’s culture has persisted through many market cycles
and significant growth in the firm’s operations, including the
establishment of global operating hubs and distribution offices in
New York, Dublin, Singapore and Tokyo, and also the development
of local asset management operations in Colombia, Peru, Saudi
Arabia, the United Arab Emirates, India and Indonesia.
Importantly, while the local asset management businesses operate
independently in terms of investment decisions, they share a
common team-based culture with the Group’s global operations.
The same remuneration philosophy is followed by the local offices.
Efficient, team-based operations
Ashmore’s management structure is efficient, with a relatively flat
hierarchy that minimises bureaucracy and supports effective
decision making with clear accountability.
The Group’s ICs oversee the management of client portfolios by
investment teams, which operate with collective responsibility.
There is a ’no star’ fund manager culture, with no individual
responsible for a discrete fund, which instils appropriate behaviour
with committee oversight.
c.40%
of Ashmore’s shares are owned
by current employees
46
Ashmore Group plc Annual Report and Accounts 2023
The team-based approach is echoed across Ashmore’s operations
including distribution and support functions, and its overseas
offices. This results in a collegiate, collaborative, client-focused and
mutually supportive culture across the whole firm. The lack of
individual profit centres or operational silos, together with a culture
of shared equity ownership for all Group employees, means that
Ashmore’s employees have suitable incentives to collaborate in
order to achieve appropriate outcomes for the business as a whole.
High standards
Ashmore’s long-term strategic success is ultimately dependent on
its more than 300 employees and it aims to attract, develop and
retain high-calibre people.
Recognising the diverse nature of its operations across 11
countries, Ashmore’s policies and procedures reflect best practice
within each of these countries and the firm requires its employees
to act ethically and to uphold clearly the standards expected by the
Group’s stakeholders including its clients, regulators, shareholders
and broader society. By way of oversight, the Board receives
periodic culture and conduct updates.
Long-term employee loyalty
The effectiveness of Ashmore’s commitment to and ongoing
investment in its employees is demonstrated by their loyalty
to the firm. As a consequence of the team-based culture and
performance-based and equity-focused remuneration philosophy,
Ashmore enjoys relatively low levels of unplanned staff turnover
(FY2023: 14.4%). This means that 60% of Ashmore’s staff have
been with the firm for four or more years, and approximately 30%
joined the firm more than a decade ago.
Diversity, equality and inclusion
Diversity means many things to Ashmore, but the unifying thread
is that the diverse characteristics of markets, clients, investment
strategies and employees are all positive factors that help to
underpin the Group’s long-term success.
Employee diversity can be considered through many lenses,
not just gender and ethnicity, but also characteristics such as
experience, skills, tenure, age, disability and sexual orientation.
The diverse nature of a firm can help to reduce the risks of
‘groupthink’ and promote an appropriate culture that supports
the achievement of strategic objectives.
Ashmore’s focus on Emerging Markets and its network of 11
offices with local employees mean that it is diverse from ethnicity,
gender and nationality perspectives, with 69% of employees from
diverse backgrounds (defined as being not white or male). More
than a third (36%) of the Group’s employees and 57% of the Board
Directors are female. Recognising that the financial services sector
has historically been a male-dominated industry, the firm is keen to
promote gender diversity.
However, Ashmore is a relatively small organisation of
approximately 300 employees, with a long-standing remuneration
philosophy that rewards performance and engenders long-term
employee loyalty. It does not have large-scale recruitment
programmes. Therefore, while Ashmore has become more diverse
over the past 12 months, any significant desired changes in the
profile of the employee base must occur over time as succession
occurs, new roles arise, and replacements are recruited based
on merit and objective criteria without any quotas set.
Within this context, Ashmore seeks to ensure that candidate pools
are assembled wherever possible to include candidates of different
gender, ethnic and social backgrounds.
Ashmore launched its graduate recruitment programme in FY2022
and the first group of graduates joined in September 2022. The
programme’s focus is on front office roles and it will support the
ongoing development of a diverse workforce over the longer term.
To ensure diversity characteristics are understood and, where
necessary, acted upon, Ashmore maintains a comprehensive view
of the profile of its employees, based on self-identified factual
data. The ’diversity dashboard’ is reported periodically to the
Board, its Remuneration Committee and the RCC. In addition,
all employees receive comprehensive annual Equality and
Diversity in the Workplace training.
During the year, the Board agreed to establish a Diversity
Committee, chaired by the Non-executive Director responsible for
workforce engagement. The committee held its first meeting in
July 2023, and will oversee Ashmore’s diversity and inclusion
strategies and activities.
Year end headcount
2023: 316
3
2
0
2
2
2
0
2
1
2
0
2
0
2
0
2
9
1
0
2
122
106
118
102
113
99
112
98
117
95
194
210
197
213
197
211
194
208
190
212
Global
Local
Support
Investment professionals
Ashmore Group plc Annual Report and Accounts 2023
47
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS P E O P L E & C U L T U R E ( C O N T I N U E D )
Nationality and
ethnicity
Ashmore is proud to have a diverse workforce with
employees from 37 different countries.
Nationality (%)
North America
South America
Europe
Asia Pacific
Middle East
Africa
7
19
42
25
6
1
Ethnicity (%)
Asian
Black
Hispanic
Middle Eastern /
North African
Mixed race
Other
White
No response
31
2
17
6
1
1
35
7
Diversity
Listing Rules disclosures
Gender identity or sex
Men
Women
Not specified/prefer not to say
Ethnic background
White British or other white (including minority-white groups)
Mixed/multiple ethnic groups
Asian/Asian British
Black/African/Caribbean/Black British
Other ethnic group, including Arab
Not specified/prefer not to say
FTSE Women Leaders Review
Number of board
members
3
4
0
Percentage of the
board
43%
57%
0%
Number of board
members
6
0
1
0
0
0
Percentage of the
board
86%
0%
14%
0%
0%
0%
Number of senior
positions on the
board (CEO, CFO,
SID and Chair)
3
1
0
Number of senior
positions on the
board (CEO, CFO,
SID and Chair)
4
0
0
0
0
0
Number in
executive
management
11
1
0
Number in
executive
management
8
0
1
0
3
0
Percentage of
executive
management
92%
8%
0%
Percentage of
executive
management
67%
0%
8%
0%
25%
0%
The Review sets three targets to be met by the end of 2025. Ashmore has made good progress, meeting or exceeding two of the targets
with 57% of the Board, including the Senior Independent Director, being female. The third, and more challenging, target is for women to
represent 40% of the senior management team and Ashmore is currently at 19%.
Parker Review
Ashmore complies with the recommendations of this review. It has an ethnic minority Board member and has recently established a target
for 40% of the senior management team to be from an ethnic minority background by 2027.
48
Ashmore Group plc Annual Report and Accounts 2023
Mumbai International Airport, India
Ashmore Group plc Annual Report and Accounts 2023
49
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS S U S T A I N A B I L I T Y
Critical to success
Ashmore is an Emerging Markets focused investment manager whose
success is dependent on understanding sustainability in the markets
in which it operates and invests.
Ashmore recognises the role it plays in the deployment of its
clients’ capital and the impact this can have on sustainability of the
environment and broader society. As such, the Group aims to
integrate responsible investing across its operations, coordinated
by the Head of Responsible Investment and ESG Policy. Board
accountability is ensured through the Group’s specialised ESGC,
which has overall responsibility for Ashmore’s sustainability and
responsible investing framework across its operational and
investment activities.
Ashmore’s responsibility further extends to all its stakeholders
and includes managing its operations in ways that effectively
ensure the health and wellbeing of its employees. The Group’s
distinctive culture means that Ashmore ensures that its employees
are able to work in an environment that enables personal and
professional development.
Understanding and achieving sustainability can take many forms,
but arguably some of the greatest impact and change can be
achieved in Emerging Markets. Two areas that are particularly
relevant to these markets are:
– Environmental challenges: specifically, the effects of climate
change, which already can be acutely felt by companies and
communities in these markets, including many in which
Ashmore operates and invests. In recognition of this, the
Group reports in accordance with the TCFD
recommendations and is a member of NZAMI.
– Inequality and wealth disparity: this can present significant
challenges in developing markets, and the social investments
made by The Ashmore Foundation aim to empower
communities at the extreme end of these disparities.
Ashmore’s commitment to act as a responsible investor extends
to support for and membership of global and industry-specific
initiatives, including the UN PRI and Climate Action 100+.
Ashmore will continue to develop its approach in line with
regulatory requirements and in so doing contribute to the
evolving industry practice.
Ashmore’s broad and encompassing approach to sustainability
is centred on three pillars covering the breadth of its corporate
operations, investment activities, and social impact investing by
The Ashmore Foundation. These pillars are not mutually exclusive
but provide a framework enabling Ashmore to define and pursue
its sustainability objectives.
In addition to the sections below, relating to Ashmore’s approach
to corporate sustainability and The Ashmore Foundation, further
information is available elsewhere in this report and on the
Group’s website:
Annual Report and Accounts
– People & culture
– TCFD
– Directors’ report
Group website
– Sustainability Report
– TCFD Investment Management Report
Corporate responsibility
Responsible investment
The Ashmore Foundation
Ensure the Group is managed to the
appropriate governance, social and
environmental standards, in line with
local expectations
Ensure Ashmore invests aligned with
the expectations of a ‘responsible
investor’ with particular attention to the
risks stemming from ESG concerns and
sustainability impacts
Philanthropic efforts to make a social
and environmental difference in the
communities in which Ashmore invests
50
Ashmore Group plc Annual Report and Accounts 2023
The Banghwa Bridge, South Korea
Corporate sustainability
Ashmore’s approach to corporate responsibility recognises the role the Group plays in wider society and is underpinned by values of
transparency, fairness, accountability and integrity across the Group’s worldwide operations.
The nature of Ashmore’s business as an investment manager and its consistent single operating platform mean that corporate
responsibility can be considered and understood in a relatively small number of areas, listed in the table below.
1. Social
2. Governance
As a traditional asset management business, employees are a critical asset to Ashmore. The Group’s
responsibilities to its employees are well understood and reflected in its commitments to diversity, career
development, health and safety, including workplace benefits, and a remuneration philosophy that delivers a
long-term alignment of interests between employees, clients and shareholders.
The Board maintains a distinctive culture across the Group, with a strong ‘tone from the top’ that outlines clear
expectations, standards and the importance of accountability to employees. In addition to the corporate
governance arrangements described in the Governance section and the Section 172 statement, corporate
responsibility is also underpinned by the following factors:
– A commitment to upholding high ethical standards across the Group’s operations and to minimising the risks
associated with financial crime.
– The Board has ultimate responsibility for risk management and control. This encompasses a wide range of
principal and emerging risks, as described in the Annual Report and Accounts.
– Ashmore has operations in multiple regulatory and tax jurisdictions and manages its business in a responsible
and transparent manner.
3. Environment
Ashmore’s business is based primarily on intellectual capital so its direct impact on the environment is limited.
However, the Group manages the environmental risks it faces responsibly, and described below are specific
developments in the areas of GHG emissions and carbon offsetting.
In recognition of its approach to corporate responsibility, Ashmore
is a constituent of the FTSE4Good equity index. It has a AA ESG
rating from MSCI, and a Sustainalytics ESG score of 19.2, which
places it in the ‘low exposure to ESG risk’ category.
Policy documents
Ashmore has a number of policies and other documents that
support its approach to corporate responsibility. These include
documents that are for employee use, that are made available to
the Group’s clients, and that are publicly available on the Group’s
website, such as those listed below:
– ESG Policy
– Supplier Code of Conduct
– Slavery and human trafficking statement
– Conflicts of interest statement
– Complaints handling procedure
– UK tax strategy
Ashmore Group plc Annual Report and Accounts 2023
51
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS S U S T A I N A B I L I T Y ( C O N T I N U E D )
Governance
Ashmore’s Board of Directors maintains a strong corporate culture,
employing high standards of integrity and fair dealing in the
conduct of the Group’s activities, and compliance with both the
letter and the spirit of relevant regulations and standards of good
market practice in all jurisdictions where the Group operates.
Ethical standards
The Board aims to ensure that the Group is fit and proper to
undertake its business, to safeguard the legitimate interests of
Ashmore clients and to protect Ashmore’s reputation.
Although there have been no whistleblowing reports this year,
Ashmore considers it important that there is a clear and accessible
process through which staff can raise such concerns. Therefore,
it has procedures in place to enable employees to raise concerns
confidentially regarding behaviour or decisions that are perceived to
be unethical. This includes use of a third-party agency to provide
staff with an independent whistleblowing channel and the Chair of
the Audit and Risk Committee acts as the nominated Board
Director for whistleblowing.
Financial crime risks
Ashmore is committed to minimising the risk that the Group
is used for the purposes of financial crime, including money
laundering, bribery and corruption, fraud and market abuse.
To achieve this aim, Ashmore has adopted a number of risk-based
policies and procedures for each area of financial crime, as
described in the Risk management section of the Annual Report
and Accounts. The Group provides training to all employees in
relation to anti-money laundering and countering terrorist financing,
including customer due diligence requirements and identifying
money laundering, suspicious activity and financial crime.
Ashmore is committed to ensuring that it verifies the identity of its
clients before a business relationship commences and that this is
valid throughout the course of the relationship.
Information security and data protection
Ashmore’s client base comprises institutions, such as pension
funds and central banks, and intermediaries that provide access
to end investors. Consequently, the Group does not handle
substantial quantities of special categories personal data (also
known as sensitive personal data) relating to clients, investors
or related parties.
The Group has comprehensive and, necessarily, confidential
Information Security and Data Protection policies that are
reviewed at least annually and apply to all employees and offices.
The Board is ultimately responsible for the Group’s risk
management and internal control systems and for reviewing their
effectiveness. The Group considers principal and emerging risks,
and associated controls and mitigants relating to information
security and data protection, within this framework.
The following sections provide a summary of the principles
and processes in place to manage data protection and
information security.
Data protection
Ashmore processes (i.e. collects, uses and destroys) personal
data in accordance with applicable data protection and privacy
laws in place within the jurisdictions in which it operates,
including the GDPR as implemented in the United Kingdom
and the European Union.
52
Ashmore Group plc Annual Report and Accounts 2023
The Group’s Data Protection Policy describes the GDPR-aligned
principles by which Ashmore processes personal data; how
Ashmore and its employees are to adhere to these principles; and
the potential consequences of non-compliance for Ashmore, its
clients and its employees. These principles are listed below.
– Lawfulness, fairness and transparency: Personal data shall be
processed lawfully, fairly and in a transparent manner in
relation to individuals.
– Purpose limitation: Personal data shall be collected for specified,
explicit and legitimate purposes and not further used or
otherwise processed in a manner that is incompatible with
those purposes.
– Data minimisation: Personal data shall be adequate, relevant and
limited to what is necessary in relation to the purposes for which
they are processed.
– Accuracy: Personal data shall be accurate and, where necessary,
kept up to date; every reasonable step must be taken to ensure
that personal data that are inaccurate, having regard to the
purposes for which they are processed, are erased, or rectified
without delay.
– Storage limitation: Personal data shall be kept in a form
which permits identification of individuals for no longer than
is necessary for the purposes for which the personal data
are processed.
– Respect for individuals: Personal data shall be processed in
accordance with individuals’ legal rights.
– Integrity and confidentiality: Personal data shall be processed in
a manner that ensures appropriate security of the personal data,
including protection against unauthorised or unlawful processing
and against accidental loss, destruction or damage, using the
appropriate technical or organisational measures.
– Safe transfer: Personal data shall not be transferred abroad
without adequate safeguards being put in place in accordance
with the law.
In accordance with relevant laws and regulations Ashmore
respects and aims to comply with individuals’ rights as they
relate to their data. For example, the Data Protection Policy
recognises the following rights under GDPR legislation:
– to ask whether the Group holds personal data and/or to receive
a copy of that data;
– to restrict or object to processing of personal data;
– to prevent processing for direct marketing purposes;
– to object to decisions being taken by automated means;
– in certain circumstances, to have inaccurate personal data
rectified, blocked, erased or destroyed; and
– to claim compensation for damages caused by a breach of
the GDPR.
Furthermore, in accordance with the GDPR, Ashmore commits
to keeping the use of legally defined special category personal
data, such as that relating to a data subject’s ethnic origin, to a
minimum and to restrict its availability only to those people
who need to know it.
Ashmore maintains a register that describes its processing of
personal data in accordance with Article 30 of the GDPR.
Information security and cyber security
Information security (including cyber security) is identified as a
principal risk to the business which is subject to Ashmore’s
governance, policies and procedures and risk assessment.
Ashmore assesses, monitors and controls data security risk,
and ensures that there is adequate communication between the
key stakeholders, which include senior management and IT,
human resources, risk management and control, and legal and
compliance departments.
Ashmore has a layered security model, within which multiple
complementary technologies and processes are employed.
Ashmore staff undertake mandatory training in matters of
information security (including cyber security). Ashmore routinely
deploys security updates to its systems and undertakes regular
vulnerability testing of its networks and systems using a specialist
service provider. Events from all key security platforms are
aggregated and correlated using a next-generation SIEM, which
alerts to suspicious patterns of activity. The SIEM is monitored
continuously by cyber security professionals. The Board’s Audit
and Risk Committee receives an annual report on the Group’s
cyber security arrangements, and the Group has a culture of
continuous improvement that means improvements can and do
occur throughout the year.
Ashmore undertakes appropriate pre-contractual due diligence for
new suppliers. Ashmore also maintains appropriate oversight of
cyber security arrangements for all key partners, ensuring there
is additional monitoring and protection regarding their cyber
security. For example, Ashmore affirms and/or attests with key
partners on an annual basis that they have not been susceptible
to cyber security attacks and vendors have taken all reasonable
steps to continuously monitor and protect themselves on cyber
security weaknesses.
Environment
Ashmore’s business is based fundamentally on intellectual capital,
and it does not own its business premises, therefore its direct
impact on the environment is limited and there are few
environmental risks associated with the Group’s activities.
Nevertheless, Ashmore has a responsibility to manage these
risks as effectively as possible.
The Group continues to promote energy efficiency and the
avoidance of waste throughout its operations. Ashmore’s largest
occupancy is at its headquarters at 61 Aldwych, London where
it has a single floor of approximately 19,000 square feet in a nine
storey multi-tenanted building. Electricity usage in London is
separately monitored by floor, with energy efficient lighting
installed. The building landlord allocates the usage of other
utilities based on occupied floor space.
Recycling programmes operate for appropriate disposable
materials. The Group seeks to minimise the use of paper and
wherever possible chooses paper materials that have been
sustainably sourced and are FSC or equivalently accredited.
Carbon offsetting
Ashmore Group plc donates 0.5% of its profit before tax to
charities each year, a proportion of which it donates to The
Ashmore Foundation. Within the Foundation’s donation is a
specific amount to support the Group’s objective to offset its GHG
emissions. In this way, the initiative will have not only the desired
offsetting outcome but also deliver social benefits in the emerging
countries in which Ashmore invests and operates.
Ashmore sets its internal carbon price annually using the past three
months’ rolling average market price of the first carbon futures
contract traded on the European Energy Exchange. For FY2023,
the internal carbon price is EUR 86.8 (FY2022: EUR 83.5).
Ashmore will continue to review its internal carbon price
methodology as industry best practice evolves.
Plant Your Future initiative
The Ashmore Foundation has developed a partnership with Plant
Your Future to offset Ashmore’s Scope 1, 2 and 3 emissions for
FY2022 using a community approach model to reforest parts of
the Peruvian Amazon in Ucayali and Loreto.
Plant Your Future’s work is helping rural Amazonian communities
to break the vicious cycle of deforestation and degradation that is
trapping them in poverty. The project is based on a sustainable
’agroforestry’ model for carbon offsetting through native species
tree planting, restoring canopy cover to deforested farmland, but
at the same time empowering local smallholder communities to
adopt an income-generating sustainable livelihood from their land.
The Ashmore Foundation has purchased 654 tCO2 to offset
Ashmore’s FY2022 emissions.
The Plant Your Future model is not just about planting trees, rather
it has a community-centred approach and builds the capacity of
smallholders to transition permanently to sustainable farming
models and increase the productivity of their land. Agroforestry
combines ’agriculture and forestry’, meaning that the trees planted
capture and store carbon from the atmosphere as they grow, but
the trees themselves, and crops planted alongside them, provide
improved livelihoods at the same time to enable local people to
lift themselves out of poverty. In the Plant Your Future model,
smallholders harvest cash crops (e.g. bananas or chilli peppers)
for short-term income, alongside native fruit or orchard trees
(e.g. cocoa or lime) for a medium-term income.
Future initiatives
The Ashmore Foundation continues to research and plan initiatives
to support Ashmore’s carbon offsetting objectives. While the scale
of individual initiatives tends to be relatively targeted, the Group
nonetheless believes that this approach is optimal because it helps
communities in emerging countries and has greater direct impact
than, for example, generically acquiring carbon-related securities.
The Ashmore Foundation Director visiting a local farmer
with Plant Your Future’s team in Loreto, Peru
Ashmore Group plc Annual Report and Accounts 2023
53
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS S U S T A I N A B I L I T Y ( C O N T I N U E D )
The Ashmore Foundation
Since its establishment in 2008, The Ashmore
Foundation has partnered with over 78 local
organisations in 26 Emerging Markets
countries to equip women and young people with the skills and
resources they need to generate income, drive systemic change
and have a positive environmental impact on their local
communities and beyond.
The Ashmore Foundation functions independently of Ashmore
and is registered in the United Kingdom as a charity and
company limited by guarantee. It is staffed by an Executive
Director who is responsible for managing the Foundation’s affairs.
The Ashmore Foundation board of trustees consists of eight
Ashmore employees, one Ashmore Group plc Non-executive
Director and one independent trustee. In addition to the board
of trustees, Ashmore employees are encouraged to engage
directly in the governance of the Foundation through
involvement in sub-committees.
Ashmore supports the Foundation’s charitable activities through
the provision of pro bono office space, administrative support
and a matched funding commitment for employee donations
to the Foundation.
Ashmore Group plc donates 0.5% of its profit before tax to
charities each year, a proportion of which it donates to The
Ashmore Foundation to deliver its charitable grant strategy.
Ashmore employees actively support the Foundation through a
worldwide annual giving programme as well as organising and
participating in a range of fundraising events from wine tastings
to sports competitions. This year will see employees from across
Ashmore’s Asian and European offices climb Mount Fuji and
Mount Trigav to raise funds for the Foundation.
Delivering social impact in Emerging Markets
As shown opposite, The Ashmore Foundation’s grant strategy is
underpinned by the belief that gender equity, systemic change and
a people first approach are necessary to support economic and
social development at a time when inequality continues to rise in
Emerging Markets.
The Ashmore Foundation believes that with the right support and
investment in education, employment and entrepreneurship,
people can grow and prosper to break the cycle of poverty that
disproportionately affects women and young people in Emerging
Markets countries. The Foundation therefore focuses its social
investment strategy on programmes that aim to equip people with
the skills and resources they need to increase their livelihood
opportunities, enabling them to meet their basic needs while also
supporting economic growth and beginning to address broader
societal inequalities.
Supported by The Ashmore Foundation, World Bicycle
Relief will distribute 350 bicycles, mostly to women, in
the Wayuu community in northern Colombia
54
Ashmore Group plc Annual Report and Accounts 2023
Mobilised communities in rural ColombiaMore than nine million people live in rural areas across Colombia. La Guajira is one of the poorest of Colombia’s Departments. The region has the largest population of indigenous people in the country, an estimated 20% of its population. Uribia, one of the municipalities of La Guajira, reached one of the highest multidimensional poverty indexes (92.2%) in 2020. Affordable transportation options are largely unavailable, resulting in families – especially women and girls – relying primarily on walking to reach health services, water and fuel sources, and the district’s main market. WHY we do it
WHO we do it for
WHERE we invest
Mission &
model
To equip people with the
skills and resources they
need to generate income
and meet their basic
needs as well as drive
systemic change and
have a positive
environmental impact.
Beneficiary groups
Women &
girls
Children &
young
people
Carbon & other
GHG reduction
initiatives
Disadvantaged
communities
Geographic
areas
Where Ashmore has a
local presence, invests or
has existing networks,
with a focus on where it
has a physical presence.
Current priorities:
– India
– Indonesia
– Peru
– Colombia
Geographical focus does
not apply to emergency
responses.
HOW we do it
WHAT we do
Partnership
model
Build long-term
relationships with small to
mid-sized local NGOs to
create systemic change.
However, we want to
ensure these NGOs do
not become reliant on
the Foundation.
Impact themes & grant programmes
Skills &
training
Financial
resilience
Gender
equality
Emergency
response
Systemic
change
Income generation
activities
Carbon /
environmental
Access &
inclusion to
economic
participation
Ashmore Group plc Annual Report and Accounts 2023
55
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS T A S K F O R C E O N C L I M A T E - R E L A T E D F I N A N C I A L D I S C L O S U R E S
Addressing
climate-related risks
and opportunities
Ashmore recognises the responsibilities it has as a steward of clients’
capital. It explicitly considers climate-related risks and opportunities
in its operations and investment processes as recommended by the
TCFD framework and incorporated into the Listing Rules.
Comply or explain framework
In accordance with the Listing Rules for premium-listed companies,
specifically LR 9.8.6R(8) and LR 9.8.6BG, Ashmore has made
disclosures consistent with the 11 TCFD recommendations,
including Sections C and D of the TCFD 2021 Annex. The Group
is compliant with nine of the 11 recommendations, the
exceptions being:
– recommendation five (scenario modelling), where the Group has
performed only a qualitative analysis, but will consider a more
detailed, quantitative approach, including additional scenarios,
as data and models evolve; and
– recommendation 10 (GHG emissions), where Ashmore provides
Scope 1, 2 and 3 emissions, but does not disclose financed
emissions. Following recent FRC guidance, the Group will
continue to consider how it can resolve the challenges to
presenting a meaningful financed emissions figure.
Ashmore intends to undertake further analysis in order to make
progress towards compliance with these recommendations over
the next 12 months.
Investment management activities
The disclosures on the following pages are in respect of Ashmore’s
corporate operations. The disclosures required in respect of its
investment management activities are included in the separate
TCFD Investment Management report, available on the
Group’s website.
Introduction
Environmental challenges, and specifically the effects of climate
change, can be acutely felt by Emerging Markets countries and
companies. Ashmore understands the climate-related challenges
faced by these markets, as well as the need for investors from
both developed and emerging economies to invest in Emerging
Markets to finance sustainable growth. These markets have
typically not contributed to human-made climate change to the
same extent as developed markets, and consequently they do not
bear much of the same responsibility for global warming. Yet,
many developing economies face some of the most serious
physical consequences of a changing climate and must bear the
56
Ashmore Group plc Annual Report and Accounts 2023
burden of building adaptation measures. Consequently, this lack
of climate equity makes it important to ensure that these
markets receive the monetary support and technology transfers
necessary to continue to raise living standards and to support their
populations without adding to the mitigation challenge. Indeed,
several developing countries have stated in their Nationally
Determined Contributions that they will have to rely on international
climate finance if they are to reach their stated targets.
Ashmore supports urgent action to mitigate global warming.
Transitioning to a low-carbon economy will be fraught with
challenges, such as ensuring a Just Transition, however Ashmore
believes that it will also be a source of opportunities. Nowhere is
this more the case than in Emerging Markets, where there is
significant potential to develop sustainable economic growth, and
to support growing populations, on renewable sources of energy.
Ashmore is supportive of efforts that consider the complexity
and varying needs of countries to take action on climate change.
For some countries the focus might be on decarbonising existing
infrastructure, while for others it might be strengthening
governance or protecting natural resources. For example,
Emerging Markets countries are often the guardians of some of
the world’s most precious ecosystems and carbon sinks. It is
therefore crucial that the global economy provides such markets
with the incentives to protect and restore these, treating them
as the valuable resources they are.
Ashmore is headquartered in the United Kingdom and,
consequently, the UK’s commitment in the Climate Act 2008
(2050 Target Amendment) Order 2019 to a net zero economy
has been considered as part of the Group’s TCFD disclosures.
Currently, the main framework for asset managers in this regard
is the voluntary NZAMI, which Ashmore joined in July 2021.
Ashmore submitted its NZAMI Interim Targets in July 2022, and
this initiative serves as the main mechanism by which the Group
addresses climate change mitigation. Refer to the TCFD
Investment Management report for further information.
Governance
1. Describe the Board’s oversight of climate-related risks and opportunities. (Compliant)
Ashmore Group plc has a premium listing on the London
Stock Exchange. The Board has ultimate responsibility for the
Group’s strategy and maintains full and effective control over
appropriate strategic, financial, operational and compliance
matters, including material climate-related issues through its
corporate governance framework. This framework provides
for regular reporting and other updates to the Board, through
which it is able to oversee progress against the Group’s
targets, including those relating to climate issues.
Hence, overall responsibility for climate-related risks and
opportunities lies with the Board. However, on a day-to-day
basis the authority is delegated to the Executive Directors and
the Group’s specialised committees. The Board’s annual
review and challenge of Ashmore’s strategy explicitly includes
areas of focus relating to ESG and responsible investment.
It is important to note that from an operational perspective,
physical climate risk has limited impact on an asset
management business. Instead, climate risks are
predominantly transitional and may impact the Group’s
products, and costs of business travel and office use.
The consideration of climate-related issues as they relate to
guiding strategy, major plans of action, risk management
policies, annual budgets and business plans is guided by the
Responsible Investment Strategy presented to the CEO,
extracts of which are also included and discussed in the
annual update to the Board.
The consideration of climate-related issues is a core part of
the investment framework applied by Ashmore’s investment
teams and consequently it is a component of their
performance objectives. The oversight, monitoring and
implementation of a range of responsible investment
activities also forms part of the performance objectives of
senior management, with ESG matters being one of the areas
of performance considered by the Remuneration Committee
when determining variable remuneration on an annual basis
for the Executive Directors.
ESG in the context of Ashmore’s governance structure
PLC BOARD OF
DIRECTORS
PLC EXECUTIVE
DIRECTORS
ESG COMMITTEE
PLC AUDIT AND
RISK COMMITTEE
LOCAL OFFICE RESPONSIBLE
INVESTMENT FORUM
2. Describe management’s role in assessing and managing climate-related risks and opportunities. (Compliant)
The Board has delegated certain authorities to the Executive
Directors who in turn have formed several specialist
committees with terms of reference to carry out the
functions delegated to them. One such specialised
committee is the ESGC, which is chaired by the CEO and
with members drawn from across Ashmore’s investment,
distribution, risk, legal, operations and other support
functions. This ensures that responsible investment topics are
appropriately understood, assigned to and discussed by all
relevant areas of the firm.
The ESGC has oversight of relevant climate-related issues and
the Group’s Head of Responsible Investment and ESG Policy,
or a delegate, provides updates to the Board. The Board is
informed about goals and targets designed to address
climate-related issues and these are consequently reported
on the following year. Additionally, ESGC members provide
the Board, its Audit and Risk Committee and the RCC with
multiple formal points of contact throughout the year.
Furthermore, Ashmore created the Local Office Responsible
Investment Forum to ensure the sharing of knowledge,
expertise, process and initiatives between the ESGC and the
Group’s local offices.
From an investment management perspective, Ashmore’s
ICs are ultimately responsible for the management of
client portfolios. Through the oversight by these committees,
the Group has integrated the assessment and management
of ESG risks and opportunities, including those related to
climate, into all its investment processes, including both
global and local investment platforms and all investment
themes. Reports presented both at the ESGC and the relevant
ICs ensure the effective monitoring of ESG-related risks.
The processes described in the Risk management section
on pages 35 to 38 incorporate how senior management is
informed about climate-related issues and their assessment
and management of such risks faced by the Group.
Ashmore Group plc Annual Report and Accounts 2023
57
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS T A S K F O R C E O N C L I M A T E - R E L A T E D F I N A N C I A L D I S C L O S U R E S
( C O N T I N U E D )
Strategy
3. Describe the climate-related risks and opportunities the organisation has identified over the short, medium and long
term. (Compliant)
Ashmore considers material climate-related risks and
opportunities over the short term (up to three years, which is
consistent with the planning horizon under the ICARA process),
the medium term (up to 10 years, being an appropriate
timeframe for a reasonable long-term investor), and the long
term (beyond 10 years). The process to determine the risks and
opportunities that could have a material financial impact on the
Group is embedded in Ashmore’s day-to-day operations and
includes consideration of climate-related risks and opportunities
through the Group’s internal control and risk management
framework, the activities of the ESGC including the Local
Office Responsible Investment Forum, the ICs, and the
Group’s financial planning.
Over the short and long term, to the extent possible, Ashmore
has identified limited direct exposure to material operational
climate-related risks. The medium-term opportunity relating to
Emerging Markets capital flows has been identified, for
example the IEA estimates US$1 trillion per annum will be
required to fund clean energy initiatives consistent with
achieving net zero by 2050. Ashmore’s Emerging Markets
specialism means it is well-placed to facilitate and to benefit
from these capital flows, and in the meantime it is gaining
further understanding through membership of organisations
such as the Glasgow Financial Alliance for Net Zero (GFANZ).
Over the short term, a prominent climate-related risk that could
have a material financial impact on Ashmore is the evolving
climate-related regulation and industry developments,
potentially leading to duplication, contradiction and diminishing
effectiveness of initiatives. Ashmore remains focused on
actions that support its purpose to deliver long-term investment
performance for clients and to generate value for shareholders
through market cycles. While evolving regulation poses
implementation risks, it also creates opportunities for an active
manager to develop new products and strategies to fulfil
clients’ investment objectives. In line with client preferences,
and through its Product Committee, Ashmore will continue to
seek opportunities to manage capital to deliver appropriate
investment outcomes, including those related to climate risk.
Since Ashmore invests across fixed income, equity and
alternatives asset classes, and its investment universe
encompasses the full range of diversified Emerging Markets,
these opportunities are assessed on a broad basis.
Over the medium term, there will be further opportunities to
influence perceptions and methods of measuring some of
the factors commonly linked to climate change. For example,
investors typically view GHG emissions from a producer
perspective, which is to the detriment of developing countries
that serve as manufacturing bases, whereas a consumer
perspective would shift the emphasis to patterns of behaviour
in developed countries. Developing countries will require
investment capital to achieve domestic and international
ambitions related to climate change. The first phase of
Ashmore’s corporate strategy, which explicitly targets higher
allocations to Emerging Markets, and therefore a greater focus
by investors on the impact of, and action required to mitigate,
climate-related risks, means that more capital should continue
to flow to Emerging Markets over time.
Over the long term, the most prominent climate-related risk
that could have a material financial impact on Ashmore is
failure to deliver on its net zero commitment.
During the year, Ashmore conducted a review of the physical
climate-related risks faced by seven of its 11 offices and
concluded that the impact in the short term is limited given its
office-based asset management model and mitigating factors.
Ashmore’s office network spans both developed and emerging
countries and therefore the Group faces a wide range of
climate-related physical risks and with different national
adaptation capabilities. For example, while the UK may
experience changing weather patterns, it has a high GDP per
capita and is relatively well-prepared. In contrast, India is
experiencing the consequences of severe weather events on
its population, including large-scale migration to urban areas
that is putting pressure on commuting infrastructure. In
Colombia, the reliance on services such as access to drinking
water is expected to be affected. However, Ashmore’s offices
are located in large cities and benefit from the associated
infrastructure; the offices are leased, which provides
medium-term operational flexibility; and working from
home is an established option for employees.
Identified climate-related risks and opportunities for Ashmore Group plc
Opportunities
– Product development (S)
– Increased capital allocations to
Emerging Markets (M)
Risks
Transition to
low-carbon world
– Evolving regulatory landscape & reporting
requirements (S)
– Changes in consumer preferences (M)
– Market-wide climate-related shocks (S)
– Net zero delivery (L)
Physical impacts of
climate change
– Weather events (S)
– Flooding (S)
– Higher temperatures (S)
Timeframes considered: S = short term; M = medium term; L = long term
58
Ashmore Group plc Annual Report and Accounts 2023
4. Describe the impact of climate-related risks and opportunities on the organisation’s businesses, strategy and
financial planning. (Compliant)
The identified climate-related issues outlined above have not
significantly affected Ashmore’s business, strategy and
financial planning. From an operational standpoint this is, as
explained above, less material. Energy prices could pose a
financial risk related to operational running costs, but this is not
considered a material risk at this time. The main area of impact
relates to the Group’s products and services with opportunities
for its investment management activities. Ashmore’s
investment processes currently incorporate investment
solutions that respond to the evolving regulatory and industry
requirements as they relate to climate change, including
establishing net zero capabilities. For client portfolios, Ashmore
uses its proprietary ESG scorecard to make an assessment
of the impact of climate-related risks and opportunities.
Please refer to Ashmore’s TCFD Investment Management and
Sustainability reports on its website for further information.
Ashmore will assess and act upon climate-related issues that
might affect its planning processes, as appropriate, through
the Group’s established processes including the Operating
Committee, ICs, the ESGC, the Product Committee, and via
the Board’s regular strategy reviews. Thus far, no direct and
material impact of climate-related issues on Ashmore’s financial
performance has been identified. Furthermore, over the
medium to longer term, Ashmore’s business model provides
for significant mitigating factors, such as flexibility afforded
through being a leasehold tenant rather than landlord and the
potential for remote working, together with regional or national
government commitments to address climate-related challenges.
Major categories of potential financial impact
Financial performance
Financial position
Revenues: The need for private capital to contribute to
addressing climate mitigation and adaption can potentially
act as an opportunity for Ashmore.
Assets and liabilities: Ashmore is conscious of how
climate-related risks may impact its assets and liabilities
and includes this consideration in its assessments.
Expenditures: Ashmore’s flexible cost structure is
well-placed to accommodate its required response to
climate-related issues.
Capital and financing: Climate-related risks have been
considered unlikely to affect Ashmore’s capital, and it
has no debt.
5. Describe the resilience of the organisation’s strategy, taking into consideration different climate-related scenarios
including a 2°C or lower scenario. (Partially compliant)
Therefore, Ashmore concludes that its strategy will prove to
be resilient if faced with more severe effects of climate
change. The Group will keep its position under review and
where appropriate will also consider additional scenario analysis
tools to complement its reviews including, as appropriate
data and models permit, the consideration of a transition to a
low-carbon economy consistent with a 2°C or lower scenario.
Ashmore intends to make further progress in this area over
the next financial year, including an assessment of the
three main scenario frameworks available, being the
Intergovernmental Panel on Climate Change’s Representative
Concentration Pathway scenarios; the IEA’s transition risk
scenarios; and the Network for Greening the Financial Sector’s
scenarios covering physical and transition risks.
Qualitative and quantitative scenario analysis, subject to
appropriate data being available to support quantitative
models, can help to highlight the transformations required
to meet certain climate targets, warn about policy changes,
challenge conventional wisdom about the future, and
question business-as-usual assumptions.
Over the past year, Ashmore’s approach to scenario analysis
has remained largely qualitative with the aim of exploring the
range of potential climate change implications for its business.
Ashmore is also assessing the array of scenario analysis
techniques available, as set out below.
Transition risks are considered as part of the Group’s risk
management and internal control framework, and do not
currently pose a significant threat to Ashmore’s overall
strategy. Similarly, from a Group perspective, the review of
physical risks to offices concluded that the risks are unlikely
to have a material impact in the short term. Over the medium
to longer term, there are significant mitigating factors, such
as flexibility afforded through being a leasehold tenant rather
than a landlord, the potential for remote working and
regional or national government commitments to address
climate-related challenges.
Ashmore Group plc Annual Report and Accounts 2023
59
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS T A S K F O R C E O N C L I M A T E - R E L A T E D F I N A N C I A L D I S C L O S U R E S
( C O N T I N U E D )
Risks and opportunities
6. Describe the organisation’s processes for identifying and assessing climate-related risks. (Compliant)
Ashmore’s internal control framework, described in detail in
the Risk management section on pages 35 to 38, provides a
set of processes for identifying, evaluating and managing the
Group’s emerging and principal risks, and identifies associated
controls and mitigants. The Board’s Audit and Risk Committee
regularly reviews the framework. Ashmore’s Principal Risk
Matrix explicitly identifies climate risk and ensures senior
management is made aware of, and acts on, such risks.
For example, the principal risk includes the failure to
understand and plan for the potential impact to the business
that investor or business sentiment, climate change and
sustainability regulations may have on product preferences
and on underlying asset prices that may be affected by the
transition to a low-carbon economy.
In addition, consideration of the regulatory requirements for
asset managers, including those relating to climate change
(and ESG more generally), is a principal risk for the Group.
This is monitored through the ESGC’s standing agenda item
covering regulatory updates.
Further information relating to Ashmore’s investment
processes, including sovereign and corporate engagements,
is available in the Group’s Sustainability, Engagement,
UK Stewardship Code and TCFD Investment Management
reports, available on its website.
7. Describe the organisation’s processes for managing climate-related risks. (Compliant)
Ashmore reviews and prioritises climate-related risks and
associated controls and mitigants as part of its Principal Risk
Matrix and, where appropriate, on a quarterly basis challenge is
provided by the RCC and the Audit and Risk Committee (see
Risk management section on pages 35 to 41).
Climate change and the failure to understand and plan for the
potential impact to the business that investor sentiment,
climate change and sustainability regulations may have on
product preferences and on underlying asset prices that may
be affected by the transition to a low-carbon economy are
mitigated by a combination of policy setting and governance
by the ESGC. At the Group level, this risk is managed in
relation to Ashmore’s GHG emissions, which are offset via
The Ashmore Foundation.
8. Describe how processes for identifying, assessing and managing climate-related risks are integrated into the
organisation’s overall risk management. (Compliant)
Climate-related risks are considered in a similar manner to
other emerging or principal risks, since they may affect various
aspects of the Group’s strategy, business model, clients and
operational and financial performance. In this context, the
identification, assessment and management of such risks are
integrated into Ashmore’s robust risk management culture and
its internal control framework.
For example, within Ashmore’s Principal Risk Matrix, the
different aspects of climate risks would impact distribution
and client oversight activities, integration within investment
management processes as well as regulatory requirements and
the Group’s overall reputation. These are considered both on a
standalone basis as well as in combination to ensure related
risks are assessed, managed and, where appropriate, mitigated
through the development of internal controls and processes.
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Ashmore Group plc Annual Report and Accounts 2023
Metrics and targets
9. Disclose the metrics used by the organisation to assess climate-related risks and opportunities in line with its
strategy and risk management process. (Compliant)
The main climate-related metric used by Ashmore is its
operational GHG emissions, which are modest and are
disclosed in accordance with the Act and SECR requirements.
The latest disclosures can be found in the Directors’ report.
As part of the process to offset its GHG emissions, Ashmore
sets an internal carbon price based on the three-month rolling
average market price of the first carbon futures contract traded
on the European energy exchange.
This methodology is unchanged from last year and for
the period ending 30 June 2023 resulted in a price of
€86.82 per tonne CO2e.
Ashmore’s Remuneration Committee takes into consideration
qualitative and quantitative ESG factors, including those relating
to climate issues, when determining Executive Directors’
performance-related variable remuneration, as described in the
Remuneration report.
Summary of climate-related metrics
Ashmore Group plc metric
Investment management metric1
GHG emissions
Scope 1, 2 & 3 provided in tCO2e
WACI (tCO2e/US$ million revenue)
Total/Absolute Carbon Emissions (tCO2e)
Carbon Footprint (tCO2e/US$ million invested)
Transition risks
Qualitative assessment
Physical risks
Qualitative review
Climate-related
opportunities
Industry demand for dedicated
ESG-labelled products
Capital deployment
N/A
Stranded assets
Qualitative assessment
Qualitative assessment
Qualitative assessment
Internal carbon price
Carbon price calculated using average price over three months
1. Refer to TCFD Investment Management report for further information, including details of NZAMI targets.
10. Disclose Scope 1, Scope 2 and, if appropriate, Scope 3 GHG emissions and the related risks. (Partially compliant)
Ashmore reports its GHG emissions annually, as required by
the Companies Act. The latest disclosures are in the Directors’
report on page 113, and summarised in the chart opposite.
In July 2023, the FRC published a thematic review of climate-
related metrics and targets with specific guidance and
expectations for asset managers. This included the view that
financed emissions are likely to be material for most asset
managers, and therefore relevant to the consideration of this
TCFD recommendation. Ashmore does not currently calculate
financed emissions beyond its regulatory requirements under
SFDR (see Ashmore website for related disclosures) and client
reporting on specific portfolios, and hence it has concluded that
it is currently only partially compliant with this TCFD
recommendation. The Group will continue to consider how to
resolve the inherent challenges in presenting a meaningful
financed emissions figure, which include the availability of
consistent and reliable data from Emerging Markets issuers;
the treatment of data from corporate and sovereign issuers;
and the choice of appropriate intensity measures.
Ashmore Group plc’s GHG emissions by scope (tCO2e)
FY2023
FY2022
FY2021
FY2020
989.5
653.9
227.0
689.7
11. Describe the targets used by the organisation to manage climate-related risks and opportunities and performance
against targets. (Compliant)
Operationally, Ashmore leases its offices, typically alongside
other tenants, meaning that in many cases it is allocated a share
of total building emissions based on leased footprint. Therefore,
the ability to measure, and hence to directly influence changes
in the Group’s gross GHG emissions, is severely limited.
Nonetheless, Ashmore seeks to offset its operational GHG
emissions through a thoughtful, socially responsible and
measurable approach via The Ashmore Foundation.
As described in the Sustainability section, the Foundation has
developed a partnership with Plant Your Future, through which
it has purchased 654 tCO2 to offset the Group’s emissions
relating to FY2022. This will be delivered through a community
approach model to reforest parts of the Peruvian Amazon in
Ucayali and Loreto, and will assist local communities to break
the vicious cycle of deforestation and degradation that is
trapping them in poverty.
Ashmore Group plc Annual Report and Accounts 2023
61
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS B O A R D O F D I R E C T O R S
Committed to robust
standards of governance
Mark Coombs
Chief Executive Officer
Tom Shippey
Group Finance Director
Clive Adamson
Non-executive Chair
Appointed to the Board: December 1998
Appointed to the Board: November 2013
Skills, experience and contribution:
Skills, experience and contribution:
Mark Coombs founded the business
which became Ashmore in 1992 and
has overseen its successful growth for
over 30 years.
Other roles past and present:
Mark was appointed a Director on the
incorporation of the Company and has
served as its Chief Executive Officer
since then. He held a number of positions
at ANZ and led Ashmore’s buyout from
ANZ in early 1999. He is Co-Chair of
EMTA, having been on the Board since
1993. Mark holds an MA in Law from
Cambridge University.
Tom Shippey is a chartered accountant
with extensive experience in investment
management, mergers and acquisitions,
capital raising and financial and
regulatory reporting.
Other roles past and present:
Tom was appointed to the Board as
GFD in November 2013. Prior to joining
Ashmore in 2007, he worked at UBS
Investment Bank, including advising on
the Ashmore IPO in 2006. He is currently
a trustee of the Resurgo Trust.
Tom qualified as a Chartered Accountant
with PricewaterhouseCoopers in 1999 and
is a Fellow of the ICAEW. Tom holds a BSc
in International Business and German from
Aston University.
Key to membership of committees
A
N
R
– Audit and Risk
– Nominations
– Remuneration
(A square denotes the Chair)
Appointed to the Board: October 2015
and as Chair: April 2022 (independent
on appointment)
Skills, experience and contribution:
Clive Adamson has enjoyed a career in
financial services for over 40 years, spanning
executive roles in banking and regulation and
Non-executive Director roles, including Board
and Committee Chair positions, across
wholesale and retail banking, insurance and
asset management.
Other roles past and present:
Clive spent 20 years in wholesale banking,
holding senior positions with Citigroup and
Bank of America. He moved into regulation
as an adviser at the Bank of England before
joining the newly formed Financial Services
Authority and then the FCA upon formation
where he was Director of Supervision and an
Executive Member of the Board. Clive was a
Non-executive Director of Virgin Money plc
and a Senior Adviser at McKinsey & Company.
He is currently Chair of J.P. Morgan Europe Ltd
and its Nominations Committee (the Chase UK
digital consumer bank), a Non-executive
Director and Chair of the Audit Committee of
J.P. Morgan Securities plc, and Chair of
Nutmeg Saving and Investment Ltd. He is a
Non-executive Director and Chair of the Risk
Committee of both M&G plc and Prudential
Assurance Company Limited. Clive holds an
MA in Economics from Cambridge University.
Committee membership: N R
Board and committee attendance
The table below sets out members’ attendance at scheduled and additional meetings of the Board and its committees.
Meeting attendance between
1 July 2022 and 30 June 2023
Mark Coombs
Tom Shippey
Clive Adamson1
Helen Beck
Jennifer Bingham
Thuy Dam2
Shirley Garrood3
Board
Attended
7/7
7/7
7/7
7/7
7/7
1/1
6/6
N: Nominations
Committee
Attended
–
–
5/5
5/5
5/5
1/1
4/4
A: Audit and Risk
Committee
Attended
–
–
2/2
7/7
7/7
1/1
7/7
R: Remuneration
Committee
Attended
–
–
7/7
7/7
7/7
1/1
6/6
Members of executive management are invited to attend scheduled Board committee meetings as required but do not attend as members of those committees.
1 Clive Adamson stood down as a member and Chair of the Audit and Risk Committee on 23 January 2023.
2 Thuy Dam was appointed to the Board on 1 June 2023.
3 Shirley Garrood was appointed to the Board on 1 August 2022 and took over from Clive Adamson as Chair of the Audit and Risk Committee on 23 January 2023.
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Ashmore Group plc Annual Report and Accounts 2023
Helen Beck
Independent Non-executive Director
Appointed to the Board: June 2021
Skills, experience and contribution:
Helen Beck is a commercial international
adviser with significant experience in
advising boards on remuneration and
human resources. She has a strong
executive track record in building and
growing client centric businesses with
extensive financial services experience
across a broad range of asset management
firms and banks.
Other roles past and present:
Helen was formerly a Partner and Head of
Financial services remuneration practice at
Deloitte LLP. Prior to joining Deloitte, she
held a number of senior executive
appointments in human resources,
remuneration and consultancy, including at
Standard Bank, McLagan Partners and
Fidelity Asia-Hong Kong. Helen is currently
a Non-executive Director of Funding Circle
Holdings plc and Chair of its Remuneration
Committee, an Independent Governor of
University of Bedfordshire, and an
Independent Member of the Remuneration
Committee for the British Olympic
Association. She was previously a
Non-executive Director of Irwin Mitchell
Holdings Limited. Helen holds a BA(Hons)
in Social Administration from the University
of Nottingham, is a Member of the
Institute of Personnel Development and
holds a Post Graduate Diploma in
Personnel Management.
Committee membership:
A N
R
Jennifer Bingham
Senior Independent Director
Appointed to the Board: June 2018
Skills, experience and contribution:
Jennifer Bingham has in-depth experience
in investment oversight of the investment
portfolios of family offices and charitable
foundations and in her previous executive
role in the Emerging Markets fund
management business.
Other roles past and present:
Jennifer is an accountant and between
1992 and 2003 she was a senior executive
of Brunswick Capital Management Limited,
an investment manager specialising in the
Russian equity market. During this period
she variously held the offices of Chief
Executive, Chief Operating and Chief
Financial Officer. Since 2003 Jennifer has
held finance, administration and
investment oversight roles with investment
company PCHB Limited (part of the Cundill
group of companies). She is currently an
Executive Director of FPC Philanthropies
Ltd (the Peter Cundill Foundation) and sits
on the investment committee of PCHB
Limited. Jennifer is also an Executive
Director of Valley Management (UK)
Limited, an Executive Director of Stichting
Pamina, a Dutch Charitable Foundation,
and a Trustee of The Ashmore Foundation.
Committee membership: A N R
Thuy Dam
Independent Non-executive Director
Appointed to the Board: June 2023
Skills, experience and contribution:
Thuy Dam has extensive investment and
banking knowledge and has a thorough
understanding of the complexity of
Emerging Markets, particularly in Asia.
Other roles past and present:
Thuy began her career as an entrepreneur,
co-founding Vietnam’s first private foreign
investment consultancy firm. She then
joined ANZ, helping to set up ANZ’s
banking business in Asia and becoming
the first Vietnamese citizen to lead an
international bank in Vietnam. Thuy was
ANZ’s Vice Chair to the Greater Mekong
region prior to joining the National Australia
Bank as its Chief Representative in
Vietnam. She has previously served as a
Non-executive Director and Chair of the
Remuneration Committee of VinaCapital
Vietnam Opportunity Fund Ltd and was
the President of the Fulbright University
Vietnam. Thuy is Non-executive Director of
Thien Minh Group Limited, TASCO JSC
and EQuest Education Group. Thuy holds a
BA in English from the University of Hanoi
and an MBA in Finance from the Wharton
School of Business at the University of
Pennsylvania.
Committee membership: A N R
Shirley Garrood
Independent Non-executive Director
Appointed to the Board: August 2022
Skills, experience and contribution:
Shirley Garrood has extensive financial
services experience built up over many
years with a focus on operations, finance
and risk matters within financial services
and investment management.
Other roles past and present:
Shirley was Chief Financial Officer and
Chief Operating Officer of Henderson
Group plc and, since finishing her executive
career, has held roles at esure Group plc as
Deputy Chair, Chair of the Audit Committee
and Senior Independent Director; and Chair
of the Audit and Risk Committees and
Senior Independent Director of Hargreaves
Lansdown plc. She also served as a
governor of the Peabody Trust housing
association; a Non-executive Director of
Royal London Mutual Insurance Society
Limited, and Chair of Royal London Asset
Management Holdings Limited and Royal
London Asset Management Limited, also
chairing their Risk and Capital Committee;
and a Non-executive Director and Chair of
the Audit and Risk Committee of the BBC.
Shirley is currently an Independent
Non-executive on Deloitte LLP’s Audit
Governance Board, providing oversight of
the external audit and assurance business
only. She is also Chair of Dignity Group
Holdings Limited and Chair of the Audit
Committee. Shirley holds a BSc in
Economics and Accounting from the
University of Bristol and is a qualified
Chartered Accountant and Corporate
Treasurer.
Committee membership: A N R
Ashmore Group plc Annual Report and Accounts 2023
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GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS C H A I R ’ S S T A T E M E N T A N D I N T R O D U C T I O N T O
C O R P O R A T E G O V E R N A N C E
Commitment to
robust governance
Dear shareholder,
At the end of my first full year as Chair of the Board, I am pleased
to say that Ashmore continues to have a knowledgeable, engaged
and effective Board. We welcomed two new Board members
during the year, Shirley Garrood and Thuy Dam, and I look forward
to their participation continuing to enhance our Board discussions.
I would like to thank all of my fellow Directors for their ongoing
commitment to Ashmore.
The past year has seen notable improvements in many global
macro factors, although regrettably the war in Ukraine continues.
Although market cycles present challenges, they also provide
investment opportunities and Ashmore’s consistent approach and
experience of investing in Emerging Markets over the past 30
years means that it is delivering significant outperformance for
clients as markets begin to recover from headwinds such as rising
interest rates. The Group’s flexible and resilient business model
has helped to mitigate the impact of lower average AuM levels on
the financial performance, and the Board is recommending the
payment of an unchanged final ordinary dividend to shareholders.
I would also like to thank Ashmore’s employees for their efforts
during the year. They continue to show professionalism, dedication
and team spirit, which is key to Ashmore’s success.
Governance and Company purpose
Ashmore’s governance structure remains appropriate to the size
and complexity of the business. It enables the Board to oversee
the execution and delivery of Ashmore’s purpose, as a specialist
Emerging Markets investment manager, to deliver long-term
investment outperformance for clients and generate value for
shareholders across market cycles. In fulfilling its role, the Board is
guided by the Group’s purpose in the shaping of key decisions,
culture and values. The Board follows the highest ethical and
professional standards in the business, supported by a strong
internal culture and staff values, which drive appropriate behaviour,
embedded by the Company’s compliance, risk management and
employment policies and practices.
The Board’s work during the year is set out on page 71 and shows
the usual schedule of business as well as updates on specific
topics. The Company’s consistent three-phase strategy remains
to capitalise on the substantial growth opportunities available in
the Emerging Markets in order to create value for clients and
shareholders. More detail can be found in the Strategy
description on page 14.
Board changes and time commitments
The Nominations Committee regularly discusses succession
planning and diversity for both the Board and senior management.
This year we put this planning into practice by approving the
establishment of a Diversity Committee and by welcoming two
new Non-executive Directors.
Shirley Garrood joined the Board on 1 August 2022 and she
became a member of the Nominations, Remuneration and Audit
and Risk Committees on appointment. Following the receipt of
FCA approval, Shirley took over as Chair of the Audit and Risk
Committee on 23 January 2023, capitalising on her extensive
financial services and audit experience.
We then welcomed Thuy Dam to the Board on 1 June 2023 and
she also became a member of the Nominations, Remuneration
and Audit and Risk Committees on appointment. Thuy is our first
Non-executive Director based in an Emerging Market, Vietnam,
and brings valuable local markets insights on the Southeast Asia
region to Ashmore.
In both cases, any potential conflicts and other time commitments
were declared to the Nominations Committee and considered by
the Board at the time of appointment. Shirley and Thuy each took
part in a comprehensive induction programme to support their
introduction to Ashmore.
All external appointments are disclosed to and considered by
the Board in the context of the overall time commitments of
the relevant Director (bearing in mind any roles that have also
been relinquished) and whether such commitments impinge
on their duties to Ashmore. Details of the Directors’ external
commitments are provided on pages 62 to 63. The Nominations
Committee report gives details on how it considered applications
by Non-executive Directors to take on new external
appointments on page 77.
Details of each Director’s profile can be found on pages 62 to 63
of this report and the Board is recommending the election or
re-election of all Directors at this year’s AGM.
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Ashmore Group plc Annual Report and Accounts 2023
Board evaluation
This year, I led the annual evaluation of the Board, its committees
and the Directors, assisted by a questionnaire and meetings with
each member of the Board. All views were shared and discussed in
an informal meeting of the Board. All Directors were of the opinion
that the Board and its committees are effective in carrying out their
responsibilities. Nevertheless, we found certain areas where we
can focus in the coming year. More detail is provided in the
Nominations Committee report on page 77.
The Board values the experience of face-to-face meetings,
in-person management presentations and informal ‘meet the
teams’ sessions, which this year included visits to our Singapore
and Indonesia offices as detailed below. However, the benefits of
remote meetings are recognised and will ensure that Thuy Dam is
able to participate fully on occasions when she is not present in
London for Board and committee meetings. It is anticipated that
Thuy will attend meetings in person at least three times a year.
Board visit to Singapore and Indonesia
In December 2022, the Board held its Board and committee
meetings in Ashmore’s office in Jakarta, Indonesia, and also visited
the Ashmore office in Singapore. As part of the visit, the Directors
held ‘meet the teams’ sessions to meet the local employees in
both the Singapore and Indonesia offices. Members of the
Singaporean and Indonesian teams were also invited to join the
Board for dinner, which offered the Directors an opportunity to
engage more informally with Ashmore employees. The Board felt
that the trip was highly informative and intends to undertake similar
visits to other Ashmore offices in future years to continue to
expand its understanding of the Group’s local market operations.
Our people
In addition to the Board visit, the Directors have continued to
engage directly with Ashmore’s workforce, by hosting informal
discussions with employees from different departments. This
approach allows Directors to meet directly and informally with
employees and helps us assess and monitor the culture of the firm.
Jennifer Bingham is the Non-executive Director for workforce
engagement. As such, she chairs the ‘meet the teams’ sessions
and acts as a conduit for the Board to facilitate interaction and
understanding of workforce sentiment. This engagement helps to
inform our discussions and decision making. A summary of the
Board’s engagement with employees and other stakeholders is
included in the Section 172 statement on page 42 and the
Directors’ report on page 113.
The Board has responsibility for oversight of the Group’s
whistleblowing arrangements and the Chair of the Audit and Risk
Committee is the nominated Director with responsibility for
whistleblowing. An independent agency provides a means through
which employees can raise concerns confidentially, if they do not
wish to bring these to the attention of management. All employees
are made aware of and have access to these arrangements.
Details of how Ashmore invests in and rewards its people are
provided in the Remuneration report on pages 78 to 111. The
Board believes that the current remuneration structure for all
employees works to benefit clients, shareholders and employees
alike. The proposed changes to the Directors’ Remuneration policy
are intended to maintain this alignment under the new structure for
the Executive Directors.
ArtScience Museum, Singapore
Diversity
In order to execute its strategy, the Group needs to continue to
attract, develop and retain a diverse workforce. Ashmore is an
organisation that spans multiple cultures and ethnicities, and the
Board and Nominations Committee understand the importance
of improving its gender and ethnic diversity. The Board regularly
discusses diversity and the diversity policies of the Board and the
Group are reviewed at least annually. A new Diversity Committee,
chaired by Jennifer Bingham, was established during the year.
Our progress on diversity is described further in the Nominations
Committee report on page 77 and the Directors’ report on
page 113.
I am pleased to confirm that the Board meets the requirement to
have a minimum of 40% of Board positions held by women and
we have a female Senior Independent Director, meaning that
Ashmore was in compliance with the FTSE Women Leaders
Review and the Listing Rules throughout the year. Following the
appointment of Thuy Dam on 1 June 2023, the Board also now
has at least one Director from an ethnic minority background in
line with the Parker Review and the Listing Rules. The gender and
ethnic diversity of the Board, senior management and employees
is reported on pages 47 and 48.
Ashmore Group plc Annual Report and Accounts 2023
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GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS C H A I R ’ S S T A T E M E N T A N D I N T R O D U C T I O N T O
C O R P O R A T E G O V E R N A N C E ( C O N T I N U E D )
Our shareholders
Understanding the views of shareholders is essential to the
Group’s long-term success. The Board regularly considers
shareholder feedback at its meetings and factors these views
into its decision making. We keep shareholders updated on
performance and news through annual and half-year results,
quarterly AuM statements and via the regulatory news service.
The Executive Directors hold regular meetings with a range of
shareholders and potential investors and I also met several of
Ashmore’s major shareholders during the year. Ashmore’s AGM
provides an opportunity for all shareholders to meet with the
Board and raise matters of interest.
At the 2022 AGM, 78% of shareholders voted in favour of the
Remuneration report. Through our ongoing programme of
engagement with shareholders and proxy advisers, we are aware
of the views held by certain governance teams in relation to the
Remuneration report, leading to the votes against.
In preparation for the triennial shareholder vote on the Directors’
Remuneration policy at the 2023 AGM, the Remuneration
Committee has reviewed Ashmore’s approach to executive
remuneration and a comprehensive governance roadshow was
held, which covered c.75% of the institutional shareholder register
and the main proxy advisers. This enabled Helen Beck, in her role
as Chair of the Remuneration Committee, to discuss proposed
changes to the Directors’ Remuneration policy and other matters.
Further details on this review and the subsequent roadshow can be
found in the Remuneration report on pages 81 to 84. The proposed
Directors’ Remuneration policy is set out on pages 85 to 93.
Wider society
Ashmore continues to engage with investors, governments and
NGOs across a range of issues that are important to the business
and the wider world. Management shares insight and feedback
from this engagement with the Board, helping us understand how
Ashmore’s products and services can better serve its stakeholders.
Our Section 172 statement on pages 42 to 45 sets out how
Ashmore has taken account of our stakeholders, and the
Sustainability report on pages 50 to 55 describes the good work
that has been done this year by The Ashmore Foundation and the
offsetting of the Group’s carbon emissions. ESG is integrated into
Ashmore’s investment processes and we are committed to
providing transparent reporting to stakeholders on ESG outcomes.
A more extensive review of Ashmore’s ESG activities can be
found in the Sustainability Report, which is available on the
Group’s website.
Dividend
The Board recognises the importance of the ordinary dividend to
shareholders, and, taking into consideration the annual profit, the
unrealised nature of the seed capital result, the cash flows
delivered, the balance sheet’s strength and the continued growth
opportunities available to Ashmore over the longer term, it is
recommending a final dividend of 12.1 pence per share, to give
total dividends per share for the year of 16.9 pence.
Clive Adamson
Chair
5 September 2023
2018 UK Corporate Governance
Code Compliance Statement:
Ashmore has complied with the Code
during the year, save for Provision 24
(membership of the Audit and Risk
Committee) for part of the year. Ashmore
explains on pages 67 to 68 how each of the
Principles of the Code have been applied
and why there was a departure from
Provision 24 on an interim basis.
Operational resilience
During the period, Ashmore addressed the FCA’s
operational resilience requirements. A working group
chaired by the GFD identified Ashmore’s important
business services which are delivered to clients and
mapped out the processes that enable those services to
function. It was then determined how much disruption
each important business service could tolerate and this
impact tolerance was then tested. This self-assessment
was completed in March 2023 and approved by the
Board in May 2023. A similar operational resilience
self-assessment will be completed annually, starting in
early 2024 and therefore well ahead of the FCA’s deadline
of March 2025.
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Ashmore Group plc Annual Report and Accounts 2023
C O R P O R A T E G O V E R N A N C E
Complying with the Code
Ashmore explains below how it applied the Principles of the Code during
the year ended 30 June 2023. The explanation references the alphabetic
coding of the Provisions of the Code. Ashmore complied with all
Provisions, save as indicated below (Provision 24).
Board Leadership and Company Purpose
A. Board’s role. A formal schedule of matters reserved for the
Board is reviewed and approved by the Board on an annual
basis. It sets out the framework under which the Board
manages its responsibilities, discharges its authority and
manages its own activities. A yearly planner seeks to ensure the
most important and current topics are discussed at meetings
during the year. The Board’s main activities throughout the year
are detailed on page 71.
B. Purpose and culture. The Company’s purpose, as a specialist
Emerging Markets investment manager, is to deliver long-term
investment outperformance for clients and generate value for
shareholders through market cycles. Its strategy for doing so is
set out in the Strategic report and includes, among other
matters, how in pursuing the objectives set out within the
purpose, Ashmore ensures its culture and working practices
align both with its purpose and its broader set of stakeholders
through effective and entrepreneurial leadership. The Board
receives regular reports on employees’ compliance with
regulatory and risk management requirements, hears
presentations and updates from different departments and
offices and meets employees on an informal basis after each
Board meeting. These elements underpin Ashmore’s
assessment of its culture, which is also considered as part of
internal audit reviews.
C. Resources and controls. It is the duty of the Board to ensure
that adequate resources are in place for the delivery of its
strategy over the long term. The use of those resources is set
out in a delegated authority framework, designed to ensure that
decisions over those resources are taken by the right persons at
the right level with accountability to the Board. The Risk
management section of this report further describes the
framework of controls by which Ashmore enables risk
assessment and risk management.
D. Stakeholder engagement. The Section 172 statement made on
pages 42 to 45 includes examples of matters considered by the
Board during the year and what was taken into account when
making those decisions, including engagement with
shareholders and other stakeholders. The Board’s monitoring
and response to any Director’s potential conflict of interest is
carried out by the Nominations Committee. An agreement is in
place with respect to the controlling shareholding of Mark
Coombs where independence provisions are in place. This is
explained in more detail in the Directors’ report on page 113.
Any Director with any concerns about the Board or
management of the Company may have these recorded in
the minutes.
E. Workforce engagement. Jennifer Bingham, the Senior
Independent Director, is the designated Non-executive Director
with responsibility for engagement with Ashmore’s workforce.
An explanation as to how she undertook this function during the
year is given on page 113. The Chair of the Audit and Risk
Committee performs the role of whistleblowing champion for
the Group. A confidential hotline is available for any employees
who wish to raise concerns of wrongdoing in the workplace on
an anonymous basis. The Board receives regular reports on the
functioning of the independent reporting arrangements in place
for any such matter raised.
Division of Responsibilities
F. Role of the Chair. Clive Adamson was independent upon
appointment as Chair of the Board. He leads on the
effectiveness of the Board by setting the agendas and timetable
for meetings, and encouraging an open and constructive
dialogue during meetings, inviting the views of all Board
members. He ensures that Board members receive accurate,
timely and clear information in his regular interactions with
Executive Directors and the Company Secretary.
G. Composition of the Board. The Board consists of two Executive
Directors, four Non-executive Directors and a Non-executive
Chair who was considered independent upon appointment to
the Board. Their responsibilities have been set out in writing and
agreed by the Board and are available on the Group’s website.
Their roles and responsibilities are also further described on
page 70, which show the division between the Board
responsibilities and the executive leadership of the Company.
These roles and responsibilities are reviewed annually.
A Senior Independent Director has been appointed and
Jennifer Bingham led this year’s appraisal of the Chair.
More details are given on page 77.
Ashmore Group plc Annual Report and Accounts 2023
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GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS C O R P O R A T E G O V E R N A N C E ( C O N T I N U E D )
The Board delegates a number of responsibilities to the Audit
and Risk Committee, including oversight of the Group’s financial
reporting processes, internal control and risk management
systems and the work undertaken by the external and internal
auditors. The Committee also supports the Board’s consideration
of the Company’s viability statement and its ability to operate
as a going concern. The Audit and Risk Committee report on
pages 72 to 75 describes the work of the Committee during
the year and how it discharged its duties and responsibilities.
N. Fair, balanced and understandable assessment. When taken as
a whole, the Directors consider the Annual Report and Accounts
is fair, balanced and understandable and provides information
necessary for shareholders to assess the Company’s
performance, business model and strategy. A description of
how the Audit and Risk Committee ensures that a robust
process is in place for ensuring this is described on page 72.
O. Risk management and internal control framework. The Board is
responsible for setting the Company’s risk appetite in line with
its long-term strategic objectives, and annually reviews the
effectiveness of the Company’s risk management and internal
control systems. The internal control framework is described
on pages 35 to 39. The Audit and Risk Committee has oversight
of the effectiveness of internal controls and for developing
proposals in respect of overall risk appetite and tolerance as
well as metrics to monitor the Group’s risk management
performance. Further details are set out in the Audit and Risk
Committee report on pages 72 to 75 and a description of the
principal risks facing the Company is set out on pages 40 to 41.
Remuneration
P. Remuneration policies and practices. The Remuneration
Committee comprises all the independent Non-executive
Directors and is chaired by Helen Beck. The Chair of the Board,
who was independent on appointment, is also a member of
the Committee. The Remuneration report provides details of
the Group’s approach to remuneration on page 94.
Q. Executive remuneration. The Remuneration Committee has
responsibility for determining the policy for executive
remuneration and for setting remuneration for the Chair of
the Board, Executive Directors and senior management.
No Director is involved in deciding their own remuneration
and the remuneration of the Chair of the Board and the
Non-executive Directors is designed to reflect their time
commitment and responsibilities. Further details are set
out in the Remuneration report on pages 78 to 111.
R. Remuneration outcomes and independent judgement. Details of
the composition and the work of the Remuneration Committee
are reflected in its terms of reference and are set out in the
Remuneration report.
H. Role of the Non-executive Directors. The Non-executive
Directors’ engagement with management, their constructive
challenge and contribution to Board discussion are assessed as
part of the Board’s annual effectiveness review. Their expected
minimum time commitment is set out in their appointment
letters and they are required to seek approval for any new
external appointments in advance, as set out in the Nominations
Committee report on page 77. All Directors’ other appointments
are listed on pages 62 to 63 and their attendance at meetings
on page 62.
I. Role of the Company Secretary. All Directors have access to the
advice and support of the Group Company Secretary and her
team. Directors can request the arrangement of additional
briefings on the business, external developments and
professional advice independent of the Company, at the
Company’s expense. The appointment or removal of the
Group Company Secretary is a matter for the Board.
Composition, Succession and Evaluation
J. Appointments to the Board and succession planning.
The Nominations Committee report on pages 76 to 77 sets out
its activities and areas of focus during the year, including the
recruitment of a new Non-executive Director, Board and
committee composition and progress on diversity and inclusion.
All the independent Non-executive Directors are members of
the Nominations Committee and the Chair of the Board is also
Chair of the Committee, save where it considers the role of
Board Chair. All Directors are subject to shareholder election or
re-election at each AGM, unless retiring at the conclusion of the
meeting. None of the Non-executive Directors has served over
nine years on the Board.
K. Skills, experience and knowledge of the Board. During the year,
the Nominations Committee recommended the appointment of
a new Non-executive Director based on an analysis of the skills,
experience and knowledge needed. The Nominations
Committee report on page 76 gives further details of that
recruitment process. Following the appointment of Shirley
Garrood and Thuy Dam to the Board, a series of induction
meetings was set up to enable each of them to gather further
insights into the Company. There is a programme of ongoing
training for all Board members in addition to the regular
programme of presentations at Board meetings.
L. Board evaluation. The internal Board evaluation, which took
place during the year, is described in the Nominations
Committee report on page 77, together with its outcomes.
Audit, Risk and Internal Control
M. Internal and external audit. The Audit and Risk Committee
currently comprises four independent Non-executive Directors.
From 21 April 2022 to 23 January 2023, following the
resignation of David Bennett and appointment of Clive Adamson
as Chair of the Board, the Company did not comply with
Provision 24 of the Code which states that the Chair of the
Board should not be a Committee member. Clive Adamson
retained the role of Chair of the Audit and Risk Committee when
he took over as Chair of the Board. This was an interim solution,
while FCA approval was awaited for Shirley Garrood to take on
the role of Chair of the Audit and Risk Committee following her
appointment to the Board on 1 August 2022. On 23 January
2023, Shirley Garrood succeeded Clive Adamson as Chair of
the Audit and Risk Committee and Clive stepped down as a
member of the Committee. Further details are set out in the
Nominations Committee report on page 76.
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Ashmore Group plc Annual Report and Accounts 2023
Corporate governance
framework
plc Remuneration Committee
Terms of reference approved by the
Board. Determines compensation for
Executive Directors and Code Staff, and
reviews compensation for Control Staff
plc Nominations Committee
Terms of reference approved by the
Board. Makes recommendations on
Board membership, diversity and
governance structure in line with
corporate governance best practice
plc Audit and Risk Committee
Terms of reference approved by the
Board. Oversees the Group’s financial
reporting processes, internal control
and risk management systems and
auditors in line with corporate
governance best practice
Auditors
External:
Independent assurance via audit of
Group financial statements and audit
of internal control procedures under
ISAE 3402 and SSAE 18
Internally resourced:
Independent assurance via audit
directed at specific departmental
control procedures
plc Board of Directors
Responsible for overall strategy, management and control
Schedule of matters reserved solely for its decision
plc Executive Directors
Schedule of matters delegated by the Board
Specialised committees
Responsible for overseeing business, investments and internal controls.
Terms of reference approved by executive management
– Investment Committees
– Pricing Methodology and
Valuation Committee
– Product Committee
– GIPS Committee
– Awards Committee
– Disclosure Committee
– Research Oversight Committee
– Operating Committee
– Risk and Compliance
Committee
– Pricing Oversight Committee
– Foreign Exchange and Liquidity
Management Committee
– IT Steering Group (in respect
of cyber security)
– Best Execution Committee
– ESG Committee
Senior management
Responsible for day-to-day management
Ashmore Group plc Annual Report and Accounts 2023
69
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS C O R P O R A T E G O V E R N A N C E ( C O N T I N U E D )
Roles of the Board
Executive roles
Non-executive roles
Chief Executive Officer
Responsible for managing and leading
the business and its employees
Chair of the fixed income, equities, healthcare and
special situations ICs
Developing an effective relationship
with the Chair and the Board
Leading the business towards
achievement of the strategy
Maintaining an effective dialogue
with shareholders and stakeholders
Making business decisions (within the framework
of the Board’s delegated authorities)
Group Finance Director
Managing the Group’s capital, cash flow
and liquidity
Leading and overseeing the Finance, Middle Office
and IT functions, which are responsible for
Operational Risk, Transaction Processing, Fund
Administration, Performance, Data and Client
Reporting, Information Technology development
and infrastructure
Responsible for the Group’s financial reporting and
leading the annual budget process
Maintaining an effective dialogue with shareholders
and analysts on the performance of the Company
Responsible for investor relations and corporate
development, including mergers and acquisitions
Governance of the Group’s subsidiaries
Chair
Responsible for leading the Board and its
overall effectiveness
Building an effective and diverse Board
with complementary skills which is
progressively refreshed
Facilitating and encouraging an
effective contribution from all Board members
Ensuring the Board has clear, accurate
and timely information
Facilitating an annual evaluation of the Board,
its committees and individual Directors
Senior Independent Director
A sounding board for the Chair
and an intermediary for the other Directors
and shareholders
Facilitating an annual review of the performance
of the Chair
Independent Non-executive Directors
Providing oversight of, but not managing,
the business
Providing effective independent oversight
and challenge of executive management
Scrutinising the performance of
executive management
The Group Company Secretary is responsible for advising the Board on all governance matters.
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Ashmore Group plc Annual Report and Accounts 2023
Board activity during the year
Standing agenda items:
– Declaration of Directors’ potential conflicts of
interest and any significant additional time
commitments
– Reports from Chairs of Committees
– Monthly management report
– Investor relations update
– Strategy update
Additional meetings and training:
– ‘Meet the teams’ sessions
– Non-executive Directors’ private sessions
– Board effectiveness review
– Diversity and inclusion training
– Remuneration Committee training in
preparation for the review of the Directors’
Remuneration policy
– Operational resilience feedback session
– GDPR briefing (via the Audit and Risk Committee)
– Cyber security update (via the Audit and Risk
Committee)
In addition to its regular business, specific topics considered by the Board at its
meetings this year included:
July 2022
– Appointment of Shirley Garrood as a
Non-executive Director
September 2022
– Annual Review on the Effectiveness of Risk
Management and Internal Control Systems
– ICAAP report
– Distribution presentation
– Operational resilience update
October 2022
– Operations and IT presentation
– AGM arrangements, results of proxy voting and
governance agency reports
– Operational resilience update
December 2022
– Board visit to offices in Singapore and Indonesia
– Annual review of Culture, Conduct and Diversity
– Group strategy review
– Annual review of delegated authorities and
matters reserved to the Board
– Modern Slavery Act statement
– Chief Risk Officer review
– Local office presentation: Indonesia
– ICARA approval
February 2023
– Review of Seed Capital Policy
– Review of FX and Liquidity Management
Framework Policy and activities
– External debt team presentation
– Tax presentation
– Interim ICARA update
– Operational resilience update
April 2023
– Appointment of Ernst & Young LLP as external
auditor, subject to shareholder approval
– Appointment of Thuy Dam as a Non-executive
Director
– Consumer Duty overview
– Compliance officer reports
– Renewal of the Group and funds’ insurances
– Operational resilience update
June 2023
– FY2024 Budget
– ESG presentation
– The Ashmore Foundation presentation
– Operational resilience update
Ashmore Group plc Annual Report and Accounts 2023
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GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS A U D I T A N D R I S K C O M M I T T E E R E P O R T
Providing oversight
and challenge
This report outlines the activities of
the Audit and Risk Committee for
the year ended 30 June 2023. The
Committee remains central to the
oversight of the Group’s financial
reporting, risk management, control
and assurance processes and internal
and external audit. During the year,
the Committee led the tender for
the Group’s external audit.
Shirley Garrood
Chair
Committee membership
The following Directors served on the Committee
during the year:
– Shirley Garrood (member from 1 August 2022 and
Chair from 23 January 2023)
– Clive Adamson (stood down as a member and
Chair on 23 January 2023)
– Jennifer Bingham
– Helen Beck
– Thuy Dam (from 1 June 2023)
The members of the Committee at the date of this report
are all independent Non-executive Directors.
The Code states that the Chair of the Board should not be
a member of the Audit and Risk Committee. For part of
the year, until Clive Adamson stood down as a member
and Chair of the Committee, the Committee’s
composition was not fully compliant with the Code. An
explanation is given in the Nominations Committee report
on page 76.
The attendance record of Committee members is set out
in the table on page 62.
The Board is satisfied that for the year under review and
going forward, Shirley Garrood is the Committee member
with recent and relevant financial experience, and the
Committee as a whole has competence relevant to the
sector in which the Company operates.
The terms of reference for the Committee can be found
on Ashmore’s website.
72
Ashmore Group plc Annual Report and Accounts 2023
Meetings
During the year ended 30 June 2023, the Committee held four
scheduled meetings. Each of these meetings is divided into two
sessions: the first to address risk management and compliance
reporting; and the second to address financial and audit reporting.
The GFD, Head of Risk Management and Control, Head of Internal
Audit, Group Head of Finance and Group Head of Compliance are
invited to attend the relevant sessions of each meeting. The Chair
of the Committee typically holds one-to-one meetings prior to the
Committee meetings, with the attendees and the external auditor.
The Committee has adopted an integrated assurance approach to
assess the various key matters relative to its terms of reference
and to satisfy itself that the sources of assurance and information
the Committee has used to carry out its role to review, monitor and
provide assurance or recommendations to the Board are sufficient
and objective. This approach relies on the work of the external
auditor, on management assurances received through reports
from the GFD, the Group Head of Compliance, the Head of Risk
Management and Control, the Head of Internal Audit and the
Group Head of Finance, and on the existing Ashmore governance
framework such as specialised management committees. Other
independent assurance is received from the compliance monitoring
programme, Internal Audit and the externally audited ISAE 3402
report on the control environment.
The Committee considered a range of standing topics throughout
the year, including product governance, balance sheet risks and risk
appetite metrics, updates in line with the IFPR requirements on
capital and liquidity, and subsidiary and funds reporting and
governance. The Committee also received reports on the Annual
Review of Risk Management and Internal Control Systems as well
as special topics such as cyber security and GDPR. The Chair
reports to the Board on the business of each Committee meeting.
For each of the half-year and annual financial statements, a review
is undertaken by a panel comprising the GFD, the Head of Investor
Relations, the Group Company Secretary and the Group Head of
Finance to ensure that the reporting is ‘fair, balanced and
understandable’, and other members of senior management attend
as appropriate. This review is taken into account by the Committee
in advising the Board as to whether these criteria have been met.
Financial statements
The Committee reviewed the 2023 Annual Report and Accounts,
the interim results and reports from the external auditor, KPMG
LLP, on the outcome of its reviews and audits in FY2023.
Significant accounting matters
During the year, the Committee considered key accounting issues,
matters and judgements in relation to the Group’s financial
statements and disclosures. The principal areas of estimates and
judgements are disclosed in note 2 of the financial statements.
Other accounting matters
During the year, the Committee received communications
from management and from the external auditor on other
accounting matters. The Committee has also reviewed the
adoption of the going concern basis in preparing the interim and
year end consolidated accounts and considered the longer-term
viability statement for the Group, which is described in more
detail on page 39.
External auditor
KPMG LLP (including its prior entity KPMG Audit plc) has acted as
external auditor to Ashmore since the IPO in October 2006. The
lead audit partner rotates every five years to ensure independence.
The external auditor provides reports at each Committee meeting
on topics such as the control environment, key accounting matters
and mandatory communications. An annual audit plan for the full
year and a review plan for the interim statement are presented for
the Committee’s approval each year, covering key audit matters
and scope. There were no new financial accounting Standards or
Interpretations in issue and required to be adopted by the Group
during the current year.
The Committee also receives presentations from the independent
auditors of Ashmore sponsored SICAV, US 40 Act, Guernsey and
Cayman funds auditors on the conduct and outcome of the audits
for the year, including any key accounting matters and
developments, and no material issues were raised.
External auditor independence
It is the responsibility of the Committee to monitor the
performance, objectivity and independence of the external
auditor. A policy is in place for permitted non-audit services, to
ensure that these do not impair these requirements. In practice,
the majority of such services provided to the Company by KPMG
LLP are closely related to audit work. All contracts for non-audit
services over £25,000 must be notified to and approved by the
Chair of the Committee.
In FY2023 the value of non-audit services provided by KPMG LLP
amounted to £0.2 million (FY2022: £0.2 million). Non-audit services
as a proportion of total fees paid to the auditor were
approximately 20% (FY2022: 21%). The Committee considers this
proportion acceptable. The non-audit services provided related to
supplying mandatory assurance reports in relation to client assets
to the FCA (as the regulator of Ashmore Investment Management
Limited and Ashmore Investment Advisors Limited), a review of
Ashmore’s half-year financial statements and for work on ISAE
3402. ISAE 3402 covers internal control systems and is applicable
to Ashmore’s offices in London and Dublin, in line with investment
management industry standards.
The assurance provided by the Group’s external auditor on the
items listed above is considered by the Committee to be strictly
necessary in the interests of the business and, by their nature,
these services could not easily be provided by a separate
professional auditing firm. KPMG LLP does not supply tax
compliance or advisory services to the Group. Independent tax
advice is supplied by Deloitte LLP.
At the end of each Committee meeting, the Non-executive
Directors meet with the external and internal auditors without the
Executive Directors present to permit them to raise any matters of
concern in confidence.
Wisma 46 skyscraper downtown Jakarta, Indonesia
The Committee is required to assess the quality and effectiveness
of the external audit process as well as the controls and procedures
in place to ensure auditor independence and objectivity. Measures
taken by the Committee included detailed questions for both
management and the external auditor, and a review of the audit
quality statistics. During the year, the Committee also received the
outcome of the FRC’s Audit Quality Review of KPMG LLP’s audit
of the Company’s 30 June 2022 financial statements, which was
undertaken as part of the FRC’s annual inspection of audit firms
and in which no significant improvements were required. Based on
its review, the Committee concurred with management’s view that
there had been appropriate focus and challenge of the primary
areas of audit risk and assessed the quality of the audit to be
satisfactory. The Committee was satisfied with the work of KPMG
LLP and considered that it remained objective and independent.
External audit tender
The Committee previously undertook a tender process in March
2016. Mandatory audit firm rotation is required after 20 years and a
re-tender must be conducted at least every 10 years.
During the year, the Committee led a comprehensive tender
process for the Group and funds’ external audits. On the basis that
the maximum of 20 years would soon be reached, KPMG LLP did
not participate in the tender.
Four firms were considered to have the required expertise and
geographical reach and were invited to participate, including
‘challenger’ firms, with two firms taking part in the tender. The
Committee communicated with the two firms opting not to
participate in the tender to understand the reasons for this.
Ashmore Group plc Annual Report and Accounts 2023
73
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS A U D I T A N D R I S K C O M M I T T E E R E P O R T ( C O N T I N U E D )
Once the request for proposal setting out the scope of the
external audit and the expectations of the successful firm had
been issued, written responses were submitted for consideration
by the Committee at an additional meeting. A number of calls
and meetings were convened with the tendering firms. The two
firms were then invited to present to the Committee, following
which the Committee met to consider their recommendation
to the Board.
Throughout the process, the Committee was conscious of the
need to base its selection on audit quality, including independence,
challenge and technical competence, rather than price or perceived
cultural fit, and Committee discussions centred on these factors.
The Committee concluded that both audit firm options presented
to the Board would undertake a high-quality external audit, and
the reasons for the preference were set out for consideration
by the Board.
At the conclusion of the tender process, the Committee
recommended to the Board that a resolution be put to
shareholders for the appointment of Ernst & Young LLP as the
Company’s external auditor at the AGM. The Board accepted the
Committee’s recommendation and the negotiation of the audit
fee was then concluded.
Internal controls and risk management systems
The Head of Risk Management and Control attends each
scheduled meeting of the Committee and provides reports.
These reports have addressed a number of risk-related topics and
have demonstrated how the output of the different IC, RCC and
Pricing and Valuation Methodology Committees’ discussions
throughout the period have been effective in highlighting, tracking
and contributing towards managing key market, liquidity, credit,
counterparty and operational risks. For example, the Committee
received updates on the impact of the macro-economic conditions
arising from the combined effects of the Russia/Ukraine conflict
and China as well as global inflation and growth concerns and also
on trading counterparty exposure. In relation to operational risk, the
Committee continued to review and discuss the Group’s Principal
Risk Matrix which functions as an effective tool to highlight and
monitor the principal risks facing the Group. During the year, the
Committee reviewed climate-related transition and physical risks,
as well as potential risks related to greenwashing.
The Committee also received a report on, and conducted a review
and evaluation of, the system of internal control and risk
management operated within the Company pursuant to the
Guidance, prior to final review by the Board.
During the year, the Committee received regular updates on the
Group’s consolidated capital and liquidity positions in line with the
IFPR requirements which took effect from January 2022. The
Committee also received a more detailed report on the first ICARA
for Ashmore Investment Management Limited prior to its
publication in December 2022.
A detailed description of the risk management framework and the
manner in which risks are identified and managed is set out on
pages 35 to 41.
Internal Audit
The Internal Audit function derives its authority from the Board
and operates under its own terms of reference that are reviewed
each year. The Board has delegated oversight of the function to
the Committee which is responsible for ensuring that it has
adequate standing, is properly resourced and free of management
or other restrictions.
The Head of Internal Audit has regular meetings with the Chair
of the Committee and attends all scheduled meetings of the
Committee. The Committee continues to monitor the Internal Audit
plan on an ongoing basis to ensure that it remains effective and
relevant to the needs of the business and to ensure that it can be
adapted or changed if a particular focus area necessitates this.
During the year, the Committee received presentations from
Internal Audit on a number of topics including the Internal Audit
plan for the year and the outcomes of any internal audits conducted
during the period under review. The Committee also received
presentations from Internal Audit on the implementation of the
assurance framework in the year and the results of the assurance
review over the effectiveness of the controls and mitigants in
place for the principal risks. Based on the work described, and in
accordance with the requirements of the Internal Audit Financial
Services Code of Practice, Internal Audit has provided the
Committee with its assessment of the overall effectiveness of
Ashmore’s governance and risk and control framework and its
conclusions with regard to Ashmore’s adherence to its risk
appetite framework.
Internal Audit provides annual confirmations to the Committee
on four areas: internal independence, Internal Audit’s ongoing
conformance with relevant professional standards, any potential
conflicts of interest and the ongoing suitability of the Internal Audit
terms of reference. In addition, the Internal Audit Financial Services
Code of Practice recommends that committees should obtain an
independent and objective external assessment of the Internal
Audit function at least every five years, and that this assessment
should explicitly include whether Internal Audit conforms with the
Internal Audit Financial Services Code of Practice. Accordingly, the
Committee approved BDO LLP to conduct this independent review
and they presented their findings to the Committee during the
year. The conclusions were that Ashmore’s Internal Audit function
demonstrates ‘general conformance’ with the standards laid out by
the Institute of Internal Auditors Standards and the Financial
Services Code in all areas. The review also recommended minor
enhancements and the Committee is pleased to report that these
have been implemented, including the publication of the Internal
Audit Charter on the Group’s website.
After due consideration, and in accordance with the Internal Audit
Financial Services Code of Practice, the Committee remains
satisfied that the quality, experience and expertise of the Internal
Audit function are appropriate, that it is operating effectively for the
business and that it has adequate and appropriate resources to
fulfil its remit.
74
Ashmore Group plc Annual Report and Accounts 2023
The Gardens by the Bay, Singapore
Compliance
In order to ensure a co-ordinated reporting process with the Risk
Management and Internal Audit functions, Compliance is invited
to attend and present to the Committee at its regular scheduled
meetings. Reports from Compliance include details of the Group’s
interactions with regulators, the compliance monitoring programme,
material breaches, errors and complaints, anti-money laundering
controls and sanctions compliance. The Committee also
approves the compliance monitoring programme and reviews
the Group’s procedures for ensuring compliance with regulatory
reporting requirements.
Information security
Information security, including cyber security, is identified as a
principal risk to the business and is subject to Ashmore’s
governance, policies and procedures and risk assessment.
The Committee receives annual updates from the Ashmore
IT department on cyber security developments and potential
cyber security threats and how Ashmore would respond to a
significant event. During the year the Committee also received
a briefing on GDPR.
Shirley Garrood
Chair of the Audit and Risk Committee
5 September 2023
Ashmore Group plc Annual Report and Accounts 2023
75
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS N O M I N A T I O N S C O M M I T T E E R E P O R T
Ensuring a fair and
balanced Board
This report details the role of the
Nominations Committee and the
important work it has undertaken
during the year ended 30 June 2023.
The Committee’s focus has continued to
be on maintaining a strong, value-adding
and effective Board, with a broad range
of professional backgrounds, skills
and perspectives.
Clive Adamson
Chair
Committee membership
The following Directors served on the Committee during
the year and to the date of this report:
– Clive Adamson (Chair)
– Jennifer Bingham
– Helen Beck
– Shirley Garrood (from 1 August 2022)
– Thuy Dam (from 1 June 2023)
The Committee’s membership was fully compliant with
the Code. Clive Adamson was an independent
Non-executive Director prior to taking up his appointment
as Committee Chair. The other Committee members are
independent Non-executive Directors. Shirley Garrood
joined the Board and the Committee on 1 August 2022.
Thuy Dam joined the Board and the Committee on
1 June 2023.
The attendance record of the Committee members is set
out in the table on page 62.
The terms of reference for the Committee can be found
on Ashmore’s website.
76
Ashmore Group plc Annual Report and Accounts 2023
During the year ended 30 June 2023, the Committee met
five times and was fully compliant with the Code in respect of
its own proceedings.
Only Committee members have the right to attend its meetings.
Other individuals such as the CEO, the Group Head of Human
Resources, senior management and external advisers may
attend meetings as and when appropriate.
As previously reported, following the retirement of David Bennett
as Non-executive Director and Chair of the Board on 20 April 2022,
Clive Adamson was appointed as the new Chair of the Board and
Chair of the Nominations Committee in his place. The Committee
agreed to recommend to the Board that Clive should retain his
existing role as Chair of the Audit and Risk Committee on an
interim basis, given that he had the most appropriate experience,
and he continued in that role whilst a successor was found.
In this respect, the Committee noted that, for a period, the
Company would not be in compliance with the Code requirement
that the Chair of the Board should not be a member of the
Audit and Risk Committee.
Clive Adamson stood down as a member of the Audit and Risk
Committee on 23 January 2023, and Shirley Garrood took over
as Chair of that Committee from that date.
Shirley Garrood joined the Board as a Non-executive Director on
1 August 2022, and the process leading to her appointment was
set out in the FY2022 Annual Report and Accounts. Following her
appointment, the Committee’s focus on Non-executive Director
succession planning continued, and it was agreed that an additional
Non-executive Director would strengthen the Board. The
Committee undertook to source potential candidates with
Emerging Markets experience to enrich Board discussions and
who had the right combination of skills and experience in the
context of Ashmore’s commitment to diversity and inclusion. As a
result of this search, Thuy Dam was appointed to the Board as a
Non-executive Director on 1 June 2023.
Thuy Dam was identified as a potential candidate by the CEO given
their industry connections during their period working together at
ANZ. In considering her appropriateness, the Committee focused
on Thuy’s extensive Emerging Markets expertise and valuable
local market insights. The Committee also undertook a thorough
investigation into her skills, past experience, other time
commitments and any potential conflicts of interest. Therefore,
while the Committee is aware of the Code expectation that an
external search consultancy or open advertising should generally
be used for the sourcing of candidates, given the availability and
suitability of Thuy Dam as well as the cost savings involved, it was
considered that departure from this expectation was acceptable.
Since joining the Board on 1 June 2023, Thuy Dam has undertaken
a comprehensive induction programme which included meetings
with all department heads to enable her to gather further insights
into the firm and its operations.
During the year, the Committee considered the composition of the
Board, particularly in the context of the requirements of the Listing
Rules, and the recommendations of the Parker Review and the
FTSE Women Leaders Review. Following Shirley Garrood and Thuy
Dam’s appointments, 57% of the Board members are women, the
Senior Independent Director is a woman, and there is one ethnic
minority member of the Board. In line with the recommendations
of the Parker Review, the Committee agreed a target to be
achieved by the end of 2027 of 40% for ethnic minority
membership of the senior management team, defined as the
Operating Committee and their direct reports who are leaders. The
Committee also monitored progress towards the target for the end
of 2025 of 40% women in the senior management team as set by
the FTSE Women Leaders Review. Details of the gender and
ethnicity balance of the Board, the senior management and the
workforce as a whole are provided on pages 47 and 48 in
accordance with the Listing Rules.
In order to assist with ensuring that the Group diversity policies
remain in line with best practice and to monitor their
implementation, particularly in light of the various diversity
initiatives, the Committee agreed to establish a new Diversity
Committee during the year. This committee is chaired by Jennifer
Bingham, with employees including the Group General Counsel
and Company Secretary and the Group Head of HR as members,
and will report to the Nominations Committee at least annually.
The Committee’s terms of reference require it to note any changes
to Ashmore’s leadership with a view to ensuring the Company’s
continued ability to compete effectively in the marketplace.
During the year, any changes to the roles held by senior
management were noted and succession plans for the leadership
team were reviewed and agreed to be satisfactory.
The Committee is also tasked with considering significant new
appointments for Non-executive Directors to ensure that any
additional time commitment does not compromise their
commitment to their roles at Ashmore and, as part of this, the
Committee also notes when previous external roles come to an
end. During the year, the Committee considered proposals for
Non-executive Directors to take on other roles. Taking into account
the proposed time commitments of each of these new roles and
the time already committed to existing roles, it was decided that
they would not impair the Directors’ commitment to Ashmore.
Having confirmed that there were no conflicts of interest, these
proposed appointments were considered and approved.
Kathedraal van Jakarta, Jakarta, Indonesia
Following the triennial externally facilitated Board evaluation in
2021 and the internal assessment of the Board’s performance
carried out in 2022, this year there was another internal Board
effectiveness review in accordance with the Code. As part of this
process, the Chair interviewed each Director and held discussions
with the Board, together with the Group Company Secretary,
focusing on the Board’s priorities during the year, the committees’
responsibilities and how they were discharged, and the quality of
reporting. Jennifer Bingham, in her capacity as Senior Independent
Director, also conducted an appraisal of Clive Adamson in his role
as Chair. It was concluded that the Board and each of its
committees is operating effectively and the Board is satisfied with
the governance structures in place and with the quality of
information being provided. The Board agreed areas of focus for
the coming year, including continuing to embed the two Non-
executive Directors who have joined the Board during the year,
continued focus on efficiency and oversight of culture, and
opportunities for informal catch ups of the Non-executive Directors
between scheduled meetings and Board dinners.
Clive Adamson
Chair of the Nominations Committee
5 September 2023
Ashmore Group plc Annual Report and Accounts 2023
77
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS R E M U N E R A T I O N R E P O R T
Ensuring alignment between
employees and shareholders
This report outlines the activities of
the Remuneration Committee for the
financial year ended 30 June 2023.
The Committee is responsible for
setting and overseeing the operation
of the Remuneration Policy for both
Executive Directors and the wider
workforce. During the year, the
Committee has consulted widely
with shareholders on our proposed
Directors’ Remuneration Policy.
Helen Beck
Chair
Committee membership
The following Directors served on the Committee during
the year and to the date of this report:
– Helen Beck (Chair)
– Clive Adamson
– Jennifer Bingham
– Shirley Garrood (from 1 August 2022)
– Thuy Dam (from 1 June 2023)
Shirley Garrood joined the Board and the Committee on
1 August 2022, and Thuy Dam joined the Board and
Committee on 1 June 2023.
Clive Adamson was an independent Non-executive
Director prior to taking up his appointment as Chair of
the Board within the meaning of the Code. The other
Committee members are independent Non-executive
Directors of the Board. Only Committee members have
the right to attend its meetings. Other executives may
be invited to attend as the Committee requests.
The attendance record of Committee members is set
out in the table on page 62.
Activities
During the year ended 30 June 2023, the Committee met seven
times and was fully compliant with the Code in respect of its
own proceedings.
The key focus of the Committee during FY2023 has been an
extensive review and consultation process with shareholders in
relation to the new Directors’ Remuneration Policy, which will be
put to shareholders at the 2023 AGM.
In order that sufficient time was available to the Committee to
consider the new Directors’ Remuneration Policy, additional
Committee meetings were held during the year, which included a
specific listed company market practice review delivered to the
Committee by PricewaterhouseCoopers LLP.
During the year, the Committee also implemented changes to the
Group’s share plan in order to ensure compliance with the FCA’s
MIFIDPRU remuneration rules as they relate to malus and clawback
for employees considered to be material risk takers, as well as
other employees, and undertook a review of employee benefits.
Performance during FY2023
As noted in detail on pages 10 and 11, the past year has provided
encouraging evidence that the cyclical recovery has begun across
Emerging Markets despite continuing geopolitical and
macroeconomic headwinds. Against this backdrop, Ashmore has
delivered meaningful investment outperformance for clients with
69% of AuM outperforming their benchmarks over three years
(FY2022: 28%).
The Group’s financial performance naturally lags the turn in markets
and so despite encouraging momentum in client activity levels over
the year, average AuM was 30% lower and net revenue fell by
25%. However, a focus on cost control, and higher levels of
interest earned on cash balances, meant that profit before tax was
just 6% lower.
Ashmore has experienced many cycles in more than 30 years
of specialist investing in Emerging Markets and its distinctive
culture and flexible remuneration structure are designed to
mitigate the impact of fluctuating AuM levels on its operational
and financial performance.
78
Ashmore Group plc Annual Report and Accounts 2023
The Committee, with input from the Committee Chair and CEO,
All employee remuneration
has decided to increase the proportion of profits paid to employees
in variable remuneration this year to 25% (FY2022: 21.5%). In
absolute terms, the sum available for annual bonuses is 24% lower
than in FY2022. However, the higher percentage payout reflects
the Committee’s desire to reward key employees for the much
improved investment outperformance, continued client focus and
support from the distribution teams in challenging markets, and the
strength of the control and operational functions.
Disclosure
The Committee has provided greater transparency in the
disclosures made in relation to annual performance in the Annual
Report on Remuneration and there remains full disclosure of the
performance measures used to determine vesting for share awards
The Committee has spent time this year considering all employee
remuneration and benefits, to ensure that, whilst maintaining
Ashmore’s flexible remuneration structure, which this year has
reduced the sum available for variable remuneration by 24%,
consideration is given to salary levels and benefits to recognise the
current inflationary environment. As can been seen in figure 10 on
page 109, relevant employee salaries were increased by 11% on
average during the period, significantly ahead of previous periods,
with the focus being on those who receive lower total
compensation. Taking into account the performance achieved, the
impact on relevant employees’ annual bonus payments in FY2023
can be seen in figure 10 on page 109, as an average reduction
relative to FY2022 of 8%.
with additional performance conditions attached.
Directors’ Remuneration Policy
Executive Directors’ performance assessment and
reward for FY2023
During FY2023 the Committee has undertaken an extensive review
of the current Directors’ Remuneration Policy and has consulted
with shareholders and proxy voting agencies in relation to the new
Despite improved investment performance during FY2023, financial
Directors’ Remuneration Policy (the Policy) which will be put to
performance as usual lags due to the delayed impact on net
shareholders at the 2023 AGM.
inflows. As a result, the CEO requested to waive any award for this
year and the Committee agreed to make no bonus award.
The Committee assessed that the GFD had performed well in
FY2023, which has been the first full year of his expanded
responsibilities, and he has demonstrated strong personal
performance. However, with the business reporting reduced
profitability, the Committee has determined that his bonus should
be reduced by 10% relative to the amount awarded in FY2022 and
Throughout the review process it has been the Committee’s
intention to retain as much of Ashmore’s uniquely flexible
remuneration model for the Executive Directors as possible, to
retain their alignment with all other Group employees, clients and
shareholders and to ensure that the reward structure remains
aligned with the business strategy and culture of Ashmore, whilst
including some of the more common elements of remuneration
structures a number of shareholders have expressed a desire to
that 70% of the award should be delivered in restricted shares. His
see adopted.
bonus for FY2023 is £720,000.
Shares awarded to the Executive Directors in 2017 that were
subject to performance conditions were due to vest during the
period. No shares vested as a result of the application of the
performance conditions, and the Committee did not use their
discretion to vary this outcome.
Shares awarded to the Executive Directors in 2018 will be due to
vest in September 2023, based on the application of performance
conditions to the end of FY2023. The application of performance
conditions will result in 17% of the shares vesting. The Committee
does not intend to apply its discretion to vary these outcomes.
Executive Directors’ salaries FY2024
A summary of the key changes proposed as part of the new Policy
are set out on the following pages.
An overview of the remuneration review process the Committee
undertook can be found on pages 81-84 and the new Policy can be
found on pages 85-93, with details relating to the performance of
the Executive Directors in FY2023 on pages 96-98 followed by the
Annual Report on Remuneration from page 102.
We look forward to the support of our shareholders in adopting our
new Policy at the 2023 AGM, and thank all those who were so
involved in the consultation process and shaping its development.
The CEO’s base salary will remain unchanged at £100,000.
Helen Beck
However, in line with the new remuneration policy, the base salary
Chair of the Remuneration Committee
cap will be increased to £150,000. The Committee felt it was
appropriate that the GFD’s base salary is increased to £140,000 in
5 September 2023
line with other senior employees.
R E M U N E R A T I O N R E P O R T
Ensuring alignment between
employees and shareholders
This report outlines the activities of
the Remuneration Committee for the
financial year ended 30 June 2023.
The Committee is responsible for
setting and overseeing the operation
of the Remuneration Policy for both
Executive Directors and the wider
workforce. During the year, the
Committee has consulted widely
with shareholders on our proposed
Directors’ Remuneration Policy.
Helen Beck
Chair
Committee membership
the year and to the date of this report:
– Helen Beck (Chair)
– Clive Adamson
– Jennifer Bingham
– Shirley Garrood (from 1 August 2022)
– Thuy Dam (from 1 June 2023)
Shirley Garrood joined the Board and the Committee on
1 August 2022, and Thuy Dam joined the Board and
Committee on 1 June 2023.
Clive Adamson was an independent Non-executive
Director prior to taking up his appointment as Chair of
the Board within the meaning of the Code. The other
Committee members are independent Non-executive
Directors of the Board. Only Committee members have
the right to attend its meetings. Other executives may
be invited to attend as the Committee requests.
The attendance record of Committee members is set
out in the table on page 62.
Activities
During the year ended 30 June 2023, the Committee met seven
times and was fully compliant with the Code in respect of its
own proceedings.
The key focus of the Committee during FY2023 has been an
extensive review and consultation process with shareholders in
relation to the new Directors’ Remuneration Policy, which will be
put to shareholders at the 2023 AGM.
In order that sufficient time was available to the Committee to
consider the new Directors’ Remuneration Policy, additional
Committee meetings were held during the year, which included a
specific listed company market practice review delivered to the
Committee by PricewaterhouseCoopers LLP.
During the year, the Committee also implemented changes to the
Group’s share plan in order to ensure compliance with the FCA’s
MIFIDPRU remuneration rules as they relate to malus and clawback
for employees considered to be material risk takers, as well as
other employees, and undertook a review of employee benefits.
As noted in detail on pages 10 and 11, the past year has provided
encouraging evidence that the cyclical recovery has begun across
Emerging Markets despite continuing geopolitical and
macroeconomic headwinds. Against this backdrop, Ashmore has
delivered meaningful investment outperformance for clients with
69% of AuM outperforming their benchmarks over three years
(FY2022: 28%).
The Group’s financial performance naturally lags the turn in markets
and so despite encouraging momentum in client activity levels over
the year, average AuM was 30% lower and net revenue fell by
25%. However, a focus on cost control, and higher levels of
interest earned on cash balances, meant that profit before tax was
just 6% lower.
Ashmore has experienced many cycles in more than 30 years
of specialist investing in Emerging Markets and its distinctive
culture and flexible remuneration structure are designed to
mitigate the impact of fluctuating AuM levels on its operational
and financial performance.
The following Directors served on the Committee during
Performance during FY2023
The Committee, with input from the Committee Chair and CEO,
has decided to increase the proportion of profits paid to employees
in variable remuneration this year to 25% (FY2022: 21.5%). In
absolute terms, the sum available for annual bonuses is 24% lower
than in FY2022. However, the higher percentage payout reflects
the Committee’s desire to reward key employees for the much
improved investment outperformance, continued client focus and
support from the distribution teams in challenging markets, and the
strength of the control and operational functions.
Disclosure
The Committee has provided greater transparency in the
disclosures made in relation to annual performance in the Annual
Report on Remuneration and there remains full disclosure of the
performance measures used to determine vesting for share awards
with additional performance conditions attached.
Executive Directors’ performance assessment and
reward for FY2023
Despite improved investment performance during FY2023, financial
performance as usual lags due to the delayed impact on net
inflows. As a result, the CEO requested to waive any award for this
year and the Committee agreed to make no bonus award.
The Committee assessed that the GFD had performed well in
FY2023, which has been the first full year of his expanded
responsibilities, and he has demonstrated strong personal
performance. However, with the business reporting reduced
profitability, the Committee has determined that his bonus should
be reduced by 10% relative to the amount awarded in FY2022 and
that 70% of the award should be delivered in restricted shares. His
bonus for FY2023 is £720,000.
Shares awarded to the Executive Directors in 2017 that were
subject to performance conditions were due to vest during the
period. No shares vested as a result of the application of the
performance conditions, and the Committee did not use their
discretion to vary this outcome.
Shares awarded to the Executive Directors in 2018 will be due to
vest in September 2023, based on the application of performance
conditions to the end of FY2023. The application of performance
conditions will result in 17% of the shares vesting. The Committee
does not intend to apply its discretion to vary these outcomes.
Executive Directors’ salaries FY2024
The CEO’s base salary will remain unchanged at £100,000.
However, in line with the new remuneration policy, the base salary
cap will be increased to £150,000. The Committee felt it was
appropriate that the GFD’s base salary is increased to £140,000 in
line with other senior employees.
All employee remuneration
The Committee has spent time this year considering all employee
remuneration and benefits, to ensure that, whilst maintaining
Ashmore’s flexible remuneration structure, which this year has
reduced the sum available for variable remuneration by 24%,
consideration is given to salary levels and benefits to recognise the
current inflationary environment. As can been seen in figure 10 on
page 109, relevant employee salaries were increased by 11% on
average during the period, significantly ahead of previous periods,
with the focus being on those who receive lower total
compensation. Taking into account the performance achieved, the
impact on relevant employees’ annual bonus payments in FY2023
can be seen in figure 10 on page 109, as an average reduction
relative to FY2022 of 8%.
Directors’ Remuneration Policy
During FY2023 the Committee has undertaken an extensive review
of the current Directors’ Remuneration Policy and has consulted
with shareholders and proxy voting agencies in relation to the new
Directors’ Remuneration Policy (the Policy) which will be put to
shareholders at the 2023 AGM.
Throughout the review process it has been the Committee’s
intention to retain as much of Ashmore’s uniquely flexible
remuneration model for the Executive Directors as possible, to
retain their alignment with all other Group employees, clients and
shareholders and to ensure that the reward structure remains
aligned with the business strategy and culture of Ashmore, whilst
including some of the more common elements of remuneration
structures a number of shareholders have expressed a desire to
see adopted.
A summary of the key changes proposed as part of the new Policy
are set out on the following pages.
An overview of the remuneration review process the Committee
undertook can be found on pages 81-84 and the new Policy can be
found on pages 85-93, with details relating to the performance of
the Executive Directors in FY2023 on pages 96-98 followed by the
Annual Report on Remuneration from page 102.
We look forward to the support of our shareholders in adopting our
new Policy at the 2023 AGM, and thank all those who were so
involved in the consultation process and shaping its development.
Helen Beck
Chair of the Remuneration Committee
5 September 2023
Ashmore Group plc Annual Report and Accounts 2023
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GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
FY2023 Executive Director reward outcomes
The Chief Executive Officer’s remuneration outcomes
The CEO was not awarded a bonus for FY2023, reflecting overall
financial performance during the period.
The Group Finance Director’s remuneration outcomes
The GFD’s annual bonus comprising cash and restricted
share awards at grant value for FY2023 is £720,000
(FY2022: £1,040,000).
Salary
Pensions
Taxable benefits
Annual cash bonus
Annual bonus deferred
into equity
Annual bonus deferred
into equity, with additional
performance conditions
90.4%
8.1%
1.5%
0%
0%
0%
Salary
Pensions
Taxable benefits
13.7%
1.3%
0.5%
Annual cash bonus
24.7%
Annual bonus deferred
into equity
30.2%
Annual bonus deferred
into equity, with additional
performance conditions 29.6%
Long term incentive awards made to Executive Directors’ in 2017
which were subject to the application of performance condtions
lapsed in full.
17% of long term incentive awards made to Executive Directors’ in
2018, are due to vest in FY2024, which are after the application of
performance condtions.
Vesting
Lapsing
0%
100%
Vesting
Lapsing
17%
83%
Chief Executive Officer – variable remuneration
outcomes over time1
The chart below shows variable remuneration awarded to the
CEO each year between 2012 and 2023. As can be seen, the
Remuneration Committee exercises its discretion in setting the
annual award at an appropriate level based on the performance of
Chief Executive Officer – Remuneration outcomes
the business.
over time
£m
12
10
8
6
4
2
0
2
1
0
2
3
1
0
2
4
1
0
2
5
1
0
2
6
1
0
2
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
3
2
0
2
Comparison of total remuneration and dividends
paid2
The chart below compares the annual total cost of remuneration
paid to employees, comprising personnel expenses and variable
remuneration, with the value of ordinary dividends paid to
shareholders in each year.
Chief Executive Officer – Remuneration outcomes
over time
%
100
90
80
70
60
50
40
30
20
10
0
1
1
0
2
2
1
0
2
3
1
0
2
4
1
0
2
5
1
0
2
6
1
0
2
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
3
2
0
2
Bonus accepted
Bonus received
Bonus awarded
Total remuneration
Dividends paid in the year
1. This chart includes data on shares awarded between 2011 and 2017 which vested between 2016 and 2022. No cash bonus or shares were awarded in 2014, 2020,
2022 or 2023 to reflect business performance and the Remuneration Committee’s application of strict discretion. The chart will be updated in future years to show the
vesting outcomes for shares awarded from 2017 onwards.
2. Dividends includes the estimated cost of the proposed final dividend for FY2023.
80
Ashmore Group plc Annual Report and Accounts 2023
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
FY2023 Executive Director reward outcomes
The Chief Executive Officer’s remuneration outcomes
The Group Finance Director’s remuneration outcomes
The CEO was not awarded a bonus for FY2023, reflecting overall
The GFD’s annual bonus comprising cash and restricted
financial performance during the period.
share awards at grant value for FY2023 is £720,000
(FY2022: £1,040,000).
Long term incentive awards made to Executive Directors’ in 2017
17% of long term incentive awards made to Executive Directors’ in
which were subject to the application of performance condtions
2018, are due to vest in FY2024, which are after the application of
lapsed in full.
performance condtions.
Chief Executive Officer – variable remuneration
Comparison of total remuneration and dividends
outcomes over time1
paid2
The chart below shows variable remuneration awarded to the
The chart below compares the annual total cost of remuneration
CEO each year between 2012 and 2023. As can be seen, the
paid to employees, comprising personnel expenses and variable
Remuneration Committee exercises its discretion in setting the
remuneration, with the value of ordinary dividends paid to
annual award at an appropriate level based on the performance of
shareholders in each year.
the business.
1. This chart includes data on shares awarded between 2011 and 2017 which vested between 2016 and 2022. No cash bonus or shares were awarded in 2014, 2020,
2022 or 2023 to reflect business performance and the Remuneration Committee’s application of strict discretion. The chart will be updated in future years to show the
vesting outcomes for shares awarded from 2017 onwards.
2. Dividends includes the estimated cost of the proposed final dividend for FY2023.
Directors’ Remuneration policy review for implementation in FY2024
Balancing shareholder requirements while retaining Ashmore’s culture
The existing Directors’ Remuneration Policy was approved by
shareholders in 2020 for a three-year period, and at the 2023 AGM,
Ashmore will ask shareholders to vote on a new Policy. In
determining the new Policy, the Remuneration Committee
conducted a robust review of the existing Policy and the
Company’s remuneration principles against the Company’s strategy
and the approach taken for the wider workforce.
The Committee also sought feedback from management and
shareholders, including through consultation meetings with a large
majority of institutional shareholders and meetings with the primary
proxy voting agencies. The Committee also assessed the Policy
against the principles of clarity, simplicity, risk management,
predictability, proportionality and cultural alignment.
The new Policy continues to place emphasis on variable
remuneration being focused on performance measures linked to
Ashmore’s strategy and long-term alignment through delivering a
high percentage of the variable remuneration in equity.
The Committee’s aim is to evolve the Policy that has supported the
Group’s strategy well, providing cost flexibility in a cyclical business
and creating an equity ownership culture that retains highly
motivated staff, delivering investment performance for clients and
incentivising value creation for shareholders across market cycles.
Ashmore’s fundamental remuneration principles are:
Alignment with stakeholders
A significant portion of remuneration is delivered in Ashmore shares deferred over five years. This provides alignment between employees,
executives and shareholders.
Base salaries are capped at lower market levels to ensure that fixed costs are tightly controlled.
Under the new Policy there will be compulsory deferral of at least 70% of the bonus into Ashmore shares for a period of five years, creating
significant shareholder alignment.
A portion of the Executive Directors’ variable remuneration, delivered in the form of a new Long Term Incentive Plan, will be subject to the
achievement of performance targets, closely aligned with the Group’s KPIs normally over five years.
Alignment with the Group’s financial performance is critical, with the Remuneration Committee balancing the total spend on remuneration with
Ashmore’s financial performance, which determines a significant proportion of the variable remuneration outcomes.
Discretion and flexibility
Variable remuneration is not formulaic or capped at an individual level, an important element of Ashmore’s culture that is cascaded throughout the
Company. This allows the Remuneration Committee to apply discretion to ensure that awards reflect business and personal performance, as
evidenced in previous years where there has been a strong pay for performance linkage; thus, the behavioural risk arising from target-based
incentives is absent. As part of the new Policy we have introduced an aggregate variable remuneration cap for the Executive Directors which is an
approach to balance some shareholders’ requests for individual caps and maintain this key component of Ashmore’s culture. The LTIP outcome is
formulaic against performance measures and targets set at the start of the performance period for five years.
Consistency across the Group
The clear and simple policy has applied to all Ashmore Group employees, a material factor in defining and shaping the Ashmore culture.
The proposed Policy seeks to retain a high level of consistency of remuneration across all Group employees with low base salary caps for
employees and Executive Directors who will continue to have the same pension and benefits as our UK employees. The proposed Policy aims to
maintain a consistent approach to deferral between employees and Executive Directors. As set out later on, the matching share plan has been
removed for Executive Directors however, it will be retained for other employees. Key to the entrepreneurial culture of Ashmore is having no
individual caps to remuneration; the proposed aggregate variable remuneration cap for Executive Directors retains this crucial element of
Ashmore’s culture whilst also taking into account the views of some of our shareholders.
Pay for long-term performance
The Remuneration Committee considers the performance of the Executive Directors over the long term, considering progress over a multi-year
period and annual performance in the context of the business progress made towards its strategic objectives and KPIs.
Awards are deferred over five years into Ashmore shares, and the LTIP for Executives Directors will have a five-year performance period,
significantly longer than the usual FTSE reward structure.
Ashmore Group plc Annual Report and Accounts 2023
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I N F Y 2 0 2 4 ( C O N T I N U E D )
Policy changes
Removal of the matching share plan
The Committee has removed the matching share plan for Executive
Directors. The matching share plan will be replaced with a separate
annual bonus and LTIP, detailed below. This provides a simplified
and market-aligned remuneration structure. The matching share
plan will be retained for employees other than Executive Directors.
Annual bonus
The new Policy mandates that for Executive Directors at least 70%
of annual bonus will be subject to deferral into Ashmore shares that
will cliff vest after five years.
A deferral of at least 70% for five years is significantly above
current market practice and regulatory requirements. However, this
aligns Executive Directors with employees who make the full
voluntary deferral into the existing share matching plan. This level
of deferral also ensures significant alignment of Executive Directors
with shareholders, an important aspect of Ashmore’s culture that
the Committee believes is important to retain.
Annual bonus performance measures
The Committee will determine the annual bonus by assessing key
financial and non-financial metrics of Ashmore’s performance. The
most highly weighted elements will relate to the Company’s
financial performance and for FY2024 will include key Group
metrics such as, but not limited to, profitability, adjusted EBITDA
margin, management of costs, AuM development and investment
performance relative to benchmarks over one, three and five years
by investment theme.
The non-financial performance measures for FY2024 will include
metrics such as strategic developments, risk management,
compliance matters, outcomes for investors and clients,
employees, culture and conduct, ESG metrics, and personal
objectives, e.g. management of teams and departments.
This provides the Remuneration Committee with an overview of
Ashmore’s business performance, supports Ashmore’s
sustainability values and meets regulatory and shareholder
requirements. The annual bonus will also be subject to appropriate
risk and compliance review and malus and clawback if appropriate.
Long-Term Incentive Plan (LTIP)
Linking remuneration to long-term performance is a fundamental
element of Ashmore’s culture; therefore the proposed introduction
of an LTIP for the Executive Directors aims to reinforce this
important value.
The LTIP will normally be measured over five years and will
incorporate consistent performance measures as currently used to
determine the vesting of Executive Directors’ deferred awards with
performance conditions, namely:
– investment performance relative to benchmarks over three and
five years;
– growth in assets under management over five years; and
– profitability.
These measures represent the key drivers of Ashmore’s long-term
performance, but will be kept under review by the Remuneration
Committee. The measures will be fully disclosed when the LTIP is
awarded and performance relative to the measures will be fully
disclosed at the vesting measurement point after five years. The
LTIP will also be subject to malus and clawback if appropriate.
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I N F Y 2 0 2 4 ( C O N T I N U E D )
Policy changes
Removal of the matching share plan
The Committee has removed the matching share plan for Executive
Directors. The matching share plan will be replaced with a separate
annual bonus and LTIP, detailed below. This provides a simplified
and market-aligned remuneration structure. The matching share
plan will be retained for employees other than Executive Directors.
Annual bonus
The new Policy mandates that for Executive Directors at least 70%
of annual bonus will be subject to deferral into Ashmore shares that
will cliff vest after five years.
A deferral of at least 70% for five years is significantly above
current market practice and regulatory requirements. However, this
aligns Executive Directors with employees who make the full
voluntary deferral into the existing share matching plan. This level
of deferral also ensures significant alignment of Executive Directors
with shareholders, an important aspect of Ashmore’s culture that
the Committee believes is important to retain.
Annual bonus performance measures
The Committee will determine the annual bonus by assessing key
financial and non-financial metrics of Ashmore’s performance. The
most highly weighted elements will relate to the Company’s
financial performance and for FY2024 will include key Group
metrics such as, but not limited to, profitability, adjusted EBITDA
margin, management of costs, AuM development and investment
performance relative to benchmarks over one, three and five years
by investment theme.
The non-financial performance measures for FY2024 will include
metrics such as strategic developments, risk management,
compliance matters, outcomes for investors and clients,
employees, culture and conduct, ESG metrics, and personal
objectives, e.g. management of teams and departments.
This provides the Remuneration Committee with an overview of
Ashmore’s business performance, supports Ashmore’s
sustainability values and meets regulatory and shareholder
requirements. The annual bonus will also be subject to appropriate
risk and compliance review and malus and clawback if appropriate.
Long-Term Incentive Plan (LTIP)
Linking remuneration to long-term performance is a fundamental
element of Ashmore’s culture; therefore the proposed introduction
of an LTIP for the Executive Directors aims to reinforce this
important value.
The LTIP will normally be measured over five years and will
incorporate consistent performance measures as currently used to
determine the vesting of Executive Directors’ deferred awards with
performance conditions, namely:
– investment performance relative to benchmarks over three and
five years;
– profitability.
– growth in assets under management over five years; and
These measures represent the key drivers of Ashmore’s long-term
performance, but will be kept under review by the Remuneration
Committee. The measures will be fully disclosed when the LTIP is
awarded and performance relative to the measures will be fully
disclosed at the vesting measurement point after five years. The
LTIP will also be subject to malus and clawback if appropriate.
Following shareholder feedback, the Committee has determined
that the value of the LTIP will be equivalent to at least 25% of the
individual annual bonus awarded and can be up to 100% of the total
variable remuneration award made in a year, subject to overall
performance and affordability.
over time and external compensation benchmarking data sourced
independently from AON/McLagan and based on a peer group of
global asset management organisations appropriate to Ashmore.
The cap is set at a level to provide headroom to reward
performance in years of considerable financial growth.
Introduction of an aggregate Executive Directors’ variable
remuneration cap
Ashmore’s current policy does not apply caps or targets to
individual incentives. Ashmore’s employees are not provided with
target ranges or maximum levels of variable remuneration. The
reward philosophy has been, and will continue to be,
entrepreneurial and pays only for performance, in that all incentives
are discretionary and linked to overall Company and individual
performance. Therefore, imposing individual variable remuneration
caps on the Executive Directors would be countercultural.
As discussed during Ashmore’s consultation meetings with
shareholders and proxy voting agencies, the Committee is
proposing to introduce an aggregated variable remuneration cap for
the two Executive Directors of £20 million. The cap will be based
on the total bonus and LTIP awarded in respect of a performance
year and is intended to provide additional certainty to shareholders,
whilst maintaining flexibility to operate a fully variable pay approach.
In establishing the level of variable remuneration cap, the
Committee has considered the previous highest remuneration
levels paid to Ashmore’s Executive Directors, the impact of inflation
The Remuneration Committee has always placed considerable
focus on variable remuneration being aligned with Company
performance and, as highlighted by the chart below, has
demonstrated that it is prepared to reduce Executive Director
remuneration levels when there are periods of diminished business
performance and increase them when it is justified in doing so.
The discretion that the Remuneration Committee can apply,
combined with the absence of threshold or target levels that
produce formulaic outcomes, means that Ashmore’s remuneration
outcomes are more variable than may be seen in peer
organisations but more accurately reflect and align with the
economic performance of the business and the experience of
clients and shareholders. The Committee also remains highly aware
that in determining variable remuneration, it is essential that an
appropriate balance between returns to shareholders and
employees is maintained.
In order to provide some clarity to shareholders, when the previous
highest award level is considered, the business performance across
the key Group KPIs is shown overleaf.
Ashmore CEO and GFD aggregate variable
AON/McLagan aggregate peer group market data
remuneration
for CEO and GFD roles1
£m
12
10
8
6
4
2
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
CEO and GFD Aggregate variable remuneration
£m
25
20
15
10
5
0
Low Quartile
Median
High Quartile
Top Decile
1. Source: AON/McLagan, 2021 data.
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R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y R E V I E W F O R I M P L E M E N T A T I O N
I N F Y 2 0 2 4 ( C O N T I N U E D )
Business performance in FY2011, when the highest
variable awards to date were made
AuM ($bn)
YoY growth
Revenues (£m)
YoY growth
Adjusted EBITDA (£m)
Adjusted EBITDA margin
Diluted EPS (p)
YoY growth
FY2011
65.8
86%
333.8
17%
250.9
73%
28.1
18%
Non-executive Director fees
To align with typical market practice it is proposed that going forwards
Non-executive Director fees will be structured with a base fee and
separate fees for additional responsibilities. The Non-executive Director
base fee will be set at £60,000, with an additional fee of £15,000 for
the Senior Independent Director, Audit and Risk Committee Chair, and
Remuneration Committee Chair. The Chair fee will remain at
£150,000, inclusive of Chairing the Nominations Committee.
This change will result in an increase in the fee for the Senior
Independent Director to £75,000.
Key Policy Changes
AuM outperforming over 1 & 3 years
99% / 91%
Aggregate variable remuneration for
Executive Directors (£m)
£12
Base salary
Annual bonus
New Policy
£150,000
Current Policy
£120,000
With at least 70%
mandatory deferral
for 5 years
40% mandatory
deferral with
voluntary deferral
above this
LTIP for 5 years Matching share plan
Aggregate Cap for
Executive Directors
Uncapped at an
individual level
300% of base salary
200% of base salary
LTIP
Cap
Shareholding
requirements
Policy review conclusion
The new Policy incorporates the views of shareholders and retains
key elements that remain aligned with Ashmore’s culture and
long-term business strategy. A consistent remuneration structure
across all employees has been and remains vital, and this structure
is retained by introducing a high level of deferral for the Executive
Directors. Ashmore focuses on long-term performance, with
deferral of the majority of annual bonus for five years and the
LTIP being based principally on performance over five years.
Both the deferral periods and proportion of remuneration, which is
deferred into equity, are significantly greater than Ashmore’s peers.
Ashmore values the consistency of approach with other employees
and past practices and the alignment it creates with clients and
shareholders. These awards are also subject to a full risk and
compliance review and both malus and clawback if appropriate.
The new Policy retains a critical element of the current policy by not
introducing individual variable remuneration caps, while also
providing an aggregate variable remuneration cap for the Executive
Directors to address an issue raised by certain shareholders
through the consultation process.
Ashmore would like to thank all those shareholders and proxy
agencies who engaged with this process and whose feedback and
candid challenge were highly valuable, allowing the Committee to
conclude that it should adapt the policy but retain a number of
aspects which are fundamental to Ashmore’s culture.
It should be noted that the Committee has, in recent years,
reduced variable remuneration awards when key Group KPIs have
not been achieved, and this will continue with the new Policy.
Base salary positioning
Ashmore’s base salaries are capped at or below the lower end of
the market to ensure that fixed costs are tightly controlled and that
a more significant proportion of total remuneration is determined by
Company and individual performance than at peer organisations.
The Remuneration Committee reviewed and considered the base
salary for Executive Directors levels compared with market data
provided by Deloitte LLP and AON/McLagan. The base salary cap
will move to £150,000, which is consistent with the base salary cap
for other UK employees, and remains significantly below market
levels. The salary level for the CEO for FY2024 will remain
unchanged at £100,000. The salary for the GFD has been reviewed
and will increase to £140,000, taking into account his increased
responsibilities through the full period and in alignment with other
senior employees within Ashmore.
Shareholding requirement during employment and
post-employment
In response to shareholder feedback, the Remuneration Committee
has reviewed the current shareholder requirement level of 200% of
base salary and has increased it to 300% of base salary during
employment and for two years post-employment.
Remuneration disclosure
Discretion and flexibility are crucial elements of Ashmore’s Policy, and
therefore, formulaic arrangements are not part of the Company’s
remuneration culture. The key measures of performance for the annual
bonus are outlined above and are aligned with Ashmore's strategy,
placing a heavy emphasis on financial results. Ashmore has provided
greater transparency in the disclosures made in relation to these in the
Annual Report on Remuneration. There is currently full disclosure of the
performance measures used to determine vesting for share awards
with additional performance conditions attached, and this level of
disclosure will continue with the new LTIP.
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Ashmore Group plc Annual Report and Accounts 2023
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D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y R E V I E W F O R I M P L E M E N T A T I O N
I N F Y 2 0 2 4 ( C O N T I N U E D )
Business performance in FY2011, when the highest
Non-executive Director fees
variable awards to date were made
AuM ($bn)
YoY growth
Revenues (£m)
YoY growth
Adjusted EBITDA (£m)
Adjusted EBITDA margin
Diluted EPS (p)
YoY growth
AuM outperforming over 1 & 3 years
99% / 91%
Aggregate variable remuneration for
Executive Directors (£m)
It should be noted that the Committee has, in recent years,
reduced variable remuneration awards when key Group KPIs have
not been achieved, and this will continue with the new Policy.
Base salary positioning
Ashmore’s base salaries are capped at or below the lower end of
the market to ensure that fixed costs are tightly controlled and that
a more significant proportion of total remuneration is determined by
Company and individual performance than at peer organisations.
The Remuneration Committee reviewed and considered the base
salary for Executive Directors levels compared with market data
provided by Deloitte LLP and AON/McLagan. The base salary cap
will move to £150,000, which is consistent with the base salary cap
for other UK employees, and remains significantly below market
levels. The salary level for the CEO for FY2024 will remain
unchanged at £100,000. The salary for the GFD has been reviewed
and will increase to £140,000, taking into account his increased
responsibilities through the full period and in alignment with other
senior employees within Ashmore.
Shareholding requirement during employment and
post-employment
In response to shareholder feedback, the Remuneration Committee
has reviewed the current shareholder requirement level of 200% of
FY2011
65.8
86%
333.8
17%
250.9
73%
28.1
18%
£12
To align with typical market practice it is proposed that going forwards
Non-executive Director fees will be structured with a base fee and
separate fees for additional responsibilities. The Non-executive Director
base fee will be set at £60,000, with an additional fee of £15,000 for
the Senior Independent Director, Audit and Risk Committee Chair, and
Remuneration Committee Chair. The Chair fee will remain at
£150,000, inclusive of Chairing the Nominations Committee.
This change will result in an increase in the fee for the Senior
Independent Director to £75,000.
Key Policy Changes
Base salary
Annual bonus
LTIP
Cap
Shareholding
requirements
New Policy
£150,000
Current Policy
£120,000
With at least 70%
40% mandatory
mandatory deferral
deferral with
for 5 years
voluntary deferral
above this
LTIP for 5 years Matching share plan
Aggregate Cap for
Uncapped at an
Executive Directors
individual level
300% of base salary
200% of base salary
Policy review conclusion
The new Policy incorporates the views of shareholders and retains
key elements that remain aligned with Ashmore’s culture and
long-term business strategy. A consistent remuneration structure
across all employees has been and remains vital, and this structure
is retained by introducing a high level of deferral for the Executive
Directors. Ashmore focuses on long-term performance, with
deferral of the majority of annual bonus for five years and the
LTIP being based principally on performance over five years.
Both the deferral periods and proportion of remuneration, which is
deferred into equity, are significantly greater than Ashmore’s peers.
Ashmore values the consistency of approach with other employees
and past practices and the alignment it creates with clients and
shareholders. These awards are also subject to a full risk and
compliance review and both malus and clawback if appropriate.
base salary and has increased it to 300% of base salary during
The new Policy retains a critical element of the current policy by not
employment and for two years post-employment.
Remuneration disclosure
introducing individual variable remuneration caps, while also
providing an aggregate variable remuneration cap for the Executive
Directors to address an issue raised by certain shareholders
Discretion and flexibility are crucial elements of Ashmore’s Policy, and
through the consultation process.
therefore, formulaic arrangements are not part of the Company’s
remuneration culture. The key measures of performance for the annual
bonus are outlined above and are aligned with Ashmore's strategy,
placing a heavy emphasis on financial results. Ashmore has provided
greater transparency in the disclosures made in relation to these in the
Annual Report on Remuneration. There is currently full disclosure of the
performance measures used to determine vesting for share awards
with additional performance conditions attached, and this level of
disclosure will continue with the new LTIP.
Ashmore would like to thank all those shareholders and proxy
agencies who engaged with this process and whose feedback and
candid challenge were highly valuable, allowing the Committee to
conclude that it should adapt the policy but retain a number of
aspects which are fundamental to Ashmore’s culture.
Directors’ Remuneration
policy
This section of the Remuneration report has been prepared in
accordance with Part 4 of The Large and Medium-sized Companies
and Groups (Accounts and Reports) (Amendment) Regulations
2013 and sets out the Remuneration Policy for the Company.
The Policy has been developed taking into account the principles of
the Code and shareholders’ executive remuneration guidelines. It is
intended that the Policy will be put before shareholders for approval
by way of a binding vote at the Company’s AGM on 18 October
2023. If approved by shareholders, the Policy will apply for up to
three years from FY2024.
Policy overview
The Remuneration Committee determines and agrees with the
Board the Company’s Policy on the remuneration of the Board
Chairman, Executive Directors and senior managers, including
employees designated as material risk takers or code staff under
the FCA’s Remuneration Codes. The Remuneration Committee’s
terms of reference are available on the Company’s website.
In determining the new Policy, the Committee followed a robust
process that included discussions on the content of the Policy at four
Remuneration Committee meetings. The Committee considered
input from management and advisers PricewaterhouseCoopers LLP
and Deloitte LLP and sought the views of Ashmore’s major
shareholders, further detail of which is set out below. The
Committee also assessed the Policy against the principles of
clarity, simplicity, risk management, predictability, proportionality
and cultural alignment.
The key aims underpinning the review were:
– the need to encourage and promote the long-term success of
the Company;
– the need to attract, retain and motivate talented Executive
Directors and senior management;
– consistency with the remuneration principles applied to Ashmore
employees as a whole;
– external comparisons to examine current market trends and
practices and equivalent roles in similar companies taking into
account their size, business complexity, international scope and
relative performance; and
– the requirements of the Remuneration Codes of the FCA.
Key changes to Remuneration policy
The key changes to the policy are:
1. Simplification of the variable remuneration plan by
removing the voluntary deferral and the performance and
non-performance related share matching element;
2. An increase in the level of compulsory deferral of the
annual bonus to at least 70% of the award, normally for a
period of five years;
3. The introduction of a separate Long-Term Incentive Plan
element, normally with a five-year performance period;
4. The introduction of an aggregated cap on Executive
Director variable remuneration;
5. An increase in the shareholding guideline for the CEO and
GFD to 300%;
6. An increase of the base salary cap from £120,000 to
£150,000; and
7. The annual Non-executive Director fee will now be
structured to align with current market practice of a base
fee and a supplementary fee for Committee Chairs and a
Senior Independent Director fee.
Other changes have been made to aid operation and
increase clarity.
How the views of shareholders are taken
into account
In developing this Policy, the Committee Chair met with
shareholders representing a substantial majority of its shareholder
base and the proxy voting agencies.
The Committee has made a number of changes to the Policy to
take into account shareholder feedback, including the introduction
of an aggregate cap on Executive Directors’ variable remuneration,
removal of the matching shares element for Executive Directors’,
an increase in the level of annual bonus compulsory deferral, the
introduction of a LTIP, a commitment that the value of the LTIP
will typically be equivalent to no less than 25% of the Executive
Director’s total annual bonus award for the year, and an increase
to the shareholding guidelines.
The feedback received as part of this process has been positive and
constructive and we thank shareholders for their time.
Ashmore Group plc Annual Report and Accounts 2023
85
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
Figure 1
Remuneration Policy (the Policy) for Executive Directors
Policy table
The table below summarises the key aspects of the Company’s Remuneration policy for Executive Directors.
Base salary
Purpose and link to
short and long-term
strategy
Provides a sufficient
level of fixed
remuneration. The
cap on base salary
helps to contain
fixed costs.
Benefits
Provide cost-effective
benefits to support health
and wellbeing.
Pension
Provides a basic level of
Company contribution,
which individuals can
supplement with their
own contribution.
Operation
Base salaries are paid monthly in cash. This
reflects broader practice below the Board.
Executive Directors are eligible to receive
benefits in line with other UK employees.
Benefits currently include (but are not limited
to) medical insurance and life insurance. The
Company may reimburse any reasonable
business related expenses (including tax
thereon) incurred in connection with their role,
if these are determined to be taxable benefits.
Additional benefits may be provided if
required, for example, in the event of a
relocation of an executive, the Company may
provide appropriate relocation assistance.
Company contributions are made, normally on
a defined contribution basis, either to a
pension plan or in the form of an equivalent
cash allowance.
Maximum opportunity
Consistent with the approach taken
throughout the Company, base
salaries for all employees, including
Executive Directors’ are currently
capped at £150,000.
The cap is reviewed periodically;
the Policy permits the cap to be
changed if this is deemed necessary
to meet business, legislative or
regulatory requirements.
Benefits are not subject to a specific
cap, but represent only a small
percentage of total remuneration.
The current level of Company
contribution is 9% of base salary, with
a further matching contribution of up to
1% of base salary, should the Executive
Director make a personal contribution of
an equivalent amount. The contribution
level for Executive Directors is currently
aligned with UK employees.
Whilst no changes are currently
anticipated, it is intended that any
changes to the pension Policy for UK
employees, or to participants in the
pension plan in the relevant country,
will also apply to the Executive Directors.
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Ashmore Group plc Annual Report and Accounts 2023
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
Remuneration Policy (the Policy) for Executive Directors
Figure 1
Policy table
The table below summarises the key aspects of the Company’s Remuneration policy for Executive Directors.
Aggregate
variable
remuneration
cap
Base salary
Provides a sufficient
Base salaries are paid monthly in cash. This
Consistent with the approach taken
strategy
Operation
Maximum opportunity
reflects broader practice below the Board.
throughout the Company, base
Annual bonus
Purpose and link to
short and long-term
level of fixed
remuneration. The
cap on base salary
helps to contain
fixed costs.
salaries for all employees, including
Executive Directors’ are currently
capped at £150,000.
The cap is reviewed periodically;
the Policy permits the cap to be
changed if this is deemed necessary
to meet business, legislative or
regulatory requirements.
Purpose and link to
short and long-term
strategy
To provide shareholders
with clarity on the
maximum variable
remuneration that may
be awarded to Executive
Directors each year.
To incentivise and reward
performance in the year.
Bonus deferral enhances
alignment of interests
with those of
shareholders over the
longer term.
Benefits
Provide cost-effective
Executive Directors are eligible to receive
Benefits are not subject to a specific
benefits to support health
benefits in line with other UK employees.
cap, but represent only a small
and wellbeing.
Benefits currently include (but are not limited
percentage of total remuneration.
to) medical insurance and life insurance. The
Company may reimburse any reasonable
business related expenses (including tax
thereon) incurred in connection with their role,
if these are determined to be taxable benefits.
Additional benefits may be provided if
required, for example, in the event of a
relocation of an executive, the Company may
provide appropriate relocation assistance.
Pension
Provides a basic level of
Company contributions are made, normally on
The current level of Company
Company contribution,
a defined contribution basis, either to a
contribution is 9% of base salary, with
which individuals can
pension plan or in the form of an equivalent
a further matching contribution of up to
supplement with their
cash allowance.
own contribution.
1% of base salary, should the Executive
Director make a personal contribution of
an equivalent amount. The contribution
level for Executive Directors is currently
aligned with UK employees.
Whilst no changes are currently
anticipated, it is intended that any
changes to the pension Policy for UK
employees, or to participants in the
pension plan in the relevant country,
will also apply to the Executive Directors.
Maximum opportunity
The aggregate maximum variable
remuneration for Executive Directors is
capped, currently, at £20 million.
The Policy permits the Remuneration
Committee to vary this cap if necessary
in the event of a change in the number
of Executive Directors on the Board.
Awards will be made within the
aggregate variable remuneration cap
above.
Operation
The Policy caps the aggregate variable
remuneration for Executive Directors rather
than cap individual awards. The cap is based
on the grant value or award value made in
that year.
Executive Directors are considered for
discretionary variable remuneration awards
each year based on performance assessed at
the end of the financial year.
The assessment of performance will be based
on both Company and personal performance
and will take into account a range of
performance indicators such as (but not
limited to) financial performance including
profitability, growth in AuM, investment
performance relative to benchmarks,
strategic and operational achievements
and personal objectives.
Awards will be delivered as a combination of
cash following the end of the financial year
and deferred shares. At least 70% of the
award will be deferred into shares which will
normally vest after a period of five years.
Deferred shares will normally be delivered as
restricted shares, although awards may be
granted in such other form that the
Committee determines has the same
economic effect.
Deferred shares may include the right to
receive dividends or dividend equivalents in
respect of dividends paid, calculated on such
basis as the Committee determines.
Malus and clawback provisions will apply to
awards, as set out in the notes to this table.
Ashmore Group plc Annual Report and Accounts 2023
87
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
Long-Term
Incentive Plan
Purpose and link to
short and long-term
strategy
Rewards long-term
performance and ensures
the interests of Executive
Directors are closely
aligned with other
shareholders.
Maximum opportunity
Awards will be made within the
aggregated variable remuneration
cap above.
Operation
LTIP awards are share-based awards typically
granted to Executive Directors following the
end of the financial year. The LTIP will typically
be equivalent to no less than 25% of the
Executive Director’s total bonus award for the
year, and can be up to 100% of the total
variable remuneration awarded subject to
overall performance and affordability.
LTIP awards will normally have a five-year
performance period.
The Committee will determine the
performance conditions for each award which
aim to closely align the Executive Directors’
remuneration outcomes with the performance
of the business relative to its KPIs, e.g.
investment performance relative to
benchmarks, profitability and growth in assets
under management. Targets will be set that
are appropriately challenging relative to
relevant internal and external benchmarks.
The maximum level of vesting for achieving
threshold performance is 25%, with 100%
vesting for maximum performance.
The LTIP may be granted in the form of
restricted shares or in such other form that
the Committee determines has the same
economic effect.
LTIP awards may include the right to receive
dividend equivalents in respect of dividends
paid, calculated on such basis as the
Committee determines.
The Committee has discretion to vary LTIP
payments downwards or upwards in
appropriate circumstances, including if it
considers the outcome would not be a fair
reflection of performance.
Malus and clawback provisions will apply to
awards, as set out in the notes to this table.
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Ashmore Group plc Annual Report and Accounts 2023
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
Purpose and link to
short and long-term
strategy
Operation
Maximum opportunity
Long-Term
Incentive Plan
Rewards long-term
LTIP awards are share-based awards typically
Awards will be made within the
performance and ensures
granted to Executive Directors following the
aggregated variable remuneration
the interests of Executive
end of the financial year. The LTIP will typically
cap above.
Directors are closely
be equivalent to no less than 25% of the
aligned with other
Executive Director’s total bonus award for the
shareholders.
year, and can be up to 100% of the total
Shareholding
requirements
Purpose and link to
short and long-term
strategy
Ensures greater
alignment with the
interests of shareholders
and focus on long-term
strategy.
Maximum opportunity
Executive Directors are usually
required to build up and then maintain
a shareholding equivalent to 300%
of salary.
Operation
Levels are set in relation to annual base
salary, and are normally required to be built
up over a five-year period.
Any shares held as part of the variable
remuneration schemes that are not subject to
any further performance conditions will count
towards meeting the guideline on a net of tax
basis where appropriate.
Post-cessation of employment, Executive
Directors are usually required to maintain their
in-employment shareholding guideline (or their
actual shareholding if lower) for two years
post termination of their employment.
The Committee retains discretion to waive
these guidelines if it is not considered
appropriate in the specific circumstances
(e.g. in compassionate circumstances).
Malus and clawback
In addition to the performance conditions described above,
the Remuneration Committee has the discretion to apply malus
and clawback provisions to all elements of variable remuneration,
including to unvested equity awards made in prior periods in the
period up to six years from the date of grant or such longer period
as the Remuneration Committee determines is required by any
applicable law or regulation. The Remuneration Committee may
choose to exercise this discretion for a number of reasons,
for example:
– a material misstatement of the financial results;
– an error in the calculation;
– a material failure of risk management;
– serious reputational damage;
– misconduct, misbehaviour and material error on the part of the
participant, or failure of the participant to meet appropriate
standards of fitness and propriety;
– a material downturn in financial performance;
– the participant committed an act of fraud or other conduct with
intent or severe negligence which led to significant losses; or
– any other circumstances which the Remuneration Committee in
its discretion considers to be similar in their nature or effect.
Where malus or clawback applies, the Remuneration Committee
may, in its discretion, take a number of actions including (but not
limited to) reducing the number of shares to which an award
relates, imposing further conditions on an award or requiring a
participant to make a cash payment to the Company in respect of
some or all of the shares or cash delivered to the Executive Director.
Performance measures
– When determining discretionary variable remuneration, the
Remuneration Committee considers a range of financial and
non-financial measures. These may include profitability,
investment performance relative to benchmarks and growth in
AuM. Non-financial factors may include strategic and operational
achievements, environmental, social and governance factors and
employees’ culture and conduct may also be taken into account.
The Committee considers both quantitative and qualitative
measures of performance in determining the discretionary
variable remuneration outcomes, including longer-term
indicators. For the first LTIP awards to be made in FY2024,
the performance conditions will be based on investment
outperformance relative to benchmarks over three and five years;
growth in assets under management, demonstrated through a
compound increase in AuM over the five-year performance
period; and profitability, demonstrated through Ashmore's diluted
EPS performance relative to a comparator index over the five-
year performance period.
– The Committee undertakes a comprehensive review of different
financial and non-financial measures in determining variable
remuneration to ensure that any awards are linked to wider
Company performance, the shareholder experience, and the
wider stakeholder experience. There are comprehensive
disclosures included in the Directors’ Remuneration report on
how Ashmore has performed against these different measures.
– The expected levels of performance are set at appropriately
stretching levels taking into account the business plan, analyst
forecasts, the sector that Ashmore operates in, and the wider
economic environment.
Ashmore Group plc Annual Report and Accounts 2023
89
variable remuneration awarded subject to
overall performance and affordability.
LTIP awards will normally have a five-year
performance period.
The Committee will determine the
performance conditions for each award which
aim to closely align the Executive Directors’
remuneration outcomes with the performance
of the business relative to its KPIs, e.g.
investment performance relative to
benchmarks, profitability and growth in assets
under management. Targets will be set that
are appropriately challenging relative to
relevant internal and external benchmarks.
The maximum level of vesting for achieving
threshold performance is 25%, with 100%
vesting for maximum performance.
The LTIP may be granted in the form of
restricted shares or in such other form that
the Committee determines has the same
economic effect.
LTIP awards may include the right to receive
dividend equivalents in respect of dividends
paid, calculated on such basis as the
Committee determines.
The Committee has discretion to vary LTIP
payments downwards or upwards in
appropriate circumstances, including if it
considers the outcome would not be a fair
reflection of performance.
Malus and clawback provisions will apply to
awards, as set out in the notes to this table.
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
External Non-executive Director positions
Executive Directors are permitted to serve as Non-executive Directors
of other companies where there is no competition with the Company’s
business activities and where these duties do not interfere with the
individual’s ability to perform his or her duties for the Company.
Where an outside appointment is accepted in furtherance of
the Company’s business, any fees received are remitted to
the Company.
If the appointment is not connected to the Company’s business,
the Executive Director is entitled to retain any fees received.
Approach to remuneration for new Executive
Director appointments
The remuneration package for a new Executive Director would
normally be set in accordance with the terms and maximum levels
of the Company’s approved Remuneration Policy in force at the
time of appointment.
In the case of an externally recruited Executive Director, the
Remuneration Committee may offer additional cash and/or share-
based elements to take account of any remuneration relinquished
when leaving the former employer (a ‘buy-out’ award), when it
considers these to be in the best interests of the Company (and
therefore shareholders). In considering any such payments, the
Committee would take account of the nature, vesting dates and
any performance requirements attached to the relinquished
remuneration. The Committee may determine to make any such
buy-out related awards outside the limits set out in the Policy table.
For an internal appointment, any variable remuneration element
awarded in respect of the prior role may be allowed to be paid out
according to its terms, adjusted, if necessary, to take into account
the appointment.
For external and internal appointments, the Company may meet
certain incidental and/or relocation expenses (including any tax
thereon) as appropriate, including but not limited to assistance with
housing, immigration, taxes and travel. This may take the form of a
cash payment.
Other elements may be included in the following circumstances: (i)
an interim appointment being made to fill an Executive Director role
on a short-term basis; and (ii) if exceptional circumstances
require that the Chair or a Non-Executive Director takes on an
executive function.
Service contracts and loss of office payment Policy
Service contracts normally continue until the Executive Director’s
agreed retirement date or such other date as the parties agree.
The service contracts contain provisions for early termination.
Notice periods are limited to 12 months by either party. Service
agreements contain no contractual entitlement to receive variable
remuneration; participation in these arrangements is at the
Remuneration Committee’s discretion. The Executive Directors’
service contracts are available for inspection at the Company’s
registered office during normal business hours.
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Ashmore Group plc Annual Report and Accounts 2023
If the employment of an Executive Director is terminated without
giving the period of notice required under the contract, the
Executive Director would be entitled to claim recompense for up to
one year’s remuneration subject to consideration of the obligation
to mitigate the loss. Such recompense is expected to be limited to
base salary due for any unexpired notice period, and any amount
assessed by the Remuneration Committee as representing the
value of other contractual benefits and pension which would have
been received during the period. In the event of a change of control
of the Company, there is no enhancement to these terms.
In summary, the contractual provisions are as follows:
Provision
Notice period
Detailed terms
12 months
Termination payment in the
event of termination by the
Company without due notice
Base salary plus value of benefits
(including pension) paid monthly
and subject to mitigation
Change of control
Same terms as above
on termination
An annual variable remuneration award may be payable in the year
of leaving in the case of ‘good leavers’. This will be subject to
performance and will normally be pro-rated for time in role during
the year and subject to deferral. In respect of the year within which
an individual steps down from the Board, the Committee may
decide to only award an annual bonus and not grant an LTIP.
Any outstanding share-based entitlements held by an Executive
Director under the Company’s share plans will be determined
based on the relevant plan rules.
For FY2022 onwards, any unvested shares normally lapse following
cessation of employment during the relevant performance or
deferral period. However, in certain prescribed circumstances, or
any other circumstances at the discretion of the Committee, ‘good
leaver’ status applies. For good leavers, awards will normally vest
on their normal vesting date, and, where relevant, will be subject to
the satisfaction of the relevant performance conditions at that time
and reduced pro-rata to reflect the proportion of the period worked
between the grant date and original vesting date (except in the
case of death where the default is that pro-rating will not apply),
unless the Committee determines otherwise.
An Executive Director’s service contract may be terminated without
notice and without any further payment or compensation, except
for sums accrued up to the date of termination, on the occurrence
of certain events such as gross misconduct.
The Committee reserves the right to make any other payments in
connection with a Director’s cessation of office or employment
where the payments are made in good faith in discharge of an
existing legal obligation (or by way of damages for breach of such
an obligation) or by way of a compromise or settlement of any
claim arising in connection with the cessation of a Director’s office
or employment. Any such payments may include but are not
limited to paying any fees for outplacement assistance and/or the
Director’s legal and/or professional advice fees in connection with
cessation of office or employment and/or retirement gifts.
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
External Non-executive Director positions
Executive Directors are permitted to serve as Non-executive Directors
of other companies where there is no competition with the Company’s
business activities and where these duties do not interfere with the
individual’s ability to perform his or her duties for the Company.
Where an outside appointment is accepted in furtherance of
the Company’s business, any fees received are remitted to
the Company.
If the appointment is not connected to the Company’s business,
the Executive Director is entitled to retain any fees received.
If the employment of an Executive Director is terminated without
giving the period of notice required under the contract, the
Executive Director would be entitled to claim recompense for up to
one year’s remuneration subject to consideration of the obligation
to mitigate the loss. Such recompense is expected to be limited to
base salary due for any unexpired notice period, and any amount
assessed by the Remuneration Committee as representing the
value of other contractual benefits and pension which would have
been received during the period. In the event of a change of control
of the Company, there is no enhancement to these terms.
In summary, the contractual provisions are as follows:
Approach to remuneration for new Executive
Director appointments
Provision
Notice period
Detailed terms
12 months
The remuneration package for a new Executive Director would
Termination payment in the
Base salary plus value of benefits
normally be set in accordance with the terms and maximum levels
event of termination by the
(including pension) paid monthly
of the Company’s approved Remuneration Policy in force at the
Company without due notice
and subject to mitigation
time of appointment.
In the case of an externally recruited Executive Director, the
Remuneration Committee may offer additional cash and/or share-
based elements to take account of any remuneration relinquished
when leaving the former employer (a ‘buy-out’ award), when it
considers these to be in the best interests of the Company (and
therefore shareholders). In considering any such payments, the
Committee would take account of the nature, vesting dates and
any performance requirements attached to the relinquished
remuneration. The Committee may determine to make any such
buy-out related awards outside the limits set out in the Policy table.
For an internal appointment, any variable remuneration element
awarded in respect of the prior role may be allowed to be paid out
according to its terms, adjusted, if necessary, to take into account
the appointment.
For external and internal appointments, the Company may meet
certain incidental and/or relocation expenses (including any tax
thereon) as appropriate, including but not limited to assistance with
housing, immigration, taxes and travel. This may take the form of a
cash payment.
Other elements may be included in the following circumstances: (i)
an interim appointment being made to fill an Executive Director role
on a short-term basis; and (ii) if exceptional circumstances
require that the Chair or a Non-Executive Director takes on an
executive function.
Change of control
Same terms as above
on termination
An annual variable remuneration award may be payable in the year
of leaving in the case of ‘good leavers’. This will be subject to
performance and will normally be pro-rated for time in role during
the year and subject to deferral. In respect of the year within which
an individual steps down from the Board, the Committee may
decide to only award an annual bonus and not grant an LTIP.
Any outstanding share-based entitlements held by an Executive
Director under the Company’s share plans will be determined
based on the relevant plan rules.
For FY2022 onwards, any unvested shares normally lapse following
cessation of employment during the relevant performance or
deferral period. However, in certain prescribed circumstances, or
any other circumstances at the discretion of the Committee, ‘good
leaver’ status applies. For good leavers, awards will normally vest
on their normal vesting date, and, where relevant, will be subject to
the satisfaction of the relevant performance conditions at that time
and reduced pro-rata to reflect the proportion of the period worked
between the grant date and original vesting date (except in the
case of death where the default is that pro-rating will not apply),
unless the Committee determines otherwise.
An Executive Director’s service contract may be terminated without
notice and without any further payment or compensation, except
for sums accrued up to the date of termination, on the occurrence
Service contracts and loss of office payment Policy
of certain events such as gross misconduct.
Service contracts normally continue until the Executive Director’s
agreed retirement date or such other date as the parties agree.
The service contracts contain provisions for early termination.
Notice periods are limited to 12 months by either party. Service
agreements contain no contractual entitlement to receive variable
remuneration; participation in these arrangements is at the
Remuneration Committee’s discretion. The Executive Directors’
service contracts are available for inspection at the Company’s
registered office during normal business hours.
The Committee reserves the right to make any other payments in
connection with a Director’s cessation of office or employment
where the payments are made in good faith in discharge of an
existing legal obligation (or by way of damages for breach of such
an obligation) or by way of a compromise or settlement of any
claim arising in connection with the cessation of a Director’s office
or employment. Any such payments may include but are not
limited to paying any fees for outplacement assistance and/or the
Director’s legal and/or professional advice fees in connection with
cessation of office or employment and/or retirement gifts.
Incentive plan discretions
The Remuneration Committee will operate the current share plans
in accordance with their respective rules and the Policy set out
above, and in accordance with the Listing Rules and relevant
legislation or regulation. As is consistent with market practice, the
Remuneration Committee retains discretion over a number of areas
relating to operating and administrating the plan.
These include (but are not limited to) the following:
– who participates in the plan;
– the timing of the grant of an award and/or payment;
– the size of an award and/or a payment within the plan limits
approved by shareholders;
– the choice of (and adjustment of) performance measures and
targets in accordance with the Policy set out above and the rules
of each plan;
– discretion relating to the measurement of performance in the
event of a change of control or reconstruction;
– determination of a good leaver (in addition to any specified
categories) for incentive plan purposes, based on the rules of the
plan and the appropriate treatment under the plan rules;
– the percentage split of award between cash and share awards to
meet business, legislative or regulatory requirements;
– adjustments required in order to comply with any new regulatory
requirements which the Company is compelled to adhere to; and
– adjustments required in certain circumstances (e.g. rights issues,
corporate restructuring, special dividends and on a change
of control).
Any use of the above discretions would, where relevant, be
explained in the Annual Report on Remuneration. As appropriate,
it might also be the subject of consultation with the Company’s
major shareholders.
The Committee may make minor amendments to this Policy (for
regulatory, exchange control, tax or administrative purposes or to
take account of a change in legislation) without obtaining
shareholder approval for that amendment.
Legacy arrangements
For the avoidance of doubt, this Policy includes authority for the
Company to honour any commitments entered into with current or
former Directors prior to the approval of the Policy, provided that
such commitments were consistent with the applicable
remuneration policy in force at the time they were agreed. Any
commitments made prior to an individual becoming a Director and
not in anticipation of their appointment to the Board may also be
honoured, even where it is not consistent with the Policy at the time
the payment is made. Details of any payments to former Directors
will be set out in the Annual Report on Remuneration as they arise.
Non-executive Directors
Non-executive Directors are engaged under letters of appointment
and do not have contracts of service. They are appointed for an
initial three-year period, subject to annual shareholder re-election.
Their continued engagement is subject to the requirements of the
Company’s Articles relating to the retirement of Directors by
rotation. The letters of appointment are available for inspection at
the Company’s registered office during normal business hours.
Compliance with the Remuneration Codes
The Remuneration Committee regularly reviews its Remuneration
policy’s compliance with the principles of the FCA’s Remuneration
Codes, as applicable to Ashmore.
The Remuneration Policy is designed to be consistent with the
prudent management of risk, and the sustained, long-term
performance of the Company.
Consistent Company-wide approach to remuneration
for all employees
The Company aims to apply a consistent remuneration philosophy
for employees at all levels and the remuneration policy for
Executive Directors is broadly consistent with that for employees
across the Company as a whole. However, there are some
differences that the Remuneration Committee believes are
necessary to reflect the different responsibilities of employees
across the Company.
The cap on base salary means that Executive Directors’ base
salaries are set at a similar level to other senior investment and
professional employees in the Company, and the base salary range
from lowest to highest in the Company is considerably narrower
than the market norm.
Rates of pension contribution and fringe benefit provisions
are consistent between executives and other employees within
their country of employment. The Executive Directors are aligned
with the UK employees.
All employees may be eligible for a performance-related annual
bonus, and the principle of bonus deferral into Company shares or
equivalent applies to annual bonuses for all other employees.
Employees receive their variable remuneration in a mixture of cash
and shares and are eligible to receive share matching where
appropriate. Individuals identified as material risk takers under the
regulations applicable to Ashmore are subject to deferral
in line with those requirements.
The Committee discusses key remuneration topics relating to
employees throughout the year, including salary levels, regulatory
compensation matters and benefit trends.
The Remuneration Committee monitors the effectiveness of the
Company’s Remuneration Policy in recruiting, retaining, developing,
engaging and motivating employees and receives reports from the
CEO and the Group Head of Human Resources on how the
Company’s remuneration policies are viewed by employees and
whether they are meeting business needs.
The Company does not operate formal employee consultation on
remuneration. However, employees are able to provide direct
feedback on the Company’s Remuneration Policy to their line
managers, the Human Resources team, and the Board directly
through Ashmore’s regular ‘meet the teams’ or individually to
the Company’s nominated Non-executive Director for
workforce engagement.
Ashmore Group plc Annual Report and Accounts 2023
91
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
Reward scenarios
The Remuneration Policy results in the majority of the remuneration
received by the Executive Directors being dependent
on performance, normally with compulsory deferral of at least 70%
of the bonus into shares for five years and a five-year performance
period under the LTIP providing long-term shareholder alignment.
As noted earlier, the Policy is not to cap individual awards,
but rather the aggregate award that may be made to all Executive
Directors. As such, it is not possible to demonstrate maximum
Figure 2
remuneration levels. In lieu of this, an indication of the potential
range of total remuneration is illustrated in Figure 2 using the
highest and lowest variable remuneration awards in a five-year
period. The variable remuneration awards are shown assuming full
vesting five years later of the long-term incentive component based
on achievement relative to the performance conditions, both at the
grant price and also with 50% share price growth.
Executive Director total remuneration at different levels of performance (£’000)
CEO
GFD
£4,401
£4,011
£5,000
£4,000
£3,000
£2,000
£1,000
£1,435
£1,565
£839
£111
£111
£0
Fixed/Minimum
Lowest pay
received in
five-year
period
Highest pay
received in
five-year
period
Additional value
created should
LTI increase
in value by 50%
Salary
Benefits
Pension
Cash bonus
Deferred bonus shares
LTIP
£132
Fixed/Minimum
Lowest pay
received in
five-year
period
Highest pay
received in
five-year
period
Additional value
created should
LTI increase
in value by 50%
1. Additional value created should LTI share value increase by 50%
92
Ashmore Group plc Annual Report and Accounts 2023
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
D I R E C T O R S ’ R E M U N E R A T I O N P O L I C Y ( C O N T I N U E D )
Reward scenarios
The Remuneration Policy results in the majority of the remuneration
received by the Executive Directors being dependent
on performance, normally with compulsory deferral of at least 70%
of the bonus into shares for five years and a five-year performance
period under the LTIP providing long-term shareholder alignment.
As noted earlier, the Policy is not to cap individual awards,
but rather the aggregate award that may be made to all Executive
Directors. As such, it is not possible to demonstrate maximum
Figure 2
remuneration levels. In lieu of this, an indication of the potential
range of total remuneration is illustrated in Figure 2 using the
highest and lowest variable remuneration awards in a five-year
period. The variable remuneration awards are shown assuming full
vesting five years later of the long-term incentive component based
on achievement relative to the performance conditions, both at the
grant price and also with 50% share price growth.
1. Additional value created should LTI share value increase by 50%
Figure 3
Fee Policy for Non-executive Directors
Purpose and link to
strategy
To ensure that the Group
is able to attract and
retain experienced and
skilled individuals
Board Chair
and Non-
executive
Director fees
Maximum opportunity
The overall fees payable to Non-
executive Directors will remain within
the limit stated in the Articles of
Association, currently £750,000.
The current level of fees is disclosed in
the Annual Report on Remuneration.
Operation
The Board Chair is paid a single fee for all
responsibilities, inclusive of Chairing the
Nominations Committee.
The Non-executive Directors are paid a basic fee
with additional fees paid for additional
responsibilities (currently Senior Independent
Director, Chair of the Audit and Risk Committee
and Chair of the Remuneration Committee).
The level of the fees for the Board Chair and Non-
executive Directors is reviewed periodically with
reference to market levels in comparably sized
FTSE companies.
Fees may also be increased on an ongoing or
temporary or ad hoc basis, to take into account
changes in the working of the Board and/or
changes in responsibilities or time commitments.
The Board Chair and Non-executive Directors may
be paid expenses (including any tax thereon) in
relation to the performance of their role.
Ashmore Group plc Annual Report and Accounts 2023
93
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
Ashmore’s approach to remuneration FY2023
The Remuneration Committee is guided by a clear set of remuneration principles, with a
comprehensive approach to determining variable remuneration outcomes.
These principles assist the Committee in determining its Policy and practices, and are in compliance with Provision 40 of the Code.
The Remuneration Committee determines annual bonus awards
based on a balanced scorecard of factors at both the Group and
individual level, and applies discretion rather than a formulaic
approach in order to deliver outcomes which reflect the best value
for shareholders. The current policy can be found on pages 119 to
126 of the FY2022 report and accounts.
Factors considered include, but are not limited to:
Financial
– AuM development
– Adjusted EBITDA margin
– AuM outperforming benchmarks (1, 3 & 5 years)
– Profit before tax
– Net revenue
– Diluted EPS
– Cost management
Non-financial
– Strategic objectives
– Sustainability
– Outcomes for investors and clients
– Risk management
– Compliance
– Employees, culture and conduct
– Personal objectives
1. Discretion and flexibility
Variable remuneration is not formulaic or capped at an
individual level, albeit there is a cap at an aggregate level, and
as such the Remuneration Committee has discretion to ensure
that awards reflect business and individual performance, thus
the behavioural risk arising from target-based incentive plans is
not present.
Malus and clawback may be applied by the Remuneration
Committee to all elements of variable remuneration.
The Remuneration Committee is able to apply an ex-ante risk
adjustment to the bonus pool to reflect any concerns arising.
2. Alignment with stakeholders
Base salaries are capped and set at the lower end of market
levels to ensure fixed costs are tightly controlled.
On an annual basis the bonus pool is derived solely from
profits made in the year and has been capped at 25% of
EBVCIT, ensuring predictability of overall outcomes.
Up to 77% of variable remuneration is delivered in Ashmore
shares, restricted and deferred for five years.
A significant proportion of Executive Directors’ variable
remuneration will only vest subject to the achievement of
stretching performance targets, closely aligned with the
Group’s KPIs.
3. Consistency across the Group
The clear and simple Remuneration approach applies to all
Ashmore employees, including Executive Directors, which is a
material factor in defining and shaping both the Remuneration
Policy and Ashmore’s culture.
Executive Directors receive the same level of pension
contributions as other employees.
4. Pay for long-term performance
The Remuneration Committee considers the performance of
Executive Directors and senior managers over the long term,
taking account of progress over a multi-year period, annual
performance in the context of the business and progress made
towards both its strategic objectives and its KPIs. Awards for
Executive Directors’ are subject to performance conditions
over a five-year performance period.
94
Ashmore Group plc Annual Report and Accounts 2023
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
Ashmore’s approach to remuneration FY2023
The Remuneration Committee is guided by a clear set of remuneration principles, with a
comprehensive approach to determining variable remuneration outcomes.
These principles assist the Committee in determining its Policy and practices, and are in compliance with Provision 40 of the Code.
1. Discretion and flexibility
Variable remuneration is not formulaic or capped at an
individual level, albeit there is a cap at an aggregate level, and
as such the Remuneration Committee has discretion to ensure
that awards reflect business and individual performance, thus
the behavioural risk arising from target-based incentive plans is
The Remuneration Committee determines annual bonus awards
based on a balanced scorecard of factors at both the Group and
individual level, and applies discretion rather than a formulaic
approach in order to deliver outcomes which reflect the best value
for shareholders. The current policy can be found on pages 119 to
126 of the FY2022 report and accounts.
not present.
Factors considered include, but are not limited to:
Malus and clawback may be applied by the Remuneration
Committee to all elements of variable remuneration.
The Remuneration Committee is able to apply an ex-ante risk
adjustment to the bonus pool to reflect any concerns arising.
Financial
– AuM development
– Adjusted EBITDA margin
– AuM outperforming benchmarks (1, 3 & 5 years)
– Profit before tax
– Net revenue
– Diluted EPS
– Cost management
Non-financial
– Strategic objectives
– Sustainability
– Risk management
– Compliance
– Outcomes for investors and clients
– Employees, culture and conduct
– Personal objectives
2. Alignment with stakeholders
Base salaries are capped and set at the lower end of market
levels to ensure fixed costs are tightly controlled.
On an annual basis the bonus pool is derived solely from
profits made in the year and has been capped at 25% of
EBVCIT, ensuring predictability of overall outcomes.
Up to 77% of variable remuneration is delivered in Ashmore
shares, restricted and deferred for five years.
A significant proportion of Executive Directors’ variable
remuneration will only vest subject to the achievement of
stretching performance targets, closely aligned with the
Group’s KPIs.
3. Consistency across the Group
The clear and simple Remuneration approach applies to all
Ashmore employees, including Executive Directors, which is a
material factor in defining and shaping both the Remuneration
Policy and Ashmore’s culture.
Executive Directors receive the same level of pension
contributions as other employees.
4. Pay for long-term performance
The Remuneration Committee considers the performance of
Executive Directors and senior managers over the long term,
taking account of progress over a multi-year period, annual
performance in the context of the business and progress made
towards both its strategic objectives and its KPIs. Awards for
Executive Directors’ are subject to performance conditions
over a five-year performance period.
Key business metrics aligned to long-term
performance, delivering a strong equity
ownership culture.
Vesting of restricted share awards
is contingent on meeting stringent
long-term performance conditions,
clearly aligned with the achievement
of the Group’s strategic objectives and
KPIs, leading to a proportionality of
reward outcomes.
Profitability
Diluted EPS performance relative to
Emerging Markets indices (%)
2023
2022
2021
2020
2019
(10)
(11)
23
3
11
AuM development
AuM (US$bn)
2023
2022
2021
2020
2019
55.9
64.0
94.4
83.6
91.8
Investment performance
% of AuM outperforming benchmarks
3
2
0
2
2
2
0
2
1
2
0
2
0
2
0
2
9
1
0
2
67
69
49
45
28
48
96
57
79
9
17
74
90
97
97
1 year
3 years
5 years
To align with, encourage and maintain
Ashmore’s equity ownership culture, under
the current approach both employees and
Executive Directors may elect to reduce
their annual cash bonus by up to 50%, and
in exchange receive an equivalent value of
restricted shares, which are in turn matched
with a further award of restricted shares.
The remuneration approach generates strong retention
of employees, who are able to build up a meaningful
shareholding in the firm over time, thus aligning them with the
long-term interests of Ashmore’s clients, shareholders and
their colleagues, while also complying with relevant
remuneration regulations and encouraging behaviours
consistent with Ashmore’s culture and strategy.
The five-year deferral and cliff vesting of share awards also
provides a smoothing of income over time which again aids
retention of employees through market cycles.
40%
Approximately 40% of employee equity ownership
Ashmore Group plc Annual Report and Accounts 2023
95
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
A S H M O R E ’ S A P P R O A C H T O R E M U N E R A T I O N F Y 2 0 2 3 ( C O N T I N U E D )
Executive Director bonuses are funded from the Group bonus pool
and determined by the Committee using a balanced scorecard of
financial and non-financial measures including in relation to
individual personal performance. Within the FY2022 Annual Report,
the Committee confirmed that it would apply broadly similar
weightings and metrics for annual variable remuneration in FY2023
as in prior periods, chosen to align with the Group’s key
performance indicators and strategy.
Through the assessment of the Executive Directors annual short-term
performance measures, the Committee evaluated the level of
performance achieved against key financial and non-financial measures.
As detailed below and overleaf, performance in FY2023 was typical
of the beginning of a recovery period in Emerging Markets.
Investment performance improved significantly relative to the prior
period, which, as investor confidence improves, should translate
into positive AuM development. However, the broader financial
picture for FY2023 reflects the currently lower level of AuM.
The overall management of the business has been effective, as can
be seen from the PBT and diluted EPS outcomes relative to net
revenues, with strong control of costs and effective management
of balance sheet assets and higher interest income mitigating the
impact of the lower revenues.
The Committee discussed the performance of the Executive
Directors and the appropriate variable remuneration outcomes for
them in the context of performance delivered despite the revenue
headwinds faced by the Company this year.
Assessment of the financial measures for the Executive Directors
Performance
measure
AuM
Year
Performance relative to the prior period Outcome
FY2023
FY2022
(see page 29 for more information)
Committee
assessment
$55.9bn
$64.0bn
54%
64%
Adjusted EBITDA
margin
FY2023
FY2022
AuM
outperforming
benchmarks (1, 3
& 5 years)
(see page 32 for more information)
FY2023
FY2022
(see page 29 for more information)
Profit before tax
FY2023
FY2022
(see page 32 for more information)
Net revenue
FY2023
FY2022
(see page 31 for more information)
Diluted EPS
FY2023
FY2022
(see page 32 for more information)
Cost
management
FY2023
FY2022
(see page 31 for more information)
96
Ashmore Group plc Annual Report and Accounts 2023
1yr 67%, 3yr 69%, 5yr 49%
1yr 45%, 3yr 28%, 5yr 48%
£111.8m
£118.4m
£196.4m
£262.5m
12.2p
12.6p
£94.0m
£98.5m
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
A S H M O R E ’ S A P P R O A C H T O R E M U N E R A T I O N F Y 2 0 2 3 ( C O N T I N U E D )
Executive Director bonuses are funded from the Group bonus pool
Investment performance improved significantly relative to the prior
and determined by the Committee using a balanced scorecard of
period, which, as investor confidence improves, should translate
financial and non-financial measures including in relation to
into positive AuM development. However, the broader financial
individual personal performance. Within the FY2022 Annual Report,
picture for FY2023 reflects the currently lower level of AuM.
the Committee confirmed that it would apply broadly similar
weightings and metrics for annual variable remuneration in FY2023
as in prior periods, chosen to align with the Group’s key
performance indicators and strategy.
The overall management of the business has been effective, as can
be seen from the PBT and diluted EPS outcomes relative to net
revenues, with strong control of costs and effective management
of balance sheet assets and higher interest income mitigating the
Through the assessment of the Executive Directors annual short-term
impact of the lower revenues.
performance measures, the Committee evaluated the level of
performance achieved against key financial and non-financial measures.
The Committee discussed the performance of the Executive
Directors and the appropriate variable remuneration outcomes for
Non-financial
measures
Performance in FY2023
Committee
Assessment
Strategic objectives (see pages 10 to 15 for more information)
Phase 1
Lower allocations from Developed Markets investors, to an extent mitigated by increased
allocations from Emerging Markets based investors, who now make up 33% of AuM
(FY2022: 27%)
Phase 2
Continued strong Equities and other Fixed Income investment theme performance including high
yield and increasing client activity levels should result in flows to support the diversification of
revenue streams as investor sentiment improves
As detailed below and overleaf, performance in FY2023 was typical
them in the context of performance delivered despite the revenue
Phase 3
Local asset management platform AuM remained stable over the period
of the beginning of a recovery period in Emerging Markets.
headwinds faced by the Company this year.
Assessment of the financial measures for the Executive Directors
Performance
Year
Performance relative to the prior period Outcome
Committee
assessment
measure
AuM
FY2023
FY2022
FY2022
FY2023
FY2022
FY2022
FY2023
FY2022
FY2023
FY2022
FY2023
FY2022
(see page 29 for more information)
(see page 32 for more information)
(see page 29 for more information)
Adjusted EBITDA
FY2023
margin
AuM
outperforming
benchmarks (1, 3
& 5 years)
Profit before tax
FY2023
Net revenue
Diluted EPS
Cost
management
(see page 32 for more information)
(see page 31 for more information)
(see page 32 for more information)
(see page 31 for more information)
1yr 67%, 3yr 69%, 5yr 49%
1yr 45%, 3yr 28%, 5yr 48%
$55.9bn
$64.0bn
54%
64%
£111.8m
£118.4m
£196.4m
£262.5m
12.2p
12.6p
£94.0m
£98.5m
Sustainability (see pages 50 to 61 for more information)
In FY2023, the Group will make a payment of £0.5 million (FY2022: £0.6 million) to The Ashmore Foundation and
other charitable activities. The Group’s collaboration with The Ashmore Foundation continues to enable work
supporting reforestation and livelihoods projects which also meet Ashmore’s carbon offset needs (Scope 1-3
emissions) while generating income for farming communities through cash crops and carbon financing and providing
training for women working in seed nurseries in two regions of the Amazon.
Ashmore has maintained its ‘low’ ESG risk category with Sustainalytics, has maintained an AA ESG rating from MSCI
and remains a member of the FTSE4Good equity index and NZAMI.
Employees (see pages 46 to 49 for more information)
The Group’s average headcount increased slightly during FY2023 to 309 employees (FY2022: 305) as a result of
continued local office growth. London head office headcount remains flat, maintaining strong cost control.
Unplanned employee turnover increased during FY2023, with the London head office at 10% (FY2022: 8%) and at
14% for the Group as a whole (FY2022: 11%); the increase including subsidiaries and local asset management
businesses reflects the different nature of the employment environments which they operate in.
Average employee tenure in the London head office is over eight years and is almost seven years across the Group
as a whole, providing clients and investors with continuity of employees and demonstrating retained institutional
knowledge through market cycles.
During the period succession plans were implemented for a number of roles including two Non-executive Directors
and four senior management roles, with a smooth transition between individuals taking place.
A Diversity Committee, chaired by the Non-executive Director for workforce engagement, was established to oversee
Ashmore’s diversity and inclusion strategies.
Compliance, culture and risk management (see pages 35 to 41 for more information)
The Remuneration Committee reviews a dashboard of indicators on a biannual basis which seek to measure and
monitor aspects of organisational culture. During FY2023 the number of indicators reported on was increased from 24
to 31 under the headings of ‘tone from the top’, incentive structures and remuneration, effectiveness of management
and governance and individual accountability. There were no matters of concern arising during FY2023 that would
warrant the Remuneration Committee questioning the management of the Group or indicating poor organisational
culture or conduct risks. The Remuneration Committee is satisfied that all relevant regulatory and corporate
governance requirements have been met appropriately.
Ashmore Group plc Annual Report and Accounts 2023
97
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
A S H M O R E ’ S A P P R O A C H T O R E M U N E R A T I O N F Y 2 0 2 3 ( C O N T I N U E D )
The Remuneration Committee considered the qualitative and quantitative inputs provided to it by the management team across the
range of financial and non-financial measures detailed above and, to assist shareholders in understanding their decision making, summarises
its assessment of performance as follows:
Chief Executive Officer
The CEO’s short-term performance is assessed:
Group Finance Director
The GFD’s short-term performance is assessed:
– 75% on financial performance measures including effectively
– 85% on his management of the Finance, Middle Office
managing investment performance to deliver consistent growth
relative to each investment theme, maintaining and increasing
AuM and maintaining and increasing EBIT; and
– 25% on non-financial management performance, including
management of matters relating to ESG, strategy development
and implementation, recruitment, staff turnover and succession
planning and regulatory and compliance adherence.
Personal performance
As detailed elsewhere in this report, FY2023 has seen a
significant improvement in investment performance, with local
currency, external debt, investment grade and all cap equity
assets performing particularly strongly. However, it remains that
there is still reduced overall financial performance in the period
being assessed by the Remuneration Committee due to the
reduced AuM.
The financial measures represent the greater proportion of the
areas considered by the Remuneration Committee in determining
annual remuneration for the CEO, in order that there is a clear
alignment of annual incentives with the Group’s key performance
indicators and the delivery over time of value for shareholders.
The business has remained well managed and the CEO has
continued to provide strong leadership through a period of
challenging market conditions, including in relation to the
management of costs.
During the period positive developments relating to non-financial
measures have taken place in regards to sustainability and
succession planning and the business remains well governed and
controlled with the appropriate personnel and resources in place.
Operations, Information Technology, Corporate Development
and Investor Relations departments and on his management
of subsidiary business activities outside the UK, including
joint ventures;
– 15% on contribution to the development and implementation of
strategic goals and increasing value for shareholders, investor
relations and communication, broadening the shareholder base
and communicating effectively with all relevant stakeholders.
Personal performance
In the Remuneration Committee’s assessment, the GFD has
performed well in FY2023. This has been the first full year
managing his expanded portfolio of responsibilities. The areas of
the business he is responsible for have required restructuring and
personnel changes, both within the London head office and in a
number of the subsidiary businesses, which have been managed
well, and the departments continue to be run effectively, with
high quality teams in place delivering timely and effective outputs.
The audit tender process ran effectively and the management and
financial reporting delivered was enhanced through the period.
The subsidiary businesses have continued to perform well,
maintaining AuM and becoming a relatively more material part of
the Group’s operations through the period, and remain well
integrated with the Group.
Operating costs remained well managed by the GFD, reducing by
4% relative to the prior period.
Ongoing contribution to business strategy, investor relations and
shareholder and third-party relationship management
remains effective.
Executive Director annual bonus awards for the year ending 30 June 2023
The Remuneration Committee has considered these inputs and has determined that the reduced financial performance in the period must
be recognised in this years award levels. The Committee agreed to the CEO’s request to waive any award for this year and agreed to make
no bonus award. The Committee also recognised the contribution of the GFD; and awarded a bonus of £720,000, which is a reduction of
10% on the sum awarded in FY2022.
Mark Coombs
Tom Shippey
Annual bonus award
–
£720,000
98
Ashmore Group plc Annual Report and Accounts 2023
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
A S H M O R E ’ S A P P R O A C H T O R E M U N E R A T I O N F Y 2 0 2 3 ( C O N T I N U E D )
Performance conditions, vesting outcome and grant FY2023
The Remuneration Committee considered the qualitative and quantitative inputs provided to it by the management team across the
The table below sets out the measures and targets long-term incentive awards.
range of financial and non-financial measures detailed above and, to assist shareholders in understanding their decision making, summarises
its assessment of performance as follows:
Chief Executive Officer
Group Finance Director
The CEO’s short-term performance is assessed:
The GFD’s short-term performance is assessed:
– 75% on financial performance measures including effectively
– 85% on his management of the Finance, Middle Office
managing investment performance to deliver consistent growth
Operations, Information Technology, Corporate Development
relative to each investment theme, maintaining and increasing
and Investor Relations departments and on his management
AuM and maintaining and increasing EBIT; and
of subsidiary business activities outside the UK, including
– 25% on non-financial management performance, including
joint ventures;
management of matters relating to ESG, strategy development
– 15% on contribution to the development and implementation of
and implementation, recruitment, staff turnover and succession
strategic goals and increasing value for shareholders, investor
planning and regulatory and compliance adherence.
relations and communication, broadening the shareholder base
and communicating effectively with all relevant stakeholders.
Personal performance
Personal performance
As detailed elsewhere in this report, FY2023 has seen a
In the Remuneration Committee’s assessment, the GFD has
significant improvement in investment performance, with local
performed well in FY2023. This has been the first full year
currency, external debt, investment grade and all cap equity
managing his expanded portfolio of responsibilities. The areas of
assets performing particularly strongly. However, it remains that
the business he is responsible for have required restructuring and
there is still reduced overall financial performance in the period
personnel changes, both within the London head office and in a
being assessed by the Remuneration Committee due to the
number of the subsidiary businesses, which have been managed
reduced AuM.
The financial measures represent the greater proportion of the
well, and the departments continue to be run effectively, with
high quality teams in place delivering timely and effective outputs.
areas considered by the Remuneration Committee in determining
The audit tender process ran effectively and the management and
annual remuneration for the CEO, in order that there is a clear
financial reporting delivered was enhanced through the period.
alignment of annual incentives with the Group’s key performance
indicators and the delivery over time of value for shareholders.
The subsidiary businesses have continued to perform well,
maintaining AuM and becoming a relatively more material part of
The business has remained well managed and the CEO has
the Group’s operations through the period, and remain well
continued to provide strong leadership through a period of
integrated with the Group.
challenging market conditions, including in relation to the
management of costs.
During the period positive developments relating to non-financial
measures have taken place in regards to sustainability and
succession planning and the business remains well governed and
controlled with the appropriate personnel and resources in place.
Operating costs remained well managed by the GFD, reducing by
4% relative to the prior period.
Ongoing contribution to business strategy, investor relations and
shareholder and third-party relationship management
remains effective.
Executive Director annual bonus awards for the year ending 30 June 2023
The Remuneration Committee has considered these inputs and has determined that the reduced financial performance in the period must
be recognised in this years award levels. The Committee agreed to the CEO’s request to waive any award for this year and agreed to make
no bonus award. The Committee also recognised the contribution of the GFD; and awarded a bonus of £720,000, which is a reduction of
10% on the sum awarded in FY2022.
Mark Coombs
Tom Shippey
Annual bonus award
–
£720,000
Figure 4
Performance conditions’ vesting scale FY2023
Performance condition
Performance
TSR
Below median of peer group
Median
Between median and upper quartile
Upper quartile
% of award vesting
Zero
25%
Straight-line proportionate vesting
100%
Investment outperformance
Below 50% of assets outperforming the
benchmarks over three and five years
Zero
Growth in assets under management
50% of assets outperforming the benchmarks over
three and five years
Between 50% and 75% of assets outperforming the
benchmarks over three and five years
75% or above of assets outperforming the
benchmarks over three and five years
Below 5% compound increase in AuM over the
five-year performance period
5% compound increase in AuM over the five-year
performance period
Between 5% and 10% compound increase in AuM
over the five-year performance period
25% - Threshhold performance
Straight-line proportionate vesting
100%
Zero
25% - Threshhold performance
Straight-line proportionate vesting
Profitability – Ashmore’s diluted EPS
performance relative to a combination of
Emerging Markets indices representative
of the markets in which Ashmore invests,
determined by the Remuneration
Committee and based on the underlying
structure of the business
10% or above compound increase in AuM over the
five-year performance period
100%
Below the benchmark return
At the benchmark return
Between the benchmark return and 10%
outperformance
Zero
25% - Threshhold performance
Straight-line proportionate vesting
At or above 10% outperformance relative to the
benchmark return
100%
Performance and vesting outcome for the CEO and GFD’s long-term incentive awards
During FY2023, shares awarded to Mark Coombs and Tom Shippey in 2017 reached their vesting date on 13 September 2022. On the
vesting date, all bonus shares and half of the restricted and matching shares that were not subject to additional performance measures
vested. The half that was subject to additional performance measures lapsed in full.
The 2018 awards had performance conditions ending at the end of the FY2023 performance year and will vest on 13 September 2023.
Performance conditions were applied to the half of the restricted and matching shares awarded due to vest. For the 2018 awards TSR was
not used as a performance condition, and the remaining three performance conditions were equally weighted at 33.3%. The performance
outcomes, relative to the performance conditions vesting scale shown in Figure 4, are shown in Figure 5.
Ashmore Group plc Annual Report and Accounts 2023
99
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
P E R F O R M A N C E C O N D I T I O N S , V E S T I N G O U T C O M E A N D G R A N T F Y 2 0 2 3
( C O N T I N U E D )
Figure 5
Vesting outcome for CEO and GFD’s 2017 long-term incentive awards subject to performance conditions
Investment
performance
Performance measure assessment
Below 50% of assets outperforming the
benchmarks over three and five years, actual
was 38%
Increasing
AuM
The compound annual growth in AuM over
the five-year period was below 5%, actual
was 1.75%
Profitability On a compound basis, Ashmore’s diluted
TSR
EPS was below the benchmark return, actual
was -5.4% compared to the benchmark index
at -1.3%
The Company’s TSR was -20.1%, which ranked
Ashmore at 8.87 relative to the TSR peer group
of 14 companies; the median rank which would
have resulted in 25% vesting was 7.5 or a TSR
of 5.9%. The upper quartile rank which would
have resulted in 100% vesting was 4.25 or a
TSR of 63.9%. Therefore none of the restricted
and matching share awards vested
Vesting
percentage
Type of
share award
0% Restricte
d shares
Matching
shares
0% Restricte
d shares
Matching
shares
0% Restricte
d shares
Matching
shares
0% Restricte
d shares
0% Matching
shares
CEO
Restricted and
matching shares
awarded subject to
performance
conditions
Shares
vesting
Shares
lapsing
GFD
Restricted and
matching shares
awarded subject to
performance
conditions
Shares
vesting
Shares
lapsing
61,818
– 61,818
14,682
– 14,682
46,364
– 46,364
11,011
– 11,011
61,818
– 61,818
14,682
– 14,682
46,364
– 46,364
11,011
– 11,011
61,818
– 61,818
14,682
– 14,682
46,364
– 46,364
11,011
– 11,011
61,818
– 61,818
14,682
– 14,682
46,364
– 46,364
11,011
– 11,011
Totals
0%
432,727
– 432,727
102,772
– 102,772
Vesting outcome for CEO and GFD’s 2018 long-term incentive awards subject to performance conditions
Investment
performance
Performance measure assessment
59% of assets were
outperforming the benchmarks
over three and five years
Increasing
AuM
AuM reduced over the five-
year period from $73.9bn in
2018 to $55.9bn in 2023
Profitability On a compound basis,
Ashmore’s diluted EPS was
below the benchmark return,
actual was -10.1% compared to
the benchmark index at 0.2%
Vesting
percentage
Type of share
award
52% Restricted
shares
Matching
shares
0% Restricted
shares
Matching
shares
0% Restricted
shares
Matching
shares
CEO
GFD
Restricted and matching
shares awarded subject to
performance conditions
Shares
vesting
Shares
lapsing
Restricted and matching
shares awarded subject to
performance conditions
Shares
vesting
Shares
lapsing
40,077 20,840 19,237
17,354 9,118 8,416
30,058 15,630 14,428
3,757 1,954 1,804
40,077
– 40,077
17,354
– 17,354
30,058
– 30,058
3,757
– 3,757
40,078
– 40,077
17,354
– 17,354
30,058
– 30,058
3,758
– 3,757
Totals
17%
210,406 36,470 173,936
63,874 11,072 52,803
The Remuneration Committee has discretion to adjust the vesting level of the awards if it considers that the vesting level does not reflect
the underlying financial or non-financial performance over the vesting period; or the vesting level is not appropriate in the context of
circumstances that were unexpected or unforeseen; or there exists any other reason why an adjustment is appropriate, taking into account
such factors as the Remuneration Committee considers relevant. The Remuneration Committee has not applied its discretion to alter the
number of awards vesting during FY2023 or due to vest on 13 September 2023.
100 Ashmore Group plc Annual Report and Accounts 2023
Type of award
No. of
shares
Date
of award
Face value
(£)
Share award
price2 (£)
Performance period
end date
Name
Tom Shippey1
Tom Shippey1
Figure 5
Figure 6
Restricted shares
149,254 21 September 2022
£2.1440
£320,001
320% 20 September 2027
Matching shares
111,941 21 September 2022
£2.1440
£240,002
240% 20 September 2027
Long-term incentive awards made during the year ended 30 June 2023 – audited information
Face value
(% of salary)
R E M U N E R A T I O N R E P O R T ( C O N T I N U E D )
P E R F O R M A N C E C O N D I T I O N S , V E S T I N G O U T C O M E A N D G R A N T F Y 2 0 2 3
( C O N T I N U E D )
Vesting outcome for CEO and GFD’s 2017 long-term incentive awards subject to performance conditions
CEO
Restricted and
matching shares
awarded subject to
GFD
Restricted and
matching shares
awarded subject to
Performance measure assessment
Vesting
Type of
percentage
share award
performance
Shares
conditions
vesting
Shares
lapsing
performance
Shares
conditions
vesting
Shares
lapsing
Investment
Below 50% of assets outperforming the
0% Restricte
61,818
– 61,818
14,682
– 14,682
performance
benchmarks over three and five years, actual
was 38%
46,364
– 46,364
11,011
– 11,011
Increasing
The compound annual growth in AuM over
0% Restricte
61,818
– 61,818
14,682
– 14,682
AuM
the five-year period was below 5%, actual
was 1.75%
46,364
– 46,364
11,011
– 11,011
d shares
Matching
shares
d shares
Matching
shares
d shares
Matching
shares
d shares
shares
EPS was below the benchmark return, actual
was -5.4% compared to the benchmark index
at -1.3%
Ashmore at 8.87 relative to the TSR peer group
of 14 companies; the median rank which would
have resulted in 25% vesting was 7.5 or a TSR
of 5.9%. The upper quartile rank which would
have resulted in 100% vesting was 4.25 or a
TSR of 63.9%. Therefore none of the restricted
and matching share awards vested
Totals
0%
432,727
– 432,727
102,772
– 102,772
Vesting outcome for CEO and GFD’s 2018 long-term incentive awards subject to performance conditions
Performance measure assessment
Vesting
Type of share
shares awarded subject to
percentage
award
performance conditions
Shares
vesting
Shares
shares awarded subject to
lapsing
performance conditions
Shares
vesting
Shares
lapsing
Investment
59% of assets were
52% Restricted
40,077 20,840 19,237
17,354 9,118 8,416
CEO
GFD
Restricted and matching
Restricted and matching
Increasing
AuM reduced over the five-
0% Restricted
40,077
– 40,077
17,354
– 17,354
30,058 15,630 14,428
3,757 1,954 1,804
30,058
– 30,058
3,757
– 3,757
performance
outperforming the benchmarks
over three and five years
AuM
year period from $73.9bn in
2018 to $55.9bn in 2023
Ashmore’s diluted EPS was
below the benchmark return,
actual was -10.1% compared to
the benchmark index at 0.2%
shares
Matching
shares
shares
Matching
shares
shares
Matching
shares
Profitability On a compound basis,
0% Restricted
40,078
– 40,077
17,354
– 17,354
Totals
17%
210,406 36,470 173,936
63,874 11,072 52,803
The Remuneration Committee has discretion to adjust the vesting level of the awards if it considers that the vesting level does not reflect
the underlying financial or non-financial performance over the vesting period; or the vesting level is not appropriate in the context of
circumstances that were unexpected or unforeseen; or there exists any other reason why an adjustment is appropriate, taking into account
such factors as the Remuneration Committee considers relevant. The Remuneration Committee has not applied its discretion to alter the
number of awards vesting during FY2023 or due to vest on 13 September 2023.
Profitability On a compound basis, Ashmore’s diluted
0% Restricte
61,818
– 61,818
14,682
– 14,682
The performance conditions for the most recent awards were a combination of:
TSR
The Company’s TSR was -20.1%, which ranked
0% Restricte
61,818
– 61,818
14,682
– 14,682
0% Matching
46,364
– 46,364
11,011
– 11,011
and
– 33.3% profitability, demonstrated through Ashmore's diluted EPS performance relative to a comparator index over the five-year
performance period.
The performance conditions’ vesting scale remains unchanged in respect of these measures and is shown in Figure 4.
46,364
– 46,364
11,011
– 11,011
– 33.3% investment outperformance, relative to the relevant benchmarks over three and five years;
– 33.3% growth in assets under management, demonstrated through a compound increase in AuM over the five-year performance period;
1. Executives may voluntarily defer their cash bonus into shares in order to receive an equivalent level of matching shares and are also required under the AIFMD rules to
defer a portion of their cash bonus for six months. These awards are not subject to any performance conditions and so are not included in Figure 6; full details can be
found in Figure 7.
2. Based on the average Ashmore Group plc closing share price for the five business days prior to the grant date.
3. Mark Combs did not receive a long term incentive award in FY2023.
Long-term incentive awards made during the year ended 30 June 2023 – performance conditions
Figure 6 provides details of the long-term incentive awards that were made during FY2023. These represent the restricted and matching
share awards, 50% of which are subject to additional performance conditions, and will vest on the fifth anniversary of the award date, to the
extent that the performance conditions are met. The remaining 50% are subject to continued employment.
Payments to past Directors – audited information
No payments were made to past Directors during FY2023.
Payments for loss of office – audited information
No payments were made for loss of office during FY2023.
Non-executive Director fees at 30 June 2023
Non-executive Director fees paid at 30 June 2023 are shown below. Subject to the approval of the proposed Directors’ Remuneration policy
by shareholders at the AGM in October 2023, NED fees will be structured with a base fee and separate fees paid for additional
responsibilities. The Non-executive Directors’ base fee will be set at £60,000, with an additional fee of £15,000 for the Senior Independent
Director, Audit and Risk Committee Chair and Remuneration Committte Chair. The Chair fee will remain at £150,000, inclusive of Chairing
the Nominations Committee.
Clive Adamson
Helen Beck
Jennifer Bingham
Thuy Dam1
Shirley Garrood2
All inclusive fee
150,000
75,000
70,000
60,000
75,000
30,058
– 30,058
3,758
– 3,757
1. Thuy Dam joined the Board on 1 June 2023.
2. Shirley Garrood joined the Board on 1 August 2022.
Ashmore Group plc Annual Report and Accounts 2023
101
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
Annual Report on
Remuneration
This part of the report has been prepared in accordance with Part 3 of The Large and Medium-sized Companies and Groups (Accounts
and Reports) (Amendment) Regulations 2013 and 9.8.6R of the Listing Rules.
Figure 7
Remuneration for the year ending 30 June 2023 – audited information
The table below sets out the remuneration received by the Directors in the year ending 30 June 2023.
Executive Directors
Mark Coombs
1, 6, 7, 8, 9
Tom Shippey
1, 6, 8, 9
Clive
Adamson
Helen Beck
Jennifer Bingham
Thuy Dam
Shirley Garrood
Salary and fees
Taxable benefits
Pensions
Cash bonus
Voluntarily deferred share bonus4
Mandatorily deferred share bonus5
Total bonus
Long-term incentives vesting2, 3
Total for year
Total fixed remuneration
Total variable remuneration
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
150,000
75,000
97,365
75,000
70,000
61,782
100,000
100,000
1,653
1,123
9,000
9,000
–
–
–
–
–
–
–
–
–
542,619
110,653
652,742
110,653
110,123
–
116,667
100,000
4,133
2,808
11,083
9,500
210,600
232,800
–
240,000
257,400
287,200
468,000
760,000
–
271,308
599,883
131,883
112,308
468,000
542,619
1,031,308
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
150,000
75,000
150,000
75,000
97,365
75,000
–
–
–
–
1,143,616
97,365
75,000
5,000
65,538
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
70,000
61,782
70,000
61,782
–
–
5,000
–
5,000
–
–
–
65,538
–
65,538
–
–
–
1. Benefits for both Executive Directors include membership of the Company medical scheme.
2. Long-term incentives vesting relates to share awards with performance conditions where the performance period has ended in the relevant financial year plus the
value of any dividend equivalents.
3. The figure of £542,619 shown as the value of Mark Coombs’ 2022 Long-term incentives vesting reflects £21,979 of share price appreciation over the period
between grant and vest. The figure of £271,308 shown as the value of Tom Shippey’s 2022 Long-term incentives vesting reflects £10,990 of share price
appreciation over the period between grant and vest. No discretion has been exercised as a result of share price appreciation or depreciation.
4. Mark Coombs and Tom Shippey may voluntarily defer up to 50% of their cash bonus in favour of an equivalent amount of bonus share or phantom bonus share
awards and an equivalent value in matching share or phantom matching share awards. All share or phantom share awards will be reported in the Directors’ share
and phantom share award tables in the year of grant. Tom Shippey chose to commute 50% of his cash bonus in 2022 for an equivalent value in bonus share
awards. Bonus shares are deferred for five years with no service condition attached.
5. From the year ending 30 June 2015 onward, additional performance conditions are applied to 50% of any restricted or matching share award. The amounts shown
in the row labelled Mandatorily deferred share bonus represent the 50% of restricted and matching share awards that do not have additional performance
conditions attached, and also include the amounts detailed in note 6 below relating to compliance with the AIFMD. These amounts represent the cash value of
shares awarded at grant, which will vest after five years subject to continued employment, and in the case of shares related to AIFMD, after a retention period.
6. In order to comply with the AIFMD Mark Coombs and Tom Shippey received a proportion of their bonus, which would have otherwise been delivered in cash, as
an additional award of restricted shares which will vest after a retention period. In 2023, the value of this award for Mark Coombs was £0 (FY2022: £0), and for
Tom Shippey it was £4,320 (FY2022: £7,200).
7. In respect of prior year deferred share awards which have been waived to charity, any dividend equivalents associated with the amounts waived are paid directly
to the nominated charities. The figures shown exclude the amounts waived.
8. Dividends or dividend equivalents were paid relating to voluntarily and mandatorily deferred share or phantom share awards in the period.
9. Mark Coombs receives cash in lieu of a pension contribution. Tom Shippey’s pension contribution includes an employee contribution via salary sacrifice; in 2023
this was £583 (FY2022: £500).
10. Total short-term benefits for key management personnel, including salary and fees, taxable benefits and cash bonuses, as reported in note 28 of the financial
statements, is £798,591 in FY2023. In addition, the total cost of equity-settled awards for the Executive Directors charged to the statement of comprehensive
income, as reported in note 28 of the financial statements, is £351,755 in FY2023 (FY2022 £223,684).
102 Ashmore Group plc Annual Report and Accounts 2023
Annual Report on
Remuneration
Figure 7
Salary and fees
Taxable benefits
Pensions
Cash bonus
Voluntarily deferred share bonus4
Mandatorily deferred share bonus5
Total bonus
Total for year
Long-term incentives vesting2, 3
Total fixed remuneration
Total variable remuneration
Mark Coombs
Tom Shippey
Clive
Helen Beck
Jennifer Bingham
Thuy Dam
Shirley Garrood
Executive Directors
1, 6, 8, 9
Adamson
150,000
75,000
97,365
75,000
70,000
61,782
5,000
65,538
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
1, 6, 7, 8, 9
100,000
100,000
1,653
1,123
9,000
9,000
–
–
–
–
–
–
–
–
–
542,619
110,653
652,742
110,653
110,123
–
116,667
100,000
4,133
2,808
11,083
9,500
210,600
232,800
–
240,000
257,400
287,200
468,000
760,000
–
271,308
599,883
131,883
112,308
468,000
542,619
1,031,308
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
150,000
75,000
5,000
65,538
1,143,616
97,365
75,000
150,000
75,000
97,365
75,000
70,000
61,782
70,000
61,782
5,000
65,538
1. Benefits for both Executive Directors include membership of the Company medical scheme.
2. Long-term incentives vesting relates to share awards with performance conditions where the performance period has ended in the relevant financial year plus the
value of any dividend equivalents.
3. The figure of £542,619 shown as the value of Mark Coombs’ 2022 Long-term incentives vesting reflects £21,979 of share price appreciation over the period
between grant and vest. The figure of £271,308 shown as the value of Tom Shippey’s 2022 Long-term incentives vesting reflects £10,990 of share price
appreciation over the period between grant and vest. No discretion has been exercised as a result of share price appreciation or depreciation.
4. Mark Coombs and Tom Shippey may voluntarily defer up to 50% of their cash bonus in favour of an equivalent amount of bonus share or phantom bonus share
awards and an equivalent value in matching share or phantom matching share awards. All share or phantom share awards will be reported in the Directors’ share
and phantom share award tables in the year of grant. Tom Shippey chose to commute 50% of his cash bonus in 2022 for an equivalent value in bonus share
awards. Bonus shares are deferred for five years with no service condition attached.
5. From the year ending 30 June 2015 onward, additional performance conditions are applied to 50% of any restricted or matching share award. The amounts shown
in the row labelled Mandatorily deferred share bonus represent the 50% of restricted and matching share awards that do not have additional performance
conditions attached, and also include the amounts detailed in note 6 below relating to compliance with the AIFMD. These amounts represent the cash value of
shares awarded at grant, which will vest after five years subject to continued employment, and in the case of shares related to AIFMD, after a retention period.
6. In order to comply with the AIFMD Mark Coombs and Tom Shippey received a proportion of their bonus, which would have otherwise been delivered in cash, as
an additional award of restricted shares which will vest after a retention period. In 2023, the value of this award for Mark Coombs was £0 (FY2022: £0), and for
Tom Shippey it was £4,320 (FY2022: £7,200).
7. In respect of prior year deferred share awards which have been waived to charity, any dividend equivalents associated with the amounts waived are paid directly
to the nominated charities. The figures shown exclude the amounts waived.
8. Dividends or dividend equivalents were paid relating to voluntarily and mandatorily deferred share or phantom share awards in the period.
9. Mark Coombs receives cash in lieu of a pension contribution. Tom Shippey’s pension contribution includes an employee contribution via salary sacrifice; in 2023
this was £583 (FY2022: £500).
10. Total short-term benefits for key management personnel, including salary and fees, taxable benefits and cash bonuses, as reported in note 28 of the financial
statements, is £798,591 in FY2023. In addition, the total cost of equity-settled awards for the Executive Directors charged to the statement of comprehensive
income, as reported in note 28 of the financial statements, is £351,755 in FY2023 (FY2022 £223,684).
This part of the report has been prepared in accordance with Part 3 of The Large and Medium-sized Companies and Groups (Accounts
and Reports) (Amendment) Regulations 2013 and 9.8.6R of the Listing Rules.
Figure 8
Outstanding share awards
The table below sets out details of Executive Directors’ outstanding share awards.
Remuneration for the year ending 30 June 2023 – audited information
The table below sets out the remuneration received by the Directors in the year ending 30 June 2023.
Type of
Omnibus
award
Executive
Mark
Coombs RS1
Date of award
Share award
price
Number of
shares at
30 June 2022
Granted
during
year
Vested during
year
Lapsed
during
year
Number of
shares at
30 June 2023
Performance
period
14 September 2017 £3.2353
449,542
–
202,269 247,273
RBS1
14 September 2017 £3.2353
337,156
–
337,156
–
RMS1
14 September 2017 £3.2353
337,156
–
151,702 185,454
–
–
–
5 years
5 years
5 years
RS1
14 September 2018 £3.3269
218,342
RBS1
14 September 2018 £3.3269
163,757
RMS1
14 September 2018 £3.3269
163,757
RS1
13 September 2019 £4.3833
248,580
RBS1
13 September 2019 £4.3833
186,435
RMS1
13 September 2019 £4.3833
186,435
RS1
16 September 2021 £3.7512
144,915
RBS1
16 September 2021 £3.7512
108,686
RMS1
16 September 2021 £3.7512
108,686
Total
2,653,447
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
218,342
5 years
–
163,757
5 years
–
163,757
5 years
–
248,580
5 years
–
186,435
5 years
–
186,435
5 years
–
144,915
5 years
–
108,686
5 years
–
108,686
5 years
691,127 432,727 1,529,593
Vesting/release date
13 September
2022
13 September
2022
13 September
2022
13 September
2023
13 September
2023
13 September
2023
12 September
2024
12 September
2024
12 September
2024
15 September
2026
15 September
2026
15 September
2026
1. In respect of the years ending 30 June 2017, 2018, 2019 and 2021 Mark Coombs chose to waive 10% of his potential non-AIFMD related variable remuneration award
in return for the Remuneration Committee considering and approving a contribution to a charity or charities nominated by himself. The 'Number of shares at 30 June
2022', 'Granted during year' and 'Number of shares at 30 June 2023' figures are shown excluding the amounts waived. On the vesting/release date, any shares waived
to charity will vest to them to the extent that any relevant performance conditions have been satisfied.
Key
RS – Restricted shares
RBS – Restricted bonus shares
RMS – Restricted matching shares
Ashmore Group plc Annual Report and Accounts 2023
103
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Figure 8 continued
Outstanding share awards
Type of
Omnibus
award
Date of award
Share award
price
Number of
shares at
30 June 2022
Granted
during
year
Vested
during
year
Lapsed
during
year
Number of
shares at
30 June 2023
Performance
period
Vesting/release date
Executive
Tom
Shippey
RS
14 September 2017 £3.2353
117,455
RBS
14 September 2017 £3.2353
88,091
RMS
14 September 2017 £3.2353
88,091
RS
14 September 2018 £3.3269
105,204
RBS
14 September 2018 £3.3269
22,544
RMS
14 September 2018 £3.3269
22,544
RS
13 September 2019 £4.3833
91,256
RBS
13 September 2019 £4.3833
68,442
RMS
13 September 2019 £4.3833
68,442
RS
18 September 2020 £3.6009
99,976
RBS
18 September 2020 £3.6009
74,982
RMS
18 September 2020 £3.6009
74,982
16 September 2021 £3.7512
90,638
16 September 2021 £3.7512
67,979
16 September 2021 £3.7512
67,979
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
RS
RBS
RMS
RS1
RS
RBS
RMS
21 September 2022 £2.1440
–
3,359
3,359
21 September 2022 £2.1440
21 September 2022 £2.1440
21 September 2022 £2.1440
– 149,254
– 111,941
– 111,941
–
–
–
58,728
58,728
88,091
–
44,046
44,045
–
–
–
5 years 13 September 2022
5 years 13 September 2022
5 years 13 September 2022
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
105,204
5 years 13 September 2023
22,544
5 years 13 September 2023
22,544
5 years 13 September 2023
91,256
5 years 12 September 2024
68,442
5 years 12 September 2024
68,442
5 years 12 September 2024
99,976
5 years 17 September 2025
74,982
5 years 17 September 2025
74,982
5 years 17 September 2025
90,638
5 years 15 September 2026
67,979
5 years 15 September 2026
67,979
5 years 15 September 2026
–
5 years
15 March 2023
149,254
5 years 20 September 2027
111,941
5 years 20 September 2027
111,941
5 years 20 September 2027
Total
1,148,605 376,495
194,224 102,772 1,228,104
1. In order to comply with the AIFMD remuneration principles in regard to the delivery of remuneration in retained instruments, a proportion of Tom Shippey’s cash
bonuses relating to the year ending 30 June 2022 were delivered in the form of restricted shares, subject to a six-month retention period, rather than being delivered in
cash. These shares vested in full on the date shown and were not subject to any additional performance conditions.
Key
RS – Restricted shares
RBS – Restricted bonus shares
RMS – Restricted matching shares
The Company’s obligations under its employee share plans can be met by newly issued shares in the Company, or shares purchased in the
market by the trustees of the EBT.
The overall limits on new issuance operated under the existing share plans were established on the listing of the Company in 2006. Under
these agreed limits, the number of shares which may be issued in aggregate under employee share plans of the Company over any 10 year
period following the date of the Company’s Admission in 2006 is limited to 15% of the Company’s issued share capital. It is expected that
all of the awards made to date will be satisfied by the acquisition of shares in the market, thus none of the Company’s obligations under its
employee share plans have been met by newly issued shares. As at 30 June 2023, the Company had 5.57% of the Company’s issued share
capital outstanding under employee share plans to its staff.
Defined benefit pension entitlements
None of the Directors has any entitlements under Company defined benefit pension plans.
104 Ashmore Group plc Annual Report and Accounts 2023
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Figure 8 continued
Outstanding share awards
Type of
Omnibus
Executive
award
Date of award
Number of
Granted
Share award
shares at
price
30 June 2022
during
year
Vested
during
year
Lapsed
during
Number of
shares at
Performance
year
30 June 2023
period
Vesting/release date
Tom
RS
14 September 2017 £3.2353
117,455
58,728
58,728
5 years 13 September 2022
Shippey
RBS
14 September 2017 £3.2353
88,091
88,091
5 years 13 September 2022
RMS
14 September 2017 £3.2353
88,091
44,046
44,045
5 years 13 September 2022
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
RS
14 September 2018 £3.3269
105,204
RBS
14 September 2018 £3.3269
22,544
RMS
14 September 2018 £3.3269
22,544
RS
13 September 2019 £4.3833
91,256
RBS
13 September 2019 £4.3833
68,442
RMS
13 September 2019 £4.3833
68,442
RS
18 September 2020 £3.6009
99,976
RBS
18 September 2020 £3.6009
74,982
RMS
18 September 2020 £3.6009
74,982
16 September 2021 £3.7512
90,638
16 September 2021 £3.7512
67,979
16 September 2021 £3.7512
67,979
RS
RBS
RMS
RS1
RS
RBS
RMS
21 September 2022 £2.1440
21 September 2022 £2.1440
21 September 2022 £2.1440
– 149,254
– 111,941
– 111,941
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
105,204
5 years 13 September 2023
22,544
5 years 13 September 2023
22,544
5 years 13 September 2023
91,256
5 years 12 September 2024
68,442
5 years 12 September 2024
68,442
5 years 12 September 2024
99,976
5 years 17 September 2025
74,982
5 years 17 September 2025
74,982
5 years 17 September 2025
90,638
5 years 15 September 2026
67,979
5 years 15 September 2026
67,979
5 years 15 September 2026
149,254
5 years 20 September 2027
111,941
5 years 20 September 2027
111,941
5 years 20 September 2027
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
21 September 2022 £2.1440
–
3,359
3,359
–
5 years
15 March 2023
Total
1,148,605 376,495
194,224 102,772 1,228,104
1. In order to comply with the AIFMD remuneration principles in regard to the delivery of remuneration in retained instruments, a proportion of Tom Shippey’s cash
bonuses relating to the year ending 30 June 2022 were delivered in the form of restricted shares, subject to a six-month retention period, rather than being delivered in
cash. These shares vested in full on the date shown and were not subject to any additional performance conditions.
Key
RS – Restricted shares
RBS – Restricted bonus shares
RMS – Restricted matching shares
The Company’s obligations under its employee share plans can be met by newly issued shares in the Company, or shares purchased in the
market by the trustees of the EBT.
The overall limits on new issuance operated under the existing share plans were established on the listing of the Company in 2006. Under
these agreed limits, the number of shares which may be issued in aggregate under employee share plans of the Company over any 10 year
period following the date of the Company’s Admission in 2006 is limited to 15% of the Company’s issued share capital. It is expected that
all of the awards made to date will be satisfied by the acquisition of shares in the market, thus none of the Company’s obligations under its
employee share plans have been met by newly issued shares. As at 30 June 2023, the Company had 5.57% of the Company’s issued share
capital outstanding under employee share plans to its staff.
Defined benefit pension entitlements
None of the Directors has any entitlements under Company defined benefit pension plans.
Directors’ shareholding and share interests
Details of the Directors’ interests in shares are shown in the table below. As set out earlier, subject to the approval of the proposed
Directors’ Remuneration Policy by shareholders at the AGM in October 2023, the shareholder requirement is being increased from 200%
of salary to 300% of salary. New Executive Directors would normally be expected to achieve this within five years from appointment.
Mark Coombs meets both the current and future shareholding requirements. Tom Shippey’s salary was increased to £120,000 effective
1 September 2022, increasing his shareholding requirement under the current policy to 57,526 shares, which he will be required to hold
within three years of the date of salary increase. Tom Shippey meets the future shareholding requirement.
Under the Directors’ Remuneration Policy, the post-employment shareholder requirement will also increase to 300% of salary, or the actual
shareholding if lower, for two years post termination of their employment. The Committee retains discretion to waive this guideline if it is
not considered appropriate in the specific circumstances, e.g. compassionate circumstances.
Figure 9
Share interests of Directors and connected persons at 30 June 2023 – audited information
Beneficially owned
Shares held that are not subject
to any further performance
conditions
Shares held that are subject to
further performance conditions
Total interest in shares1
Shareholding as a
percentage of salary2
Executive Directors
Mark Coombs
Tom Shippey
Non-executive Directors
Clive Adamson
Helen Beck
Jennifer Bingham
Shirley Garrood
Thuy Dam
222,063,615
52,390
939,686
786,995
589,907
441,109
223,593,208
462,928%
1,280,494
814%
2,304
–
–
–
–
–
–
–
–
–
–
–
–
–
–
2,304
–
–
–
–
_
–
–
–
–
1. Save as described above, there have been no changes in the shareholdings of the Directors between 30 June and 5 September 2023. The Directors are permitted to
hold their shares as collateral for loans with the express permission of the Board.
2. Shareholding as a percentage of salary is calculated as the value of the Directors’ interests in shares which are either beneficially owned or not subject to future
performance conditions, and where currently unvested on a net of tax basis, divided by the FY2023 year end share price of £2.08.
Statement on implementation of the Remuneration Policy in the year commencing 1 July 2023
The Remuneration Committee intends to continue to apply broadly the same metrics and weightings to the measures which determine
annual variable remuneration in the year ending 30 June 2024 as have been applied in the current period. The Committee also intends to
apply the same three performance conditions and targets to any long-term incentive awards made with the same weightings as used in
FY2023, these being in relation to investment outperformance relative to benchmarks, growth in assets under management and profitability.
There will be no change to the CEO’s salary (£100,000) for the year ending 30 June 2024. The Committee intends to increase the basic
salary for the GFD to £140,000, subject to the approval of the proposed Directors’ Remuneration Policy by shareholders at the AGM in
October 2023. This takes into account his increased responsibilities through the full period.
As set out earlier on, subject to the approval of the proposed Directors’ Remuneration Policy by shareholders at the AGM in October 2023,
NED fees will be structured with a base fee and separate fees paid for additional responsibilities. The Non-executive Director base fee will
be set at £60,000, with an additional fee of £15,000 for the Senior Independent Director, Audit and Risk Committee Chair and Remuneration
Committee Chair. The Chair fee will remain at £150,000 inclusive of chairing the Nominations Committee.
Ashmore Group plc Annual Report and Accounts 2023
105
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Membership of the Remuneration Committee
The members of the Remuneration Committee during the period are listed in the table below. All of these are independent Non-executive
Directors, as defined under the Code, with the exception of the Company Chair who was independent on his appointment.
Remuneration Committee attendance
Percentage of meetings attended out of potential maximum
Clive Adamson
Helen Beck
Jennifer Bingham
Shirley Garrood
Thuy Dam
100%
100%
100%
100%
100%
The Company’s CEO attends the meetings by invitation and assists the Remuneration Committee in its decision making, except when his
personal remuneration is discussed. No Directors are involved in deciding their own remuneration. The Company Secretary acts as
Secretary to the Remuneration Committee. Other executives may be invited to attend as the Remuneration Committee requests.
Terms of reference
The terms of reference for the Remuneration Committee include:
– reviewing the ongoing appropriateness and relevance of the Remuneration Policy;
– reviewing the design of all incentive and share incentive plans for approval by the Board and shareholders;
– ensuring that members of the executive management of the Company, including material risk takers, are provided with appropriate
incentives to encourage enhanced performance and that remuneration incentives are compatible with the Company’s risk policies and
systems;
– making recommendations to the Board as to the Company’s framework or Policy for the remuneration of the Chair, the Executive
Directors and the Company Secretary and to determine their total individual remuneration packages including bonuses, incentive
payments and share options or other share awards;
– ensuring that a significant proportion of Executive Directors’ remuneration is structured so as to link rewards to corporate and individual
performance and that performance conditions are stretching and designed to promote the long-term success of the Company; and
– ensuring that contractual terms on termination, and any payments made, are fair to the individual and the Company, that failure is not
rewarded and that the duty to mitigate loss is fully recognised.
Activities of the Remuneration Committee
During FY2023, the Remuneration Committee comprised the following Non-executive Directors:
– Clive Adamson
– Helen Beck
– Jennifer Bingham
– Shirley Garrood (from her appointment on 1 August 2022)
– Thuy Dam (from her appointment on 1 June 2023)
The members of the Remuneration Committee have the appropriate balance of skills, experience, independence and knowledge of the
Company to enable them to discharge their respective duties and responsibilities effectively, and met seven times during the year. The
Directors’ attendance at the Remuneration Committee meetings is set out in the table above.
106 Ashmore Group plc Annual Report and Accounts 2023
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Membership of the Remuneration Committee
The members of the Remuneration Committee during the period are listed in the table below. All of these are independent Non-executive
Directors, as defined under the Code, with the exception of the Company Chair who was independent on his appointment.
Remuneration Committee attendance
Percentage of meetings attended out of potential maximum
Clive Adamson
Helen Beck
Jennifer Bingham
Shirley Garrood
Thuy Dam
100%
100%
100%
100%
100%
The Company’s CEO attends the meetings by invitation and assists the Remuneration Committee in its decision making, except when his
personal remuneration is discussed. No Directors are involved in deciding their own remuneration. The Company Secretary acts as
Secretary to the Remuneration Committee. Other executives may be invited to attend as the Remuneration Committee requests.
Terms of reference
The terms of reference for the Remuneration Committee include:
– reviewing the ongoing appropriateness and relevance of the Remuneration Policy;
– reviewing the design of all incentive and share incentive plans for approval by the Board and shareholders;
– ensuring that members of the executive management of the Company, including material risk takers, are provided with appropriate
incentives to encourage enhanced performance and that remuneration incentives are compatible with the Company’s risk policies and
systems;
– making recommendations to the Board as to the Company’s framework or Policy for the remuneration of the Chair, the Executive
Directors and the Company Secretary and to determine their total individual remuneration packages including bonuses, incentive
payments and share options or other share awards;
– ensuring that a significant proportion of Executive Directors’ remuneration is structured so as to link rewards to corporate and individual
performance and that performance conditions are stretching and designed to promote the long-term success of the Company; and
– ensuring that contractual terms on termination, and any payments made, are fair to the individual and the Company, that failure is not
rewarded and that the duty to mitigate loss is fully recognised.
Activities of the Remuneration Committee
During FY2023, the Remuneration Committee comprised the following Non-executive Directors:
– Clive Adamson
– Helen Beck
– Jennifer Bingham
– Shirley Garrood (from her appointment on 1 August 2022)
– Thuy Dam (from her appointment on 1 June 2023)
The members of the Remuneration Committee have the appropriate balance of skills, experience, independence and knowledge of the
Company to enable them to discharge their respective duties and responsibilities effectively, and met seven times during the year. The
Directors’ attendance at the Remuneration Committee meetings is set out in the table above.
The key areas of focus during the year for the Remuneration Committee
The key focus of the Committee during FY2023 has been an extensive review and consultation process with shareholders in relation to the
new Directors’ Remuneration Policy which will be put to shareholders at the 2023 AGM.
In order that sufficient time was available to the Committee to consider the new Directors’ Remuneration Policy, additional Committee
meetings were held during the year, which included a specific listed company market practice review delivered to the Committee by
PricewaterhouseCoopers LLP; included within this was a detailed assessment of shareholder and proxy advisers requirements.
The Committee debated the shareholder feedback following the consultation process.
During the year, the Committee also implemented changes to the Group’s share plan in order to ensure compliance with the FCA’s
MIFIDPRU remuneration rules as they relate to malus and clawback for employees considered to be material risk takers and also to
other employees.
The Committee also reviewed the employee benefit arrangements following a review conducted by senior management.
The Committee reviewed the performance assessments of the CEO, the GFD, and the material risk takers and determined or reviewed the
incentive allocations as appropriate.
Regulatory considerations for FY2023
For remuneration relating to FY2023, the Remuneration Committee has again ensured that remuneration will be delivered to Executive
Directors and other employees categorised by the FCA as material risk takers or code staff consistent with the requirements of the
MIFIDPRU remuneration regime and AIFMD. This has meant that Executive Directors and other relevant employees will receive a
proportion of their cash bonus delivered as an award of restricted shares, which are retained and restricted from sale for a six-month period,
rather than as cash. Further details of this can be found on page 102. Throughout the period, regular regulatory updates were provided to
the Committee.
Ashmore’s UK employee headcount remains significantly under 250, and as a result of this, Ashmore is not required to include a CEO pay
ratio calculation as part of the Remuneration report.
Consideration of malus and clawback for FY2023
A malus and clawback principle applies to variable remuneration awarded to senior staff, including Executive Directors, enabling the
Remuneration Committee to recoup variable remuneration under certain circumstances. Malus and clawback can be applied to both the
cash and share-based elements of variable remuneration via the reduction or cancellation of any outstanding unvested deferred share
awards regardless of the year to which they relate, or via the repayment of amounts to the Company. The Remuneration Committee
considered there were no events or circumstances that would have made it appropriate to recoup remuneration from the Executive
Directors during FY2023.
External advisers
The Remuneration Committee received independent advice from Deloitte LLP throughout the period from 1 July 2022 to 30 June 2023.
Deloitte LLP abides by the Remuneration Consultants’ Code of Conduct, which requires it to provide objective and impartial advice. Deloitte
LLP’s fees for the year ending 30 June 2023 were £28,350 and were charged on a time and materials basis. Deloitte LLP also provides
other tax, employee mobility and share plan administration-related services to the Company. During the period, PricewaterhouseCoopers
LLP provided the Committee with training on competitor remuneration structures and shareholder principles. PricewaterhouseCoopers
LLP’s fees for the year ending 30 June 2023 were £15,000 and were charged on a time and materials basis.
Ashmore Group plc Annual Report and Accounts 2023
107
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Compliance with the Code
The Code requires a description of how the Remuneration Committee has addressed the following factors during FY2023:
Code requirements
How the Committee has addressed the requirement
Clarity – remuneration arrangements should be
transparent and promote effective engagement
with shareholders and the workforce
Remuneration arrangements for Executive Directors and the workforce are substantially
the same, and are described in detail within the Directors’ Remuneration Policy. A
significant proportion of variable remuneration is deferred for five years into Company
shares creating a direct alignment with external shareholders.
Simplicity – remuneration structures should avoid
complexity and their rationale and operation
should be easy to understand
Remuneration is simple for Executive Directors and the workforce, comprising a capped
basic salary and an annual bonus, delivered partly in cash and partly in Company shares
which are deferred for five years.
Risk – remuneration arrangements should
ensure reputational and other risks from
excessive rewards, and behavioural risks that
can arise from target-based incentive plans, are
identified and mitigated
The Remuneration Committee has discretion to vary the bonus pool, to vary individual
annual award levels and to apply malus or clawback to existing awards. There is no
formulaic or target-based incentive plan to drive negative behaviours. The Remuneration
Committee will determine the appropriate outcomes based solely on individual and
Company performance.
Predictability – the range of possible values of
rewards to individual directors and any other
limits or discretions should be identified and
explained at the time of approving the Policy
The bonus pool is currently capped at a Group level, at 25% of EBVCIT. Awards at an
individual level are uncapped, however the Company does not apply its discretion to
deliver excessive rewards, as can be seen in looking back at outcomes over previous
performance years which are fully aligned with performance.
Proportionality – the link between individual
awards, the delivery of strategy and the long-term
performance of the company should be clear.
Outcomes should not reward poor performance
The Remuneration Committee strictly applies its discretion to reward performance, and
to recognise periods of underperformance, as has been demonstrated on more than one
occasion where senior management and risk takers have had very material reductions in
annual variable remuneration and the CEO has not been awarded an annual bonus,
reflecting business performance at the time.
Alignment to culture – incentive schemes should
drive behaviours consistent with company
purpose, values and strategy
Ashmore’s purpose is to deliver long-term investment outperformance for clients and
generate value for shareholders through market cycles. The Committee has ensured the
remuneration policies of the Company support this, building employee retention through
cycles and delivering significant equity alignment between employee shareholders and
external shareholders.
108 Ashmore Group plc Annual Report and Accounts 2023
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Compliance with the Code
Figure 10
The Code requires a description of how the Remuneration Committee has addressed the following factors during FY2023:
Code requirements
How the Committee has addressed the requirement
Clarity – remuneration arrangements should be
Remuneration arrangements for Executive Directors and the workforce are substantially
transparent and promote effective engagement
the same, and are described in detail within the Directors’ Remuneration Policy. A
with shareholders and the workforce
significant proportion of variable remuneration is deferred for five years into Company
shares creating a direct alignment with external shareholders.
Simplicity – remuneration structures should avoid
Remuneration is simple for Executive Directors and the workforce, comprising a capped
complexity and their rationale and operation
basic salary and an annual bonus, delivered partly in cash and partly in Company shares
should be easy to understand
which are deferred for five years.
Risk – remuneration arrangements should
The Remuneration Committee has discretion to vary the bonus pool, to vary individual
ensure reputational and other risks from
annual award levels and to apply malus or clawback to existing awards. There is no
excessive rewards, and behavioural risks that
formulaic or target-based incentive plan to drive negative behaviours. The Remuneration
can arise from target-based incentive plans, are
Committee will determine the appropriate outcomes based solely on individual and
identified and mitigated
Company performance.
Predictability – the range of possible values of
The bonus pool is currently capped at a Group level, at 25% of EBVCIT. Awards at an
rewards to individual directors and any other
individual level are uncapped, however the Company does not apply its discretion to
limits or discretions should be identified and
deliver excessive rewards, as can be seen in looking back at outcomes over previous
explained at the time of approving the Policy
performance years which are fully aligned with performance.
Proportionality – the link between individual
The Remuneration Committee strictly applies its discretion to reward performance, and
awards, the delivery of strategy and the long-term
to recognise periods of underperformance, as has been demonstrated on more than one
performance of the company should be clear.
occasion where senior management and risk takers have had very material reductions in
Outcomes should not reward poor performance
annual variable remuneration and the CEO has not been awarded an annual bonus,
reflecting business performance at the time.
Alignment to culture – incentive schemes should
Ashmore’s purpose is to deliver long-term investment outperformance for clients and
drive behaviours consistent with company
generate value for shareholders through market cycles. The Committee has ensured the
purpose, values and strategy
remuneration policies of the Company support this, building employee retention through
cycles and delivering significant equity alignment between employee shareholders and
external shareholders.
Percentage changes in the remuneration of the Executive Directors and the fees of Non-executive Directors
relative to the remuneration of a relevant comparator employee group
2022 to 2023
% change
2021 to 2022
% change
2020 to 2021
% change
2019 to 2020
% change
2018 to 2019
% change
Mark Coombs base salary
Tom Shippey base salary
Clive Adamson fees1, 2
Helen Beck fees1, 3
Jennifer Bingham fees1, 4
Shirley Garrood fees1, 5
Thuy Dam fees1, 6
Relevant comparator employees’ base salary
Mark Coombs taxable benefits8
Tom Shippey taxable benefits8
Relevant comparator employees’ taxable benefits8
Mark Coombs annual bonus7
Tom Shippey annual bonus
Relevant comparator employees’ annual bonus
0%
20%
54%
0%
13%
0%
0%
11%
47%
47%
47%
0%
0%
15%
25%
3%
–
–
2%
25%
25%
25%
N/A
(100%)
(10%)
(8%)
(6%)
(16%)
0%
0%
0%
0%
0%
–
–
1%
(87%)
0%
0%
N/A
(6%)
4%
0%
0%
4%
–
0%
–
–
1%
(6%)
(6%)
0%
(100%)
(10%)
(12%)
0%
0%
22%
–
–
–
–
3%
(8%)
(4%)
(5%)
50%
14%
10%
1. Non-executive Directors do not receive a bonus.
2. Clive Adamson joined the Board on 22 October 2015 and chaired the Remuneration Committee from 31 December 2017 until 19 October 2018; he became the Senior
Independent Director and Audit and Risk Committee Chair on 19 October 2018, and became the Chair on 21 April 2022.
3. Helen Beck joined the Board on 1 June 2021 and became the Remuneration Committee Chair on 1 July 2021.
4. Jennifer Bingham became the Senior Independent Director on 21 April 2022.
5. Shirley Garrood joined the Board on 1 August 2022, and became the Audit and Risk Committee Chair on 23 January 2023.
6. Thuy Dam joined the Board on 1 June 2023.
7. Mark Coombs did not receive a bonus in 2020, 2022 or 2023.
8. The increase in taxable benefits is a result of the cost increase of private medical coverage.
Figure 10 compares the year-on-year percentage change from 2018 to 2023 in remuneration elements for the CEO, the GFD and the Non-
executive Directors with the average year-on-year change across relevant comparator employees as a whole. Relevant comparator
employees are all full-time employees and part-time employees on a full-time equivalent basis of Ashmore Group, who have been employed
throughout the full performance year. Figures do not include amounts of cash waived to charity.
Ashmore Group plc Annual Report and Accounts 2023
109
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Performance chart
Figure 11 shows the Company’s TSR performance (with dividends reinvested) against the performance of the FTSE 250 and FTSE 100 for
the period since 30 June 2013. These indices have been chosen as they represent companies of a broadly similar market capitalisation to
Ashmore. Each point at a financial year end is calculated using an average TSR value over the month of June (i.e. 1 June to 30 June
inclusive). As the chart indicates, £100 invested in Ashmore on 30 June 2013 was worth £102 10 years later, compared with £175 for the
same investment in the FTSE 100 Index, and £176 for the same investment in the FTSE 250 Index.
Figure 11
TSR – value of hypothetical £100 holding
£
300
250
200
150
100
50
0
)
d
e
s
a
b
e
r
(
)
£
(
e
u
a
V
l
£176
£175
£102
30 June 13
30 June 14
30 June 15
30 June 16
30 June 17
30 June 18
30 June 19
30 June 20
30 June 21
30 June 22
30 June 23
Ashmore Group
FTSE 100 Index
FTSE 250 Index
This graph shows the value, by 30 June 2023, of £100 invested in Ashmore Group on 30 June 2013, compared with the value of £100 invested in the FTSE 100 and FTSE 250 indices on the same date.
Source: Factset
Figure 12
Chief Executive Officer
Figure 12 shows the total remuneration figure for the CEO during each of the financial years shown in the TSR chart. The total remuneration
figure includes the annual bonus and share awards, which vested based on performance in those years. As there is no cap on the maximum
individual bonus award, a percentage of maximum annual bonus is not shown.
Annual
bonus
Performance-related
restricted and matching
phantom shares vested1
Percentage of restricted
and matching phantom
shares vested
Year ended 30 June
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
Salary
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
Benefits
£1,653
£1,123
£901
£7,203
£7,627
£8,293
£8,404
£8,400
£8,388
£8,934
Pension
£9,000
£9,000
£9,000
£9,000
£9,000
£9,000
£9,000
–
–
£1,241,700
–
£2,491,200
£1,261,277
£3,071,748
£9,000
£1,083,458
£8,000
£2,415,000
£7,000
–
–
£542,619
£1,108,587
–
£997,173
–
£95,574
£284,932
£462,159
£452,386
–
79.55%
Total
£110,653
£652,742
57.00%
£2,460,188
–
£116,203
30.23%
£3,605,000
–
–
–
–
–
£1,378,570
£3,284,726
£1,485,790
£2,993,547
£568,320
1. Performance-related restricted and matching or phantom share equivalent awards vested during the years ending 30 June 2019, 2021 and 2022 plus the value of any
dividend equivalents. The sums shown in earlier years relate to dividends or dividend equivalents paid on share or phantom share awards.
110 Ashmore Group plc Annual Report and Accounts 2023
A N N U A L R E P O R T O N R E M U N E R A T I O N ( C O N T I N U E D )
Performance chart
Figure 11 shows the Company’s TSR performance (with dividends reinvested) against the performance of the FTSE 250 and FTSE 100 for
the period since 30 June 2013. These indices have been chosen as they represent companies of a broadly similar market capitalisation to
Ashmore. Each point at a financial year end is calculated using an average TSR value over the month of June (i.e. 1 June to 30 June
inclusive). As the chart indicates, £100 invested in Ashmore on 30 June 2013 was worth £102 10 years later, compared with £175 for the
same investment in the FTSE 100 Index, and £176 for the same investment in the FTSE 250 Index.
Figure 11
TSR – value of hypothetical £100 holding
Figure 12
Chief Executive Officer
individual bonus award, a percentage of maximum annual bonus is not shown.
Annual
bonus
Performance-related
restricted and matching
phantom shares vested1
Percentage of restricted
and matching phantom
shares vested
Year ended 30 June
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
Salary
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
£100,000
Benefits
£1,653
£1,123
£901
£7,203
£7,627
£8,293
£8,404
£8,400
£8,388
£8,934
Pension
£9,000
£9,000
£9,000
£9,000
£9,000
£9,000
£9,000
–
–
–
£1,241,700
£2,491,200
£1,261,277
£3,071,748
£9,000
£1,083,458
£8,000
£2,415,000
£7,000
–
£542,619
£1,108,587
–
–
–
£95,574
£284,932
£462,159
£452,386
79.55%
57.00%
£2,460,188
Total
£110,653
£652,742
£116,203
£1,378,570
£3,284,726
£1,485,790
£2,993,547
£568,320
–
–
–
–
–
–
–
£997,173
30.23%
£3,605,000
1. Performance-related restricted and matching or phantom share equivalent awards vested during the years ending 30 June 2019, 2021 and 2022 plus the value of any
dividend equivalents. The sums shown in earlier years relate to dividends or dividend equivalents paid on share or phantom share awards.
Figure 13
Relative importance of spend on pay
Metric
2023
2022
2022 to 2023
% change
Remuneration paid to or receivable by all employees of the Group (i.e. accounting cost)
£66.2m
£73.4m
(10%)
Average headcount
Distributions to shareholders (dividends and/or share buybacks)
309
305
£118.4m
£118.5m
1%
0%
Figure 14
Statement of shareholder voting
At the 2020 AGM, the Directors’ Remuneration Policy received the following votes from shareholders:
Remuneration Policy
Votes cast in favour
Votes cast against
Total votes cast
Abstentions
2020 AGM resolution to approve
the Directors’ Remuneration Policy
for the years ending
30 June 2021, 2022 and 2023
386,652,049
172,385,927
559,037,976
38,657,285
At the 2022 AGM, the Directors’ Remuneration report received the following votes from shareholders:
Remuneration report
Votes cast in favour
Votes cast against
Total votes cast
Abstentions
2022 AGM resolution to approve
the Directors’ Remuneration report
for the year ended 30 June 2022
433,517,825
122,140,125
55,657,950
38,468,005
% of
votes cast
69.16%
30.84%
100.00%
N/A
% of
votes cast
78.02%
21.98%
100.00%
N/A
Figure 12 shows the total remuneration figure for the CEO during each of the financial years shown in the TSR chart. The total remuneration
figure includes the annual bonus and share awards, which vested based on performance in those years. As there is no cap on the maximum
Figure 15
For additional information, Figure 15 shows the history of financial results for the last five years.
Five-year summary of financial results
AuM US$ billion (at period end)
Operating profit £ million
2023
55.9
77.4
2022
64.0
119.2
2021
94.4
258.3
2020
83.6
209.7
2019
91.8
202.8
Approval
This Directors’ Remuneration report including both the proposed Directors’ Remuneration Policy and the Annual Report on Remuneration
has been approved by the Board of Directors.
Signed on behalf of the Board of Directors.
Helen Beck
Chair of the Remuneration Committee
5 September 2023
Ashmore Group plc Annual Report and Accounts 2023
111
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
S T A T E M E N T O F D I R E C T O R S ’ R E S P O N S I B I L I T I E S I N R E S P E C T
O F T H E A N N U A L R E P O R T A N D T H E F I N A N C I A L S T A T E M E N T S
The Directors are responsible for preparing the Annual Report and
the Group and parent Company financial statements in accordance
with applicable law and regulations.
Company law requires the Directors to prepare Group and parent
Company financial statements for each financial year. Under that
law they are required to prepare the Group financial statements
in accordance with UK-adopted international accounting standards
and applicable law and have elected to prepare the parent
Company financial statements on the same basis.
Under applicable law and regulations, the Directors are also
responsible for preparing a Strategic report, Directors’ report,
Remuneration report and Corporate governance statement
that comply with that law and those regulations.
The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company’s website. Legislation in the UK governing the
preparation and dissemination of financial statements may
differ from legislation in other jurisdictions.
Under company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Group and parent Company
and of the Group’s profit or loss for that period. In preparing
each of the Group and parent Company financial statements,
the Directors are required to:
– select suitable accounting policies and then apply them
consistently;
– make judgements and estimates that are reasonable, relevant
and reliable;
– state whether they have been prepared in accordance with
UK-adopted international accounting standards;
– assess the Group and parent Company’s ability to continue as
a going concern, disclosing, as applicable, matters related to
going concern; and
– use the going concern basis of accounting unless they either
intend to liquidate the Group or the parent Company or to cease
operations, or have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the parent
Company’s transactions and disclose with reasonable accuracy at
any time the financial position of the parent Company and enable
them to ensure that its financial statements comply with the
Companies Act. They are responsible for such internal control as
they determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due
to fraud or error, and have general responsibility for taking such
steps as are reasonably open to them to safeguard the assets of
the Group and to prevent and detect fraud and other irregularities.
In accordance with DTR 4.1.14R, the financial statements will
form part of the annual report and accounts prepared using the
single electronic reporting format under ESEF. The auditor’s report
on these financial statements provides no assurance over the
ESEF format.
Responsibility statement of the Directors in respect
of the annual financial report
The Directors confirm that to the best of their knowledge:
– the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view
of the assets, liabilities, financial position and profit or loss of
the Company and the undertakings included in the consolidation
taken as a whole; and
– the Strategic report and Directors’ report include a fair review
of the development and performance of the business and the
position of the issuer and the undertakings included in the
consolidation taken as a whole, together with a description
of the principal risks and uncertainties that they face.
The Directors consider the Annual Report and Accounts, taken as
a whole, is fair, balanced and understandable and provides the
information necessary for shareholders to assess the Group’s
position and performance, business model and strategy.
Clive Adamson
Chair
5 September 2023
112 Ashmore Group plc Annual Report and Accounts 2023
D I R E C T O R S ’ R E P O R T
The Directors present their Annual Report and
Accounts for the year ended 30 June 2023.
The financial statements have been prepared in accordance with
UK adopted international accounting standards.
Principal activity and business review
The principal activity of the Group is the provision of investment
management services. The Company is required to set out in this
report a fair review of the business of the Group during the
financial year ended 30 June 2023 and of the position of the Group
at the end of that financial year and a description of the principal
risks and uncertainties facing the Group (referred to as the
Business review). The information that fulfils the requirements of
the Business review, along with an indication of the likely future
developments in the business, can be found in the financial
highlights on the inside front cover, the CEO review on page 10,
the Business review on pages 28 to 34 and the Corporate
governance report on pages 62 to 71.
The Group’s approach to financial risk management and the
principal operating risks facing the business, including price risk,
credit risk, liquidity risk and cash flow risk, are detailed on pages
35 to 41.
Results and dividends
The results of the Group for the year are set out in the consolidated
statement of comprehensive income on page 126.
The Directors are recommending a final dividend of 12.1 pence
per share (FY2022: 12.1 pence) which, together with the interim
dividend of 4.8 pence per share (FY2022: 4.8 pence) already
declared, makes a total for the year ended 30 June 2023 of
16.9 pence per share (FY2022: 16.9 pence). Further details relating
to dividends are set out in note 14 to the financial statements.
Subject to approval at the AGM, the final dividend will be paid on
8 December 2023 to shareholders on the register on 3 November
2023 (the ex-dividend date being 2 November 2023).
Related party transactions
Details of related party transactions are set out in note 28 to the
financial statements.
Directors
The members of the Board together with their biographical details
are shown on pages 62 to 63. Shirley Garrood was appointed as a
Director on 1 August 2022 and Thuy Dam was appointed as a
Director on 1 June 2023. All other members of the Board served
as Directors throughout the year.
Details of the service contracts of the current Directors are
described on page 117.
Under the Articles, the minimum number of Directors is two and
the maximum is nine. Directors may be appointed by the Company
by ordinary resolution or by the Board. A Director appointed by the
Board must offer himself/herself for election at the next AGM
following their appointment. That Director is not taken into account
in determining the Directors or the number of Directors who are to
retire by rotation at that meeting. Notwithstanding these
provisions, the Board has adopted provision 18 of the Code and all
Directors will retire and seek re-election at each AGM. The Listing
Rules require that the election/re-election of independent directors
is by a majority of votes cast by independent shareholders as well
as by a majority of votes cast by all shareholders.
The Board confirms that the Company and Mark Coombs entered
into a relationship agreement on 1 July 2014 as required under
Listing Rule 9.2.2ADR(1); and that: (i) the Company has complied
with the independence provisions included in that agreement; (ii)
so far as the Company is aware, Mark Coombs has complied with
the independence provisions included in that agreement; and (iii) so
far as the Company is aware, Mark Coombs has complied with the
procurement obligation included in that agreement pursuant to
Listing Rule 9.2.2BR(2)(a), in each case during the financial year
ended 30 June 2023.
Diversity
The Nominations Committee and the Board recognise the
importance of diversity and ensuring candidates for Board
appointments, whilst being assembled on merit and objective
criteria, wherever possible reflect different genders, ethnic and
social backgrounds. The Board’s diversity policy applies to
appointments to the Board as well as to the Audit and Risk,
Nominations and Remuneration Committees and reflects the
Board’s belief that diversity includes and extends beyond gender
and encompasses, amongst other things, experience, skills, tenure,
age, geographical expertise, professional and socio-economic
background, ethnicity, disability and sexual orientation. In addition,
the Nominations Committee, in assessing the suitability of a
prospective Director, will consider whether the candidate is
‘over-boarded’ and has sufficient time available to discharge
their duties, and the overall balance of skills, experience and
knowledge on the Board.
It is Ashmore’s policy to attract and retain a diverse workforce.
Whilst there are no quotas set in respect of gender, age, ethnicity,
educational or professional background for its employees, Ashmore
is committed to providing equal opportunities and seeks to ensure
that its workforce reflects, as far as is practicable, the diversity of
the many communities in which it operates and this is set out in
the Group’s diversity policy. Details of the gender and ethnicity
balance across the Group and in relation to the Board and senior
management are provided on pages 47 and 48.
It is the Group’s policy to give appropriate consideration to
applications from persons with disabilities, having regard to their
particular aptitudes and abilities. For the purposes of training,
career development and progression (including those who become
disabled during the course of their employment), all are treated on
equal terms with other employees.
Engagement with employees and wider stakeholders
The Board, at a series of ‘meet the teams’ sessions chaired by
Jennifer Bingham as the Non-executive Director for workforce
engagement, listened to employees’ views on the Group.
These interactive sessions help shape the Group’s culture, in
addition to other forms of employee engagement such as
regular employee newsletters and off-site team building exercises
across the Group’s offices. Ashmore’s engagement with other
stakeholders and the outcomes are detailed in the Section 172
statement on pages 42 to 45.
Insurance and indemnification of Directors
The Company maintains Directors’ and officers’ liability insurance
for all Directors. To the extent permissible by law, the Articles of
Association also permit the Company to indemnify Directors and
former Directors against any liability incurred whilst serving in
such capacity.
Ashmore Group plc Annual Report and Accounts 2023
113
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS D I R E C T O R S ’ R E P O R T ( C O N T I N U E D )
Directors’ conflicts of interest
The Companies Act imposes upon Directors a statutory duty
to avoid unauthorised conflicts of interest with the Company.
The Company’s Articles of Association enable Directors to
approve conflicts of interest and also include other conflict of
interest provisions. Such conflicts are then, where appropriate,
considered for approval by the Board.
Save as disclosed on page 62, the Executive Directors do not
presently hold any external appointments with any
non-Ashmore-related companies.
Directors’ share interests
The interests of Directors in the Company’s shares are shown on
page 105 within the Remuneration report.
Significant agreements with provisions applicable
to a change in control of the Company
Save as described, there are no agreements in place applicable to
a change in control of the Company.
Resolution 19 in the Notice of AGM will seek approval from
shareholders to a waiver of the provisions of Rule 9 of the
Takeover Code in respect of the obligation that could arise for
Mark Coombs to make a mandatory offer for the Company in the
event that the Company exercises the authority to make market
purchases of its own shares. Further details will be contained in
the separate Notice of AGM.
Relations with shareholders
The Company places great importance on communication with its
investors and has regular communication with institutional and
retail shareholders, and sell-side analysts throughout the year.
Annual and interim reports and quarterly AuM updates are
distributed to other parties who may have an interest in the
Group’s performance. These documents are also made available
on the Company’s website where formal regulatory information
service announcements are posted. The CEO and GFD report to
the Board on investor relations and on specific discussions with
major shareholders.
The Company will be issuing a separate circular and Notice of
Meeting in respect of this year’s AGM. The Group will announce
the number of votes cast on resolutions at the AGM via a
regulatory information service.
The Senior Independent Director is available to shareholders if they
have a concern where contact through the normal channels of
Chair, CEO or GFD has failed to resolve it or for which such contact
is inappropriate.
Share capital
The Company has a single class of share capital, ordinary shares
of 0.01 pence, each of which rank pari passu in respect of
participation and voting rights. The shares are in registered form.
The issued share capital of the Company at 30 June 2023 was
712,740,804 shares. There were no shares held in Treasury.
Details of the structure of and changes in share capital are set out
in note 22 to the financial statements.
Restrictions on voting rights
A member shall not be entitled to vote at any general meeting or
class meeting in respect of any share held by him if any call or
other sum then payable by him in respect of that share remains
unpaid or if a member has been served with a restriction notice
(as defined in the Articles of Association) after failure to provide the
Company with information concerning interests in those shares
required to be provided under the Companies Act. Votes may be
exercised in person or by proxy. The Articles of Association
currently provide a deadline for submission of proxy forms of
48 hours before the meeting.
Purchase of own shares
In the year under review, the Company did not purchase any of its
own shares for Treasury and the EBT purchased 7,038,639 shares
worth £15.6 million. Until the date of the next AGM, the Company
is generally and unconditionally authorised to buy back up to
35,637,040 of its own issued shares. The Company is seeking a
renewal of the share buyback authority at the 2023 AGM.
Power to issue and allot shares
The Directors are generally and unconditionally authorised to allot
unissued shares in the Company up to a maximum nominal
amount of £23,758.03 (and £47,516.05 in connection with an
offer by way of a rights issue).
Substantial shareholdings1
The Company has been notified of the following significant interests in accordance with DTR 5 (other than those of the Directors which are
disclosed separately on page 105) in the Company’s ordinary shares of 0.01 pence each.
Overseas Pensions and Benefits Limited2
BlackRock, Inc.
Jupiter Fund Management PLC
Schroders plc
Allianz Global Investors GmbH
Number
of voting
rights disclosed
as at
30 June 2023
50,648,181
42,956,269
36,034,780
34,470,970
32,695,220
Number
of voting
rights disclosed
as at
5 September 2023
50,648,181
44,196,398
36,034,780
34,470,970
32,695,220
Percentage
interests3
7.10
6.01
5.05
4.85
4.58
Percentage
interests3
7.10
6.19
5.05
4.85
4.58
1 The shareholding of Mark Coombs, a Director and substantial shareholder, is disclosed separately on page 105.
2 In addition to the interests in the Company’s ordinary shares referred to above, each Executive Director and employee of the Group has an interest in the Company’s
ordinary shares held by Overseas Pensions and Benefits Limited under the terms of the EBT. The voting rights disclosed for the EBT in this table reflect the last
notification made to the Company in accordance with DTR 5. The actual number of shares held by the EBT as at 30 June 2023 is disclosed in note 23 to the
financial statements.
3 Percentage interests are based on 712,740,804 shares in issue (2022: 712,740,804).
114 Ashmore Group plc Annual Report and Accounts 2023
A further authority has been granted to the Directors to allot the
Company’s shares for cash, up to a maximum nominal amount
of £7,127.40, without regard to the pre-emption provisions of the
Companies Act. No such shares have been issued or allotted under
these authorities, nor is there any current intention to do so, other
than to satisfy outstanding obligations under the employee share
schemes where necessary.
These authorities are valid until the date of the 2023 AGM when a
resolution for such renewal will be proposed.
Employees
Details of the Company’s employment practices can be found in
the People & culture report on page 46.
Overseas Pensions and Benefits Limited as trustee of the EBT has
discretion as to the exercise of voting rights over shares which it
holds in respect of unallocated shares, namely those shares in
which no employee beneficial interests exist.
Corporate governance
The Company is governed according to the applicable provisions of
company law and by the Company’s Articles. As a listed company,
the Company must also comply with the Listing Rules and the DTRs.
Listed companies are expected to comply as far as possible with the
provisions of the Code, and to state how its principles have been
applied. There is a report from the Chair on corporate governance on
pages 64 to 66 and a description of how the Company has applied
each of the principles of the Code on pages 67 to 68. The Company
complied throughout the financial period with all the relevant
provisions set out in the Code other than Provision 24 where
Clive Adamson retained the role of Chair of the Audit and Risk
Committee on an interim basis for part of the year whilst also being
Chair of the Company.
Mandatory GHG reporting and SECR requirements
In line with the Companies Act (Strategic Report and Directors’
Report) Regulations 2013, all companies listed on the main market
of the London Stock Exchange have been required to report their
GHG emissions within their annual report. In addition, as of 1 April
2019, the Group is required to meet the mandatory SECR
requirements. These comprise disclosure of Scope 1 and 2 emissions
and energy consumption, at least one intensity metric (e.g. emissions
per revenue, or per FTE), a list of energy efficiency actions taken
(if applicable), and a comparison with the emissions of the previous
year, when available. An explanation of the methodology and the
sources of the conversion factors used is also required.
Operational control methodology
The Group has followed the operational control method of
reporting. The emissions reported below are for the 11 offices
around the world where the Group exercised direct operational
control in FY2023. The office emissions reported, as well as
emissions originating from their operations, are those which are
considered material to the Group and for which data was available.
Emission scopes
In accordance with mandatory GHG reporting, Scope 1 and Scope
2 are required to be reported. In line with the GHG Protocol’s dual
reporting requirements, Scope 2 emissions have been reported both
in terms of ‘market-based’ emissions and ‘location-based’ emissions.
It is not mandatory to report Scope 3. However, the Group
continues to report on key Scope 3 emission categories (e.g. air
travel, water, waste) in order to provide more complete
disclosure to stakeholders.
FY2023 saw the inclusion of well-to-tank emissions1 for the first
time, to increase the completeness of Ashmore’s Scope 3
disclosure.
Exclusions and estimation
Overall, 14% of total emissions generated were based on
estimation (135 tCO2e). Best endeavours have been undertaken at
each office to provide the required data; however, in some cases
data was not available for reporting and estimation was required.
Estimation methodologies adopted are summarised in the
following approaches:
– For offices located within shared and leased buildings, many
were only able to provide an estimated consumption rate based
on the apportionment of the building total as sub-metered data
was not available.
– Where only spend data was available, an average price per unit
estimate was applied to the total cost to calculate the
consumption rate.
– For some offices, waste data could only be provided in terms of
volume disposed. The waste volume was converted to weight
using UK Government waste-type specific weight conversion
factors.
– For offices unable to provide any waste or water data, it was
decided that estimation was inappropriate due to the significant
differences in disposal rates by building, office size and per
employee, and therefore no waste data was included.
– For offices unable to provide their emissions data relative to
the last quarter of the Group’s financial year, the impact of this
quarter was estimated by projecting the available data for the
remaining months of this financial year.
Exclusions were based on three types of criteria: relevancy to the
Company’s operations, materiality2 and data availability. In particular,
Scope 1 and 2 emissions areas that are not covered in this analysis3
are not applicable; the excluded upstream Scope 3 categories4 are
expected to have an immaterial impact on emissions, and none of
the downstream Scope 3 categories5 are applicable except for
category 15 (investments). The Group invests across multiple asset
classes and in markets where disclosure requirements are still
evolving, therefore it has not currently calculated an aggregate
figure for category 15. Please refer to the TCFD section on page 56
for further information.
1 Well-to-tank emissions are the Scope 3 emissions associated with the extraction, refining and transportation of the raw fuel sources prior to their combustion.
They are calculated from the data on fuels burned in company owned vehicles and fuels and electricity used in the company’s premises.
2 A materiality threshold of 5% of total emissions is used to determine whether an emissions source is required to be included as per SECR requirements.
3 Process emissions, electric vehicles, and heat and steam consumption.
4 Category 1 material use and supply chain, category 2 capital goods, and category 4 upstream freight.
5 Categories 9 to 15.
Ashmore Group plc Annual Report and Accounts 2023
115
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS D I R E C T O R S ’ R E P O R T ( C O N T I N U E D )
Quantification and reporting methodology
Consumption of GHG emitting sources
Data collection and analysis has strictly followed the GHG Protocol
Corporate Accounting and Reporting Standard. The WRI and the
WBCSD developed the standard to promote standardised global
carbon accounting methodologies and, as such, the GHG Protocol
Standard is one of the recommended methodologies under the
SECR requirements. The UK Government’s 2022 emission factors,
generated by DEFRA, have been used to quantify all emissions,
with the exception of overseas electricity, which has been
quantified using data from European Investment Bank’s 2022
Project Carbon Footprint Methodologies (Colombia, India,
Indonesia, Peru, Saudi Arabia, Singapore, United Arab Emirates),
the IEA’s 2022 emissions factors (Ireland), the 2021 Climate
Transparency Report (Japan), and the 2022 factors from the United
States Environmental Protection Agency (United States). The
market-based (supplier-specific) conversion factors have been
supplied by the Group’s offices in Colombia and Ireland.
The Group’s data inputs and outputs have been reviewed and
processed by Carbon Responsible Limited.
Consumption and emissions
The Group emitted a total of 990 tonnes of CO2e across its global
offices for all scopes (including Scope 3 which is not mandatory to
report). Scope 3 accounted for 68% of the total emissions, Scope 2
for 23% and Scope 1 for 10% of total emissions.
Overall, the Group’s GHG emissions increased by 51% compared
to FY2022. The significant difference in emissions is primarily due
to an increase in reported business travel to pre-Covid levels,
access to wider data and inclusion of additional GHG categories.
Recorded emissions were generated by various sources, across
the three scopes. As a proportion of the total emissions, the
biggest source of emissions was business travel (531 tCO2e, 54%
of total emissions), followed by electricity generation (225 tCO2e,
23% of total emissions), fuel and electricity well-to-tank (71 tCO2e,
7% of total emissions), hotels (47 tCO2e, 5% of total emissions),
stationary fuel (41 tCO2e, 4% of total emissions), refrigerants (38
tCO2e, 4% of total emissions), mobile fuel combustion (17 tCO2e,
2% of total emissions) and electricity transmission and distribution
(16 tCO2e, 2% of total emissions). All other emission sources
contributed less than 1% of the total emissions.
Carbon offset
The Group seeks to offset its GHG emissions via The Ashmore
Foundation. It uses a carbon price methodology to establish a
donation amount and then the Foundation identifies project(s) to
target the required offset in the emerging countries in which the
Group invests and operates. The activities relating to the FY2023
GHG emissions will be reported in the Group’s FY2024 Annual
Report and Accounts.
Scope emissions by source
Scope 1 Natural gas (kWh)
Other fuels (kWh)
Owned vehicles (km)
Refrigerants (kg)
Scope 2 Electricity (kWh)
Scope 3 Air travel
(passenger km)
Hotel stay (room nights)
Third-party vehicles (km)
Water (m3)
Waste (kg)
FY2022
212,833
29,849
6,670
1
509,618
FY2023
222,083
65,1861
–1
59
554,956
Year-on-year
change
+9,250
+35,337
-6,670
+58
+45,338
2,434,869
241
498
1,454
33,913
4,825,046 +2,390,177
+1,224
+14,782
+423
-14,298
1,465
15,280
1,877
19,615
1. Fuel consumption data was available for all the vehicles owned by the Group,
so the data on the distance travelled by owned vehicles was not used in
FY2023. This does not mean that the emissions decreased, but simply that the
emissions from mobile fuel are all included in ‘other fuels’ instead.
Emissions by scope
Scope
1
2 (market-based)
2 (location-based)
3
Total (market-based)
Total (location-based)
Scope 1,2&3 tCO2e/FTE
Scope 1&2 tCO2e/FTE
Scope 1,2&3 kgCO2e/office m2
Scope 1&2 kgCO2e/office m2
% of total
change
13%
1%
86%
FY2022
51.9
221.1
227.3
380.8
653.8
660.0
2.2
0.9
118
49
Change in
FY2023
tCO2e
94.9 +43.0
+3.5
224.6
233.1
+5.8
670.1 +289.3
989.6 +335.6
998.1 +338.1
+1.1
+0.2
+59
+8
3.3
1.1
177
57
Year-on-year change in emissions (UK and global)
UK/non-UK
UK & offshore
Global (non-UK)
Total
Intensity metrics
FY2022
246
408
654
FY2023
361
629
990
Change in
tCO2e
+115
+221
+336
% of total
change
34%
66%
Two intensity metrics have been calculated for emissions, one
based on FTE and one on office area (m2). Intensity metrics are a
useful way to assess changes in emissions within a growing
company, as whilst absolute emissions increase, the impact per
chosen unit can reduce.
The table on the following page shows the emissions per FTE and
office m2 for FY2022 and FY2023. In both cases, the intensity
metrics are provided both for total (Scope 1, 2 and 3) emissions
and for Scope 1 and 2 emissions only. While providing intensity
metrics based on all the reported emissions is a requirement for
SECR, the intensity metrics regarding Scope 1 and 2 emissions
only are provided to facilitate a valuable comparison with the other
companies in the same sector who only disclose Scope 1 and 2
emissions to comply with SECR requirements. Emissions per FTE
are expressed in tonnes of CO2e per FTE; emissions per office area
are expressed in kilograms of CO2e per office squared metre.
116 Ashmore Group plc Annual Report and Accounts 2023
By observing the table below, it is notable that reported Scope 1, 2
and 3 emissions per FTE and office area have both increased
substantially since FY2022, while both intensity metrics relative to
Scope 1 and 2 emissions only have remained similar to their
FY2022 values. Since neither the number of FTE nor the area of
offices have varied substantially since last year, the increase in these
intensity metrics is reflective of an increase in emissions (especially
Scope 3 emissions) as presented above.
Intensity metrics relative to both total emissions and Scope
1 and 2 emissions only
FY2022
2.22
0.93
118
49
FY2023
3.34
1.08
177
57
Scope 1,2&3 tCO2e/FTE
Scope 1&2 tCO2e/FTE
Scope 1,2&3 kgCO2e/office m2
Scope 1&2 kgCO2e/office m2
The report covers all the main emissions sources that are required
to be reported under the SECR requirements and for which data
has been collected. Optional disclosure of Scope 3 impacts has
been undertaken as far as practicable to reflect the impact from the
Group’s core operations.
Charitable and political contributions
During the year, the Group made charitable donations of £0.5 million
(FY2022: £0.6 million). The work of The Ashmore Foundation is
described in the Sustainability section of this report on pages 50
to 55. It is the Group’s policy not to make contributions for
political purposes.
Creditor payment policy
The Group’s policy and practice in the UK are to follow its suppliers’
terms of payment and to make payment in accordance with those
terms subject to receipt of satisfactory invoicing. Unless otherwise
agreed, payments to creditors are made within 30 days of receipt
of an invoice. At 30 June 2023, the amount owed to the Group’s
trade creditors in the UK represented approximately 21 days’
average purchases from suppliers (FY2022: 17 days).
Auditors and the disclosure of information
to auditors
The Directors who held office at the date of approval of this
Directors’ report confirm that, so far as they are each aware, there
is no relevant audit information of which the Group’s auditors are
unaware, and each Director has taken all the steps that they ought
to have taken as Directors to make himself or herself aware of any
relevant audit information and to establish that the Group’s auditors
are aware of that information.
Resolutions will be proposed at the AGM to appoint Ernst & Young
LLP as auditor and to authorise the Audit and Risk Committee to
agree their remuneration. Note 11 to the financial statements sets
out details of the auditor’s remuneration.
2023 Annual General Meeting
Details of the AGM will be given in the separate circular and Notice
of Meeting.
Going concern
The Company and Group have considerable financial resources and
the Directors believe that both are well placed to manage their
business risks successfully.
Further information regarding the Group’s business activities,
together with the factors likely to affect its future development,
performance and position, are set out on pages 28 to 34.
After making enquiries, the Directors are satisfied that the Company
and the Group have adequate resources to continue to operate for
the next 12 months from the date of this report and confirm that
the Company and the Group are going concerns. For this reason
they continue to adopt the going concern basis in preparing these
financial statements.
Companies Act
This Directors’ report on pages 113 to 117 inclusive has been
drawn up and presented in accordance with and in reliance on
English company law and the liabilities of the Directors in
connection with that report shall be subject to the limitations
and restrictions provided by such law.
References in this Directors’ report to the financial highlights,
the Business review, the Corporate governance report and the
Remuneration report are deemed to be included by reference in
this Directors’ report.
Directors’ service contracts
The summary below provides details of the Directors’ service agreements/letters of appointment:
Directors’ service contracts
Executive Directors
Mark Coombs
Tom Shippey
Non-executive Directors
Clive Adamson
Jennifer Bingham
Helen Beck
Thuy Dam
Shirley Garrood
Date appointed Director
Contract commencement date
Notice period
Expiry/review date
3 December 1998
25 November 2013
21 September 2006
25 November 2013
22 October 2015
29 June 2018
1 June 2021
1 June 2023
1 August 2022
22 October 2015
29 June 2018
1 June 2021
1 June 2023
1 August 2022
1 year
1 year
1 month
1 month
1 month
1 month
1 month
Rolling
Rolling
22 October 2024
29 June 2024
1 June 2024
1 June 2026
1 August 2025
Approved by the Board and signed on its behalf by:
Alexandra Autrey
Group Company Secretary
5 September 2023
Ashmore Group plc Annual Report and Accounts 2023
117
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
Independent auditor’s report to the members of
Ashmore Group plc only
Year ended 30 June 2023
Our opinion is unmodified
We have audited the financial statements of Ashmore Group plc
(the Company) for the year ended 30 June 2023 which comprise the
Consolidated statement of comprehensive income, Consolidated
balance sheet, Consolidated statement of changes in equity,
Consolidated cash flow statement, Company balance sheet,
Company statement of changes in equity, Company cash flow
statement, and the related notes, including the accounting policies
in notes 1 to 4.
In our opinion:
– the financial statements give a true and fair view of the state of the
Group’s and of the parent Company’s affairs as at 30 June 2023
and of the Group’s profit for the year then ended;
– the Group financial statements have been properly prepared in
accordance with UK-adopted international accounting standards;
– the parent Company financial statements have been properly
prepared in accordance with UK-adopted international accounting
standards, and as applied in accordance with the provisions of
the Companies Act 2006; and
– the financial statements have been prepared in accordance with
the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities are described below. We believe that the
audit evidence we have obtained is a sufficient and appropriate
basis for our opinion. Our audit opinion is consistent with our
report to the Audit and Risk Committee.
We were first appointed as auditor of the Company (then Ashmore
Group Limited) by the Directors following its incorporation on
30 November 1998. Subsequent to the Company’s conversion
into a public limited company and the public listing of its shares
on the London Stock Exchange on 3 October 2006, we were
reappointed as auditor of Ashmore Group plc by the Directors on
31 October 2007. The period of total uninterrupted engagement is
24 years ended 30 June 2023 (16 years since the Company’s public
listing). We have fulfilled our ethical responsibilities under, and we
remain independent of the Group in accordance with, UK ethical
requirements including the FRC Ethical Standard as applied to
listed public interest entities.
No non-audit services prohibited by that standard were provided.
Overview
Materiality:
Group financial
statements as a whole
Coverage
£8.1m (2022: £9.1m)
5.2% of Group profit
before tax adjusted for investments
gains and losses averaged over three
years (2022: 5.5% of Group profit
before tax adjusted for investments
gains and losses)
89% (2022: 89%) of Group profit
before tax
Key audit matters
Recurring risks
Management fees
Recoverability of parent
Company’s loan to subsidiaries
vs 2022
◄ ►
◄ ►
118 Ashmore Group plc Annual Report and Accounts 2023
Independent auditor’s report to the members of
Ashmore Group plc only
Year ended 30 June 2023
Our opinion is unmodified
Basis for opinion
We have audited the financial statements of Ashmore Group plc
We conducted our audit in accordance with International
(the Company) for the year ended 30 June 2023 which comprise the
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Consolidated statement of comprehensive income, Consolidated
Our responsibilities are described below. We believe that the
balance sheet, Consolidated statement of changes in equity,
audit evidence we have obtained is a sufficient and appropriate
Consolidated cash flow statement, Company balance sheet,
basis for our opinion. Our audit opinion is consistent with our
Company statement of changes in equity, Company cash flow
report to the Audit and Risk Committee.
statement, and the related notes, including the accounting policies
in notes 1 to 4.
In our opinion:
– the financial statements give a true and fair view of the state of the
Group’s and of the parent Company’s affairs as at 30 June 2023
and of the Group’s profit for the year then ended;
– the Group financial statements have been properly prepared in
accordance with UK-adopted international accounting standards;
– the parent Company financial statements have been properly
prepared in accordance with UK-adopted international accounting
the Companies Act 2006; and
– the financial statements have been prepared in accordance with
the requirements of the Companies Act 2006.
standards, and as applied in accordance with the provisions of
listed public interest entities.
We were first appointed as auditor of the Company (then Ashmore
Group Limited) by the Directors following its incorporation on
30 November 1998. Subsequent to the Company’s conversion
into a public limited company and the public listing of its shares
on the London Stock Exchange on 3 October 2006, we were
reappointed as auditor of Ashmore Group plc by the Directors on
31 October 2007. The period of total uninterrupted engagement is
24 years ended 30 June 2023 (16 years since the Company’s public
listing). We have fulfilled our ethical responsibilities under, and we
remain independent of the Group in accordance with, UK ethical
requirements including the FRC Ethical Standard as applied to
No non-audit services prohibited by that standard were provided.
Overview
Materiality:
Group financial
statements as a whole
£8.1m (2022: £9.1m)
5.2% of Group profit
before tax adjusted for investments
gains and losses averaged over three
years (2022: 5.5% of Group profit
before tax adjusted for investments
gains and losses)
Coverage
89% (2022: 89%) of Group profit
Key audit matters
Recurring risks
Management fees
Recoverability of parent
Company’s loan to subsidiaries
before tax
vs 2022
◄ ►
◄ ►
Key audit matters: our assessment of risks of material misstatement
Key audit matters are those matters that, in our professional judgement, were of most significance in the audit of the financial statements
and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those
which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the
engagement team. We summarise below the key audit matters (unchanged from 2022), in decreasing order of audit significance, in arriving
at our audit opinion above, together with our key audit procedures to address those matters and our findings from those procedures in order
that the Company’s members as a body may better understand the process by which we arrived at our audit opinion. These matters were
addressed, and our findings are based on procedures undertaken, in the context of, and solely for the purpose of, our audit of the financial
statements as a whole, and in forming our opinion thereon, and consequently are incidental to that opinion, and we do not provide a
separate opinion on these matters.
The risk
Our response
Revenue recognition:
Management fees
£185.4 million;
(2022: £247.0 million)
Refer to page 140
(accounting policy).
Data capture and calculation error
Management fees is the most significant
item in the consolidated statement of
comprehensive income and represents an
area that had the greatest effect on the
overall Group audit. Management fees
comprise segregated and pooled
management fees.
The two key components to management
fee calculations are fee rates to be applied
and the amount of assets under
management (AuM).
The following are identified as the key
risks for management fee income:
– Risk in relation to fee rates: There is a
risk that fee rates have not been entered
appropriately into the fee calculation and
billing systems when new clients are
onboarded or agreements are amended.
– Risk in relation to AuM: There is a risk
that AuM data from the third-party service
providers and other in-house systems is
not complete and/or accurate.
– Risk in relation to calculation of
management fee income: There is a risk
that management fee income is
incorrectly calculated.
Our procedures included:
Procedures in relation to fee rates
– Control design and operation: We tested the design and
operating effectiveness of controls over new and amended
fee agreements.
– Tests of details: We agreed a selection of fee rates used in the
system calculation to the original investment management
agreements (IMAs), fee letters or fund prospectuses outlining
the latest effective fee rates.
Procedures in relation to AuM
– Control design and operation: For segregated management
fees, we tested the design and operating effectiveness of
controls over the production of AuM valuations used in
calculating management fees.
– For pooled funds management fees, we inspected the
internal controls reports prepared by the outsourced service
organisations (in particular Northern Trust) to check whether
the key controls over the production of AuM valuations
used in calculated management fees were designed and
operating effectively.
General procedures
– Test of details: We independently recalculated 100% of in-scope
component pooled management fees and a sample of
segregated management fees. We agreed the recalculated fees
to the general ledger records. This represented 91% (2022:
82%) of total revenue for the Group.
– Assessing transparency: We considered the adequacy of the
disclosures made in respect of management fees against the
relevant accounting standards.
Our findings
– We found no errors in the Group’s calculation of its
management fee income (2022: no errors).
Ashmore Group plc Annual Report and Accounts 2023
119
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
I N D E P E N D E N T A U D I T O R ’ S R E P O R T T O T H E M E M B E R S O F A S H M O R E
G R O U P P L C O N L Y ( C O N T I N U E D )
Year ended 30 June 2023
The risk
Our response
Recoverability of
parent Company’s
loan to subsidiaries
£266.4 million;
(2022: £376.9 million)
Refer to page 137
(accounting policy)
and page 154
(financial disclosures).
Low risk, high value
The carrying amount of the
parent Company’s loans due from
subsidiaries represents 41% (2022:
57%) of the parent Company’s total
assets and is comprised of a loan to
one subsidiary. The recoverability of
the loan is not at high risk of
significant misstatement or subject
to significant judgement. However,
due to its materiality in the context of
the parent Company financial
statements, this is considered to be
the area that had the greatest effect
on our overall parent Company audit.
Our procedures included:
Test of details
– We assessed the parent Company’s loan with reference to the
subsidiary’s balance sheet, to identify whether the subsidiary had a
positive net asset value, and therefore coverage of the debt owed,
as well as assessing whether the subsidiary had historically been
profit-making.
Assessing subsidiary audits:
– We considered the results of the work we performed on the
subsidiary audit on those net assets, including assessing the ability
of the subsidiary to obtain liquid funds and, therefore, the ability of
the subsidiary to fund the repayment of the loan.
– We performed the tests above rather than seeking to rely on any of
the Company's controls because the nature of the balance is such
that we would expect to obtain audit evidence primarily through the
detailed procedures described.
Our findings
– We found the Company’s conclusion that there is no impairment of
the loan due from its subsidiary to be balanced (2022: balanced).
120 Ashmore Group plc Annual Report and Accounts 2023
I N D E P E N D E N T A U D I T O R ’ S R E P O R T T O T H E M E M B E R S O F A S H M O R E
G R O U P P L C O N L Y ( C O N T I N U E D )
Year ended 30 June 2023
Recoverability of
parent Company’s
loan to subsidiaries
£266.4 million;
(2022: £376.9 million)
Refer to page 137
(accounting policy)
and page 154
The risk
Our response
Low risk, high value
The carrying amount of the
Our procedures included:
Test of details
parent Company’s loans due from
– We assessed the parent Company’s loan with reference to the
subsidiaries represents 41% (2022:
57%) of the parent Company’s total
assets and is comprised of a loan to
subsidiary’s balance sheet, to identify whether the subsidiary had a
positive net asset value, and therefore coverage of the debt owed,
as well as assessing whether the subsidiary had historically been
(financial disclosures).
significant misstatement or subject
Assessing subsidiary audits:
one subsidiary. The recoverability of
profit-making.
the loan is not at high risk of
to significant judgement. However,
due to its materiality in the context of
the parent Company financial
statements, this is considered to be
– We considered the results of the work we performed on the
subsidiary audit on those net assets, including assessing the ability
of the subsidiary to obtain liquid funds and, therefore, the ability of
the subsidiary to fund the repayment of the loan.
the area that had the greatest effect
– We performed the tests above rather than seeking to rely on any of
on our overall parent Company audit.
the Company's controls because the nature of the balance is such
that we would expect to obtain audit evidence primarily through the
detailed procedures described.
Our findings
– We found the Company’s conclusion that there is no impairment of
the loan due from its subsidiary to be balanced (2022: balanced).
Our application of materiality and an overview
of the scope of our audit
Materiality for the Group financial statements as a whole was
set at £8.1 million (2022: £9.1 million), which is determined
with reference to a benchmark of Group profit before tax adjusted
for investment gains and losses averaged over three years, of
which it represents 5.2% (2022: 5.5% of Group profit before tax
adjusted for investments gains and losses). The adjustments are
made up of the following line items from the consolidated
statement of comprehensive income: gains/(losses) on investment
securities, change in third-party interests in consolidated funds
and finance income/(expense). We have amended our benchmark
by averaging it over three years to account for fluctuations in
financial performance.
Materiality for the parent Company financial statements as a whole
was set at £6.5 million (2022: £6.6 million), determined with
reference to a benchmark of Company total assets, of which it
represents 1% (2022: 1%).
In line with our audit methodology, our procedures on individual
account balances and disclosures were performed to a lower
threshold, performance materiality, so as to reduce to an
acceptable level the risk that individually immaterial misstatements
in individual account balances add up to a material amount across
the financial statements as a whole.
Performance materiality was set at 75% (2022: 75%) of materiality
for the financial statements as a whole, which equates to
£6.1 million (2022: £6.8 million) for the Group and £4.9 million
(2022: £4.9 million) for the parent Company. We applied this
percentage in our determination of performance materiality
because we did not identify any factors indicating an elevated
level of risk.
We agreed to report to the Group Audit and Risk Committee any
corrected or uncorrected identified misstatements exceeding
£0.4 million (2022: £0.5 million), in addition to other identified
misstatements that warranted reporting on qualitative grounds.
Of the Group’s 28 (2022: 28) reporting components, we subjected
four (2022: four) to full scope audits for Group reporting purposes
and four (2022: four) to specified risk-focused audit procedures.
The latter were not individually financially significant enough to
require a full scope audit for Group purposes, but did present
specific individual risks that needed to be addressed. The
components within the scope of our work accounted for the
percentages illustrated opposite. For the residual components,
we performed analysis at an aggregated Group level to re-examine
our assessment that there were no significant risks of material
misstatement within the components.
All of the work, including the audit of the parent Company,
was performed by the Group team. The Group team performed
procedures on the items excluded from Group profit before tax.
The Group team approved component materialities, which ranged
from £6.5 million to £4.0 million (2022: £8.0 million to £1.0 million),
having regard to the mix of size and risk profile of the components
across the Group. The scope of the audit work performed was
predominately substantive as we placed limited reliance upon the
Group’s internal control over financial reporting other than as set
out in our key audit matter.
Group profit before tax
£111.8m (2022: £118.4m)
Group materiality
£8.1m (2022: £9.1m)
£8.1m
Whole financial statements
materiality (2022: £9.1m)
£6.1m
Whole financial statements
performance materiality
(2022: £6.8m)
£6.5m
Range of materiality at 8
components (£6.5m to £4.0m)
(2022: £8.0m to £1.0m)
£0.41m
Misstatements reported to
the Audit and Risk Committee
(2022: £0.46m)
Group profit before tax
Group materiality
Group net revenue
Group profit before tax
2
14
91%
(2022: 82%)
82
89
89%
(2022: 89%)
50
75
39
Group total assets
Group net assets
17
97%
(2022: 96%)
79
97
20
93%
(2022: 97%)
77
93
Full scope for Group audit purposes 2023
Specified risk-focused audit procedures 2023
Full scope for Group audit purposes 2022
Specified risk-focused audit procedures 2022
Residual components
Ashmore Group plc Annual Report and Accounts 2023
121
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
I N D E P E N D E N T A U D I T O R ’ S R E P O R T T O T H E M E M B E R S O F A S H M O R E
G R O U P P L C O N L Y ( C O N T I N U E D )
Year ended 30 June 2023
The impact of climate change on our audit
In planning our audit we have considered the potential impacts
of climate change on the Group’s business and its financial
statements. Climate change impacts the Group in a number of
ways: through its own operations (including potential reputational
risk associated with the Group’s delivery of its climate related
initiatives), through its portfolio of investments and its stewardship
role, and the greater emphasis on climate related narrative and
disclosure in the Annual Report.
– we have nothing material to add or draw attention to in relation to
the Directors’ statement in note 2 to the financial statements on
the use of the going concern basis of accounting with no material
uncertainties that may cast significant doubt over the Group and
Company’s use of that basis for the going concern period and we
found the going concern disclosure in note 2 to be acceptable; and
– the related statement under the Listing Rules set out on page 39
is materially consistent with the financial statements and our
audit knowledge.
However, as we cannot predict all future events or conditions and
as subsequent events may result in outcomes that are inconsistent
with judgements that were reasonable at the time they were
made, the above conclusions are not a guarantee that the Group or
the Company will continue in operation.
Fraud and breaches of laws and regulations – ability
to detect
Identifying and responding to risks of material
misstatement due to fraud
To identify risks of material misstatement due to fraud (fraud risks)
we assessed events or conditions that could indicate an incentive or
pressure to commit fraud or provide an opportunity to commit fraud.
Our risk assessment procedures included:
– Enquiring of Directors and inspection of policy documentation as
to the Group’s high-level policies and procedures to prevent and
detect fraud, as well as whether they have knowledge of any
actual, suspected or alleged fraud.
– Reading Audit and Risk Committee meeting minutes.
– Using analytical procedures to identify any unusual or
unexpected relationships.
– Considering remuneration incentive schemes and performance
targets for management and Directors such as the Group’s
executive share-based incentive scheme.
We communicated identified fraud risks throughout the audit team
and remained alert to any indications of fraud throughout the audit.
As required by auditing standards, and taking into account our
overall knowledge of the control environment, we perform
procedures to address the risk of management override of controls,
in particular the risk that management may be in a position to make
inappropriate accounting entries. On this audit we do not believe
there is a fraud risk related to revenue recognition because the
calculation of the revenue is non-judgemental and straightforward,
with limited opportunity for manipulation.
We did not identify any additional fraud risks.
We also performed procedures including identifying journal
entries to test based on risk criteria and comparing the identified
entries to supporting documentation. These included all material
post-closing journals.
As a part of our audit, we have made enquiries of management to
understand the extent of the potential impact of climate change risk
on the Group’s financial statements and the Group’s preparedness
for this. We have performed a risk assessment of how the impact
of climate change may affect the financial statements and
our audit. We held discussions with our own climate change
professionals to challenge our risk assessment.
On the basis of the risk assessment procedures performed above
and taking into account the nature of the assets on the Group’s
balance sheet, we concluded that there was no significant impact
from climate change. We have also read the disclosure of climate
related information in the front half as set out on pages 56 to 61 of
the Annual Report and considered consistency with the financial
statements and our audit knowledge.
Going concern
The Directors have prepared the financial statements on the going
concern basis as they do not intend to liquidate the Company
or the Group or to cease their operations, and as such they have
concluded that the Company’s and the Group’s financial position
means that this is realistic. They have also concluded that there
are no material uncertainties that could have cast significant doubt
over their ability to continue as a going concern for at least a year
from the date of approval of the financial statements (the going
concern period).
We used our knowledge of the Group, its industry, and the general
economic environment to identify the inherent risks to its business
model and analysed how those risks might affect the Group’s and
Company’s financial resources or ability to continue operations over
the going concern period. The risk that we considered most likely
to adversely affect the Group’s and Company’s available financial
resources over this period was AuM outflows.
We considered whether the risk could plausibly affect the liquidity
in the going concern period by assessing the degree of downside
assumption that, individually and collectively, could result in a
liquidity issue, taking into account the Group’s current and
projected cash. We also assessed the completeness of the going
concern disclosure.
Our conclusions based on this work:
– we consider that the Directors’ use of the going concern basis
of accounting in the preparation of the financial statements
is appropriate;
– we have not identified, and concur with the Directors’
assessment that there is not, a material uncertainty related to
events or conditions that, individually or collectively, may cast
significant doubt on the Group’s or Company's ability to continue
as a going concern for the going concern period;
122 Ashmore Group plc Annual Report and Accounts 2023
I N D E P E N D E N T A U D I T O R ’ S R E P O R T T O T H E M E M B E R S O F A S H M O R E
G R O U P P L C O N L Y ( C O N T I N U E D )
Year ended 30 June 2023
The impact of climate change on our audit
In planning our audit we have considered the potential impacts
of climate change on the Group’s business and its financial
statements. Climate change impacts the Group in a number of
ways: through its own operations (including potential reputational
risk associated with the Group’s delivery of its climate related
– we have nothing material to add or draw attention to in relation to
the Directors’ statement in note 2 to the financial statements on
the use of the going concern basis of accounting with no material
uncertainties that may cast significant doubt over the Group and
Company’s use of that basis for the going concern period and we
found the going concern disclosure in note 2 to be acceptable; and
initiatives), through its portfolio of investments and its stewardship
– the related statement under the Listing Rules set out on page 39
role, and the greater emphasis on climate related narrative and
is materially consistent with the financial statements and our
disclosure in the Annual Report.
audit knowledge.
As a part of our audit, we have made enquiries of management to
However, as we cannot predict all future events or conditions and
understand the extent of the potential impact of climate change risk
as subsequent events may result in outcomes that are inconsistent
on the Group’s financial statements and the Group’s preparedness
with judgements that were reasonable at the time they were
for this. We have performed a risk assessment of how the impact
made, the above conclusions are not a guarantee that the Group or
of climate change may affect the financial statements and
the Company will continue in operation.
our audit. We held discussions with our own climate change
professionals to challenge our risk assessment.
On the basis of the risk assessment procedures performed above
and taking into account the nature of the assets on the Group’s
balance sheet, we concluded that there was no significant impact
Fraud and breaches of laws and regulations – ability
to detect
Identifying and responding to risks of material
misstatement due to fraud
from climate change. We have also read the disclosure of climate
To identify risks of material misstatement due to fraud (fraud risks)
related information in the front half as set out on pages 56 to 61 of
we assessed events or conditions that could indicate an incentive or
the Annual Report and considered consistency with the financial
pressure to commit fraud or provide an opportunity to commit fraud.
statements and our audit knowledge.
Our risk assessment procedures included:
Going concern
The Directors have prepared the financial statements on the going
concern basis as they do not intend to liquidate the Company
or the Group or to cease their operations, and as such they have
– Enquiring of Directors and inspection of policy documentation as
to the Group’s high-level policies and procedures to prevent and
detect fraud, as well as whether they have knowledge of any
actual, suspected or alleged fraud.
concluded that the Company’s and the Group’s financial position
– Reading Audit and Risk Committee meeting minutes.
means that this is realistic. They have also concluded that there
are no material uncertainties that could have cast significant doubt
over their ability to continue as a going concern for at least a year
from the date of approval of the financial statements (the going
concern period).
We used our knowledge of the Group, its industry, and the general
economic environment to identify the inherent risks to its business
model and analysed how those risks might affect the Group’s and
Company’s financial resources or ability to continue operations over
the going concern period. The risk that we considered most likely
to adversely affect the Group’s and Company’s available financial
resources over this period was AuM outflows.
We considered whether the risk could plausibly affect the liquidity
in the going concern period by assessing the degree of downside
assumption that, individually and collectively, could result in a
liquidity issue, taking into account the Group’s current and
projected cash. We also assessed the completeness of the going
concern disclosure.
Our conclusions based on this work:
– Using analytical procedures to identify any unusual or
unexpected relationships.
– Considering remuneration incentive schemes and performance
targets for management and Directors such as the Group’s
executive share-based incentive scheme.
We communicated identified fraud risks throughout the audit team
and remained alert to any indications of fraud throughout the audit.
As required by auditing standards, and taking into account our
overall knowledge of the control environment, we perform
procedures to address the risk of management override of controls,
in particular the risk that management may be in a position to make
inappropriate accounting entries. On this audit we do not believe
there is a fraud risk related to revenue recognition because the
calculation of the revenue is non-judgemental and straightforward,
with limited opportunity for manipulation.
We did not identify any additional fraud risks.
We also performed procedures including identifying journal
entries to test based on risk criteria and comparing the identified
entries to supporting documentation. These included all material
– we consider that the Directors’ use of the going concern basis
of accounting in the preparation of the financial statements
post-closing journals.
is appropriate;
– we have not identified, and concur with the Directors’
assessment that there is not, a material uncertainty related to
events or conditions that, individually or collectively, may cast
significant doubt on the Group’s or Company's ability to continue
as a going concern for the going concern period;
Identifying and responding to risks of material
misstatement due to non-compliance with laws
and regulations
We identified areas of laws and regulations that could reasonably
be expected to have a material effect on the financial statements
from our general commercial and sector experience, and through
discussion with the Directors and other management (as required
by auditing standards), and from inspection of the Group’s
regulatory and legal correspondence and discussed with the
Directors and other management the policies and procedures
regarding compliance with laws and regulations.
As the Group is regulated, our assessment of risks involved gaining
an understanding of the control environment including the entity’s
procedures for complying with regulatory requirements.
We communicated identified laws and regulations throughout our
team and remained alert to any indications of non-compliance
throughout the audit.
The potential effect of these laws and regulations on the financial
statements varies considerably.
Firstly, the Group is subject to laws and regulations that directly
affect the financial statements including financial reporting
legislation (including related companies legislation), distributable
profits legislation, taxation legislation, and financial services
legislation and we assessed the extent of compliance with these
laws and regulations as part of our procedures on the related
financial statement items.
Secondly, the Group is subject to many other laws and regulations
where the consequences of non-compliance could have a material
effect on amounts or disclosures in the financial statements, for
instance through the imposition of fines or litigation or the loss of the
Group’s authority to operate. We identified the following areas as those
most likely to have such an effect: specific areas of regulatory capital
and liquidity, conduct including client assets, anti-money laundering,
anti-bribery and market abuse regulations, and certain aspects of
company legislation and financial services legislation recognising the
financial and regulated nature of the Group’s activities and its legal
form. Auditing standards limit the required audit procedures to identify
non-compliance with these laws and regulations to enquiry of the
Directors and other management and inspection of regulatory and legal
correspondence, if any. Therefore if a breach of operational regulations
is not disclosed to us or evident from relevant correspondence, an audit
will not detect that breach.
Context of the ability of the audit to detect fraud or
breaches of law or regulation
Owing to the inherent limitations of an audit, there is an unavoidable
risk that we may not have detected some material misstatements
in the financial statements, even though we have properly planned
and performed our audit in accordance with auditing standards.
For example, the further removed non-compliance with laws and
regulations is from the events and transactions reflected in the
financial statements, the less likely the inherently limited
procedures required by auditing standards would identify it.
In addition, as with any audit, there remained a higher risk of
non-detection of fraud, as these may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of
internal controls. Our audit procedures are designed to detect
material misstatement. We are not responsible for preventing
non-compliance or fraud and cannot be expected to detect
non-compliance with all laws and regulations.
We have nothing to report on the other information
in the Annual Report
The Directors are responsible for the other information presented in the
Annual Report together with the financial statements. Our opinion on
the financial statements does not cover the other information and,
accordingly, we do not express an audit opinion or, except as explicitly
stated below, any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so,
consider whether, based on our financial statements audit work,
the information therein is materially misstated or inconsistent with
the financial statements or our audit knowledge. Based solely on
that work we have not identified material misstatements in the
other information.
Strategic report and Directors’ report
Based solely on our work on the other information:
– we have not identified material misstatements in the Strategic
report and the Directors’ report;
– in our opinion the information given in those reports for the
financial year is consistent with the financial statements; and
– in our opinion those reports have been prepared in accordance
with the Companies Act 2006.
Directors’ Remuneration report
In our opinion the part of the Directors’ Remuneration report to
be audited has been properly prepared in accordance with the
Companies Act 2006.
Ashmore Group plc Annual Report and Accounts 2023
123
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
I N D E P E N D E N T A U D I T O R ’ S R E P O R T T O T H E M E M B E R S O F A S H M O R E
G R O U P P L C O N L Y ( C O N T I N U E D )
Year ended 30 June 2023
Disclosures of principal and emerging risks and
longer-term viability
We are required to perform procedures to identify whether there is
a material inconsistency between the Directors’ disclosures in
respect of principal and emerging risks and the longer-term viability
statement, and the financial statements and our audit knowledge.
Based on those procedures, we have nothing material to add or
draw attention to in relation to:
Corporate governance disclosures
We are required to perform procedures to identify whether there is
a material inconsistency between the Directors’ corporate
governance disclosures and the financial statements and our
audit knowledge.
Based on those procedures, we have concluded that each of the
following is materially consistent with the financial statements and
our audit knowledge:
– the Directors’ confirmation within the longer-term viability
statement on page 39 that they have carried out a robust
assessment of the emerging and principal risks facing the Group,
including those that would threaten its business model, future
performance, solvency and liquidity;
– the principal and emerging risks disclosures describing these
risks and how emerging risks are identified, and explaining how
they are being managed and mitigated; and
– the Directors’ explanation in the longer-term viability statement
of how they have assessed the prospects of the Group, over
what period they have done so and why they considered that
period to be appropriate, and their statement as to whether they
have a reasonable expectation that the Group will be able to
continue in operation and meet its liabilities as they fall due over
the period of their assessment, including any related disclosures
drawing attention to any necessary qualifications or assumptions.
We are also required to review the longer-term viability statement,
set out on page 39, under the Listing Rules. Based on the above
procedures, we have concluded that the above disclosures are
materially consistent with the financial statements and our
audit knowledge.
Our work is limited to assessing these matters in the context of
only the knowledge acquired during our financial statements audit.
As we cannot predict all future events or conditions and as
subsequent events may result in outcomes that are inconsistent
with judgements that were reasonable at the time they were
made, the absence of anything to report on these statements is not
a guarantee as to the Group’s and Company’s longer-term viability.
– the Directors’ statement that they consider that the Annual
Report and financial statements taken as a whole is fair, balanced
and understandable, and provides the information necessary for
shareholders to assess the Group’s position and performance,
business model and strategy;
– the section of the Annual Report describing the work of the Audit
and Risk Committee, including the significant issues that the
Audit and Risk Committee considered in relation to the financial
statements, and how these issues were addressed; and
– the section of the Annual Report that describes the review of the
effectiveness of the Group’s risk management and internal
control systems.
We are required to review the part of the Corporate Governance
Statement relating to the Group’s compliance with the provisions of
the UK Corporate Governance Code specified by the Listing Rules
for our review. We have nothing to report in this respect.
We have nothing to report on the other matters
on which we are required to report by exception
Under the Companies Act 2006, we are required to report to you if,
in our opinion:
– adequate accounting records have not been kept by the parent
Company, or returns adequate for our audit have not been
received from branches not visited by us; or
– the parent Company financial statements and the part of the
Directors’ Remuneration report to be audited are not in
agreement with the accounting records and returns; or
– certain disclosures of Directors’ remuneration specified by law
are not made; or
– we have not received all the information and explanations we
require for our audit.
We have nothing to report in these respects.
124 Ashmore Group plc Annual Report and Accounts 2023
I N D E P E N D E N T A U D I T O R ’ S R E P O R T T O T H E M E M B E R S O F A S H M O R E
G R O U P P L C O N L Y ( C O N T I N U E D )
Year ended 30 June 2023
Disclosures of principal and emerging risks and
Corporate governance disclosures
longer-term viability
We are required to perform procedures to identify whether there is
We are required to perform procedures to identify whether there is
a material inconsistency between the Directors’ corporate
a material inconsistency between the Directors’ disclosures in
governance disclosures and the financial statements and our
respect of principal and emerging risks and the longer-term viability
audit knowledge.
statement, and the financial statements and our audit knowledge.
Based on those procedures, we have nothing material to add or
draw attention to in relation to:
our audit knowledge:
Based on those procedures, we have concluded that each of the
following is materially consistent with the financial statements and
– the Directors’ confirmation within the longer-term viability
statement on page 39 that they have carried out a robust
assessment of the emerging and principal risks facing the Group,
including those that would threaten its business model, future
– the Directors’ statement that they consider that the Annual
Report and financial statements taken as a whole is fair, balanced
and understandable, and provides the information necessary for
shareholders to assess the Group’s position and performance,
performance, solvency and liquidity;
business model and strategy;
– the principal and emerging risks disclosures describing these
risks and how emerging risks are identified, and explaining how
they are being managed and mitigated; and
– the Directors’ explanation in the longer-term viability statement
of how they have assessed the prospects of the Group, over
what period they have done so and why they considered that
– the section of the Annual Report describing the work of the Audit
and Risk Committee, including the significant issues that the
Audit and Risk Committee considered in relation to the financial
statements, and how these issues were addressed; and
– the section of the Annual Report that describes the review of the
effectiveness of the Group’s risk management and internal
period to be appropriate, and their statement as to whether they
control systems.
have a reasonable expectation that the Group will be able to
continue in operation and meet its liabilities as they fall due over
the period of their assessment, including any related disclosures
drawing attention to any necessary qualifications or assumptions.
We are also required to review the longer-term viability statement,
set out on page 39, under the Listing Rules. Based on the above
procedures, we have concluded that the above disclosures are
We are required to review the part of the Corporate Governance
Statement relating to the Group’s compliance with the provisions of
the UK Corporate Governance Code specified by the Listing Rules
for our review. We have nothing to report in this respect.
We have nothing to report on the other matters
on which we are required to report by exception
materially consistent with the financial statements and our
Under the Companies Act 2006, we are required to report to you if,
audit knowledge.
in our opinion:
Our work is limited to assessing these matters in the context of
– adequate accounting records have not been kept by the parent
only the knowledge acquired during our financial statements audit.
Company, or returns adequate for our audit have not been
As we cannot predict all future events or conditions and as
received from branches not visited by us; or
subsequent events may result in outcomes that are inconsistent
with judgements that were reasonable at the time they were
made, the absence of anything to report on these statements is not
a guarantee as to the Group’s and Company’s longer-term viability.
– the parent Company financial statements and the part of the
Directors’ Remuneration report to be audited are not in
agreement with the accounting records and returns; or
– certain disclosures of Directors’ remuneration specified by law
– we have not received all the information and explanations we
are not made; or
require for our audit.
We have nothing to report in these respects.
Respective responsibilities
Directors’ responsibilities
As explained more fully in their statement set out on page 112,
the Directors are responsible for: the preparation of the financial
statements including being satisfied that they give a true and fair
view; such internal control as they determine is necessary to
enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error; assessing
the Group and parent Company’s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern;
and using the going concern basis of accounting unless they either
intend to liquidate the Group or the parent Company or to cease
operations, or have no realistic alternative but to do so.
The purpose of our audit work and to whom we owe
our responsibilities
This report is made solely to the Company’s members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006
and the terms of our engagement by the Company. Our audit work
has been undertaken so that we might state to the Company’s
members those matters we are required to state to them in an
auditor’s report, and the further matters we are required to state
to them in accordance with the terms agreed with the Company,
and for no other purpose. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other than the
Company and the Company’s members, as a body, for our audit
work, for this report, or for the opinions we have formed.
Jatin Patel (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
15 Canada Square
London E14 5GL
5 September 2023
Auditor’s responsibilities
Our objectives are to obtain reasonable assurance about whether the
financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue our opinion in an
auditor’s report. Reasonable assurance is a high level of assurance,
but does not guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it
exists. Misstatements can arise from fraud, other irregularities or
error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial statements.
A fuller description of our responsibilities is provided on the FRC’s
website at www.frc.org.uk/auditorsresponsibilities.
The Company is required to include these financial statements in an
annual financial report prepared under Disclosure Guidance and
Transparency Rule (DTR) 4.1.17R and 4.1.18R. This auditor’s report
provides no assurance over whether the annual financial report has
been prepared in accordance with those requirements.
Ashmore Group plc Annual Report and Accounts 2023
125
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
Consolidated statement of comprehensive income
For the year ended 30 June 2023
Notes
2023
£m
2022
£m
185.4
247.0
7
20
20
9
11
8
26
12
5.1
2.7
193.2
(2.2)
5.4
196.4
(44.3)
19.3
(66.2)
(27.8)
77.4
33.9
0.5
4.5
2.9
254.4
(3.5)
11.6
262.5
(61.3)
16.5
(73.4)
(25.1)
119.2
(2.1)
1.3
111.8
118.4
(25.3)
86.5
(26.5)
91.9
(26.2)
4.9
(21.3)
65.2
83.3
3.2
86.5
62.7
2.5
65.2
80.2
(6.0)
74.2
166.1
88.5
3.4
91.9
161.9
4.2
166.1
13
13
12.43p
12.15p
13.42p
12.61p
Management fees
Performance fees
Other revenue
Total revenue
Distribution costs
Foreign exchange
Net revenue
Losses on investment securities
Change in third-party interests in consolidated funds
Personnel expenses
Other expenses
Operating profit
Finance income/(expense)
Share of profit from associates
Profit before tax
Tax expense
Profit for the year
Other comprehensive income/(loss), net of related tax effect
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences arising on foreign operations
Cash flow hedge intrinsic value gains/(losses)
Other comprehensive income/(loss), net of tax
Total comprehensive income for the year
Profit attributable to:
Equity holders of the parent
Non-controlling interests
Profit for the year
Total comprehensive income attributable to:
Equity holders of the parent
Non-controlling interests
Total comprehensive income for the year
Earnings per share
Basic
Diluted
The notes on pages 133 to 174 form an integral part of these financial statements.
126 Ashmore Group plc Annual Report and Accounts 2023
Consolidated statement of comprehensive income
For the year ended 30 June 2023
Consolidated balance sheet
As at 30 June 2023
Losses on investment securities
Change in third-party interests in consolidated funds
Management fees
Performance fees
Other revenue
Total revenue
Distribution costs
Foreign exchange
Net revenue
Personnel expenses
Other expenses
Operating profit
Finance income/(expense)
Share of profit from associates
Profit before tax
Tax expense
Profit for the year
Other comprehensive income/(loss), net of related tax effect
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences arising on foreign operations
Cash flow hedge intrinsic value gains/(losses)
Other comprehensive income/(loss), net of tax
Total comprehensive income for the year
Profit attributable to:
Equity holders of the parent
Non-controlling interests
Profit for the year
Total comprehensive income attributable to:
Equity holders of the parent
Non-controlling interests
Total comprehensive income for the year
Earnings per share
Basic
Diluted
The notes on pages 133 to 174 form an integral part of these financial statements.
Notes
2023
£m
2022
£m
185.4
247.0
7
20
20
9
11
8
26
12
5.1
2.7
193.2
(2.2)
5.4
196.4
(44.3)
19.3
(66.2)
(27.8)
77.4
33.9
0.5
(26.2)
4.9
(21.3)
65.2
83.3
3.2
86.5
62.7
2.5
65.2
4.5
2.9
254.4
(3.5)
11.6
262.5
(61.3)
16.5
(73.4)
(25.1)
119.2
(2.1)
1.3
80.2
(6.0)
74.2
166.1
88.5
3.4
91.9
161.9
4.2
166.1
Assets
Non-current assets
Goodwill and intangible assets
Property, plant and equipment
Investment in associates
Non-current financial assets measured at fair value
Deferred acquisition costs
Deferred tax assets
Current assets
Investment securities
Financial assets measured at fair value
Trade and other receivables
Cash and cash equivalents
Total assets
111.8
118.4
(25.3)
86.5
(26.5)
91.9
Equity and liabilities
Capital and reserves – attributable to equity holders of the parent
Issued capital
Share premium
Retained earnings
Foreign exchange reserve
Cash flow hedging reserve
Non-controlling interests
Total equity
Liabilities
Non-current liabilities
Lease liabilities
Deferred tax liabilities
Current liabilities
Lease liabilities
Derivative financial instruments
Third-party interests in consolidated funds
Trade and other payables
Total liabilities
Total equity and liabilities
The notes on pages 133 to 174 form an integral part of these financial statements.
Approved by the Board on 5 September 2023 and signed on its behalf by:
13
13
12.43p
12.15p
13.42p
12.61p
Mark Coombs
Chief Executive Officer
Tom Shippey
Group Finance Director
Notes
2023
£m
2022
£m
15
16
26
19, 20
18
19, 20
19, 20
17
22
31
16
18
16
19, 21
19, 20
24
86.9
6.5
2.3
54.1
0.3
23.9
174.0
229.9
55.8
70.4
478.6
834.7
90.9
9.1
2.1
39.3
0.4
32.7
174.5
265.1
32.3
74.3
552.0
923.7
1,008.7
1,098.2
0.1
15.6
875.4
7.7
–
898.8
14.2
913.0
3.7
9.3
13.0
2.1
0.2
56.2
24.2
82.7
0.1
15.6
901.0
33.2
(4.9)
945.0
21.8
966.8
5.8
8.8
14.6
2.2
5.2
73.0
36.4
116.8
95.7
1,008.7
131.4
1,098.2
Ashmore Group plc Annual Report and Accounts 2023
127
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
Consolidated statement of changes in equity
For the year ended 30 June 2023
Balance at 30 June 2021
0.1
15.6
941.0
(46.2)
1.1 911.6
21.1
932.7
Attributable to equity holders of the parent
Issued
capital
£m
Share
premium
£m
Retained
earnings
£m
Foreign
exchange
reserve
£m
Cash flow
hedging
reserve
£m
Non-
controlling
interests
£m
Total
£m
Total
equity
£m
Profit for the year
Other comprehensive income/(loss):
Foreign currency translation differences arising on
foreign operations
Cash flow hedge intrinsic value losses
Total comprehensive income/(loss)
Transactions with owners:
Purchase of own shares
Share-based payments
Decrease in non-controlling interests
Dividends to equity holders
Dividends to non-controlling interests
Total contributions and distributions
Balance at 30 June 2022
Profit for the year
Other comprehensive income/(loss):
Foreign currency translation differences arising on
foreign operations
Cash flow hedge intrinsic value gains
Total comprehensive income/(loss)
Transactions with owners:
Purchase of own shares
Share-based payments
Movements in non-controlling interests
Dividends to equity holders
Dividends to non-controlling interests
Total contributions and distributions
Balance at 30 June 2023
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
88.5
–
–
–
79.4
–
88.5
79.4
(34.5)
24.5
–
(118.5)
–
(128.5)
–
–
–
–
–
–
–
–
88.5
3.4
91.9
79.4
0.8
80.2
(6.0)
(6.0)
(6.0)
–
(6.0)
161.9
4.2
166.1
–
–
–
–
–
–
(34.5)
24.5
–
–
–
(0.5)
(34.5)
24.5
(0.5)
(118.5)
–
(118.5)
–
(3.0)
(3.0)
(128.5)
(3.5)
(132.0)
0.1
15.6
901.0
33.2
(4.9)
945.0
21.8
966.8
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
83.3
–
–
–
(25.5)
–
83.3
(25.5)
(15.6)
18.5
6.6
(118.4)
–
(108.9)
–
–
–
–
–
–
0.1
15.6
875.4
7.7
–
–
83.3
3.2
86.5
(25.5)
(0.7)
(26.2)
4.9
4.9
4.9
62.7
–
4.9
2.5
65.2
–
–
–
–
–
–
–
(15.6)
18.5
–
–
6.6
(6.8)
(15.6)
18.5
(0.2)
(118.4)
–
(118.4)
–
(3.3)
(3.3)
(108.9)
(10.1)
(119.0)
898.8
14.2
913.0
The notes on pages 133 to 174 form an integral part of these financial statements.
128 Ashmore Group plc Annual Report and Accounts 2023
Consolidated statement of changes in equity
For the year ended 30 June 2023
Consolidated cash flow statement
For the year ended 30 June 2023
Balance at 30 June 2021
0.1
15.6
941.0
(46.2)
1.1 911.6
21.1
932.7
Attributable to equity holders of the parent
Issued
capital
£m
Share
premium
£m
Retained
earnings
£m
exchange
reserve
£m
hedging
reserve
£m
Foreign
Cash flow
Non-
controlling
interests
£m
Total
£m
Total
equity
£m
Foreign currency translation differences arising on
79.4
79.4
0.8
80.2
Profit for the year
Other comprehensive income/(loss):
foreign operations
Cash flow hedge intrinsic value losses
Total comprehensive income/(loss)
Transactions with owners:
Purchase of own shares
Share-based payments
Decrease in non-controlling interests
Dividends to equity holders
Dividends to non-controlling interests
Total contributions and distributions
Balance at 30 June 2022
Profit for the year
Other comprehensive income/(loss):
foreign operations
Cash flow hedge intrinsic value gains
Total comprehensive income/(loss)
Transactions with owners:
Purchase of own shares
Share-based payments
Movements in non-controlling interests
Dividends to equity holders
Dividends to non-controlling interests
Total contributions and distributions
Balance at 30 June 2023
88.5
–
88.5
3.4
91.9
88.5
79.4
161.9
4.2
166.1
(6.0)
–
(6.0)
(6.0)
(6.0)
(34.5)
24.5
–
–
–
–
(0.5)
(34.5)
24.5
(0.5)
(118.5)
–
(118.5)
(3.0)
(3.0)
(128.5)
(3.5)
(132.0)
0.1
15.6
901.0
33.2
(4.9)
945.0
21.8
966.8
83.3
83.3
3.2
86.5
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(34.5)
24.5
(118.5)
(128.5)
–
–
–
–
–
–
(15.6)
18.5
6.6
(118.4)
–
(108.9)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
83.3
(25.5)
4.9
4.9
4.9
62.7
–
4.9
2.5
65.2
(15.6)
18.5
–
–
6.6
(6.8)
(15.6)
18.5
(0.2)
(118.4)
–
(118.4)
–
(3.3)
(3.3)
(108.9)
(10.1)
(119.0)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Foreign currency translation differences arising on
(25.5)
(25.5)
(0.7)
(26.2)
The notes on pages 133 to 174 form an integral part of these financial statements.
0.1
15.6
875.4
7.7
898.8
14.2
913.0
Operating activities
Profit for the year
Adjustments for non-cash items:
Depreciation and amortisation
Share-based payments
Foreign exchange gains
Net losses on investment securities
Finance (income)/expense
Tax expense
Share of profits from associates
Cash generated from operations before working capital changes
Changes in working capital:
Decrease in trade and other receivables
Decrease/(increase) in derivative financial instruments
Decrease in trade and other payables
Cash generated from operations
Taxes paid
Net cash generated from operating activities
Investing activities
Interest and investment income received
Purchase of non-current financial assets measured at fair value
Purchase of financial assets measured at fair value
Sale of investment securities
Sale of non-current financial assets measured at fair value
Sale of financial assets held for sale
Sale of financial assets measured at fair value
Net cash on initial consolidation of seed capital investments
Purchase of property, plant and equipment
Net cash generated from/(used in) investing activities
Financing activities
Dividends paid to equity holders
Dividends paid to non-controlling interests
Third-party subscriptions into consolidated funds
Third-party redemptions from consolidated funds
Distributions paid by consolidated funds
Decrease in non-controlling interests
Payment of lease liabilities
Interest paid
Purchase of own shares
Net cash used in financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of year
Cash and cash equivalents at end of year comprise:
Cash at bank and in hand
Daily dealing liquidity funds
Deposits
2023
£m
2022
£m
86.5
91.9
3.2
18.9
(5.4)
25.0
(33.9)
25.3
(0.5)
119.1
9.7
(5.0)
(12.2)
111.6
(7.1)
104.5
31.2
(19.5)
(23.0)
3.2
5.0
–
–
(1.7)
(0.4)
(5.2)
(118.4)
(3.3)
2.8
(29.1)
(4.2)
(0.4)
(2.2)
(0.3)
(15.6)
(170.7)
(71.4)
552.0
(2.0)
478.6
40.9
56.8
380.9
478.6
3.1
24.3
(11.6)
44.8
2.1
26.5
(1.3)
179.8
4.9
6.5
(9.1)
182.1
(24.7)
157.4
8.1
(1.9)
(5.5)
24.2
1.5
0.1
44.0
0.3
(0.5)
70.3
(118.5)
(3.0)
0.5
(4.2)
(10.7)
(0.5)
(2.0)
(0.4)
(34.5)
(173.3)
54.4
456.1
41.5
552.0
57.4
225.7
268.9
552.0
The notes on pages 133 to 174 form an integral part of these financial statements.
Ashmore Group plc Annual Report and Accounts 2023
129
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
Company balance sheet
As at 30 June 2023
Assets
Non-current assets
Goodwill
Property, plant and equipment
Investment in subsidiaries
Deferred acquisition costs
Trade and other receivables
Deferred tax assets
Current assets
Trade and other receivables
Derivative financial instruments
Cash and cash equivalents
Total assets
Equity and liabilities
Capital and reserves
Issued capital
Share premium
Retained earnings
Cash flow hedging reserve
Total equity attributable to equity holders of the Company
Liabilities
Non-current liabilities
Lease liability
Current liabilities
Lease liability
Derivative financial instruments
Trade and other payables
Total liabilities
Total equity and liabilities
Notes
2023
£m
2022
£m
15
16
25
17
18
17
21
22
4.1
4.1
19.9
0.3
167.8
11.6
207.8
116.6
0.2
327.7
444.5
652.3
0.1
15.6
605.2
–
620.9
4.1
5.5
19.9
0.4
132.0
18.2
180.1
324.9
–
159.7
484.6
664.7
0.1
15.6
600.6
(4.9)
611.4
16
2.2
3.3
16
21
24
1.2
–
28.0
29.2
31.4
1.3
5.2
43.5
50.0
53.3
652.3
664.7
The Company has taken the exemption under section 408 of the Companies Act 2006 not to present its profit and loss account and related
notes. The Company’s profit for the year ended 30 June 2023 was £120.1 million (30 June 2022: £188.6 million).
The notes on pages 133 to 174 form an integral part of these financial statements.
The financial statements of Ashmore Group plc (registered number 03675683) were approved by the Board on 5 September 2023 and
signed on its behalf by:
Mark Coombs
Chief Executive Officer
Tom Shippey
Group Finance Director
130 Ashmore Group plc Annual Report and Accounts 2023
Company balance sheet
As at 30 June 2023
Company statement of changes in equity
For the year ended 30 June 2023
Balance at 30 June 2021
Profit for the year
Cash flow hedge intrinsic value losses
Purchase of own shares
Share-based payments
Dividends to equity holders
Balance at 30 June 2022
Profit for the year
Cash flow hedge intrinsic value gains
Purchase of own shares
Share-based payments
Dividends to equity holders
Balance at 30 June 2023
Issued
capital
£m
0.1
Share
premium
£m
15.6
–
–
–
–
–
–
–
–
–
–
0.1
15.6
–
–
–
–
–
–
–
–
–
–
0.1
15.6
Retained
earnings
£m
540.6
188.6
–
(34.1)
24.0
(118.5)
600.6
120.1
–
(15.6)
18.5
(118.4)
605.2
Cash flow
hedging
reserve
£m
Total equity
attributable to
equity holders of
the parent
£m
1.1
557.4
–
(6.0)
–
–
–
(4.9)
–
4.9
–
–
–
–
188.6
(6.0)
(34.1)
24.0
(118.5)
611.4
120.1
4.9
(15.6)
18.5
(118.4)
620.9
The notes on pages 133 to 174 form an integral part of these financial statements.
Assets
Goodwill
Non-current assets
Property, plant and equipment
Investment in subsidiaries
Deferred acquisition costs
Trade and other receivables
Deferred tax assets
Current assets
Trade and other receivables
Derivative financial instruments
Cash and cash equivalents
Total assets
Equity and liabilities
Capital and reserves
Issued capital
Share premium
Retained earnings
Cash flow hedging reserve
Liabilities
Non-current liabilities
Lease liability
Current liabilities
Lease liability
Derivative financial instruments
Trade and other payables
Total liabilities
Total equity and liabilities
Total equity attributable to equity holders of the Company
Notes
2023
£m
2022
£m
15
16
25
17
18
17
21
22
16
21
24
4.1
4.1
19.9
0.3
167.8
11.6
207.8
116.6
0.2
327.7
444.5
652.3
0.1
15.6
605.2
–
620.9
4.1
5.5
19.9
0.4
132.0
18.2
180.1
324.9
–
159.7
484.6
664.7
0.1
15.6
600.6
(4.9)
611.4
16
2.2
3.3
1.2
–
28.0
29.2
31.4
1.3
5.2
43.5
50.0
53.3
652.3
664.7
The Company has taken the exemption under section 408 of the Companies Act 2006 not to present its profit and loss account and related
notes. The Company’s profit for the year ended 30 June 2023 was £120.1 million (30 June 2022: £188.6 million).
The notes on pages 133 to 174 form an integral part of these financial statements.
The financial statements of Ashmore Group plc (registered number 03675683) were approved by the Board on 5 September 2023 and
signed on its behalf by:
Mark Coombs
Chief Executive Officer
Tom Shippey
Group Finance Director
Ashmore Group plc Annual Report and Accounts 2023
131
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
Company cash flow statement
For the year ended 30 June 2023
Operating activities
Profit for the year
Adjustments for:
Depreciation and amortisation
Share-based payments
Foreign exchange losses/(gains)
Finance income
Tax expense
Dividends received from subsidiaries
Cash generated from/(used in) operations before working capital changes
Changes in working capital:
Decrease/(increase) in trade and other receivables
Decrease/(increase) in derivative financial instruments
Decrease in trade and other payables
Cash generated from/(used in) operations
Taxes paid
Net cash generated from/(used in) operating activities
Investing activities
Interest received
Loans advanced to subsidiaries
Loans repaid by subsidiaries
Dividends received from subsidiaries
Purchase of property, plant and equipment
Net cash generated from investing activities
Financing activities
Dividends paid
Payment of lease liability
Interest paid
Purchase of own shares
Net cash used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of year
Cash and cash equivalents at end of year comprise:
Cash at bank and in hand
Daily dealing liquidity funds
Deposits
The notes on pages 133 to 174 form an integral part of these financial statements.
132 Ashmore Group plc Annual Report and Accounts 2023
2023
£m
2022
£m
120.1
188.6
1.8
13.7
9.6
(10.0)
9.8
1.8
19.3
(58.4)
(0.4)
26.0
(145.2)
(174.0)
(0.2)
2.9
57.8
(5.4)
(15.5)
36.7
(6.3)
30.4
8.9
(27.3)
137.8
145.2
(0.3)
264.3
(73.8)
6.5
(59.0)
(123.4)
(12.1)
(135.5)
0.2
(0.2)
184.0
174.0
(0.4)
357.6
(118.4)
(118.5)
(1.2)
(0.1)
(15.6)
(135.3)
159.4
159.7
8.6
327.7
2.9
0.8
324.0
327.7
(1.1)
(0.2)
(34.1)
(153.9)
68.2
86.1
5.4
159.7
6.3
1.9
151.5
159.7
Company cash flow statement
For the year ended 30 June 2023
Notes to the financial statements
Operating activities
Profit for the year
Adjustments for:
Depreciation and amortisation
Share-based payments
Foreign exchange losses/(gains)
Finance income
Tax expense
Dividends received from subsidiaries
Cash generated from/(used in) operations before working capital changes
Changes in working capital:
Decrease/(increase) in trade and other receivables
Decrease/(increase) in derivative financial instruments
Decrease in trade and other payables
Cash generated from/(used in) operations
Taxes paid
Net cash generated from/(used in) operating activities
Investing activities
Interest received
Loans advanced to subsidiaries
Loans repaid by subsidiaries
Dividends received from subsidiaries
Purchase of property, plant and equipment
Net cash generated from investing activities
Financing activities
Dividends paid
Payment of lease liability
Interest paid
Purchase of own shares
Net cash used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of year
Cash and cash equivalents at end of year comprise:
Cash at bank and in hand
Daily dealing liquidity funds
Deposits
The notes on pages 133 to 174 form an integral part of these financial statements.
2023
£m
2022
£m
120.1
188.6
(145.2)
(174.0)
(0.2)
2.9
1.8
13.7
9.6
(10.0)
9.8
57.8
(5.4)
(15.5)
36.7
(6.3)
30.4
8.9
(27.3)
137.8
145.2
(0.3)
264.3
(1.2)
(0.1)
(15.6)
(135.3)
159.4
159.7
8.6
327.7
2.9
0.8
324.0
327.7
1.8
19.3
(58.4)
(0.4)
26.0
(73.8)
6.5
(59.0)
(123.4)
(12.1)
(135.5)
0.2
(0.2)
184.0
174.0
(0.4)
357.6
(1.1)
(0.2)
(34.1)
(153.9)
68.2
86.1
5.4
159.7
6.3
1.9
151.5
159.7
(118.4)
(118.5)
1) General information
Ashmore Group plc (the Company) is a public limited company
listed on the London Stock Exchange and incorporated and
domiciled in the United Kingdom. The consolidated financial
statements of the Company and its subsidiaries (together the
Group) for the year ended 30 June 2023 were authorised for issue
by the Board of Directors on 5 September 2023. The principal
activity of the Group is described in the Directors’ report on
page 113.
There are areas of the financial statements where the use of
estimation is important, but where the risk of material adjustment
is not significant, including the assessment of performance
conditions attached to certain executive share awards (note 10),
assumptions used in the valuation of level 3 seed capital
investments (note 19) and deferred tax assets (note 18). The areas
where judgements are made include the impairment review of
goodwill (note 15), the calculation of lease assets and liabilities
(note 16) and consolidation of seed capital investments (note 20).
2) Basis of preparation
The Group and Company financial statements for the year ended
30 June 2023 have been prepared in accordance with UK-adopted
international accounting standards.
The financial statements have been prepared on a going concern
basis under the historical cost convention, except for the
measurement at fair value of derivative financial instruments
and financial assets and liabilities that are held at fair value
through profit or loss.
The Company has taken advantage of the exemption in section
408 of the Companies Act 2006 that allows it not to present its
individual statement of comprehensive income and related notes.
Going concern
The Board of Directors has considered the resilience of the Group,
taking into account its current financial position, and the principal
and emerging risks facing the business in the context of the current
economic outlook. The Board reviewed cash flow forecasts for a
period of 12 months from the date of approval of these financial
statements which indicate that the Group will have sufficient funds
to meet its liabilities as they fall due for that period. The Board
applied stressed scenarios, including severe but plausible downside
assumptions on AuM, profitability of the Group and known
commitments. While there are wider market uncertainties that may
impact the Group, the stressed scenarios, which assumed a
significant reduction in revenue for the entire forecast period, show
that the Group and Company would continue to operate profitably
and meet their liabilities as they fall due for a period of at least 12
months from the date of approval of the annual financial
statements. The financial statements have therefore been prepared
on a going concern basis.
Principal estimates and judgements
The preparation of the financial statements in conformity with UK-
adopted international accounting standards requires the use of
certain accounting estimates, and management to exercise its
judgement in the process of applying the Group’s accounting
policies. The estimates and judgements used in preparing the
financial statements are periodically evaluated and are based on
historical experience and other factors, including expectations of
future events that are believed to be reasonable under the
circumstances, the results of which form the basis of making the
judgements about carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ
from these estimates.
3) New Standards and Interpretations not
yet adopted
There were no Standards or Interpretations that were in
issue and required to be adopted by the Group as at the date of
authorisation of these consolidated financial statements. No other
Standards or Interpretations have been issued that are expected to
have a material impact on the Group’s financial statements.
4) Significant accounting policies
The following principal accounting policies have been applied
consistently where applicable to all years presented in dealing
with items considered material in relation to the Group and
Company financial statements, unless otherwise stated.
Basis of consolidation
The consolidated financial statements of the Group comprise
the financial statements of the Company and its subsidiaries,
associates and joint ventures. This includes an Employee Benefit
Trust (EBT) established for the employee share-based awards and
consolidated investment funds.
Interests in subsidiaries
Subsidiaries are entities, including investment funds, over which
the Group has control as defined by IFRS 10. The Group has
control if it is exposed to, or has rights to, variable returns from
its involvement with the entity and has the ability to affect those
returns through its power over the entity. The financial statements
of subsidiaries are included in the consolidated financial statements
from the date on which control commences until the date when
control ceases. The Group reassesses whether or not it controls an
entity if facts and circumstances indicate that there are changes to
one or more of the elements of control.
The profit or loss and each component of other comprehensive
income are attributed to the equity holders of the Company and to
any non-controlling interests. Based on their nature, the interests of
third parties in consolidated funds are classified as liabilities and
appear as ‘Third-party interests in consolidated funds’ on the
Group’s balance sheet.
Ashmore Group plc Annual Report and Accounts 2023
133
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
arrangements. Aggregate economic interest is a measure of the
Group’s exposure to variable returns in the fund through a combination
of direct interest, expected share of performance fees, expected
management fees, fair value gains or losses, and distributions
receivable from the fund. The Group concludes that it acts as a
principal when the power it has over the fund is deemed to be
exercised for self-benefit, considering the level of aggregate
economic exposure in the fund and the assessed strength of third-
party investors’ kick-out rights. The Group concludes that it acts as
an agent when the power it has over the fund is deemed to be
exercised for the benefit of third-party investors.
If the Group concludes that it acts as a principal, it is deemed to
have control and, therefore, will consolidate a fund as if it were a
subsidiary. If the Group concludes that it does not have control over
the fund, the Group recognises and measures its interest in the
fund as a financial asset.
Interests in unconsolidated structured entities
The Group classifies the following investment funds as
unconsolidated structured entities:
– Segregated mandates and pooled funds managed where the
Group does not hold any direct interest. In this case, the Group
considers that its aggregate economic exposure is insignificant
and, in relation to segregated mandates, the third-party investor
has the practical ability to remove the Group from acting as fund
manager, without cause. As a result, the Group concludes that
it acts as an agent for third-party investors.
– Pooled funds managed by the Group where the Group holds a
direct interest, for example seed capital investments, and the
Group’s aggregate economic exposure in the fund relative to
third-party investors is less than the threshold established by the
Group for determining agent versus principal classification. As a
result, the Group concludes that it is an agent for third-party
investors and, therefore, will account for its beneficial interest in
the fund as a financial asset.
The disclosure of the AuM in respect to consolidated and
unconsolidated structured entities is provided in note 27.
Foreign currency
The Group’s financial statements are presented in Pounds Sterling
(Sterling), which is also the Company’s functional and presentation
currency. Items included in the financial statements of each of the
Group’s entities are measured using the functional currency, which
is the currency that prevails in the primary economic environment
in which the entity operates.
4) Significant accounting policies continued
Associates and joint ventures are presented as single-line items in
the statement of comprehensive income and balance sheet.
Intercompany transactions and balances are eliminated on
consolidation. Consistent accounting policies have been applied
across the Group in the preparation of the consolidated financial
statements as at 30 June 2023.
A change in the ownership interest of a consolidated entity that
does not result in a loss of control by the Group is accounted
for as an equity transaction. If the Group loses control over a
consolidated entity, it derecognises the related assets, goodwill,
liabilities, non-controlling interest and other components of equity,
and any gain or loss is recognised in consolidated comprehensive
income. Any investment retained is recognised at its fair value at
the date of loss of control.
Interests in associates and joint arrangements
Associates are partly owned entities over which the Group has
significant influence but no control. Joint ventures are entities
through which the Group and other parties undertake an economic
activity which is subject to joint control.
Investments in associates and interests in joint ventures are
measured using the equity method of accounting. Under this
method, the investments are initially recognised at cost,
including attributable goodwill, and are adjusted thereafter for
the post-acquisition changes in the Group’s share of net assets.
The Group’s share of post-acquisition profit or loss is recognised in
the statement of comprehensive income. Where the Group’s
financial year is not coterminous with those of its associates or
joint ventures, unaudited interim financial information is used after
appropriate adjustments have been made.
Interests in consolidated structured entities
The Group acts as fund manager to investment funds that are
considered to be structured entities. Structured entities are entities
that have been designed so that voting or similar rights are not the
dominant factor in deciding which party has control: for example,
when any voting rights relate to administrative tasks only and
the relevant activities of the entity are directed by means of
contractual arrangements. The Group’s assets under management
are managed within structured entities. These structured
entities typically consist of unitised vehicles such as Société
d’Investissement à Capital Variable (SICAVs), limited partnerships,
unit trusts and open-ended and closed-ended vehicles which
entitle third-party investors to a percentage of the vehicle’s net
asset value.
The Group has interests in structured entities as a result of the
management of assets on behalf of its clients. Where the Group
holds a direct interest in a closed-ended fund, private equity fund or
open-ended pooled fund such as a SICAV, the interest is accounted
for either as a consolidated structured entity or as a financial asset,
depending on whether the Group has control over the fund or not.
Control is determined in accordance with IFRS 10, based on an
assessment of the level of power and aggregate economic interest
that the Group has over the fund, relative to third-party investors.
Power is normally conveyed to the Group through the existence of
an investment management agreement and/or other contractual
134 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
4) Significant accounting policies continued
Associates and joint ventures are presented as single-line items in
the statement of comprehensive income and balance sheet.
Intercompany transactions and balances are eliminated on
consolidation. Consistent accounting policies have been applied
across the Group in the preparation of the consolidated financial
statements as at 30 June 2023.
A change in the ownership interest of a consolidated entity that
does not result in a loss of control by the Group is accounted
for as an equity transaction. If the Group loses control over a
consolidated entity, it derecognises the related assets, goodwill,
liabilities, non-controlling interest and other components of equity,
and any gain or loss is recognised in consolidated comprehensive
income. Any investment retained is recognised at its fair value at
the date of loss of control.
Interests in associates and joint arrangements
arrangements. Aggregate economic interest is a measure of the
Group’s exposure to variable returns in the fund through a combination
of direct interest, expected share of performance fees, expected
management fees, fair value gains or losses, and distributions
receivable from the fund. The Group concludes that it acts as a
principal when the power it has over the fund is deemed to be
exercised for self-benefit, considering the level of aggregate
economic exposure in the fund and the assessed strength of third-
party investors’ kick-out rights. The Group concludes that it acts as
an agent when the power it has over the fund is deemed to be
exercised for the benefit of third-party investors.
If the Group concludes that it acts as a principal, it is deemed to
have control and, therefore, will consolidate a fund as if it were a
subsidiary. If the Group concludes that it does not have control over
the fund, the Group recognises and measures its interest in the
fund as a financial asset.
Associates are partly owned entities over which the Group has
Interests in unconsolidated structured entities
significant influence but no control. Joint ventures are entities
The Group classifies the following investment funds as
through which the Group and other parties undertake an economic
unconsolidated structured entities:
– Segregated mandates and pooled funds managed where the
Group does not hold any direct interest. In this case, the Group
considers that its aggregate economic exposure is insignificant
and, in relation to segregated mandates, the third-party investor
has the practical ability to remove the Group from acting as fund
manager, without cause. As a result, the Group concludes that
it acts as an agent for third-party investors.
– Pooled funds managed by the Group where the Group holds a
direct interest, for example seed capital investments, and the
Group’s aggregate economic exposure in the fund relative to
third-party investors is less than the threshold established by the
Group for determining agent versus principal classification. As a
result, the Group concludes that it is an agent for third-party
investors and, therefore, will account for its beneficial interest in
the fund as a financial asset.
The disclosure of the AuM in respect to consolidated and
unconsolidated structured entities is provided in note 27.
Foreign currency
The Group’s financial statements are presented in Pounds Sterling
(Sterling), which is also the Company’s functional and presentation
currency. Items included in the financial statements of each of the
Group’s entities are measured using the functional currency, which
is the currency that prevails in the primary economic environment
in which the entity operates.
activity which is subject to joint control.
Investments in associates and interests in joint ventures are
measured using the equity method of accounting. Under this
method, the investments are initially recognised at cost,
including attributable goodwill, and are adjusted thereafter for
the post-acquisition changes in the Group’s share of net assets.
The Group’s share of post-acquisition profit or loss is recognised in
the statement of comprehensive income. Where the Group’s
financial year is not coterminous with those of its associates or
joint ventures, unaudited interim financial information is used after
appropriate adjustments have been made.
Interests in consolidated structured entities
The Group acts as fund manager to investment funds that are
considered to be structured entities. Structured entities are entities
that have been designed so that voting or similar rights are not the
dominant factor in deciding which party has control: for example,
when any voting rights relate to administrative tasks only and
the relevant activities of the entity are directed by means of
contractual arrangements. The Group’s assets under management
are managed within structured entities. These structured
entities typically consist of unitised vehicles such as Société
d’Investissement à Capital Variable (SICAVs), limited partnerships,
unit trusts and open-ended and closed-ended vehicles which
entitle third-party investors to a percentage of the vehicle’s net
asset value.
The Group has interests in structured entities as a result of the
management of assets on behalf of its clients. Where the Group
holds a direct interest in a closed-ended fund, private equity fund or
open-ended pooled fund such as a SICAV, the interest is accounted
for either as a consolidated structured entity or as a financial asset,
depending on whether the Group has control over the fund or not.
Control is determined in accordance with IFRS 10, based on an
assessment of the level of power and aggregate economic interest
that the Group has over the fund, relative to third-party investors.
Power is normally conveyed to the Group through the existence of
an investment management agreement and/or other contractual
Acquisition-related costs are expensed as incurred, except if they
are related to the issue of debt or equity securities.
Contingent consideration is classified either as equity or a financial
liability. Amounts classified as a financial liability are subsequently
remeasured to fair value with changes in fair value recognised
in profit or loss. If the contingent consideration is classified as
equity, it will not be remeasured and settlement is accounted
for within equity.
If the business combination is achieved in stages, the acquisition
date carrying value of the acquirer’s previously held equity interest
in the acquiree is remeasured to fair value at the acquisition date.
Any gains or losses arising from such remeasurement are
recognised in profit or loss.
Goodwill
The cost of a business combination in excess of the fair value of
net identifiable assets or liabilities acquired, including intangible
assets identified, is recognised as goodwill and stated at cost less
any accumulated impairment losses. Goodwill has an indefinite
useful life, is not subject to amortisation and is tested annually for
impairment or when there is an indication of impairment.
Intangible assets
The cost of intangible assets, such as management contracts
and brand names, acquired as part of a business combination
is their fair value as at the date of acquisition. The fair value at the
date of acquisition is calculated using the discounted cash flow
methodology and represents the valuation of the profits expected
to be earned from the management contracts and brand name in
place at the date of acquisition.
Following initial recognition, intangible assets are carried at cost
less any accumulated amortisation and impairment losses.
Intangible assets with finite life are amortised on a systematic basis
over their useful lives. The useful life of an intangible asset which
has arisen from contractual or other legal rights does not exceed
the period of the contractual or other legal rights.
Non-controlling interests (NCI)
The Group recognises NCI in an acquired entity either at fair value
or at the NCI’s proportionate share of the acquired entity’s net
identifiable assets. This decision is made on an acquisition-by-
acquisition basis. Changes to the Group’s interest in a subsidiary
that do not result in a loss of control are accounted for as
equity transactions.
Foreign currency transactions
Transactions in foreign currencies are translated into the respective
functional currencies of the Group entities at the spot exchange
rates at the date of the transactions.
Monetary assets and liabilities denominated in foreign currencies
at the balance sheet date are translated into the functional currency
at the spot exchange rate at that date. Non-monetary assets and
liabilities that are measured in terms of historical cost in a foreign
currency are translated using the exchange rate at the date of
the transaction.
Foreign currency differences arising on translation are generally
recognised in comprehensive income, except for qualifying cash
flow hedges to the extent that the hedge is effective, in which case
foreign currency differences arising are recognised in other
comprehensive income.
Foreign operations
The assets and liabilities of foreign operations, including goodwill
and fair value adjustments arising on consolidation, are translated
into Sterling at the spot exchange rates at the balance sheet date.
The revenues and expenses of foreign operations are translated
into Sterling at rates approximating to the foreign exchange rates
ruling at the dates of the transactions.
Foreign currency differences are recognised in other
comprehensive income, and accumulated in the foreign currency
translation reserve, except to the extent that the translation
difference is allocated to non-controlling interests.
When a foreign operation is disposed of such that control is lost,
the cumulative amount in the foreign currency translation reserve
related to that foreign operation is reclassified to comprehensive
income as part of the gain or loss on disposal. If the Group
disposes of only part of its interest in a subsidiary that includes a
foreign operation while retaining control, the relevant proportion of
the cumulative amount is reattributed to non-controlling interests.
If the settlement of a monetary item receivable from or payable to a
foreign operation is neither planned nor likely in the foreseeable
future, foreign currency differences arising on the item form part
of the net investment in the foreign operation and are recognised
in other comprehensive income, and accumulated in the foreign
currency translation reserve within equity.
Business combinations
Business combinations are accounted for using the acquisition
method as at the acquisition date. The acquisition date is the date
on which the acquirer effectively obtains control of the acquiree.
The consideration transferred for the acquisition is generally
measured at the acquisition date fair value, as are the identifiable
net assets acquired, liabilities incurred (including any asset or
liability resulting from a contingent consideration arrangement)
and equity instruments issued by the Group in exchange for control
of the acquiree.
Ashmore Group plc Annual Report and Accounts 2023
135
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
Financial instruments
Recognition and initial measurement
Financial instruments are recognised when the Group becomes
party to the contractual provisions of an instrument, initially at fair
value plus transaction costs except for financial assets classified at
fair value through profit or loss. Purchases or sales of financial
assets are recognised on the trade date, being the date that the
Group commits to purchase or sell the asset.
Financial assets are derecognised when the rights to receive
cash flows from the investments have expired or been transferred
or when the Group has transferred substantially all risks and
rewards of ownership. Financial liabilities are derecognised
when the obligation under the liability has been discharged,
cancelled or expires.
Subsequent measurement
The subsequent measurement of financial instruments depends
on their classification in accordance with IFRS 9 Financial
Instruments.
Under IFRS 9, the Group classifies its financial assets into
two measurement categories: amortised cost and FVTPL.
The classification of financial assets under IFRS 9 is generally
based on the business model in which a financial asset is managed
and its contractual cash flow characteristics. A financial asset is
measured at amortised cost if it meets both of the following
conditions and is not designated as at FVTPL:
– it is held within a business model whose objective is to hold
assets to collect contractual cash flows; and
– its contractual terms give rise on specified dates to cash flows
that are solely payments of principal and interest on the principal
amount outstanding.
All financial assets not classified as measured at amortised cost are
measured at FVTPL. The Group classifies its financial liabilities at
amortised cost or derivative liabilities measured at FVTPL.
Amortised cost is the amount determined based on moving the
initial amount recognised for the financial instrument to the maturity
value on a systematic basis using a fixed interest rate (effective
interest rate), taking account of repayment dates and initial
premiums or discounts.
4) Significant accounting policies continued
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated
depreciation and impairment losses. Cost is determined on the
basis of the direct and indirect costs that are directly attributable.
Property, plant and equipment are depreciated using the straight-
line method over the estimated useful lives, assessed to be
five years for office equipment and four years for IT equipment.
The residual values and useful lives of assets are reviewed at
least annually.
The Group’s property, plant and equipment include right-of use
assets recognised on lease arrangements in accordance with IFRS
16 Leases.
Leases
The Group’s lease arrangements primarily consist of leases relating
to office space. Obligations and rights under lease agreements are
recognised and classified within property, plant and equipment on
the Group’s consolidated statement of financial position in
accordance with IFRS 16.
The Group initially records a lease liability reflecting the present
value of the future contractual cash flows to be made over the
lease term, discounted using the rate implicit in the lease, being the
rate that the lessee would have to pay to borrow the funds
necessary to obtain an asset of similar value to the right-of-use
asset in a similar economic environment with similar terms,
security and conditions. Where this rate is not readily available,
the Group applies the incremental borrowing rate applicable for
each lease arrangement. A right-of-use asset is also recorded at the
value of the lease liability plus any directly related costs and
estimated dilapidation expenses and is presented within property,
plant and equipment. Interest is accrued on the lease liability using
the effective interest rate method to give a constant rate of return
over the life of the lease whilst the balance is reduced as lease
payments are made. The right-of-use asset is depreciated over the
life of the lease as the benefit of the lease is consumed.
After the commencement date, the Group reassesses the lease
term if there is a significant event or change in circumstances that
is within its control and affects the likelihood that it will exercise (or
not exercise) a term extension option.
The cost of short-term (less than 12 months) leases is expensed on
a straight-line basis over the lease term.
Deferred acquisition costs
Costs that are directly attributable to securing an investment
management contract are deferred if they can be identified
separately and measured reliably and it is probable that they will be
recovered. Deferred acquisition costs represent the incremental
costs incurred by the Group to acquire an investment management
contract, typically on a closed-ended fund. The Group amortises the
deferred acquisition asset recognised on a systematic basis, in line
with the revenue generated from providing the investment
management services over the life of the fund.
136 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
4) Significant accounting policies continued
Financial instruments
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated
depreciation and impairment losses. Cost is determined on the
basis of the direct and indirect costs that are directly attributable.
Property, plant and equipment are depreciated using the straight-
line method over the estimated useful lives, assessed to be
five years for office equipment and four years for IT equipment.
The residual values and useful lives of assets are reviewed at
The Group’s property, plant and equipment include right-of use
assets recognised on lease arrangements in accordance with IFRS
least annually.
16 Leases.
Leases
The Group’s lease arrangements primarily consist of leases relating
to office space. Obligations and rights under lease agreements are
recognised and classified within property, plant and equipment on
the Group’s consolidated statement of financial position in
accordance with IFRS 16.
The Group initially records a lease liability reflecting the present
value of the future contractual cash flows to be made over the
lease term, discounted using the rate implicit in the lease, being the
rate that the lessee would have to pay to borrow the funds
necessary to obtain an asset of similar value to the right-of-use
asset in a similar economic environment with similar terms,
security and conditions. Where this rate is not readily available,
the Group applies the incremental borrowing rate applicable for
each lease arrangement. A right-of-use asset is also recorded at the
value of the lease liability plus any directly related costs and
estimated dilapidation expenses and is presented within property,
plant and equipment. Interest is accrued on the lease liability using
the effective interest rate method to give a constant rate of return
over the life of the lease whilst the balance is reduced as lease
Recognition and initial measurement
Financial instruments are recognised when the Group becomes
party to the contractual provisions of an instrument, initially at fair
value plus transaction costs except for financial assets classified at
fair value through profit or loss. Purchases or sales of financial
assets are recognised on the trade date, being the date that the
Group commits to purchase or sell the asset.
Financial assets are derecognised when the rights to receive
cash flows from the investments have expired or been transferred
or when the Group has transferred substantially all risks and
rewards of ownership. Financial liabilities are derecognised
when the obligation under the liability has been discharged,
cancelled or expires.
Subsequent measurement
The subsequent measurement of financial instruments depends
on their classification in accordance with IFRS 9 Financial
Instruments.
Under IFRS 9, the Group classifies its financial assets into
two measurement categories: amortised cost and FVTPL.
The classification of financial assets under IFRS 9 is generally
based on the business model in which a financial asset is managed
and its contractual cash flow characteristics. A financial asset is
measured at amortised cost if it meets both of the following
conditions and is not designated as at FVTPL:
– it is held within a business model whose objective is to hold
assets to collect contractual cash flows; and
– its contractual terms give rise on specified dates to cash flows
that are solely payments of principal and interest on the principal
amount outstanding.
All financial assets not classified as measured at amortised cost are
measured at FVTPL. The Group classifies its financial liabilities at
payments are made. The right-of-use asset is depreciated over the
amortised cost or derivative liabilities measured at FVTPL.
life of the lease as the benefit of the lease is consumed.
After the commencement date, the Group reassesses the lease
term if there is a significant event or change in circumstances that
Amortised cost is the amount determined based on moving the
initial amount recognised for the financial instrument to the maturity
value on a systematic basis using a fixed interest rate (effective
is within its control and affects the likelihood that it will exercise (or
interest rate), taking account of repayment dates and initial
not exercise) a term extension option.
premiums or discounts.
The cost of short-term (less than 12 months) leases is expensed on
a straight-line basis over the lease term.
Deferred acquisition costs
Costs that are directly attributable to securing an investment
management contract are deferred if they can be identified
separately and measured reliably and it is probable that they will be
recovered. Deferred acquisition costs represent the incremental
costs incurred by the Group to acquire an investment management
contract, typically on a closed-ended fund. The Group amortises the
deferred acquisition asset recognised on a systematic basis, in line
with the revenue generated from providing the investment
management services over the life of the fund.
Financial assets
The Group classifies its financial assets into the following
categories: investment securities at FVTPL, financial assets at
FVTPL and financial assets measured at amortised cost.
The Group may, from time to time, invest seed capital in funds
where a subsidiary is the investment manager or an adviser.
Where the holding in such investments is deemed to represent
a controlling stake and is acquired exclusively with a view to
subsequent disposal through sale or dilution, these seed capital
investments are recognised as financial assets measured at FVTPL.
If a seed capital investment remains under the control of the Group
for more than one year from the original investment date, the
underlying fund is consolidated line by line.
Investment securities at FVTPL
Investment securities represent securities, other than derivatives,
held by consolidated funds. These securities are measured at fair
value with gains and losses recognised through the consolidated
statement of comprehensive income.
Financial assets at FVTPL
Financial assets at FVTPL include certain readily realisable interests
in seeded funds, non-current financial assets measured at fair value
and derivatives. From the date the financial asset is recognised,
all subsequent changes in fair value, foreign exchange differences,
interest and dividends are reflected in the consolidated statement
of comprehensive income and presented in finance income
or expense.
(i) Non-current financial assets measured at fair value
Non-current financial assets include closed-end funds that are
measured at FVTPL. They are held at fair value with changes in fair
value being recognised through the consolidated statement of
comprehensive income.
(ii) Current financial assets measured at fair value
The Group classifies readily realisable interests in seeded funds as
current financial assets measured at FVTPL with fair value changes
being directly recognised through the consolidated statement of
comprehensive income. Fair value is measured based on the
proportionate net asset value in the fund.
(iii) Derivatives
Derivatives include foreign exchange forward contracts and options
used by the Group to manage its foreign currency exposures and
those held in consolidated funds. Derivatives are initially recognised
at fair value on the date on which a derivative contract is entered
into and subsequently remeasured at fair value. Transaction costs
are recognised immediately in the statement of comprehensive
income. All derivatives are carried as financial assets when the
fair value is positive and as financial liabilities when the fair value
is negative.
Any gains or losses arising from changes in the fair value of
derivatives are taken directly in comprehensive income, except for
the effective portion of cash flow hedges, which is recognised in
other comprehensive income.
Financial assets measured at amortised cost
(i) Trade and other receivables
Trade and other receivables are initially recorded at fair value plus
transaction costs. The fair value on acquisition is normally the cost.
Subsequent to initial recognition these assets are measured at
amortised cost less impairment loss allowances. Impairment losses
are recognised in the statement of comprehensive income for
expected credit losses, and changes in those expected credit
losses over the life of the instrument. Loss allowances are
calculated based on lifetime expected credit losses at each
reporting date.
(ii) Cash and cash equivalents
Cash represents cash at bank and in hand, and cash equivalents
comprise short-term deposits and investments in money market
instruments that are redeemable on demand or with an original
maturity of three months or less. The carrying amount of these
assets approximates their fair value.
Ashmore Group plc Annual Report and Accounts 2023
137
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
4) Significant accounting policies continued
Financial liabilities
The Group classifies its financial liabilities into the following
categories: financial liabilities at FVTPL and financial liabilities at
amortised cost.
Financial liabilities at FVTPL
Financial liabilities at FVTPL include derivative financial instruments
and third-party interests in consolidated funds. They are carried at
fair value with gains or losses recognised in the consolidated
statement of comprehensive income within finance income
or expense.
Financial liabilities at amortised cost
Other financial liabilities including trade and other payables are
subsequently measured at amortised cost using the effective
interest rate method. Interest expense is recognised as it is
incurred using the effective interest method, which allocates
interest at a constant rate of return over the expected life of the
financial instrument based on the estimated future cash flows.
Fair value of financial instruments
Fair value is defined as the price that would be received to sell an
asset or paid to transfer a liability (i.e. the ‘exit price’) in an orderly
transaction between market participants at the measurement date.
In determining fair value, the Group uses various valuation
approaches and establishes a hierarchy for inputs used in
measuring fair value that maximises the use of relevant observable
inputs and minimises the use of unobservable inputs by requiring
that the most observable inputs be used when available.
Observable inputs are inputs that market participants would use in
pricing the asset or liability developed based on market data
obtained from sources independent of the Group.
Unobservable inputs are inputs that reflect the Group’s judgements
about the assumptions other market participants would use in
pricing the asset or liability, developed based on the best
information available in the circumstances.
Securities listed on a recognised stock exchange, or dealt on any
other regulated market that operates regularly, is recognised and
open to the public, are valued at the last known available closing bid
price. If a security is traded on several actively traded and organised
financial markets, the valuation is made on the basis of the last
known bid price on the main market on which the securities are
traded. In the case of securities for which trading on an actively
traded and organised financial market is not significant, but which
are bought and sold on a secondary market with regulated trading
among security dealers (with the effect that the price is set on a
market basis), the valuation may be based on this secondary market.
Where instruments are not listed on any stock exchange or not
traded on any regulated markets, valuation techniques are used
by valuation specialists. These techniques include the market
approach, the income approach or the cost approach. The use of
the market approach generally consists of using comparable market
transactions or using techniques based on market observable
inputs, while the use of the income approach generally consists
of the net present value of estimated future cash flows, adjusted
as deemed appropriate for liquidity, credit, market and/or other
risk factors.
Investments in funds are valued on the basis of the last available
net asset value of the units or shares of such funds.
The fair value of the derivatives is their quoted market price at the
balance sheet date.
Hedge accounting
The Group applies the general hedge accounting model in IFRS 9.
This requires the Group to ensure that hedge accounting
relationships are aligned with its risk management objectives and
strategy and to apply a more qualitative and forward-looking
approach to assessing hedge effectiveness.
The Group uses forward and option contracts to hedge the
variability in cash flows arising from changes in foreign exchange
rates relating to management fee revenues. The Group designates
only the change in fair value of the spot element of the forward and
option contracts in cash flow hedging relationships. The effective
portion of changes in fair value of hedging instruments is
accumulated in a cash flow hedge reserve as a separate
component of equity.
The Group applies cash flow hedge accounting when the
transaction meets the specified hedge accounting criteria.
To qualify, the following conditions must be met:
– formal documentation of the relationship between the hedging
instrument(s) and hedged item(s) must exist at inception;
– the hedged cash flows must be highly probable and must
present an exposure to variations in cash flows that could
ultimately affect comprehensive income;
– the effectiveness of the hedge can be reliably measured; and
– the hedge must be highly effective, with effectiveness assessed
on an ongoing basis.
For qualifying cash flow hedges, the change in fair value of the
effective hedging instrument is initially recognised in other
comprehensive income and is released to comprehensive income
in the same period during which the relevant financial asset or
liability affects the Group’s results.
Where the hedge is highly effective overall, any ineffective portion
of the hedge is immediately recognised in comprehensive income.
Where the instrument ceases to be highly effective as a hedge, or
is sold, terminated or exercised, hedge accounting is discontinued.
138 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
4) Significant accounting policies continued
Financial liabilities
The Group classifies its financial liabilities into the following
categories: financial liabilities at FVTPL and financial liabilities at
amortised cost.
Financial liabilities at FVTPL
Financial liabilities at FVTPL include derivative financial instruments
and third-party interests in consolidated funds. They are carried at
fair value with gains or losses recognised in the consolidated
statement of comprehensive income within finance income
or expense.
Financial liabilities at amortised cost
Other financial liabilities including trade and other payables are
subsequently measured at amortised cost using the effective
interest rate method. Interest expense is recognised as it is
incurred using the effective interest method, which allocates
interest at a constant rate of return over the expected life of the
financial instrument based on the estimated future cash flows.
Fair value of financial instruments
Fair value is defined as the price that would be received to sell an
asset or paid to transfer a liability (i.e. the ‘exit price’) in an orderly
transaction between market participants at the measurement date.
In determining fair value, the Group uses various valuation
approaches and establishes a hierarchy for inputs used in
measuring fair value that maximises the use of relevant observable
inputs and minimises the use of unobservable inputs by requiring
that the most observable inputs be used when available.
Observable inputs are inputs that market participants would use in
pricing the asset or liability developed based on market data
obtained from sources independent of the Group.
Unobservable inputs are inputs that reflect the Group’s judgements
about the assumptions other market participants would use in
pricing the asset or liability, developed based on the best
information available in the circumstances.
Securities listed on a recognised stock exchange, or dealt on any
other regulated market that operates regularly, is recognised and
open to the public, are valued at the last known available closing bid
price. If a security is traded on several actively traded and organised
financial markets, the valuation is made on the basis of the last
known bid price on the main market on which the securities are
traded. In the case of securities for which trading on an actively
traded and organised financial market is not significant, but which
are bought and sold on a secondary market with regulated trading
among security dealers (with the effect that the price is set on a
market basis), the valuation may be based on this secondary market.
Where instruments are not listed on any stock exchange or not
traded on any regulated markets, valuation techniques are used
by valuation specialists. These techniques include the market
approach, the income approach or the cost approach. The use of
the market approach generally consists of using comparable market
transactions or using techniques based on market observable
inputs, while the use of the income approach generally consists
of the net present value of estimated future cash flows, adjusted
as deemed appropriate for liquidity, credit, market and/or other
risk factors.
Investments in funds are valued on the basis of the last available
net asset value of the units or shares of such funds.
The fair value of the derivatives is their quoted market price at the
balance sheet date.
Hedge accounting
The Group applies the general hedge accounting model in IFRS 9.
This requires the Group to ensure that hedge accounting
relationships are aligned with its risk management objectives and
strategy and to apply a more qualitative and forward-looking
approach to assessing hedge effectiveness.
The Group uses forward and option contracts to hedge the
variability in cash flows arising from changes in foreign exchange
rates relating to management fee revenues. The Group designates
only the change in fair value of the spot element of the forward and
option contracts in cash flow hedging relationships. The effective
portion of changes in fair value of hedging instruments is
accumulated in a cash flow hedge reserve as a separate
component of equity.
The Group applies cash flow hedge accounting when the
transaction meets the specified hedge accounting criteria.
To qualify, the following conditions must be met:
– formal documentation of the relationship between the hedging
instrument(s) and hedged item(s) must exist at inception;
– the hedged cash flows must be highly probable and must
present an exposure to variations in cash flows that could
ultimately affect comprehensive income;
– the effectiveness of the hedge can be reliably measured; and
– the hedge must be highly effective, with effectiveness assessed
on an ongoing basis.
For qualifying cash flow hedges, the change in fair value of the
effective hedging instrument is initially recognised in other
comprehensive income and is released to comprehensive income
in the same period during which the relevant financial asset or
liability affects the Group’s results.
Where the hedge is highly effective overall, any ineffective portion
of the hedge is immediately recognised in comprehensive income.
Where the instrument ceases to be highly effective as a hedge, or
is sold, terminated or exercised, hedge accounting is discontinued.
Derecognition of financial assets and liabilities
The Group derecognises a financial asset only when the contractual
rights to the cash flows from the asset expire, or when it transfers
the financial asset and substantially all the risk and rewards of
ownership of the asset. The Group derecognises a financial
liability when the Group’s obligations are discharged, cancelled or
they expire.
Impairment of financial assets
Under IFRS 9, impairment losses on the Group’s financial assets at
amortised cost are measured using an expected credit loss (ECL)
model. Under this model, the Group is required to account for
expected credit losses, and changes in those expected credit
losses, over the life of the instrument. The amount of expected
credit losses is updated at each reporting date to reflect changes in
credit risk since initial recognition and, consequently, more timely
information is provided about expected credit losses.
The Group applies the simplified approach to calculate expected
credit losses for financial assets measured at amortised cost.
Under this approach, expected credit losses are calculated based
on the life of the instrument.
Assets measured at amortised cost
The Group measures loss allowances at an amount equal to
lifetime expected credit losses. Expected credit loss allowances
for financial assets measured at amortised cost are deducted from
the gross carrying amount of the assets. The Group’s financial
assets subject to impairment assessment under the ECL model
comprise cash deposits held with banks and trade receivables.
In assessing the impairment of financial assets under the
ECL model, the Group assesses whether the risk of default has
increased significantly since initial recognition, by considering
both quantitative and qualitative information, and the analysis is
based on the Group’s historical experience of credit default,
including forward-looking information.
The Group’s trade receivables comprise balances due from
management fees, performance fees and expense recoveries from
funds managed, and are generally short term and do not contain
financing components. Factors considered in determining whether
a default has taken place include how many days past the due date
a payment is, deterioration in the credit quality of a counterparty,
and knowledge of specific events that could influence a
counterparty’s ability to pay.
The Group assesses lifetime expected credit losses based on
historical observed default rates, adjusted by forward-looking
estimates regarding the economic conditions within the next year.
Externally derived credit ratings have been identified as
representing the best available determinant of counterparty credit
risk for cash balances and credit risk is deemed to have increased
significantly if the credit rating has significantly deteriorated at the
reporting date relative to the credit rating at the date of
initial recognition.
Impairment of non-financial assets
For all other assets other than goodwill, an impairment test
is performed annually or whenever events or changes in
circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by
which the asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less
costs of disposal and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which
there are separately identifiable cash inflows which are largely
independent of the cash inflows from other assets or groups
of assets (cash-generating units). Non-financial assets, other
than goodwill, that have suffered an impairment are reviewed
for possible reversal of the impairment at the end of each
reporting period.
Goodwill
Goodwill is tested for impairment annually or whenever there is an
indication that the carrying amount may not be recoverable based
on management’s judgements regarding the future prospects of
the business, estimates of future cash flows and discount rates.
When assessing the appropriateness of the carrying value of
goodwill at year end, the recoverable amount is considered
to be the greater of fair value less costs to sell or value in use.
The pre-tax discount rate applied is based on the Group’s weighted
average cost of capital after making allowances for any specific risks.
The business of the Group is managed as a single unit, with asset
allocations, research and other such operational practices reflecting
the commonality of approach across all fund themes. Therefore,
for the purpose of testing goodwill for impairment, the Group is
considered to have one cash-generating unit to which all goodwill
is allocated and, as a result, no further split of goodwill into smaller
cash-generating units is possible and the impairment review is
conducted for the Group as a whole.
An impairment loss in respect of goodwill cannot be reversed.
Ashmore Group plc Annual Report and Accounts 2023
139
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
4) Significant accounting policies continued
Net revenue
Net revenue is total revenue less distribution costs and including
foreign exchange. The Group’s total revenue includes management
fees, performance fees and other revenue. The primary revenue
source for the Group is fee income received or receivable for the
provision of investment management services.
The Group recognises revenue in accordance with the principles of
IFRS 15 Revenue from Contracts with Customers.
The core principle of IFRS 15 is that revenue is recognised to
reflect the transfer of promised goods or services to customers in
an amount that reflects the consideration to which the entity
expects to be entitled in exchange for those goods or services. The
Group applies the IFRS 15 five-step model for recognising revenue,
which consists of identifying the contract with the customer;
identifying the relevant performance obligations; determining the
amount of consideration to be received under the contract;
allocating the consideration to each performance obligation; and
earning the revenue as the performance obligations are satisfied.
The Group’s principal revenue recognition policies are
summarised below:
Management fees
Management fees are presented net of rebates, and are calculated
as a percentage of net fund assets managed in accordance with
individual management agreements. Management fees are
calculated and recognised on a monthly basis in accordance with
the terms of the management fee agreements. Management fees
are typically collected on a monthly or quarterly basis.
Performance fees
Performance fees are presented net of rebates, and are calculated
as a percentage of the appreciation in the net asset value of a fund
above a defined hurdle. Performance fees are earned from some
arrangements when contractually agreed performance levels are
exceeded within specified performance measurement periods,
typically over one year. The fees are recognised when they can
be reliably estimated and/or crystallised, and there is deemed
to be a low probability of a significant reversal in future periods.
This is usually at the end of the performance period or upon early
redemption by a fund investor. Once crystallised, performance fees
typically cannot be clawed-back.
Rebates
Rebates relate to repayments of management and performance
fees charged subject to a rebate agreement, typically with
institutional investors, and are calculated based on an agreed
percentage of net fund assets managed and recognised as the
service is received. Where rebate agreements exist, management
and performance fees are presented on a net basis in the
consolidated statement of comprehensive income.
Other revenue
Other revenue principally comprises fees for other services,
which are typically driven by the volume of transactions, along with
revenues that vary in accordance with the volume of fund project
development activities.
140 Ashmore Group plc Annual Report and Accounts 2023
Other revenue includes transaction, structuring and administration
fees, project management fees, and reimbursement by funds of
costs incurred by the Group. This revenue is recognised as the
relevant service is provided and it is probable that the fee will be
collected.
Distribution costs
Distribution costs are costs of sales payable to external
intermediaries for marketing and investor servicing. Distribution
costs vary based on fund assets managed and the associated
management fee revenue, and are expensed over the period in
which the service is provided.
Employee benefits
Obligations for contributions to defined contribution pension plans
are recognised as an expense in the statement of comprehensive
income when payable in accordance with the scheme particulars.
Share-based payments
The Group issues share awards to its employees under share-based
compensation plans.
For equity-settled awards, the fair value of the amounts payable to
employees is recognised as an expense with a corresponding
increase in equity over the vesting period after adjusting for the
estimated number of shares that are expected to vest. The fair
value is measured at the grant date using an appropriate valuation
model, taking into account the terms and conditions upon which
the instruments were granted. At each balance sheet date prior to
vesting, the cumulative expense representing the extent to which
the vesting period has expired and management’s best estimate of
the awards that are ultimately expected to vest is calculated. The
movement in cumulative expense is recognised in the statement of
comprehensive income with a corresponding entry within equity.
For cash-settled awards, the fair value of the amounts payable to
employees is recognised as an expense with a corresponding
liability on the Group’s balance sheet. The fair value is measured
using an appropriate valuation model, taking into account the
estimated number of awards that are expected to vest and the
terms and conditions upon which the instruments were granted.
During the vesting period, the liability recognised represents the
portion of the vesting period that has expired at the balance sheet
date multiplied by the fair value of the awards at that date.
Movements in the liability are recognised in the statement of
comprehensive income.
The Group has in place an intragroup recharge arrangement for
equity-settled share-based awards whereby the parent Company is
reimbursed based on the grant-date cost of share awards granted
to employees of the subsidiary entity. During the vest period, the
subsidiary entity recognises a share-based payment expense in
accordance with IFRS 2 requirements with an intercompany
payable to the parent Company. The parent Company recognises
an intercompany receivable and a corresponding credit within
equity as a share-based payment reserve. The intercompany
balances are settled regularly and reported as current
assets/liabilities.
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
The Group recognises revenue in accordance with the principles of
intermediaries for marketing and investor servicing. Distribution
4) Significant accounting policies continued
Net revenue
Net revenue is total revenue less distribution costs and including
foreign exchange. The Group’s total revenue includes management
fees, performance fees and other revenue. The primary revenue
source for the Group is fee income received or receivable for the
provision of investment management services.
IFRS 15 Revenue from Contracts with Customers.
The core principle of IFRS 15 is that revenue is recognised to
reflect the transfer of promised goods or services to customers in
an amount that reflects the consideration to which the entity
expects to be entitled in exchange for those goods or services. The
Group applies the IFRS 15 five-step model for recognising revenue,
which consists of identifying the contract with the customer;
identifying the relevant performance obligations; determining the
amount of consideration to be received under the contract;
allocating the consideration to each performance obligation; and
earning the revenue as the performance obligations are satisfied.
The Group’s principal revenue recognition policies are
summarised below:
Management fees
Management fees are presented net of rebates, and are calculated
as a percentage of net fund assets managed in accordance with
individual management agreements. Management fees are
calculated and recognised on a monthly basis in accordance with
the terms of the management fee agreements. Management fees
are typically collected on a monthly or quarterly basis.
Performance fees
Performance fees are presented net of rebates, and are calculated
as a percentage of the appreciation in the net asset value of a fund
above a defined hurdle. Performance fees are earned from some
arrangements when contractually agreed performance levels are
exceeded within specified performance measurement periods,
typically over one year. The fees are recognised when they can
be reliably estimated and/or crystallised, and there is deemed
to be a low probability of a significant reversal in future periods.
This is usually at the end of the performance period or upon early
typically cannot be clawed-back.
Rebates
Rebates relate to repayments of management and performance
fees charged subject to a rebate agreement, typically with
institutional investors, and are calculated based on an agreed
percentage of net fund assets managed and recognised as the
service is received. Where rebate agreements exist, management
and performance fees are presented on a net basis in the
consolidated statement of comprehensive income.
Other revenue includes transaction, structuring and administration
fees, project management fees, and reimbursement by funds of
costs incurred by the Group. This revenue is recognised as the
relevant service is provided and it is probable that the fee will be
collected.
Distribution costs
Distribution costs are costs of sales payable to external
costs vary based on fund assets managed and the associated
management fee revenue, and are expensed over the period in
which the service is provided.
Employee benefits
Obligations for contributions to defined contribution pension plans
are recognised as an expense in the statement of comprehensive
income when payable in accordance with the scheme particulars.
Share-based payments
compensation plans.
The Group issues share awards to its employees under share-based
For equity-settled awards, the fair value of the amounts payable to
employees is recognised as an expense with a corresponding
increase in equity over the vesting period after adjusting for the
estimated number of shares that are expected to vest. The fair
value is measured at the grant date using an appropriate valuation
model, taking into account the terms and conditions upon which
the instruments were granted. At each balance sheet date prior to
vesting, the cumulative expense representing the extent to which
the vesting period has expired and management’s best estimate of
the awards that are ultimately expected to vest is calculated. The
movement in cumulative expense is recognised in the statement of
comprehensive income with a corresponding entry within equity.
For cash-settled awards, the fair value of the amounts payable to
employees is recognised as an expense with a corresponding
liability on the Group’s balance sheet. The fair value is measured
using an appropriate valuation model, taking into account the
estimated number of awards that are expected to vest and the
terms and conditions upon which the instruments were granted.
During the vesting period, the liability recognised represents the
portion of the vesting period that has expired at the balance sheet
Movements in the liability are recognised in the statement of
comprehensive income.
The Group has in place an intragroup recharge arrangement for
equity-settled share-based awards whereby the parent Company is
reimbursed based on the grant-date cost of share awards granted
to employees of the subsidiary entity. During the vest period, the
subsidiary entity recognises a share-based payment expense in
accordance with IFRS 2 requirements with an intercompany
payable to the parent Company. The parent Company recognises
an intercompany receivable and a corresponding credit within
equity as a share-based payment reserve. The intercompany
balances are settled regularly and reported as current
redemption by a fund investor. Once crystallised, performance fees
date multiplied by the fair value of the awards at that date.
Other revenue
Other revenue principally comprises fees for other services,
which are typically driven by the volume of transactions, along with
revenues that vary in accordance with the volume of fund project
assets/liabilities.
development activities.
Dividends
Dividends are recognised when shareholders’ rights to receive
payments have been established.
Equity shares
The Company’s ordinary shares of 0.01 pence each are classified as
equity instruments. Ordinary shares issued by the Company are
recorded at the fair value of the consideration received or the
market price at the day of issue. Direct issue costs, net of tax, are
deducted from equity through share premium. When share capital
is repurchased, the amount of consideration paid, including directly
attributable costs, is recognised as a change in equity.
Own shares
Own shares are held by the Employee Benefit Trust (EBT).
The holding of the EBT comprises own shares that have not
vested unconditionally to employees of the Group. In both the
Group and Company, own shares are recorded at cost and are
deducted from retained earnings.
Segmental information
Key management information, including revenues, margins,
investment performance, distribution costs and AuM flows, which
is relevant to the operation of the Group, is reported to and
reviewed by the Board on the basis of the investment management
business as a whole. Hence, the Group’s management considers
that the Group’s services and its operations are not run on a
discrete geographic basis and comprise one business segment
(being provision of investment management services).
Company-only accounting policies
In addition to the above accounting policies, the following
specifically relates to the Company:
Investment in subsidiaries
Investments by the Company in subsidiaries are stated at cost less,
where appropriate, provisions for impairment.
Finance income and expense
Finance income includes interest receivable on the Group’s cash
and cash equivalents, and both realised and unrealised gains on
financial assets at FVTPL.
Finance expense includes both realised and unrealised losses on
financial assets at FVTPL. Interest expense on lease liabilities is
presented within finance expense.
Taxation
Tax expense for the year comprises current and deferred tax.
Tax is recognised in the consolidated statement of comprehensive
income except to the extent that it relates to items recognised
directly in equity, in which case it is recognised in equity.
Current tax
Current tax comprises the expected tax payable or receivable on
the taxable income or loss for the year, and any adjustment to the
tax payable or receivable in respect of previous years. It is
measured using tax rates enacted or substantively enacted at the
balance sheet date in the countries where the Group operates.
Current tax also includes withholding tax arising from dividends.
Deferred tax
Deferred tax is recognised using the balance sheet liability method,
in respect of temporary differences between the carrying amounts
of assets and liabilities for financial reporting purposes and the
amounts used for taxation purposes. The following differences are
not provided for:
– goodwill not deductible for tax purposes; and
– differences relating to investments in subsidiaries to the extent
that they will probably not reverse in the foreseeable future.
The amount of deferred tax provided is based on the expected
manner of realisation or settlement of the carrying amount of
assets and liabilities, using tax rates enacted or substantively
enacted at the reporting date.
Deferred tax assets are recognised only to the extent that it is
probable that future taxable profits will be available against which
the assets can be utilised. Deferred tax assets are reviewed at each
reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realised.
Deferred tax is measured at the tax rates that are expected to be
applied to temporary differences when they reverse, using tax rates
enacted or substantively enacted at the balance sheet date.
Ashmore Group plc Annual Report and Accounts 2023
141
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
5) Segmental information
The Group’s operations are reported to and reviewed by the Board on the basis of the investment management business as a whole,
hence the Group is treated as a single segment. The key management information considered is adjusted EBITDA which is £106.2 million
for the year as reconciled on page 28 (FY2022: adjusted EBITDA of £164.3 million was derived by adjusting operating profit by £3.1 million
of depreciation and amortisation expense, £46.2 million of loss related to seed capital and £4.2 million of foreign exchange gains).
The disclosures below are supplementary, and provide the location of the Group’s non-current assets at year end other than financial assets
and deferred tax assets. Disclosures relating to revenue by location are in note 6.
Analysis of non-current assets by geography
United Kingdom and Ireland
United States
Other
Total non-current assets
2023
£m
24.3
69.8
1.9
96.0
2022
£m
26.5
73.5
2.5
102.5
6) Revenue
Management fees are accrued throughout the year in line with prevailing levels of AuM and performance fees are recognised when they
can be estimated reliably and it is probable that they will crystallise. The Group is not considered to be reliant on any single source of
revenue. During the year, none of the Group’s funds (FY2022: none) provided more than 10% of total revenue in the year respectively when
considering management fees and performance fees on a combined basis.
Analysis of revenue by geography
United Kingdom and Ireland
United States
Other
Total revenue
2023
£m
142.3
13.7
37.2
193.2
2022
£m
193.6
22.0
38.8
254.4
7) Foreign exchange
The foreign exchange rates which had a material impact on the Group’s results are the US dollar, the Euro, the Indonesian rupiah and the
Colombian peso.
£1
US dollar
Euro
Indonesian rupiah
Colombian peso
Foreign exchange gains are shown below.
Net realised and unrealised hedging gains
Translation gains on non-Sterling denominated monetary assets and liabilities
Total foreign exchange gains
Closing rate
as at 30 June
2023
Closing rate
as at 30 June
2022
Average rate
year ended
30 June
2023
Average rate
year ended
30 June
2022
1.2714
1.2145
1.2079
1.3289
1.1653
1.1617
1.1523
1.1785
19,061
5,309
18,092
5,053
18,259
5,519
19,146
5,164
2023
£m
4.4
1.0
5.4
2022
£m
6.3
5.3
11.6
142 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
2023
£m
24.3
69.8
1.9
96.0
2022
£m
26.5
73.5
2.5
102.5
2023
£m
142.3
13.7
37.2
193.2
2022
£m
193.6
22.0
38.8
254.4
United Kingdom and Ireland
United States
Other
Total non-current assets
6) Revenue
United Kingdom and Ireland
United States
Other
Total revenue
7) Foreign exchange
Colombian peso.
£1
US dollar
Euro
Indonesian rupiah
Colombian peso
Management fees are accrued throughout the year in line with prevailing levels of AuM and performance fees are recognised when they
can be estimated reliably and it is probable that they will crystallise. The Group is not considered to be reliant on any single source of
revenue. During the year, none of the Group’s funds (FY2022: none) provided more than 10% of total revenue in the year respectively when
considering management fees and performance fees on a combined basis.
Analysis of revenue by geography
The foreign exchange rates which had a material impact on the Group’s results are the US dollar, the Euro, the Indonesian rupiah and the
Foreign exchange gains are shown below.
Net realised and unrealised hedging gains
Translation gains on non-Sterling denominated monetary assets and liabilities
Total foreign exchange gains
Closing rate
as at 30 June
2023
Closing rate
as at 30 June
2022
1.2714
1.2145
Average rate
year ended
Average rate
year ended
30 June
2023
1.2079
30 June
2022
1.3289
1.1653
1.1617
1.1523
1.1785
19,061
5,309
18,092
5,053
18,259
5,519
19,146
5,164
2023
£m
4.4
1.0
5.4
2022
£m
6.3
5.3
11.6
5) Segmental information
8) Finance income/(expense)
The Group’s operations are reported to and reviewed by the Board on the basis of the investment management business as a whole,
hence the Group is treated as a single segment. The key management information considered is adjusted EBITDA which is £106.2 million
for the year as reconciled on page 28 (FY2022: adjusted EBITDA of £164.3 million was derived by adjusting operating profit by £3.1 million
of depreciation and amortisation expense, £46.2 million of loss related to seed capital and £4.2 million of foreign exchange gains).
Interest and investment income
Net realised gains on seed capital investments measured at fair value
The disclosures below are supplementary, and provide the location of the Group’s non-current assets at year end other than financial assets
Net unrealised gains/(losses) on seed capital investments measured at fair value
and deferred tax assets. Disclosures relating to revenue by location are in note 6.
Analysis of non-current assets by geography
Interest expense on lease liabilities (note 16)
Total finance income/(expense)
2023
£m
27.2
2.4
4.6
(0.3)
33.9
2022
£m
7.7
0.1
(9.5)
(0.4)
(2.1)
Included within interest and investment income is interest earned on cash deposits of £16.2 million (FY2022: £2.0 million) and investment
income of £11.0 million (FY2022: £5.7 million) on consolidated funds (note 20c).
Included within net realised and unrealised gains on seed capital investments totalling £7.0 million (FY2022: £9.4 million losses) are £2.6
million gains (FY2022: £12.5 million losses) on financial assets measured at FVTPL (note 20a), £1.4 million gains (FY2022: £4.2 million gains)
on non-current financial assets measured at fair value (note 20b) and £3.0m realised gains on consolidated funds (FY2022: £1.1 million
losses on financial assets held for sale).
9) Personnel expenses
Personnel expenses during the year comprised the following:
Wages and salaries
Performance-related cash bonuses
Share-based payments (note 10)
Social security costs
Pension costs
Other costs
Total personnel expenses
2023
£m
24.0
17.3
17.5
2.4
2.1
2.9
2022
£m
22.1
20.7
24.9
1.9
1.8
2.0
66.2
73.4
Number of employees
At 30 June 2023, the number of investment management employees of the Group (including Executive Directors) during the year was
as follows:
Average for
the year
ended
30 June 2023
Number
Average for
the year
ended
30 June 2022
Number
At
30 June 2023
Number
At
30 June 2022
Number
Total investment management employees
309
305
310
309
Directors’ remuneration
Disclosures of Directors’ remuneration during the year as required by the Companies Act 2006 are included in the Remuneration report
on pages 78 to 111.
There are retirement benefits accruing to two Executive Directors under a defined contribution scheme (FY2022: two).
10) Share-based payments
The cost related to share-based payments recognised by the Group in the statement of comprehensive income is shown below:
Group
Omnibus Plan
Phantom Bonus Plan
Total share-based payments expense
2023
£m
17.4
0.1
17.5
2022
£m
25.1
(0.2)
24.9
The total expense recognised for the year in respect of equity-settled share-based payment awards was £18.5 million (FY2022:
£24.5 million), of which £0.4 million (FY2022: £0.2 million) relates to share awards granted to key management personnel.
Ashmore Group plc Annual Report and Accounts 2023
143
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
10) Share-based payments continued
The Executive Omnibus Incentive Plan (Omnibus Plan)
The Omnibus Plan was introduced prior to the Company listing in October 2006 and provides for the grant of share awards, market value
options, premium cost options, discounted options, linked options, phantoms and/or nil-cost options to employees. The Omnibus Plan will
also allow bonuses to be deferred in the form of share awards with or without matching shares. Awards granted under the Omnibus Plan
typically vest after five years from date of grant, with the exception of bonus awards which vest after the shorter of five years from date of
grant or on the date of termination of employment. Awards under the Omnibus Plan are accounted for as equity-settled, with the exception
of phantoms which are classified as cash-settled.
The combined cash and equity-settled payments below represent the share-based payments relating to the Omnibus Plan.
Total expense by year awards were granted (excluding national insurance)
Group and Company
Year of grant
2017
2018
2019
2020
2021
2022
2023
2023
£m
–
3.0
3.7
3.5
3.9
3.3
1.2
2022
£m
3.2
2.9
3.5
3.5
5.5
5.7
–
Total Omnibus share-based payments expense reported in comprehensive income
18.6
24.3
Awards outstanding under the Omnibus Plan were as follows:
i) Equity-settled awards
Group and Company
Restricted share awards
At the beginning of the year
Granted
Vested
Forfeited
Awards outstanding at year end
Bonus share awards
At the beginning of the year
Granted
Vested
Forfeited
2023
Number of
shares subject
to awards
2023
Weighted
average
share price
2022
Number of
shares subject
to awards
2022
Weighted
average
share price
19,311,495
£3.65 19,997,393
5,553,128
£2.14
4,423,544
(4,671,286)
(1,160,520)
£3.25
(3,874,613)
£2.17
(1,234,829)
19,032,817
£3.32 19,311,495
10,997,593
£3.64 10,617,648
3,014,720
£2.14
2,285,034
(3,686,132)
£2.87
(1,905,089)
(179,660)
£3.67
–
£3.58
£3.71
£3.44
£3.44
£3.65
£3.58
£3.75
£3.44
–
Awards outstanding at year end
10,146,521
£3.31 10,997,593
£3.64
Matching share awards
At the beginning of the year
Granted
Vested
Forfeited
Awards outstanding at year end
Total
10,379,745
£3.65 10,687,135
3,031,105
£2.14
2,297,585
(2,547,699)
£3.28
(1,881,231)
(652,622)
£2.18
(723,744)
10,210,529
£3.31 10,379,745
39,389,867
£3.32 40,688,833
£3.58
£3.75
£3.44
£3.42
£3.65
£3.65
144 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
10) Share-based payments continued
The Executive Omnibus Incentive Plan (Omnibus Plan)
The Omnibus Plan was introduced prior to the Company listing in October 2006 and provides for the grant of share awards, market value
options, premium cost options, discounted options, linked options, phantoms and/or nil-cost options to employees. The Omnibus Plan will
also allow bonuses to be deferred in the form of share awards with or without matching shares. Awards granted under the Omnibus Plan
typically vest after five years from date of grant, with the exception of bonus awards which vest after the shorter of five years from date of
grant or on the date of termination of employment. Awards under the Omnibus Plan are accounted for as equity-settled, with the exception
of phantoms which are classified as cash-settled.
The combined cash and equity-settled payments below represent the share-based payments relating to the Omnibus Plan.
Total expense by year awards were granted (excluding national insurance)
Total Omnibus share-based payments expense reported in comprehensive income
18.6
24.3
Awards outstanding under the Omnibus Plan were as follows:
2023
£m
–
3.0
3.7
3.5
3.9
3.3
1.2
2022
£m
3.2
2.9
3.5
3.5
5.5
5.7
–
£3.58
£3.71
£3.44
£3.44
£3.65
£3.58
£3.75
£3.44
–
£3.58
£3.75
£3.44
£3.42
£3.65
£3.65
2023
Number of
shares subject
2023
2022
Weighted
Number of
average
shares subject
to awards
share price
to awards
2022
Weighted
average
share price
19,311,495
£3.65 19,997,393
5,553,128
£2.14
4,423,544
(4,671,286)
(1,160,520)
£3.25
(3,874,613)
£2.17
(1,234,829)
19,032,817
£3.32 19,311,495
10,997,593
£3.64 10,617,648
3,014,720
£2.14
2,285,034
(3,686,132)
£2.87
(1,905,089)
(179,660)
£3.67
–
10,379,745
£3.65 10,687,135
3,031,105
£2.14
2,297,585
(2,547,699)
£3.28
(1,881,231)
(652,622)
£2.18
(723,744)
10,210,529
£3.31 10,379,745
39,389,867
£3.32 40,688,833
Group and Company
Year of grant
2017
2018
2019
2020
2021
2022
2023
i) Equity-settled awards
Group and Company
Restricted share awards
At the beginning of the year
Awards outstanding at year end
Bonus share awards
At the beginning of the year
Matching share awards
At the beginning of the year
Awards outstanding at year end
Granted
Vested
Forfeited
Granted
Vested
Forfeited
Granted
Vested
Forfeited
Total
Awards outstanding at year end
10,146,521
£3.31 10,997,593
£3.64
ii) Cash-settled awards
Group and Company
Restricted share awards
At the beginning of the year
Granted
Vested
Forfeited
Awards outstanding at year end
Bonus share awards
At the beginning of the year
Granted
Vested
Forfeited
Awards outstanding at year end
Matching share awards
At the beginning of the year
Granted
Vested
Forfeited
Awards outstanding at year end
Total
2023
Number of
shares subject
to awards
2023
Weighted
average
share price
2022
Number of
shares subject
to awards
2022
Weighted
average
share price
110,280
47,785
(45,003)
–
£3.60
£2.14
£3.24
–
122,239
15,741
(27,700)
–
£3.53
£3.75
£3.40
–
113,062
£3.13
110,280
£3.60
80,511
34,982
(33,753)
–
£3.60
£2.14
£3.24
–
80,765
11,276
(11,530)
–
£3.55
£3.75
£3.40
–
81,740
£3.12
80,511
£3.60
80,511
34,982
(33,753)
–
81,740
276,542
£3.60
£2.14
£3.24
–
£3.12
£3.13
80,765
11,276
(11,530)
–
80,511
271,302
£3.55
£3.75
£3.40
–
£3.60
£3.60
Ashmore Group plc Annual Report and Accounts 2023
145
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
10) Share-based payments continued
iii) Total awards
Group and Company
Restricted share awards
At the beginning of the year
Granted
Vested
Forfeited
Awards outstanding at year end
Bonus share awards
At the beginning of the year
Granted
Vested
Forfeited
2023
Number of
shares subject
to awards
2023
Weighted
average
share price
2022
Number of
shares subject
to awards
2022
Weighted
average
share price
19,421,775
£3.65 20,119,632
5,600,913
£2.14
4,439,285
(4,716,289)
(1,160,520)
£3.25
(3,902,313)
£2.17
(1,234,829)
19,145,879
£3.32 19,421,775
11,078,104
£3.64 10,698,413
3,049,702
£2.14
2,296,310
(3,719,885)
£2.87
(1,916,619)
(179,660)
£3.67
–
£3.58
£3.71
£3.44
£3.44
£3.65
£3.58
£3.75
£3.44
–
Awards outstanding at year end
10,228,261
£3.31 11,078,104
£3.64
Matching share awards
At the beginning of the year
Granted
Vested
Forfeited
Awards outstanding at year end
Total
10,460,256
£3.65 10,767,900
3,066,087
£2.14
2,308,861
(2,581,452)
£3.28
(1,892,761)
(652,622)
£2.18
(723,744)
10,292,269
£3.31 10,460,256
39,666,409
£3.32 40,960,135
£3.58
£3.75
£3.44
£3.42
£3.65
£3.65
The weighted average fair value of awards granted to employees under the Omnibus Plan during the year was £2.14 (FY2022: £3.73),
calculated based on the average Ashmore Group plc closing share price for the five business days prior to grant. For Executive Directors,
the fair value of awards also takes into account the performance conditions set out in the Remuneration report.
Where the grant of restricted and matching share awards is linked to the annual bonus process, the fair value of the awards is spread over a
period including the current financial year and the subsequent five years to their vesting date when the grantee becomes unconditionally
entitled to the underlying shares. The fair value of the remaining awards is spread over the period from the date of grant to the vesting date.
The liability arising from cash-settled awards under the Omnibus Plan at the end of the year and reported within trade and other payables on
the Group consolidated balance sheet is £0.3 million (30 June 2022: £0.4 million) of which £nil (30 June 2022: £nil) relates to vested awards.
146 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
10) Share-based payments continued
iii) Total awards
Group and Company
Restricted share awards
At the beginning of the year
Awards outstanding at year end
Bonus share awards
At the beginning of the year
Matching share awards
At the beginning of the year
Awards outstanding at year end
Granted
Vested
Forfeited
Granted
Vested
Forfeited
Granted
Vested
Forfeited
Total
2023
Number of
shares subject
2023
2022
Weighted
Number of
average
shares subject
to awards
share price
to awards
2022
Weighted
average
share price
19,421,775
£3.65 20,119,632
5,600,913
£2.14
4,439,285
(4,716,289)
(1,160,520)
£3.25
(3,902,313)
£2.17
(1,234,829)
19,145,879
£3.32 19,421,775
11,078,104
£3.64 10,698,413
3,049,702
£2.14
2,296,310
(3,719,885)
£2.87
(1,916,619)
(179,660)
£3.67
–
10,460,256
£3.65 10,767,900
3,066,087
£2.14
2,308,861
(2,581,452)
£3.28
(1,892,761)
(652,622)
£2.18
(723,744)
10,292,269
£3.31 10,460,256
39,666,409
£3.32 40,960,135
£3.58
£3.71
£3.44
£3.44
£3.65
£3.58
£3.75
£3.44
–
£3.58
£3.75
£3.44
£3.42
£3.65
£3.65
Awards outstanding at year end
10,228,261
£3.31 11,078,104
£3.64
The weighted average fair value of awards granted to employees under the Omnibus Plan during the year was £2.14 (FY2022: £3.73),
calculated based on the average Ashmore Group plc closing share price for the five business days prior to grant. For Executive Directors,
the fair value of awards also takes into account the performance conditions set out in the Remuneration report.
Where the grant of restricted and matching share awards is linked to the annual bonus process, the fair value of the awards is spread over a
period including the current financial year and the subsequent five years to their vesting date when the grantee becomes unconditionally
entitled to the underlying shares. The fair value of the remaining awards is spread over the period from the date of grant to the vesting date.
The liability arising from cash-settled awards under the Omnibus Plan at the end of the year and reported within trade and other payables on
the Group consolidated balance sheet is £0.3 million (30 June 2022: £0.4 million) of which £nil (30 June 2022: £nil) relates to vested awards.
11) Other expenses
Other expenses consist of the following:
Travel
Professional fees
Information technology and communications
Amortisation of intangible assets (note 15)
Lease expenses
Depreciation of property, plant and equipment (note 16)
Premises-related costs
Insurance
Research costs
Auditor’s remuneration (see below)
Consolidated funds
Other expenses
2023
£m
2022
£m
2.1
5.5
7.8
0.2
0.4
3.0
1.3
1.0
0.4
0.9
1.1
4.1
0.9
4.7
7.3
0.2
0.4
2.9
1.3
1.0
0.4
0.9
1.2
3.9
27.8
25.1
Lease expenses relates to short-term leases where the Group has applied the optional exemption contained within IFRS 16, which permits
the cost of short-term leases (less than 12 months) to be expensed on a straight-line basis over the lease term.
Auditor’s remuneration
Fees for statutory audit services:
– Fees payable to the Company’s auditor for the audit of the Group’s accounts
– Fees payable to the Company’s auditor and its associates for the audit of the Company’s subsidiaries
pursuant to legislation
Fees for non-audit services:
– Other non-audit services
2023
£m
0.2
0.5
0.2
0.9
2022
£m
0.2
0.5
0.2
0.9
Ashmore Group plc Annual Report and Accounts 2023
147
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
12) Taxation
Analysis of tax charge for the year:
Current tax
UK corporation tax on profits for the year
Overseas corporation tax charge
Adjustments in respect of prior years
Deferred tax
Origination and reversal of temporary differences (note 18)
Tax expense
Factors affecting tax charge for the year
Profit before tax
2023
£m
5.6
10.5
0.1
16.2
9.1
25.3
2022
£m
11.1
14.9
(0.5)
25.5
1.0
26.5
2023
£m
111.8
2022
£m
118.4
Profit on ordinary activities multiplied by the blended UK tax rate of 20.5% (FY2022: UK tax rate of 19%)
22.9
22.5
Effects of:
Permanent differences including non-taxable income and non-deductible expenses
Different rate of taxes on overseas profits
Non-deductible/(non-taxable) investment returns1
Adjustments in respect of prior years
Tax expense
7.4
(3.2)
(1.9)
0.1
25.3
1. Non-taxable investment returns comprise seed capital investment gains/losses in certain jurisdictions in which the Group operates for which there are local
tax exemptions.
The tax charge/(credit) recognised in reserves within other comprehensive income is as follows:
Current tax expense/(credit) on foreign exchange gains/(losses)
Tax expense/(credit) recognised in reserves
2023
£m
(0.6)
(0.6)
4.7
(3.3)
3.2
(0.6)
26.5
2022
£m
2.9
2.9
148 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
12) Taxation
Analysis of tax charge for the year:
Current tax
UK corporation tax on profits for the year
Overseas corporation tax charge
Adjustments in respect of prior years
Origination and reversal of temporary differences (note 18)
Factors affecting tax charge for the year
Deferred tax
Tax expense
Profit before tax
Effects of:
Tax expense
tax exemptions.
Profit on ordinary activities multiplied by the blended UK tax rate of 20.5% (FY2022: UK tax rate of 19%)
22.9
22.5
Permanent differences including non-taxable income and non-deductible expenses
Different rate of taxes on overseas profits
Non-deductible/(non-taxable) investment returns1
Adjustments in respect of prior years
1. Non-taxable investment returns comprise seed capital investment gains/losses in certain jurisdictions in which the Group operates for which there are local
The tax charge/(credit) recognised in reserves within other comprehensive income is as follows:
Current tax expense/(credit) on foreign exchange gains/(losses)
Tax expense/(credit) recognised in reserves
13) Earnings per share
Basic earnings per share at 30 June 2023 of 12.43 pence (30 June 2022: 13.42 pence) is calculated by dividing the profit after tax for the
financial year attributable to equity holders of the parent of £83.3 million (FY2022: £88.5 million) by the weighted average number of ordinary
shares in issue during the year, excluding own shares.
Diluted earnings per share is calculated based on basic earnings per share adjusted for dilutive potential ordinary shares. There is
no difference between the profit for the year attributable to equity holders of the parent used in the basic and diluted earnings per
share calculations.
The weighted average number of shares used in calculating basic and diluted earnings per share are shown below.
Weighted average number of ordinary shares used in the calculation of basic earnings per share
Weighted average number of ordinary shares used in the calculation of diluted earnings per share
2023
£m
111.8
2022
£m
118.4
14) Dividends
Dividends paid in the year
Company
Final dividend for FY2022 – 12.10p (FY2021: 12.10p)
Interim dividend FY2023 – 4.80p (FY2022: 4.80p)
In addition, the Group paid £3.3 million (FY2022: £3.0 million) of dividends to non-controlling interests.
Dividends declared/proposed in respect of the year
Company
Interim dividend per share paid
Final dividend per share proposed
2023
Number of
ordinary
shares
2022
Number of
ordinary
shares
670,224,113 659,466,487
685,760,649 702,124,339
2023
£m
84.8
33.6
2022
£m
85.0
33.5
118.4
118.5
2023
pence
4.80
12.10
16.90
2022
pence
4.80
12.10
16.90
On 5 September 2023, the Board proposed a final dividend of 12.10 pence per share for the year ended 30 June 2023. This has not been
recognised as a liability of the Group at the year end as it has not yet been approved by shareholders. Based on the number of shares
in issue at the year end that qualify to receive a dividend, the total amount payable would be £85.1 million.
2023
£m
5.6
10.5
0.1
16.2
9.1
25.3
7.4
(3.2)
(1.9)
0.1
25.3
2023
£m
(0.6)
(0.6)
2022
£m
11.1
14.9
(0.5)
25.5
1.0
26.5
4.7
(3.3)
3.2
(0.6)
26.5
2022
£m
2.9
2.9
Ashmore Group plc Annual Report and Accounts 2023
149
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
Fund
management
intangible assets
£m
Goodwill
£m
Total
£m
70.4
0.9
71.3
–
–
–
–
–
80.1
–
10.4
90.5
–
(3.8)
86.7
(0.5)
(0.1)
(0.6)
(0.1)
(0.7)
0.4
(0.1)
0.1
0.4
(0.1)
(0.1)
0.2
(0.5)
(0.1)
(0.6)
(0.1)
(0.7)
80.5
(0.1)
10.5
90.9
(0.1)
(3.9)
86.9
Goodwill
£m
4.1
4.1
15) Goodwill and intangible assets
Group
Cost (at original exchange rate)
At 30 June 2023 and 2022
Accumulated amortisation and impairment
At 30 June 2021
Amortisation charge for the year
At 30 June 2022
Amortisation charge for the year
At 30 June 2023
Net book value
At 30 June 2021
Accumulated amortisation for the year
Foreign exchange revaluation through reserves*
At 30 June 2022
Accumulated amortisation for the year
Foreign exchange revaluation through reserves*
At 30 June 2023
* Foreign exchange revaluation through reserves is a result of the retranslation of US dollar-denominated intangibles and goodwill.
Company
Cost
At the beginning and end of the year
Net carrying amount at 30 June 2023 and 2022
150 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
15) Goodwill and intangible assets
Group
Cost (at original exchange rate)
At 30 June 2023 and 2022
Accumulated amortisation and impairment
At 30 June 2021
Amortisation charge for the year
At 30 June 2022
Amortisation charge for the year
At 30 June 2023
Net book value
At 30 June 2021
Accumulated amortisation for the year
Foreign exchange revaluation through reserves*
At 30 June 2022
Accumulated amortisation for the year
Foreign exchange revaluation through reserves*
At 30 June 2023
Company
Cost
At the beginning and end of the year
Net carrying amount at 30 June 2023 and 2022
* Foreign exchange revaluation through reserves is a result of the retranslation of US dollar-denominated intangibles and goodwill.
Fund
management
Goodwill
intangible assets
£m
£m
Total
£m
70.4
0.9
71.3
–
–
–
–
–
80.1
–
10.4
90.5
–
(3.8)
86.7
(0.5)
(0.1)
(0.6)
(0.1)
(0.7)
0.4
(0.1)
0.1
0.4
(0.1)
(0.1)
0.2
(0.5)
(0.1)
(0.6)
(0.1)
(0.7)
80.5
(0.1)
10.5
90.9
(0.1)
(3.9)
86.9
Goodwill
£m
4.1
4.1
Goodwill
The Group’s goodwill balance relates to the acquisition of subsidiaries. The Company’s goodwill balance relates to the acquisition of the
business from ANZ in 1999.
Goodwill acquired in a business combination is allocated to the cash-generating units that are expected to benefit from that business
combination. It is the Group’s judgement that the lowest level of cash-generating unit used to determine impairment is the investment
management segment level. The Group has assessed that it consists of a single cash-generating unit for the purposes of monitoring and
assessing goodwill for impairment. This reflects the Group’s global operating model, based on a single operating platform, into which
acquired businesses are fully integrated and from which acquisition-related synergies are expected to be realised. Based on this model,
the Group’s investment management activities are considered as a single cash-generating unit, for which key management regularly receive
and review internal financial information.
An annual impairment review of goodwill was undertaken for the year ending 30 June 2023, and no factors indicating potential impairment
of goodwill were noted. Goodwill is tested for impairment annually or whenever there is an indication that the carrying amount may not be
recoverable based on management’s judgements regarding the future prospects of the business, market capitalisation, macroeconomic and
market considerations. The key assumption used to determine the recoverable amount is based on a fair value calculation using the
Company’s market share price.
Based on the calculation as at 30 June 2023 using a market share price of £2.08, the recoverable amount was in excess of the carrying
value of goodwill and no impairment was implied. In addition, the sensitivity of the recoverable amount to a 10% change in the Company’s
market share price will not lead to any impairment. Therefore, no impairment loss has been recognised in the current or preceding years.
Fund management intangible assets
Intangible assets as at 30 June 2023 comprise fund management contracts recognised by the Group on the acquisition of Ashmore Avenida
Investments (Real Estate) LLP in July 2018.
Ashmore Group plc Annual Report and Accounts 2023
151
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
16) Property, plant and equipment
The Group’s property, plant and equipment include right-of-use assets recognised on lease arrangements as follows:
Group
£m
1.2
5.3
6.5
Company
£m
0.9
3.2
4.1
2023
Property, plant
and equipment
£m
2022
Property, plant
and equipment
£m
23.0
0.6
(0.6)
23.0
13.9
3.0
(0.4)
16.5
6.5
21.9
0.5
0.6
23.0
10.7
2.9
0.3
13.9
9.1
2023
Property, plant
and equipment
£m
2022
Property, plant
and equipment
£m
13.9
0.3
14.2
8.4
1.7
10.1
4.1
13.5
0.4
13.9
6.8
1.6
8.4
5.5
Property, plant and equipment owned by the Group
Right-of-use assets
Net book value at 30 June 2023
The movement in property, plant and equipment is provided below:
Group
Cost
At the beginning of the year
Additions
Foreign exchange revaluation
At the end of the year
Accumulated depreciation
At the beginning of the year
Depreciation charge for the year
Foreign exchange revaluation
At the end of the year
Net book value at 30 June
Company
Cost
At the beginning of the year
Additions
At the end of the year
Accumulated depreciation
At the beginning of the year
Depreciation charge for year
At the end of the year
Net book value at 30 June
152 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
16) Property, plant and equipment
The Group’s property, plant and equipment include right-of-use assets recognised on lease arrangements as follows:
Property, plant and equipment owned by the Group
Right-of-use assets
Net book value at 30 June 2023
The movement in property, plant and equipment is provided below:
Group
Cost
Additions
At the beginning of the year
Foreign exchange revaluation
At the end of the year
Accumulated depreciation
At the beginning of the year
Depreciation charge for the year
Foreign exchange revaluation
At the end of the year
Net book value at 30 June
Company
Cost
At the beginning of the year
Additions
At the end of the year
Accumulated depreciation
At the beginning of the year
Depreciation charge for year
At the end of the year
Net book value at 30 June
Group
£m
1.2
5.3
6.5
Company
£m
0.9
3.2
4.1
2023
2022
Property, plant
and equipment
Property, plant
and equipment
£m
£m
23.0
0.6
(0.6)
23.0
13.9
3.0
(0.4)
16.5
6.5
13.9
0.3
14.2
8.4
1.7
10.1
4.1
21.9
0.5
0.6
23.0
10.7
2.9
0.3
13.9
9.1
13.5
0.4
13.9
6.8
1.6
8.4
5.5
2023
2022
Property, plant
and equipment
Property, plant
and equipment
£m
£m
Lease arrangements
The Group leases office space in various countries and enters into lease agreements on office premises with remaining lease periods of one
to six years. Lease terms are negotiated on an individual basis and contain varying terms and conditions depending on location. The lease
agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. The Group
calculates the lease liabilities using the lessee’s incremental borrowing rates that resulted in a weighted average incremental borrowing rate
of 4.9% (FY2022: 4.6%).
The carrying value of right-of-use assets, lease liabilities and the movement during the year are set out below.
At 30 June 2021
Lease payments
Interest expense (note 8)
Depreciation charge
Foreign exchange revaluation through reserves
At 30 June 2022
Additions
Lease payments
Interest expense (note 8)
Depreciation charge
Foreign exchange revaluation through reserves
At 30 June 2023
Right-of-use
assets
£m
Group
Lease
liabilities
£m
Right-of-use
assets
£m
Company
Lease
liabilities
£m
9.4
–
–
(2.1)
0.3
7.6
0.2
–
–
(2.4)
(0.1)
5.3
9.8
(2.4)
0.4
–
0.2
8.0
0.1
(2.5)
0.3
–
(0.1)
5.8
5.5
–
–
(1.1)
–
4.4
–
–
–
(1.2)
–
3.2
5.7
(1.3)
0.2
–
–
4.6
–
(1.3)
0.1
–
–
3.4
The contractual maturities on the minimum lease payments under lease liabilities are provided below:
Maturity analysis – contractual undiscounted cash flows
Within 1 year
Between 1 and 5 years
Later than 5 years
Total undiscounted lease liabilities
Lease liabilities are presented in the balance sheet as follows:
Current
Non-current
Total lease liabilities
Amounts recognised under financing activities in the cash flow statement:
Payment of lease liabilities
Interest paid
Total cash outflow for leases
30 June
2023
£m
Group
30 June
2022
£m
30 June
2023
£m
Company
30 June
2022
£m
2.4
3.9
–
6.3
2.1
3.7
5.8
2.2
0.3
2.5
2.6
6.0
0.2
8.8
2.2
5.8
8.0
2.0
0.4
2.4
1.3
2.3
–
3.6
1.2
2.2
3.4
1.2
0.1
1.3
1.3
3.7
–
5.0
1.3
3.3
4.6
1.1
0.2
1.3
Ashmore Group plc Annual Report and Accounts 2023
153
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
17) Trade and other receivables
Trade debtors
Prepayments
Amounts due from subsidiaries
Loans due from subsidiaries
Other receivables
Total trade and other receivables
2023
£m
60.7
4.4
–
–
5.3
70.4
Group
2022
£m
66.1
3.5
–
–
4.7
74.3
2023
£m
2.1
1.9
10.4
266.4
3.6
284.4
Company
2022
£m
1.0
2.1
73.8
376.9
3.1
456.9
Group trade debtors include accrued management and performance fees in respect of investment management services provided up to
30 June 2023. Management fees are received in cash when the funds’ net asset values are determined, typically every month or every
quarter. Performance fees are accrued when crystallised, and amounted to £1.3 million as at 30 June 2023 (30 June 2022: £0.5 million).
The majority of fees are deducted from the net asset values of the respective funds by independent administrators and therefore the credit
risk of fee receivables is minimal. As at 30 June 2023, the assessed provision for expected credit losses was immaterial and the Group has
not recognised any expected credit losses in the current year (30 June 2022: £nil).
Amounts due from subsidiaries for the Company represent intercompany trading balances that are repayable within one year.
Loans due from subsidiaries for the Company include an intercompany loan to a subsidiary related to the provision of funding for seed
capital investments and cash invested by the subsidiary in daily-traded investment funds. Loans due from subsidiaries included within non-
current assets amounted to £167.8 million as at 30 June 2023 (30 June 2022: £132.0 million included within non-current assets). The
intercompany loan is repayable on demand and the amount classified as current is regularly settled during the year. Under the IFRS 9
expected credit loss model, credit risk is assessed by determining the borrower’s capacity to meet contractual cash flow obligations, taking
into account the available net assets to repay the intercompany balance in future periods. Expected credit losses are estimated based on
the assumption that repayment is demanded at the reporting date. If the borrower has sufficient accessible highly liquid assets available to
settle the balance if demanded at the reporting date, the expected credit loss has been assessed to be immaterial. In line with the
Company’s historical experience, and after consideration of current credit exposures, the Company does not expect to incur any credit
losses and has not recognised any expected credit losses in the current year (30 June 2022: £nil).
18) Deferred taxation
Deferred tax assets and liabilities recognised by the Group and Company at year end are attributable to the following:
Group
Deferred tax assets
Deferred tax liabilities
Company
Deferred tax assets
Other
temporary
differences
£m
Share-based
payments
£m
11.0
(9.3)
1.7
12.9
–
12.9
Other
temporary
differences
£m
Share-based
payments
£m
–
11.6
2023
Total
£m
23.9
(9.3)
14.6
2023
Total
£m
11.6
Other
temporary
differences
£m
Share-based
payments
£m
12.5
(8.8)
3.7
20.2
–
20.2
Other temporary
differences
£m
Share-based
payments
£m
–
18.2
2022
Total
£m
32.7
(8.8)
23.9
2022
Total
£m
18.2
Deferred taxes at the balance sheet date reflected in these financial statements have been measured using the relevant enacted or
substantively enacted tax rate for the year in which they are expected to be realised or settled.
154 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
17) Trade and other receivables
Trade debtors
Prepayments
Amounts due from subsidiaries
Loans due from subsidiaries
Other receivables
Total trade and other receivables
2023
£m
60.7
4.4
–
–
5.3
70.4
Group
2022
£m
66.1
3.5
–
–
4.7
74.3
2023
£m
2.1
1.9
10.4
266.4
3.6
284.4
Company
2022
£m
1.0
2.1
73.8
376.9
3.1
456.9
Group trade debtors include accrued management and performance fees in respect of investment management services provided up to
30 June 2023. Management fees are received in cash when the funds’ net asset values are determined, typically every month or every
quarter. Performance fees are accrued when crystallised, and amounted to £1.3 million as at 30 June 2023 (30 June 2022: £0.5 million).
The majority of fees are deducted from the net asset values of the respective funds by independent administrators and therefore the credit
risk of fee receivables is minimal. As at 30 June 2023, the assessed provision for expected credit losses was immaterial and the Group has
not recognised any expected credit losses in the current year (30 June 2022: £nil).
Amounts due from subsidiaries for the Company represent intercompany trading balances that are repayable within one year.
Loans due from subsidiaries for the Company include an intercompany loan to a subsidiary related to the provision of funding for seed
capital investments and cash invested by the subsidiary in daily-traded investment funds. Loans due from subsidiaries included within non-
current assets amounted to £167.8 million as at 30 June 2023 (30 June 2022: £132.0 million included within non-current assets). The
intercompany loan is repayable on demand and the amount classified as current is regularly settled during the year. Under the IFRS 9
expected credit loss model, credit risk is assessed by determining the borrower’s capacity to meet contractual cash flow obligations, taking
into account the available net assets to repay the intercompany balance in future periods. Expected credit losses are estimated based on
the assumption that repayment is demanded at the reporting date. If the borrower has sufficient accessible highly liquid assets available to
settle the balance if demanded at the reporting date, the expected credit loss has been assessed to be immaterial. In line with the
Company’s historical experience, and after consideration of current credit exposures, the Company does not expect to incur any credit
losses and has not recognised any expected credit losses in the current year (30 June 2022: £nil).
18) Deferred taxation
Deferred tax assets and liabilities recognised by the Group and Company at year end are attributable to the following:
Group
Deferred tax assets
Deferred tax liabilities
Company
Deferred tax assets
Other
temporary
differences
Share-based
payments
£m
11.0
(9.3)
1.7
£m
12.9
–
12.9
Other
temporary
differences
£m
–
Share-based
payments
£m
11.6
2023
Total
£m
23.9
(9.3)
14.6
2023
Total
£m
11.6
Other
temporary
differences
£m
12.5
(8.8)
3.7
Share-based
payments
£m
20.2
–
20.2
Other temporary
differences
Share-based
payments
£m
–
£m
18.2
2022
Total
£m
32.7
(8.8)
23.9
2022
Total
£m
18.2
Deferred taxes at the balance sheet date reflected in these financial statements have been measured using the relevant enacted or
substantively enacted tax rate for the year in which they are expected to be realised or settled.
Movement of deferred tax balances
The movement in the deferred tax balances between the balance sheet dates has been reflected in the statement of comprehensive
income as follows:
Group
At 30 June 2021
Credited/(charged) to the consolidated statement of comprehensive income
Foreign exchange revaluation
At 30 June 2022
Charged to the consolidated statement of comprehensive income
Foreign exchange revaluation
At 30 June 2023
Company
At 30 June 2021
Charged to the statement of comprehensive income
At 30 June 2022
Charged to the statement of comprehensive income
At 30 June 2023
Other
temporary
differences
£m
Share-based
payments
£m
(2.9)
6.0
0.6
3.7
(1.8)
(0.2)
1.7
27.2
(7.0)
–
20.2
(7.3)
–
12.9
Other
temporary
differences
£m
Share-based
payments
£m
–
–
–
–
–
25.1
(6.9)
18.2
(6.6)
11.6
Total
£m
24.3
(1.0)
0.6
23.9
(9.1)
(0.2)
14.6
Total
£m
25.1
(6.9)
18.2
(6.6)
11.6
19) Fair value of financial instruments
The Group has an established control framework with respect to the measurement of fair values. This framework includes committees that
have overall responsibility for all significant fair value measurements. Each committee regularly reviews significant inputs and valuation
adjustments. If third-party information is used to measure fair value, the committee assesses and documents the evidence obtained from
the third parties to support such valuations. There are no material differences between the carrying amounts of financial assets and liabilities
and their fair values at the balance sheet date.
Fair value hierarchy
The Group measures fair values using the following fair value levels that reflect the significance of inputs used in making the
measurements, based on the degree to which the fair value is observable:
– Level 1: Valuation is based upon a quoted market price in an active market for an identical instrument. This fair value measure relates
to the valuation of quoted and exchange traded equity and debt securities.
– Level 2: Valuation techniques are based upon observable inputs, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
This fair value measure relates to the valuation of quoted equity securities in inactive markets or in interests in unlisted funds whose
net asset values are referenced to the fair values of the listed or exchange traded securities held by those funds. Valuation techniques
may include using a broker quote in an inactive market or an evaluated price based on a compilation of primarily observable market
information utilising information readily available via external sources.
– Level 3: Fair value measurements are derived from valuation techniques that include inputs not based on observable market data.
For financial instruments that are recognised at fair value on a recurring basis, the Group determines whether transfers have occurred
between levels in the hierarchy by reassessing categorisation (based on the lowest level input that is significant to the fair value
measurement as a whole) at the end of the financial year.
Ashmore Group plc Annual Report and Accounts 2023
155
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
19) Fair value of financial instruments continued
The fair value hierarchy of financial instruments which are carried at fair value at year end is summarised below:
Level 1
£m
Level 2
£m
Level 3
£m
2023
Total
£m
Level 1
£m
Level 2
£m
Level 3
£m
Financial assets
Investment securities
Financial assets measured at fair value
Non-current financial assets at fair value
Financial liabilities
Third-party interests in consolidated funds
Derivative financial instruments
112.3
–
–
112.3
36.0
–
36.0
88.8
55.8
14.9
159.5
9.6
0.2
9.8
28.8
229.9
158.8
55.8
54.1
–
–
82.7
32.3
–
339.8
158.8
115.0
56.2
0.2
56.4
58.4
–
58.4
6.3
5.2
11.5
–
39.2
68.0
10.6
–
10.6
23.6
–
39.3
62.9
8.3
–
8.3
2022
Total
£m
265.1
32.3
39.3
336.7
73.0
5.2
78.2
Transfers between levels
The Group recognises transfers into and transfers out of fair value hierarchy levels at each reporting period based on assessments of price
inputs used in the valuation of financial assets. There were no transfers between level 1, level 2 and level 3 of the fair value hierarchy during
the year.
Fair value measurements using significant unobservable inputs (level 3)
The following table presents the changes in level 3 items for the years ended 30 June 2023 and 2022:
At 30 June 2021
Additions
Disposals
Transfers out
Unrealised gains recognised in finance income
Unrealised gains recognised in reserves
At 30 June 2022
Additions
Disposals
Unrealised gains recognised in finance income
Unrealised losses recognised in reserves
At 30 June 2023
Investment
securities
£m
Non-current
financial assets at
fair value
£m
Third-party
interests in
consolidated
funds
£m
42.4
–
(25.5)
(1.5)
4.4
3.8
23.6
2.5
(9.1)
12.0
(0.2)
28.8
34.0
1.9
(1.5)
–
3.5
1.4
39.3
2.9
(5.0)
2.0
–
39.2
16.9
–
(10.7)
–
2.1
–
8.3
1.2
(3.8)
4.9
–
10.6
156 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
19) Fair value of financial instruments continued
The fair value hierarchy of financial instruments which are carried at fair value at year end is summarised below:
The Group recognises transfers into and transfers out of fair value hierarchy levels at each reporting period based on assessments of price
inputs used in the valuation of financial assets. There were no transfers between level 1, level 2 and level 3 of the fair value hierarchy during
Fair value measurements using significant unobservable inputs (level 3)
The following table presents the changes in level 3 items for the years ended 30 June 2023 and 2022:
Financial assets
Investment securities
Financial assets measured at fair value
Non-current financial assets at fair value
Financial liabilities
Third-party interests in consolidated funds
Derivative financial instruments
Transfers between levels
the year.
At 30 June 2021
Additions
Disposals
Transfers out
At 30 June 2022
Additions
Disposals
Unrealised gains recognised in finance income
Unrealised gains recognised in reserves
Unrealised gains recognised in finance income
Unrealised losses recognised in reserves
At 30 June 2023
Level 1
£m
Level 2
£m
Level 3
£m
Level 1
£m
Level 2
£m
Level 3
£m
28.8
229.9
158.8
112.3
–
–
112.3
36.0
–
36.0
88.8
55.8
14.9
159.5
9.6
0.2
9.8
–
39.2
68.0
10.6
–
10.6
339.8
158.8
115.0
–
–
58.4
–
58.4
82.7
32.3
–
6.3
5.2
11.5
23.6
–
39.3
62.9
8.3
–
8.3
2023
Total
£m
55.8
54.1
56.2
0.2
56.4
2022
Total
£m
265.1
32.3
39.3
336.7
73.0
5.2
78.2
funds
£m
16.9
(10.7)
–
–
–
2.1
8.3
1.2
(3.8)
4.9
–
10.6
Investment
financial assets at
securities
£m
Non-current
fair value
£m
Third-party
interests in
consolidated
42.4
–
(25.5)
(1.5)
4.4
3.8
23.6
2.5
(9.1)
12.0
(0.2)
28.8
34.0
1.9
(1.5)
–
3.5
1.4
39.3
2.9
(5.0)
2.0
–
39.2
Valuation of level 3 financial assets recognised at fair value on a recurring basis using valuation techniques
Investments valued using valuation techniques include financial investments which, by their nature, do not have an externally quoted price
based on regular trades, and financial investments for which markets are no longer active as a result of market conditions, e.g. market
illiquidity. The valuation techniques used include comparison to recent arm’s length transactions, market approach making reference to other
instruments that are substantially the same, discounted cash flow analysis, enterprise valuation and net assets approach. These techniques
may include a number of assumptions relating to variables such as interest rate and price earnings multiples. Changes in assumptions
relating to these variables could positively or negatively impact the reported fair value of these instruments. When determining the inputs
into the valuation techniques used, priority is given to publicly available prices from independent sources when available, but overall the
source of pricing is chosen with the objective of arriving at a fair value measurement that reflects the price at which an orderly transaction
would take place between market participants on the measurement date.
The fair value estimates are made at a specific point in time, based upon available market information and judgements about the financial
instruments, including estimates of the timing and amount of expected future cash flows. Such estimates could include a marketability
adjustment to reflect illiquidity and/or non-transferability that could result from offering for sale at one time the Group’s entire holdings of a
particular financial instrument.
The following tables show the valuation techniques and the significant unobservable inputs used to estimate the fair value of level 3
investments as at 30 June 2023 and 2022, and the associated sensitivity to changes in unobservable inputs to a reasonable alternative.
Asset class and valuation technique
Unquoted securities
Market multiple and discount
Discounted cash flow
Unquoted funds
Net assets approach
Total level 3 investments
2023
Fair value
£m
Significant
unobservable inputs
Range of
estimates
Sensitivity
factor
6.4
32.3
EBITDA multiple
15x
Marketability adjustment
30%
+/- 1x
+/- 5%
Discount rate
10%-17%
+/- 1%
Marketability adjustment
10%-54%
+/- 5%
29.3 NAV1
68.0
1x
+/- 5%
Asset class and valuation technique
Unquoted securities
2022
Fair value
£m
Market multiple and discount
6.2
Discounted cash flow
Unquoted funds
Net assets approach
Total level 3 investments
26.3
30.4
62.9
Significant
unobservable inputs
EBITDA multiple
Marketability
adjustment
Discount rate
Marketability
adjustment
Range of
estimates
Sensitivity
factor
14x
30%
+/- 1x
+/- 5%
10%-20%
+/- 1%
10%-60%
+/- 5%
NAV1
1x
+/- 5%
+/- 1.5
1. NAV priced assets include seed capital investments whose value is determined by the fund administrator using unobservable inputs. The significant unobservable inputs
applied include EBITDA, market multiples, last observable vendor price and discount rates.
The sensitivity demonstrates the effect of a change in one unobservable input while other assumptions remain unchanged. There may be a
correlation between the unobservable inputs and other factors that have not been considered. It should also be noted that some of the
sensitivities are non-linear, therefore larger or smaller impacts should not be interpolated or extrapolated from these results.
Financial instruments not measured at fair value
Financial assets and liabilities that are not measured at fair value include cash and cash equivalents, trade and other receivables, and trade
and other payables. The carrying value of financial assets and financial liabilities not measured at fair value is considered a reasonable
approximation of fair value as at 30 June 2023 and 2022.
Ashmore Group plc Annual Report and Accounts 2023
157
Change in
fair value
£m
+/- 0.6
-/+ 0.7
-/+ 3.0
-/+ 2.8
+/- 1.5
Change in
fair value
£m
+/- 0.5
-/+ 0.4
-/+ 3.6
-/+ 1.5
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
20) Seed capital investments
The Group considers itself a sponsor of an investment fund when it facilitates the establishment of a fund in which the Group is the
investment manager. The Group ordinarily provides seed capital in order to provide initial scale and facilitate marketing of the funds to
third-party investors. Aggregate interests held by the Group include seed capital, management fees and performance fees. The Group
generates management and performance fee income from managing the assets on behalf of third-party investors.
The movements of seed capital investments and related items during the year are as follows:
Group
Financial
assets
held for sale
£m
Financial
assets
measured at
fair value
£m
Investment
securities
(relating to
consolidated
funds)1
£m
Other
(relating to
consolidated
funds)2
£m
Third-party
interests in
consolidated
funds
£m
Non-current
financial assets
measured at
fair value3
£m
Total
£m
Carrying amount at 30 June 2021
42.4
41.0
318.1
9.6
(105.7)
31.4
336.8
Reclassification:
Financial assets held for sale to
consolidated funds
Consolidated funds to FVTPL
Additions
Disposals
Fair value movement
Carrying amount at 30 June 2022
Additions
Disposals
Fair value movement
Carrying amount at 30 June 2023
(39.1)
–
40.5
–
–
(0.1)
(3.2)
–
–
–
–
–
39.1
5.5
(44.9)
(8.4)
32.3
23.0
–
0.5
55.8
(59.5)
–
(25.5)
(8.5)
265.1
22.8
(23.3)
(34.7)
229.9
0.4
0.1
–
–
1.0
11.1
–
–
(0.5)
10.6
(1.8)
20.3
–
10.2
4.0
(73.0)
(1.4)
3.7
14.5
(56.2)
–
–
1.9
(1.5)
4.7
36.5
19.5
(5.0)
0.4
51.4
–
–
7.4
(61.8)
(10.4)
272.0
63.9
(24.6)
(19.8)
291.5
1. Investment securities in consolidated funds are measured at FVTPL.
2. Relates to cash and other assets in consolidated funds that are not investment securities, see note 20(c).
3. Excludes £2.7 million of other non-current financial assets measured at fair value that are not classified as seed capital.
158 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
20) Seed capital investments
The Group considers itself a sponsor of an investment fund when it facilitates the establishment of a fund in which the Group is the
investment manager. The Group ordinarily provides seed capital in order to provide initial scale and facilitate marketing of the funds to
third-party investors. Aggregate interests held by the Group include seed capital, management fees and performance fees. The Group
generates management and performance fee income from managing the assets on behalf of third-party investors.
The movements of seed capital investments and related items during the year are as follows:
Financial assets held for sale to
(39.1)
–
40.5
Group
Carrying amount at 30 June 2021
Reclassification:
consolidated funds
Consolidated funds to FVTPL
Additions
Disposals
Additions
Disposals
Fair value movement
Carrying amount at 30 June 2022
Fair value movement
Carrying amount at 30 June 2023
Financial
assets
held for sale
£m
42.4
measured at
consolidated
Financial
assets
fair value
£m
41.0
Investment
securities
(relating to
funds)1
£m
318.1
Other
(relating to
consolidated
funds)2
£m
Third-party
interests in
Non-current
financial assets
consolidated
measured at
fair value3
£m
31.4
9.6
(105.7)
funds
£m
(1.8)
20.3
–
10.2
4.0
(73.0)
(1.4)
3.7
14.5
(56.2)
Total
£m
336.8
–
–
7.4
(61.8)
(10.4)
272.0
63.9
(24.6)
(19.8)
291.5
–
–
1.9
(1.5)
4.7
36.5
19.5
(5.0)
0.4
51.4
0.4
0.1
–
–
1.0
11.1
–
–
(0.5)
10.6
(0.1)
(3.2)
–
–
–
–
–
–
–
39.1
5.5
(44.9)
(8.4)
32.3
23.0
–
0.5
55.8
(59.5)
–
(25.5)
(8.5)
265.1
22.8
(23.3)
(34.7)
229.9
1. Investment securities in consolidated funds are measured at FVTPL.
2. Relates to cash and other assets in consolidated funds that are not investment securities, see note 20(c).
3. Excludes £2.7 million of other non-current financial assets measured at fair value that are not classified as seed capital.
a) Financial assets measured at fair value through profit or loss
Where Group companies invest seed capital into funds operated and controlled by the Group and the Group is actively seeking to reduce its
investment and it is considered highly probable that it will relinquish control within a year, the interests in the funds are recognised as
financial assets and measured at FVTPL.
If the fund remains under the control of the Group for more than one year from the original investment date, it will cease to be classified
as a financial asset, and will be consolidated line by line after it is assessed that the Group controls the investment fund in accordance with
the requirements of IFRS 10.
Investments cease to be classified as consolidated funds when they are no longer controlled by the Group. A loss of control may happen
through sale of the investment and/or dilution of the Group’s holding. No such fund was transferred to the FVTPL category during the year
(FY2022: three funds with an aggregate value of £39.1 million were transferred to the FVTPL category).
FVTPL investments at 30 June 2023 comprise shares held in debt and equity funds as follows:
Equity funds
Debt funds
Financial assets measured at fair value
2023
£m
29.6
26.2
55.8
Included within finance income are gains of £2.6 million (FY2022: losses of £12.5 million) on the Group’s financial assets measured
at FVTPL.
b) Non-current financial assets measured at fair value
Non-current financial asset investments relate to the Group’s holding in closed-end funds and are measured at FVTPL.
Real estate funds
Infrastructure funds
Other funds
Non-current financial assets measured at fair value1
2023
£m
0.9
22.0
28.5
51.4
1. Excludes £2.7 million (30 June 2022: £2.8 million) of other non-current financial assets measured at fair value that are not classified as seed capital.
Included within finance income are gains of £1.4 million (FY2022: gains of £4.2 million) on the Group’s non-current financial assets
measured at fair value.
2022
£m
15.5
16.8
32.3
2022
£m
1.5
24.1
10.9
36.5
Ashmore Group plc Annual Report and Accounts 2023
159
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
20) Seed capital investments continued
c) Consolidated funds
The Group has consolidated 17 investment funds as at 30 June 2023 (30 June 2022: 18 investment funds), over which the Group is
deemed to have control (refer to note 25). Consolidated funds represent seed capital investments where the Group has held its position
for a period greater than one year and its interest represents a controlling stake in the fund in accordance with IFRS 10. Consolidated fund
assets and liabilities are presented line by line after intercompany eliminations. The table below sets out an analysis of the carrying amounts
of interests held by the Group in consolidated investment funds.
Investment securities1
Cash and cash equivalents
Other2
Third-party interests in consolidated funds
Consolidated seed capital investments
2023
£m
229.9
10.3
0.3
(56.2)
184.3
2022
£m
265.1
10.0
1.1
(73.0)
203.2
1. Investment securities represent trading securities held by consolidated investment funds and are measured at FVTPL. Note 25 provides a list of the consolidated funds
by asset class, and further detailed information at the security level is available in the individual fund financial statements.
2. Other includes trade receivables, trade payables and accruals.
The maximum exposure to loss is the carrying amount of the assets held. The Group has not provided financial support or otherwise agreed
to be responsible for supporting any consolidated or unconsolidated funds financially.
Included within the consolidated statement of comprehensive income are net losses of £15.3 million (FY2022: net losses of £40.5 million)
relating to the Group’s share of the results of the individual statements of comprehensive income for each of the consolidated funds,
as follows:
Investment income
Fair value losses on investment securities
Change in third-party interests in consolidated funds
Audit fees
Other expenses
Net losses on consolidated funds
2023
£m
11.0
(44.3)
19.3
(0.2)
(1.1)
(15.3)
2022
£m
5.7
(61.3)
16.5
(0.2)
(1.2)
(40.5)
Included in the Group’s cash generated from operations is £0.1 million cash utilised in operations (FY2022: £2.8 million cash utilised in
operations) relating to consolidated funds.
As of 30 June 2023, the Group’s consolidated funds were domiciled in Guernsey, Luxembourg, Saudi Arabia and the United States.
160 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
20) Seed capital investments continued
c) Consolidated funds
The Group has consolidated 17 investment funds as at 30 June 2023 (30 June 2022: 18 investment funds), over which the Group is
deemed to have control (refer to note 25). Consolidated funds represent seed capital investments where the Group has held its position
for a period greater than one year and its interest represents a controlling stake in the fund in accordance with IFRS 10. Consolidated fund
assets and liabilities are presented line by line after intercompany eliminations. The table below sets out an analysis of the carrying amounts
of interests held by the Group in consolidated investment funds.
Investment securities1
Cash and cash equivalents
Other2
Third-party interests in consolidated funds
Consolidated seed capital investments
1. Investment securities represent trading securities held by consolidated investment funds and are measured at FVTPL. Note 25 provides a list of the consolidated funds
by asset class, and further detailed information at the security level is available in the individual fund financial statements.
2. Other includes trade receivables, trade payables and accruals.
The maximum exposure to loss is the carrying amount of the assets held. The Group has not provided financial support or otherwise agreed
to be responsible for supporting any consolidated or unconsolidated funds financially.
Included within the consolidated statement of comprehensive income are net losses of £15.3 million (FY2022: net losses of £40.5 million)
relating to the Group’s share of the results of the individual statements of comprehensive income for each of the consolidated funds,
as follows:
Investment income
Fair value losses on investment securities
Change in third-party interests in consolidated funds
Audit fees
Other expenses
Net losses on consolidated funds
Included in the Group’s cash generated from operations is £0.1 million cash utilised in operations (FY2022: £2.8 million cash utilised in
operations) relating to consolidated funds.
As of 30 June 2023, the Group’s consolidated funds were domiciled in Guernsey, Luxembourg, Saudi Arabia and the United States.
2023
£m
229.9
10.3
0.3
(56.2)
184.3
2022
£m
265.1
10.0
1.1
(73.0)
203.2
2023
£m
11.0
(44.3)
19.3
(0.2)
(1.1)
(15.3)
2022
£m
5.7
(61.3)
16.5
(0.2)
(1.2)
(40.5)
21) Financial instrument risk management
Group
The Group is subject to strategic and business, client, investment, treasury and operational risks throughout its business, as discussed in
the Risk management section. This note discusses the Group’s exposure to and management of the following principal risks which arise
from the financial instruments it uses: credit risk, liquidity risk, interest rate risk, foreign exchange risk and price risk. Where the Group holds
units in investment funds, classified either as financial assets measured at FVTPL or non-current financial assets, the related financial
instrument risk disclosures in the note below categorise exposures based on the Group’s direct interest in those funds without looking
through to the nature of underlying securities.
Risk management is the ultimate responsibility of the Board, as noted in the Risk management section on pages 35 to 41.
Capital management
It is the Group’s policy that all entities within the Group have sufficient capital to meet regulatory and working capital requirements and
it conducts regular reviews of its capital requirements relative to its capital resources.
Ashmore has been reporting under IFPR since 1 January 2022 and applies the ICARA approach to the calculation of the capital and liquidity
requirement for its UK regulated entity, AIML.
The Board has determined that the capital required to support the Group’s activities, including its regulatory requirements, is £80.6 million.
The equivalent figure as at 30 June 2022, calculated under the previous ICAAP approach, was £125.2 million.
Ashmore holds total capital resources of £704.8 million as at 30 June 2023, providing an excess of £624.2 million over the Group
capital requirement (30 June 2022: £788.7 million, providing an excess of £663.5 million over the Group capital requirement).
Credit risk
The Group has exposure to credit risk from its normal activities where the risk is that a counterparty will be unable to pay in full amounts
when due.
Exposure to credit risk is monitored on an ongoing basis by senior management and the Group’s Risk Management and Control function.
The Group has a counterparty and cash management policy in place which, in addition to other controls, restricts exposure to any single
counterparty by setting exposure limits and requiring approval and diversification of counterparty banks and other financial institutions.
The Group’s maximum exposure to credit risk is represented by the carrying value of its financial assets measured at amortised cost,
excluding prepayments. The table below lists financial assets subject to credit risk.
Trade and other receivables
Cash and cash equivalents
Total
Notes
17
2023
£m
66.0
478.6
544.6
2022
£m
70.8
552.0
622.8
The Group’s cash and cash equivalents, comprising short-term deposits with banks and liquidity funds, are predominantly held with
counterparties with credit ratings ranging from A- to AAAm as at 30 June 2023 (30 June 2022: A to AAAm). As at 30 June 2023, the Group
held £56.8 million (30 June 2022: £225.7 million) in the Ashmore Global Liquidity Fund.
All trade and other receivables are considered to be fully recoverable at year end. They include fee debtors that arise principally within the
Group’s investment management business. They are monitored regularly and, historically, default levels have been insignificant. There is no
significant concentration of credit risk in respect of fees owing from clients.
Ashmore Group plc Annual Report and Accounts 2023
161
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
21) Financial instrument risk management continued
Group
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with its financial liabilities that are settled
by delivering cash or other financial assets.
In order to manage liquidity risk, there is a Group liquidity policy to ensure that there is sufficient access to funds to cover all forecast
committed requirements for the next 12 months.
The table below summarises the maturity profile of the Group’s financial liabilities at 30 June 2023 and 30 June 2022 based on contractual
undiscounted payments:
At 30 June 2023
Current trade and other payables
Lease liabilities
Total
At 30 June 2022
Current trade and other payables
Lease liabilities
Total
Within 1 year
£m
1-5 years
£m
More than
5 years
£m
24.2
2.4
26.6
–
3.9
3.9
–
–
–
Within 1 year
£m
1-5 years
£m
36.4
2.6
39.0
–
6.0
6.0
More than
5 years
£m
–
0.2
0.2
Total
£m
24.2
6.3
30.5
Total
£m
36.4
8.8
45.2
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of changes in market
interest rates.
The principal interest rate risk is the risk that the Group will sustain a reduction in interest income through adverse movements in interest
rates. This relates to deposits with banks and liquidity funds held in the ordinary course of business. The Group has a cash management
policy which monitors cash levels and returns within set parameters on a continuing basis.
Bank and similar deposits (including liquidity funds) held at year end are shown on the consolidated balance sheet as cash and cash
equivalents. The effective interest earned on bank and similar deposits during the year is given in the table below:
Deposits with banks and liquidity funds
2023
%
3.22
2022
%
0.41
At 30 June 2023, if interest rates over the year had been 50 basis points higher/lower with all other variables held constant, profit before tax
for the year would have been £2.5 million higher/lower (FY2022: £2.5 million higher/lower), mainly as a result of higher/lower interest on
cash balances. An assumption that the fair value of assets and liabilities will not be affected by a change in interest rates was used in the
model to calculate the effect on profit before tax.
In addition, the Group is indirectly exposed to interest rate risk where the Group holds seed capital investments in funds that invest in
debt securities.
162 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
21) Financial instrument risk management continued
Group
Liquidity risk
by delivering cash or other financial assets.
committed requirements for the next 12 months.
Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with its financial liabilities that are settled
In order to manage liquidity risk, there is a Group liquidity policy to ensure that there is sufficient access to funds to cover all forecast
The table below summarises the maturity profile of the Group’s financial liabilities at 30 June 2023 and 30 June 2022 based on contractual
undiscounted payments:
At 30 June 2023
Current trade and other payables
Lease liabilities
Total
At 30 June 2022
Lease liabilities
Total
Interest rate risk
interest rates.
Current trade and other payables
Within 1 year
1-5 years
£m
24.2
2.4
26.6
£m
36.4
2.6
39.0
More than
5 years
£m
–
–
–
More than
5 years
£m
–
0.2
0.2
£m
–
3.9
3.9
£m
–
6.0
6.0
Total
£m
24.2
6.3
30.5
Total
£m
36.4
8.8
45.2
Within 1 year
1-5 years
Interest rate risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of changes in market
The principal interest rate risk is the risk that the Group will sustain a reduction in interest income through adverse movements in interest
rates. This relates to deposits with banks and liquidity funds held in the ordinary course of business. The Group has a cash management
policy which monitors cash levels and returns within set parameters on a continuing basis.
Bank and similar deposits (including liquidity funds) held at year end are shown on the consolidated balance sheet as cash and cash
equivalents. The effective interest earned on bank and similar deposits during the year is given in the table below:
Deposits with banks and liquidity funds
At 30 June 2023, if interest rates over the year had been 50 basis points higher/lower with all other variables held constant, profit before tax
for the year would have been £2.5 million higher/lower (FY2022: £2.5 million higher/lower), mainly as a result of higher/lower interest on
cash balances. An assumption that the fair value of assets and liabilities will not be affected by a change in interest rates was used in the
model to calculate the effect on profit before tax.
In addition, the Group is indirectly exposed to interest rate risk where the Group holds seed capital investments in funds that invest in
debt securities.
2023
%
3.22
2022
%
0.41
Foreign exchange risk
Foreign exchange risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of changes in foreign
exchange rates.
The Group’s revenue is almost entirely denominated in US dollars, while the majority of the Group’s costs are denominated in Sterling.
Consequently, the Group has an exposure to movements in the GBP:USD exchange rate. In addition, the Group operates globally, which
means that it may enter into contracts and other arrangements denominated in local currencies in various countries. The Group also holds
a number of seed capital investments denominated mainly in US dollars, Colombian pesos and Indonesian rupiah.
The Group’s policy is to hedge a proportion of the Group’s revenue by using a combination of forward foreign exchange contracts and
options for a period of up to two years forward. The Group also sells US dollars at spot rates when opportunities arise.
The table below shows the Group’s sensitivity to a 1% exchange movement in the US dollar, Colombian peso, Indonesian rupiah and the
Euro, net of hedging activities.
Foreign currency sensitivity test
US dollar +/- 1%
Colombian peso +/- 1%
Indonesian rupiah +/- 1%
Euro +/- 1%
Impact on
profit
before tax
£m
2023
Impact on
equity
£m
0.4
–
–
0.1
2.5
0.2
0.1
0.1
Impact on
profit
before tax
£m
0.4
0.1
–
–
2022
Impact on
equity
£m
3.9
0.2
0.1
–
Price risk
Price risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of market changes.
Seed capital
The Group is exposed to the risk of changes in market prices in respect of seed capital investments. Such price risk is borne by the Group
directly through interests in financial assets measured at fair value or indirectly either through line-by-line consolidation of underlying financial
performance and positions held in certain funds. Details of seed capital investments held are given in note 20.
The Group has procedures defined by the Board governing the appraisal, approval and monitoring of seed capital investments.
At 30 June 2023, a 5% movement in the fair value of these investments would have a £14.6 million (FY2022: £13.6 million) impact
on net assets and profit before tax.
Management and performance fees
The Group is also indirectly exposed to price risk in connection with the Group’s management fees, which are based on a percentage of
value of AuM, and fees based on performance. Movements in market prices, exchange and interest rates could cause the AuM to fluctuate,
which in turn could affect fees earned. Performance fee revenues could also be reduced depending upon market conditions.
Management and performance fees are diversified across a range of investment themes and are not measurably correlated to any single
market index in Emerging Markets. In addition, the policy of having funds with year ends staged throughout the financial year has meant
that in periods of steep market decline, some performance fees have still been recorded. The profitability impact is likely to be less than this,
as cost mitigation actions would apply, including the reduction of the variable compensation paid to employees.
Using the year end AuM level of US$55.9 billion and applying the year’s average net management fee rate of 38bps, a 5% movement
in AuM would have a US$10.6 million impact, equivalent to £8.3 million using a year end exchange rate of 1.2714, on management fee
revenues (FY2022: US$64.0 billion and applying the year’s average net management fee rate of 39bps, a 5% movement in AuM would
have a US$12.5 million impact, equivalent to £10.3 million using a year end exchange rate of 1.2145, on management fee revenues).
Hedging activities
The Group uses forward and option contracts to hedge its exposure to foreign currency risk. These hedges, which have been assessed as
effective cash flow hedges as at 30 June 2023, protect a proportion of the Group’s revenue cash flows from foreign exchange movements.
The cumulative fair value of the outstanding foreign exchange hedges asset at 30 June 2023 was £0.2 million and is included within the
Group’s derivative financial instruments (30 June 2022: £5.2 million foreign exchange hedges liability included in derivative
financial instruments).
Ashmore Group plc Annual Report and Accounts 2023
163
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
21) Financial instrument risk management continued
Group
The notional and fair values of foreign exchange hedging instruments were as follows:
Cash flow hedges
Foreign exchange nil-cost option collars
The maturity profile of the Group’s outstanding hedges is shown below.
Notional amount of option collars maturing:
Within 6 months
Between 6 and 12 months
Later than 12 months
2023
Fair value
assets/
(liabilities)
£m
0.2
0.2
Notional
amount
US$m
40.0
40.0
2022
Fair value
assets/
(liabilities)
£m
(5.2)
(5.2)
2022
US$m
40.0
40.0
20.0
100.0
Notional
amount
US$m
100.0
100.0
2023
US$m
30.0
10.0
–
40.0
When hedges are assessed as effective, intrinsic value gains and losses are initially recognised in other comprehensive income and later
reclassified to comprehensive income as the corresponding hedged cash flows crystallise. Time value in relation to the Group’s hedges is
excluded from being part of the hedging item and, as a result, the net unrealised loss related to the time value of the hedges is recognised
in the consolidated statement of comprehensive income for the year.
An intrinsic value gain of £4.9 million (FY2022: £6.0 million loss) on the Group’s hedges has been recognised through other comprehensive
income and a £0.5 million intrinsic value gain (FY2022: £0.5 million intrinsic value loss) was reclassified from equity to the statement of
comprehensive income in the year.
Included within the net realised and unrealised hedging gain of £4.4 million (note 7) recognised at 30 June 2023 (30 June 2022: £6.3 million
gain) are:
– a £0.5 million gain in respect of foreign exchange hedges covering net management fee income for the financial year ending 30 June 2023
(FY2022: £0.5 million loss); and
– a £3.9 million gain in respect of crystallised foreign exchange contracts (FY2022: £6.8 million gain).
Company
The risk management processes of the Company, including those relating to the specific risk exposures covered below, are aligned with
those of the Group as a whole unless stated otherwise.
In addition, the risk definitions that apply to the Group are also relevant for the Company.
Credit risk
The Company’s maximum exposure to credit risk is represented by the carrying value of its financial assets measured at amortised cost,
excluding prepayments. The table below lists financial assets subject to credit risk.
Cash and cash equivalents
Trade and other receivables
Total
Notes
17
2023
£m
327.7
282.5
610.2
2022
£m
159.7
454.8
614.5
The Company’s cash and cash equivalents comprise short-term deposits held with banks and liquidity funds which have credit ratings
ranging from A- to AAAm as at 30 June 2023 (30 June 2022: A to AAAm).
All trade and other receivables are considered to be fully recoverable and none were overdue at year end (30 June 2022: none overdue).
Liquidity risk
The Company’s exposure to liquidity risk is not considered to be material and, therefore, no further information is provided.
Details on other commitments are provided in note 29.
164 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
21) Financial instrument risk management continued
Group
The notional and fair values of foreign exchange hedging instruments were as follows:
The maturity profile of the Group’s outstanding hedges is shown below.
Cash flow hedges
Foreign exchange nil-cost option collars
Notional amount of option collars maturing:
Within 6 months
Between 6 and 12 months
Later than 12 months
2023
Fair value
assets/
(liabilities)
£m
0.2
0.2
Notional
amount
US$m
40.0
40.0
2022
Fair value
assets/
(liabilities)
£m
(5.2)
(5.2)
2022
US$m
40.0
40.0
20.0
100.0
Notional
amount
US$m
100.0
100.0
2023
US$m
30.0
10.0
–
40.0
When hedges are assessed as effective, intrinsic value gains and losses are initially recognised in other comprehensive income and later
reclassified to comprehensive income as the corresponding hedged cash flows crystallise. Time value in relation to the Group’s hedges is
excluded from being part of the hedging item and, as a result, the net unrealised loss related to the time value of the hedges is recognised
in the consolidated statement of comprehensive income for the year.
An intrinsic value gain of £4.9 million (FY2022: £6.0 million loss) on the Group’s hedges has been recognised through other comprehensive
income and a £0.5 million intrinsic value gain (FY2022: £0.5 million intrinsic value loss) was reclassified from equity to the statement of
comprehensive income in the year.
Included within the net realised and unrealised hedging gain of £4.4 million (note 7) recognised at 30 June 2023 (30 June 2022: £6.3 million
– a £0.5 million gain in respect of foreign exchange hedges covering net management fee income for the financial year ending 30 June 2023
(FY2022: £0.5 million loss); and
– a £3.9 million gain in respect of crystallised foreign exchange contracts (FY2022: £6.8 million gain).
The risk management processes of the Company, including those relating to the specific risk exposures covered below, are aligned with
those of the Group as a whole unless stated otherwise.
In addition, the risk definitions that apply to the Group are also relevant for the Company.
The Company’s maximum exposure to credit risk is represented by the carrying value of its financial assets measured at amortised cost,
excluding prepayments. The table below lists financial assets subject to credit risk.
gain) are:
Company
Credit risk
Cash and cash equivalents
Trade and other receivables
Total
Notes
17
2023
£m
327.7
282.5
610.2
2022
£m
159.7
454.8
614.5
The Company’s cash and cash equivalents comprise short-term deposits held with banks and liquidity funds which have credit ratings
ranging from A- to AAAm as at 30 June 2023 (30 June 2022: A to AAAm).
All trade and other receivables are considered to be fully recoverable and none were overdue at year end (30 June 2022: none overdue).
Liquidity risk
The Company’s exposure to liquidity risk is not considered to be material and, therefore, no further information is provided.
Details on other commitments are provided in note 29.
Company
Interest rate risk
The principal interest rate risk for the Company is that it could sustain a reduction in interest revenue from bank deposits held in the ordinary
course of business through adverse movements in interest rates.
Bank and similar deposits (including liquidity funds) held at year end are shown on the Company’s balance sheet as cash and cash
equivalents. The effective interest earned on bank and similar deposits during the year is given in the table below:
Deposits with banks and liquidity funds
2023
%
4.17
2022
%
0.46
At 30 June 2023, if interest rates over the year had been 50 basis points higher/lower with all other variables held constant, post-tax profit
for the year would have been £1.2 million higher/lower (FY2022: £0.6 million higher/lower), mainly as a result of higher/lower interest on
cash balances. An assumption that the fair value of assets and liabilities will not be affected by a change in interest rates was used in the
model to calculate the effect on post-tax profits.
Foreign exchange risk
The Company is exposed primarily to foreign exchange risk in respect of US dollar cash balances and US dollar-denominated intercompany
balances. However, such risk is not hedged by the Company.
At 30 June 2023, if the US dollar had strengthened/weakened by 1% against Sterling with all other variables held constant, profit before tax
for the year would have increased/decreased by £2.4 million (FY2022: increased/decreased by £3.6 million).
22) Share capital
Authorised share capital
Group and Company
Ordinary shares of 0.01p each
Issued share capital – allotted and fully paid
Group and Company
Ordinary shares of 0.01p each
2023
Number of
shares
2023
Nominal
value
£’000
2022
Number
of shares
900,000,000
90 900,000,000
2023
Number of
shares
2023
Nominal
value
£’000
2022
Number
of shares
712,740,804
71 712,740,804
2022
Nominal
value
£’000
90
2022
Nominal
value
£’000
71
All the above ordinary shares represent equity of the Company and rank pari passu in respect of participation and voting rights.
At 30 June 2023, there were equity-settled share awards issued under the Omnibus Plan totalling 39,389,867 (30 June 2022: 40,688,833)
shares that have release dates ranging from July 2023 to September 2027. Further details are provided in note 10.
23) Own shares
The Trustees of the Ashmore 2004 Employee Benefit Trust (EBT) acquire and hold shares in Ashmore Group plc with a view to facilitating
the vesting of share awards. As at 30 June 2023, the EBT owned 50,834,683 (30 June 2022: 55,512,301) ordinary shares of 0.01p with a
nominal value of £5,083 (30 June 2022: £5,551) and shareholders’ funds are reduced by £164.2 million (30 June 2022: £187.6 million)
in this respect. The EBT is periodically funded by the Company for these purposes.
Ashmore Group plc Annual Report and Accounts 2023
165
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
24) Trade and other payables
Current
Trade payables
Accruals and provisions
Amounts due to subsidiaries
Total trade and other payables
Group
2023
£m
13.3
10.9
–
24.2
Group
2022
£m
15.8
20.6
–
36.4
Company
2023
£m
Company
2022
£m
3.0
4.5
20.5
28.0
2.4
11.4
29.7
43.5
25) Interests in subsidiaries
Operating subsidiaries held by the Company
There were no movements in investment in subsidiaries held by the Company during the year.
Company
Cost
At 30 June 2023 and 2022
2023
£m
2022
£m
19.9
19.9
In the opinion of the Directors, the following subsidiary undertakings principally affected the Group’s results or financial position at
30 June 2023. A full list of the Group’s subsidiaries and all related undertakings is disclosed in note 33.
Country of
incorporation/
formation and
principal place of
operation
% of equity
shares held
by the Group
England
England
England
Colombia
Colombia
Colombia
Guernsey
India
Indonesia
Ireland
Japan
Mauritius
Saudi Arabia
Singapore
USA
USA
100.00
100.00
100.00
59.26
53.09
56.00
100.00
100.00
60.04
100.00
100.00
100.00
100.00
100.00
100.00
100.00
Name
Ashmore Investments (UK) Limited
Ashmore Investment Management Limited
Ashmore Investment Advisors Limited
Ashmore Management Company Colombia SAS
Ashmore CAF-AM Management Company SAS
Ashmore Avenida Investments (Real Estate) LLP
Ashmore Management Company Limited
Ashmore Investment Management India LLP
PT Ashmore Asset Management Indonesia Tbk
Ashmore Investment Management (Ireland) Limited
Ashmore Japan Co. Limited
Ashmore Investments (Holdings) Limited
Ashmore Investments Saudi Arabia
Ashmore Investment Management (Singapore) Pte. Ltd.
Ashmore Investment Management (US) Corporation
Ashmore Investment Advisors (US) Corporation
166 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
25) Interests in subsidiaries
Operating subsidiaries held by the Company
There were no movements in investment in subsidiaries held by the Company during the year.
In the opinion of the Directors, the following subsidiary undertakings principally affected the Group’s results or financial position at
30 June 2023. A full list of the Group’s subsidiaries and all related undertakings is disclosed in note 33.
24) Trade and other payables
Current
Trade payables
Accruals and provisions
Amounts due to subsidiaries
Total trade and other payables
Company
Cost
At 30 June 2023 and 2022
Name
Ashmore Investments (UK) Limited
Ashmore Investment Management Limited
Ashmore Investment Advisors Limited
Ashmore Management Company Colombia SAS
Ashmore CAF-AM Management Company SAS
Ashmore Avenida Investments (Real Estate) LLP
Ashmore Management Company Limited
Ashmore Investment Management India LLP
PT Ashmore Asset Management Indonesia Tbk
Ashmore Investment Management (Ireland) Limited
Ashmore Japan Co. Limited
Ashmore Investments (Holdings) Limited
Ashmore Investments Saudi Arabia
Ashmore Investment Management (Singapore) Pte. Ltd.
Ashmore Investment Management (US) Corporation
Ashmore Investment Advisors (US) Corporation
Group
2023
£m
13.3
10.9
–
24.2
Group
2022
£m
15.8
20.6
–
36.4
Company
Company
2023
£m
3.0
4.5
20.5
28.0
2022
£m
2.4
11.4
29.7
43.5
2023
£m
2022
£m
19.9
19.9
Country of
incorporation/
formation and
principal place of
% of equity
shares held
operation
by the Group
England
England
England
Colombia
Colombia
Colombia
Guernsey
India
Indonesia
Ireland
Japan
Mauritius
Saudi Arabia
Singapore
USA
USA
100.00
100.00
100.00
59.26
53.09
56.00
100.00
100.00
60.04
100.00
100.00
100.00
100.00
100.00
100.00
100.00
Consolidated funds
The Group consolidated the following 17 investment funds as at 30 June 2023 (30 June 2022: 18 investment funds) over which the Group
is deemed to have control:
Name
Ashmore Emerging Markets Debt and Currency Fund Limited
Ashmore SICAV Emerging Markets Corporate Debt ESG Fund
Ashmore SICAV Emerging Markets Equity ESG Fund
Ashmore SICAV Emerging Markets Indonesian Equity Fund
Ashmore SICAV Emerging Markets Global Small-Cap Equity Fund
Ashmore SICAV Emerging Markets Middle East Equity Fund
Ashmore SICAV Emerging Markets IG Total Return Fund
Ashmore SICAV Emerging Markets Total Return ESG Fund
Ashmore SICAV Emerging Markets Sovereign Debt ESG Fund
Ashmore SICAV Emerging Markets China Bond Fund
Ashmore Saudi Equity Fund
Ashmore Emerging Markets Active Equity Fund
Ashmore Emerging Markets Equity ESG Fund
Ashmore Emerging Markets Short Duration Select Fund
Ashmore Emerging Markets Investment Grade Income Fund
Ashmore Emerging Markets Corporate Debt ESG Fund
Ashmore Emerging Markets Local Currency Bond Fund
Country of
incorporation/
principal place of
operation
% of net
asset value
held by the
Group
Type of fund
Alternatives
Guernsey
Corporate debt Luxembourg
Equity Luxembourg
Equity Luxembourg
Equity Luxembourg
Equity Luxembourg
Blended debt Luxembourg
Blended debt Luxembourg
External debt Luxembourg
Local currency Luxembourg
Equity Saudi Arabia
Equity
Equity
Equity
Corporate debt
Corporate debt
Local currency
USA
USA
USA
USA
USA
USA
57.72
100.00
99.36
100.00
47.55
88.78
100.00
99.77
100.00
100.00
69.29
73.14
100.00
100.00
100.00
100.00
78.91
26) Investment in associates
The Group held an interest in the following associate as at 30 June 2023, over which it continues to have significant influence:
Name
Type
Nature of business
Country of incorporation/
formation and principal
place of operation
% of equity
shares held by
the Group
Taiping Fund Management Company
Associate Investment management
China
5.23%
The movement in the carrying value of investment in associates for the year is provided below:
Associates
At the beginning of the year
Reclassification
Gain on dilution
Share of profit for the year
Foreign exchange revaluation
At the end of the year
2023
£m
2.1
–
–
0.5
(0.3)
2.3
2022
£m
0.9
(0.2)
1.3
–
0.1
2.1
Ashmore Group plc Annual Report and Accounts 2023
167
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
26) Investment in associates continued
The summarised financial information for the associate is shown below.
Associates
Total assets
Total liabilities
Net assets
Group’s share of net assets
Revenue for the year
Profit for the year
Group’s share of profit for the year
2023
£m
53.2
(10.0)
43.2
2.3
23.6
9.6
0.5
2022
£m
54.5
(13.3)
41.2
2.1
23.5
0.8
–
The carrying value of the investment in associates represents the cost of acquisition subsequently adjusted for share of profit or loss
and other comprehensive income or loss. No permanent impairment is believed to exist relating to the associate as at 30 June 2023.
The Group had no undrawn capital commitments (30 June 2022: £nil) to investment funds managed by the associate.
27) Interests in structured entities
The Group has interests in structured entities as a result of the management of assets on behalf of its clients. Where the Group holds a
direct interest in a closed-ended fund, private equity fund or open-ended pooled fund such as a SICAV, the interest is accounted for either as
a consolidated structured entity or as a financial asset, depending on whether the Group has control over the fund or not.
The Group’s interest in structured entities is reflected in the Group’s AuM. The Group is exposed to movements in AuM of structured
entities through the potential loss of fee income as a result of client withdrawals. Outflows from funds are dependent on market sentiment,
asset performance and investor considerations. Further information on these risks can be found in the Strategic report.
Considering the potential for changes in AuM of structured entities, management has determined that the Group’s unconsolidated
structured entities include segregated mandates and pooled funds vehicles. Disclosure of the Group’s exposure to unconsolidated
structured entities has been made on this basis.
The reconciliation of AuM reported by the Group within unconsolidated structured entities is shown below.
30 June 2022
30 June 2023
Less:
AuM within
consolidated
funds
US$bn
AuM within
unconsolidated
structured
entities
US$bn
0.3
0.3
63.7
55.6
Total AuM
US$bn
64.0
55.9
Included in the Group’s consolidated management fees of £185.4 million (FY2022: £247.0 million) are management fees amounting to
£184.2 million (FY2022: £246.0 million) earned from unconsolidated structured entities.
The table below shows the carrying values of the Group’s interests in unconsolidated structured entities, recognised in the Group balance
sheet, which are equal to the Group’s maximum exposure to loss from those interests.
Management fees receivable
Trade and other receivables
Seed capital investments*
Total exposure
2023
£m
37.7
1.3
107.2
146.2
2022
£m
47.6
0.8
68.8
117.2
* Comprise financial assets measured at fair value and non-current financial assets measured at fair value (refer to note 20).
The main risk the Group faces from its beneficial interests in unconsolidated structured entities arises from a potential decrease in the fair
value of seed capital investments. The Group’s beneficial interests in seed capital investments are disclosed in note 20. Note 21 includes
further information on the Group’s exposure to market risk arising from seed capital investments.
168 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
26) Investment in associates continued
The summarised financial information for the associate is shown below.
Associates
Total assets
Total liabilities
Net assets
Group’s share of net assets
Revenue for the year
Profit for the year
Group’s share of profit for the year
2023
£m
53.2
(10.0)
43.2
2.3
23.6
9.6
0.5
2022
£m
54.5
(13.3)
41.2
2.1
23.5
0.8
–
The carrying value of the investment in associates represents the cost of acquisition subsequently adjusted for share of profit or loss
and other comprehensive income or loss. No permanent impairment is believed to exist relating to the associate as at 30 June 2023.
The Group had no undrawn capital commitments (30 June 2022: £nil) to investment funds managed by the associate.
27) Interests in structured entities
The Group has interests in structured entities as a result of the management of assets on behalf of its clients. Where the Group holds a
direct interest in a closed-ended fund, private equity fund or open-ended pooled fund such as a SICAV, the interest is accounted for either as
a consolidated structured entity or as a financial asset, depending on whether the Group has control over the fund or not.
The Group’s interest in structured entities is reflected in the Group’s AuM. The Group is exposed to movements in AuM of structured
entities through the potential loss of fee income as a result of client withdrawals. Outflows from funds are dependent on market sentiment,
asset performance and investor considerations. Further information on these risks can be found in the Strategic report.
Considering the potential for changes in AuM of structured entities, management has determined that the Group’s unconsolidated
structured entities include segregated mandates and pooled funds vehicles. Disclosure of the Group’s exposure to unconsolidated
structured entities has been made on this basis.
The reconciliation of AuM reported by the Group within unconsolidated structured entities is shown below.
Included in the Group’s consolidated management fees of £185.4 million (FY2022: £247.0 million) are management fees amounting to
£184.2 million (FY2022: £246.0 million) earned from unconsolidated structured entities.
The table below shows the carrying values of the Group’s interests in unconsolidated structured entities, recognised in the Group balance
sheet, which are equal to the Group’s maximum exposure to loss from those interests.
30 June 2022
30 June 2023
Management fees receivable
Trade and other receivables
Seed capital investments*
Total exposure
Less:
AuM within
consolidated
AuM within
unconsolidated
structured
funds
US$bn
0.3
0.3
entities
US$bn
63.7
55.6
Total AuM
US$bn
64.0
55.9
2023
£m
37.7
1.3
107.2
146.2
2022
£m
47.6
0.8
68.8
117.2
* Comprise financial assets measured at fair value and non-current financial assets measured at fair value (refer to note 20).
The main risk the Group faces from its beneficial interests in unconsolidated structured entities arises from a potential decrease in the fair
value of seed capital investments. The Group’s beneficial interests in seed capital investments are disclosed in note 20. Note 21 includes
further information on the Group’s exposure to market risk arising from seed capital investments.
28) Related party transactions
Related parties of the Group include key management personnel, close family members of key management personnel, subsidiaries,
associates, joint ventures, Ashmore funds, the EBT and The Ashmore Foundation.
Key management personnel – Group and Company
The compensation paid to or payable to key management personnel is shown below:
Short-term benefits
Defined contribution pension costs
Share-based payment benefits (note 10)
2023
£m
0.8
–
0.4
1.2
2022
£m
0.8
–
0.2
1.0
Short-term benefits include salary and fees, benefits and cash bonus.
Share-based payment benefits represent the cost of equity-settled awards charged to the statement of comprehensive income.
Details of the remuneration of Directors are given in the Remuneration report on pages 78 to 111.
During the year, there were no other transactions entered into with key management personnel (FY2022: none). Aggregate key
management personnel interests in consolidated funds at 30 June 2023 were £44.5 million (30 June 2022: £62.7 million).
Transactions with subsidiaries – Company
Details of transactions between the Company and its subsidiaries are shown below:
Transactions during the year
Management fees
Net dividends
Loans repaid by subsidiaries
Amounts receivable or payable to subsidiaries are disclosed in notes 17 and 24 respectively.
2023
£m
2022
£m
59.7
145.2
110.5
67.2
174.0
183.8
Ashmore Group plc Annual Report and Accounts 2023
169
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
28) Related party transactions continued
Transactions with Ashmore funds – Group
During the year, the Group received £64.0 million of gross management fees and performance fees (FY2022: £96.2 million) from the
104 funds (FY2022: 99 funds) it manages and which are classified as related parties. As at 30 June 2023, the Group had receivables due
from funds of £4.6 million (30 June 2022: £5.8 million) that are classified as related parties.
Transactions with the EBT – Group and Company
The EBT has been provided with a loan facility to allow it to acquire Ashmore shares in order to satisfy outstanding unvested share awards.
The EBT is included within the results of the Group and the Company. As at 30 June 2023, the loan outstanding was £150.7 million
(30 June 2022: £163.7 million).
Transactions with The Ashmore Foundation – Group and Company
The Ashmore Foundation is a related party to the Group. The Foundation was set up to provide financial grants to worthwhile causes within
the Emerging Markets countries in which Ashmore invests and/or operates with a view to giving back to the countries and communities.
The Group donated £0.5 million to the Foundation during the year (FY2022: £0.6 million).
29) Commitments
The Group has undrawn investment commitments relating to seed capital investments as follows:
Group
Ashmore Andean Fund II, LP
Ashmore Avenida Colombia Real Estate Fund I (Cayman) LP
Ashmore I – CAF Colombian Infrastructure Senior Debt Fund
Fondo Ashmore Andino III – FCP
Ashmore KCH HealthCare Fund II
Ashmore KCH HealthCare LLC
Total undrawn investment commitments
2023
£m
0.1
0.1
5.7
3.0
–
–
8.9
2022
£m
0.1
0.1
6.6
–
1.2
4.4
12.4
Company
The Company has undrawn loan commitments to other Group entities totalling £482.5 million (30 June 2022: £394.1 million) to support their
investment activities but has no investment commitments of its own (30 June 2022: none).
30) Contingent assets and liabilities
The Company and its subsidiaries can be party to legal claims arising in the normal course of business. The Directors do not anticipate that
the outcome of any such potential proceedings and claims will have a material adverse effect on the Group’s financial position and at
present there are no such claims where their financial impact can be reasonably estimated. There are no other material contingent assets or
liabilities.
170 Ashmore Group plc Annual Report and Accounts 2023
31) Non-controlling interests
The Group’s material NCI as at 30 June 2023 was held in PT Ashmore Asset Management Indonesia Tbk (Ashmore Indonesia). Set out
below is summarised financial information and the amounts disclosed are before intercompany eliminations.
Transactions with The Ashmore Foundation – Group and Company
The Ashmore Foundation is a related party to the Group. The Foundation was set up to provide financial grants to worthwhile causes within
Summarised statement of comprehensive income
Summarised balance sheet
Total assets
Total liabilities
Net assets
Non-controlling interests*
2023
£m
0.1
0.1
5.7
3.0
–
–
8.9
2022
£m
0.1
0.1
6.6
–
1.2
4.4
12.4
Net revenue
Profit for the period
Other comprehensive income/(loss)
Total comprehensive income
Profit allocated to NCI
Dividends paid to NCI
Summarised cash flows
Cash flows from operating activities
Cash flows used in investing activities
Cash flows used in financing activities
Net decrease in cash and cash equivalents
* £6.8 million of historical NCI was reclassified to retained earnings during the year.
40% NCI
Ashmore Indonesia
2023
£m
19.8
(4.4)
15.4
6.1
10.9
5.1
(0.9)
4.2
1.6
2.3
4.6
–
(6.3)
(1.7)
2022
£m
23.0
(6.4)
16.6
13.6
12.3
5.9
1.6
7.5
3.0
2.3
6.5
(3.6)
(6.3)
(3.4)
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
28) Related party transactions continued
Transactions with Ashmore funds – Group
During the year, the Group received £64.0 million of gross management fees and performance fees (FY2022: £96.2 million) from the
104 funds (FY2022: 99 funds) it manages and which are classified as related parties. As at 30 June 2023, the Group had receivables due
from funds of £4.6 million (30 June 2022: £5.8 million) that are classified as related parties.
Transactions with the EBT – Group and Company
The EBT has been provided with a loan facility to allow it to acquire Ashmore shares in order to satisfy outstanding unvested share awards.
The EBT is included within the results of the Group and the Company. As at 30 June 2023, the loan outstanding was £150.7 million
(30 June 2022: £163.7 million).
the Emerging Markets countries in which Ashmore invests and/or operates with a view to giving back to the countries and communities.
The Group donated £0.5 million to the Foundation during the year (FY2022: £0.6 million).
The Group has undrawn investment commitments relating to seed capital investments as follows:
29) Commitments
Group
Ashmore Andean Fund II, LP
Ashmore Avenida Colombia Real Estate Fund I (Cayman) LP
Ashmore I – CAF Colombian Infrastructure Senior Debt Fund
Fondo Ashmore Andino III – FCP
Ashmore KCH HealthCare Fund II
Ashmore KCH HealthCare LLC
Total undrawn investment commitments
Company
The Company has undrawn loan commitments to other Group entities totalling £482.5 million (30 June 2022: £394.1 million) to support their
investment activities but has no investment commitments of its own (30 June 2022: none).
30) Contingent assets and liabilities
The Company and its subsidiaries can be party to legal claims arising in the normal course of business. The Directors do not anticipate that
the outcome of any such potential proceedings and claims will have a material adverse effect on the Group’s financial position and at
present there are no such claims where their financial impact can be reasonably estimated. There are no other material contingent assets or
liabilities.
Ashmore Group plc Annual Report and Accounts 2023
171
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
32) Post-balance sheet events
There are no post-balance sheet events that require adjustment or disclosure in the Group consolidated financial statements.
33) Subsidiaries and related undertakings
The following is a full list of the Ashmore Group plc subsidiaries and related undertakings as at 30 June 2023, along with the registered
address and the percentage of equity owned by the Group. Related undertakings comprise significant holdings in associated undertakings,
joint ventures and Ashmore sponsored public funds in which the Group owns greater than 20% interest.
Name
Ashmore Investments (UK) Limited1
Ashmore Investment Management Limited
Ashmore Investment Advisors Limited
Aldwych Administration Services Limited (dormant)
Ashmore Asset Management Limited (dormant)
Ashmore Avenida Investments (Real Estate) LLP
Ashmore Avenida Devco Holding Company Limited2
Classification
% voting
interest
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
56.00
Subsidiary
100.00
Registered address and place of incorporation
61 Aldwych, London WC2B 4AE
United Kingdom
Ashmore Investment Management (Ireland) Limited
Subsidiary
100.00 32 Molesworth Street, Dublin 2, D02 Y512
Ashmore Investment Management India LLP
Subsidiary
100.00
507A Kakad Chambers, Dr Annie Besant
Road Worli, Mumbai 400 018, India
Ashmore Investment Management (US) Corporation
Ashmore Investment Advisors (US) Corporation
Subsidiary
Subsidiary
100.00 The Corporation Trust Center, 1209 Orange
Street, Wilmington, DE 19801, USA
100.00
Avenida Partners LLC
Avenida CREF I Manager Cayman LLC
Avenida CREF I Manager LLC
Avenida A2 Partners LLC
Avenida Colombia Member LLC
Avenida CREF II Partners LLC
Avenida CREF II GP LLC
MCA Partners LLC
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
83.30
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
200 Park Avenue South
New York, 10003
USA
1. Ashmore Investments (UK) Limited (registered number 3345198) is exempt from the requirements relating to the audit of accounts under section 479A of the UK
Companies Act 2006.
2. Ashmore Avenida Devco Holding Company Limited is under an active proposal to strike off.
172 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
There are no post-balance sheet events that require adjustment or disclosure in the Group consolidated financial statements.
32) Post-balance sheet events
33) Subsidiaries and related undertakings
The following is a full list of the Ashmore Group plc subsidiaries and related undertakings as at 30 June 2023, along with the registered
address and the percentage of equity owned by the Group. Related undertakings comprise significant holdings in associated undertakings,
joint ventures and Ashmore sponsored public funds in which the Group owns greater than 20% interest.
Ashmore Investment Management (Ireland) Limited
Subsidiary
100.00 32 Molesworth Street, Dublin 2, D02 Y512
Ashmore Investment Management India LLP
Subsidiary
100.00
507A Kakad Chambers, Dr Annie Besant
Ashmore Investment Management (US) Corporation
Subsidiary
100.00 The Corporation Trust Center, 1209 Orange
Name
Ashmore Investments (UK) Limited1
Ashmore Investment Management Limited
Ashmore Investment Advisors Limited
Aldwych Administration Services Limited (dormant)
Ashmore Asset Management Limited (dormant)
Ashmore Avenida Investments (Real Estate) LLP
Ashmore Avenida Devco Holding Company Limited2
Ashmore Investment Advisors (US) Corporation
Avenida Partners LLC
Avenida CREF I Manager Cayman LLC
Avenida CREF I Manager LLC
Avenida A2 Partners LLC
Avenida Colombia Member LLC
Avenida CREF II Partners LLC
Avenida CREF II GP LLC
MCA Partners LLC
Companies Act 2006.
Registered address and place of incorporation
61 Aldwych, London WC2B 4AE
United Kingdom
Road Worli, Mumbai 400 018, India
Street, Wilmington, DE 19801, USA
200 Park Avenue South
New York, 10003
USA
Classification
% voting
interest
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
56.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
83.30
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
1. Ashmore Investments (UK) Limited (registered number 3345198) is exempt from the requirements relating to the audit of accounts under section 479A of the UK
2. Ashmore Avenida Devco Holding Company Limited is under an active proposal to strike off.
Name
Avenida REF Holding SA
Avenida CREF II Manager SRL
Avenida CREF Partners SRL
Avenida CREF II GP SRL
Ashmore Avenida LatAm Energy Efficient Affordable Housing
Fund III GP
Classification
% voting
interest
Subsidiary
100.00
Subsidiary
Subsidiary
Subsidiary
99.99
99.99
85.09
Subsidiary
100.00
Registered address and place of incorporation
Yamandu 1321, 11500
Montevideo
Uruguay
10 rue du Château d’Eau, L-3364
Leudelange, Grand Duchy of Luxembourg
Ashmore Investment Management (Singapore) Pte. Ltd.
Subsidiary
100.00 1 George Street, #15-04, Singapore 049145
KCH Cairo Pte. Ltd (dormant)
KCH Cairo S.A.E. (dormant)
PT Ashmore Asset Management Indonesia Tbk
Ashmore Dana Pasar Uang Syariah
Ashmore Dana USD Fixed Income
Ashmore Management Company Colombia SAS
Ashmore-CAF-AM Management Company SAS
Ashmore Holdings Colombia SAS
Ashmore Investment Advisors S.A. Sociedad Fiduciaria
Ashmore Backup Management Company SAS
Avenida Colombia Management Company SAS
Ashmore Avenida DP General Partner SAS
Ashmore Avenida Back Office SAS
Ashmore Peru Backup Management
Zone (T) – Emaar, Up Town Cairo,
Mokattam, Cairo, Egypt
Pacific Century Place, 18th Floor,
SCBD Lot 10, Jl. Jenderal. Sudirman Kav.
52-53 Jakarta 12190, Indonesia
Carrera 7 No. 75-66,
Office 701 & 702
Bogotá, Colombia
Subsidiary
100.00
Subsidiary
99.20
Subsidiary
60.04
Financial asset
100.00
Financial asset
Subsidiary
Subsidiary
39.42
59.26
53.09
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
80.00
Subsidiary
100.00
Subsidiary
100.00 Av. Circunvalación del Club Golf Los Incas
No. 134, Torre 1, Of. 505, Surco. Lima, Perú
Ashmore Japan Co. Limited
Subsidiary
100.00
11F, Shin Marunouchi Building 1-5-1
Marunouchi Chiyoda-ku
Tokyo Japan 100-6511
Ashmore Investments (Colombia) SL
Ashmore Management (DIFC) Limited
Ashmore Investment Saudi Arabia
Ashmore Saudi Equity Fund
Ashmore AISA (Cayman) Limited
Subsidiary
100.00 c/o Hermosilla 11, 4ºA, 28001 Madrid, Spain
Subsidiary
100.00 Unit L30-07, Level 30, ICD Brookfield Place,
Dubai International Financial Centre, Dubai,
UAE
Subsidiary
100.00
Consolidated fund
69.29
3rd Floor Tower B, Olaya Towers
Olaya Main Street, Riyadh, Saudi Arabia
Subsidiary
100.00 PO Box 309, Ugland House, Grand Cayman,
KY1-1104, Cayman Islands
AA Development Capital Investment Managers
(Mauritius) LLC
Subsidiary
55.00
Ashmore Investments (Holdings) Limited
Subsidiary
100.00
Les Cascades Building
33 Edith Cavell Street, Port Louis
Mauritius
Ashmore Group plc Annual Report and Accounts 2023
173
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
33) Subsidiaries and related undertakings continued
Name
Ashmore Management Company Limited
Ashmore Global Special Situations Fund 3 (GP) Limited
Ashmore Global Special Situations Fund 4 (GP) Limited
Ashmore Global Special Situations Fund 5 (GP) Limited
Classification
% voting
interest
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Ashmore Venezuela Recovery Fund 2 Ltd
Financial asset
Ashmore Emerging Markets Debt and Currency Fund Limited
Consolidated fund
Ashmore SICAV Emerging Markets Middle East Equity Fund
Consolidated fund
45.85
57.72
88.78
Ashmore SICAV Emerging Markets Sovereign Debt ESG Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Corporate Debt ESG Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets China Bond Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Global Small-Cap Equity Fund
Consolidated fund
47.55
Ashmore SICAV Emerging Markets IG Total Return Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Total Return ESG Fund
Consolidated fund
99.77
Ashmore SICAV Emerging Markets Indonesian Equity Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Equity ESG Fund
Consolidated fund
99.36
Ashmore SICAV Emerging Markets Local Currency Bond Fund 2
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Shariah Active Equity Fund
Financial asset
100.00
Ashmore SICAV Emerging Markets IG Short Duration Fund
Ashmore SICAV Emerging Markets Multi-Asset Fund
Financial asset
Financial asset
30.01
28.46
Ashmore Emerging Markets Corporate Debt ESG Fund
Consolidated fund
100.00
Ashmore Emerging Markets Investment Grade Income Fund
Consolidated fund
100.00
Ashmore Emerging Markets Active Equity Fund
Ashmore Emerging Markets Local Currency Bond Fund
Ashmore Emerging Markets Equity ESG Fund
Consolidated fund
Consolidated fund
73.14
78.91
Consolidated fund
100.00
Ashmore Emerging Markets Short Duration Select Fund
Consolidated fund
100.00
Registered address and place of incorporation
Trafalgar Court
Les Banques
St Peter Port
GY1 3QL
Guernsey
10, rue du Chateau d’Eau
L-3364 Leudelange
Grand-Duchy of Luxembourg
50 South LaSalle Street
Chicago, Illinois 60603
Cautionary statement regarding forward-looking statements
It is possible that this document could or may contain forward-looking statements that are based on current expectations or beliefs, as well
as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical
or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will,
may, should, would, could or other words of similar meaning.
Undue reliance should not be placed on any such statements because, by their very nature, they are subject to known and unknown risks
and uncertainties and can be affected by other factors that could cause actual results, and the Group’s plans and objectives, to differ
materially from those expressed or implied in the forward-looking statements. There are several factors that could cause actual results to
differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ
materially from those described in the forward-looking statements are changes in global, political, economic, business, competitive, market
and regulatory forces, future exchange and interest rates, changes in tax rates and future business combinations or dispositions. The Group
undertakes no obligation to revise or update any forward-looking statements contained within this document, regardless of whether those
statements are affected as a result of new information, future events or otherwise.
174 Ashmore Group plc Annual Report and Accounts 2023
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )
Five-year summary
Name
Classification
Registered address and place of incorporation
33) Subsidiaries and related undertakings continued
Ashmore Management Company Limited
Ashmore Global Special Situations Fund 3 (GP) Limited
Ashmore Global Special Situations Fund 4 (GP) Limited
Ashmore Global Special Situations Fund 5 (GP) Limited
% voting
interest
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Subsidiary
100.00
Ashmore Venezuela Recovery Fund 2 Ltd
Financial asset
Ashmore Emerging Markets Debt and Currency Fund Limited
Consolidated fund
Ashmore SICAV Emerging Markets Middle East Equity Fund
Consolidated fund
45.85
57.72
88.78
Ashmore SICAV Emerging Markets Sovereign Debt ESG Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Corporate Debt ESG Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets China Bond Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Global Small-Cap Equity Fund
Consolidated fund
47.55
Ashmore SICAV Emerging Markets IG Total Return Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Total Return ESG Fund
Consolidated fund
99.77
Ashmore SICAV Emerging Markets Indonesian Equity Fund
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Equity ESG Fund
Consolidated fund
99.36
Ashmore SICAV Emerging Markets Local Currency Bond Fund 2
Consolidated fund
100.00
Ashmore SICAV Emerging Markets Shariah Active Equity Fund
Financial asset
100.00
Ashmore SICAV Emerging Markets IG Short Duration Fund
Ashmore SICAV Emerging Markets Multi-Asset Fund
Financial asset
Financial asset
30.01
28.46
Ashmore Emerging Markets Corporate Debt ESG Fund
Consolidated fund
100.00
Ashmore Emerging Markets Investment Grade Income Fund
Consolidated fund
100.00
Ashmore Emerging Markets Active Equity Fund
Ashmore Emerging Markets Local Currency Bond Fund
Ashmore Emerging Markets Equity ESG Fund
Consolidated fund
Consolidated fund
73.14
78.91
Consolidated fund
100.00
Ashmore Emerging Markets Short Duration Select Fund
Consolidated fund
100.00
50 South LaSalle Street
Chicago, Illinois 60603
Cautionary statement regarding forward-looking statements
It is possible that this document could or may contain forward-looking statements that are based on current expectations or beliefs, as well
as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical
or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will,
may, should, would, could or other words of similar meaning.
Undue reliance should not be placed on any such statements because, by their very nature, they are subject to known and unknown risks
and uncertainties and can be affected by other factors that could cause actual results, and the Group’s plans and objectives, to differ
materially from those expressed or implied in the forward-looking statements. There are several factors that could cause actual results to
differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ
materially from those described in the forward-looking statements are changes in global, political, economic, business, competitive, market
and regulatory forces, future exchange and interest rates, changes in tax rates and future business combinations or dispositions. The Group
undertakes no obligation to revise or update any forward-looking statements contained within this document, regardless of whether those
statements are affected as a result of new information, future events or otherwise.
Trafalgar Court
Les Banques
St Peter Port
GY1 3QL
Guernsey
Management fees
Performance fees
Other revenue
Total revenue
Distribution costs
Foreign exchange
Net revenue
10, rue du Chateau d’Eau
L-3364 Leudelange
Grand-Duchy of Luxembourg
Gains/(losses) on investment securities
Change in third-party interests in consolidated funds
Personnel expenses
Variable compensation
Other operating expenses
Total operating expenses
Operating profit
Finance income/(expense)
Share of profit/(loss) from associates and joint ventures
Profit before tax
Tax expense
Profit for the year
EPS (basic)
Dividend per share
Other operating data (unaudited)
AuM at year end (US$bn)
Average AuM (US$bn)
Average GBP:USD exchange rate for the year
Period end GBP:USD exchange rate for the year
2023
£m
2022
£m
2021
£m
2020
£m
2019
£m
185.4
247.0
276.4
330.0
307.6
5.1
2.7
4.5
2.9
11.9
4.6
193.2
254.4
292.9
3.9
4.1
338.0
(14.5)
7.0
330.5
(19.1)
7.5
(27.6)
(55.0)
(26.6)
(109.2)
209.7
12.0
(0.2)
221.5
(36.8)
184.7
2.8
5.9
316.3
(13.3)
11.3
314.3
0.5
3.8
(26.5)
(57.7)
(31.6)
(115.8)
202.8
17.4
(0.3)
219.9
(38.4)
181.5
(3.5)
11.6
262.5
(61.3)
16.5
(27.8)
(45.6)
(25.1)
(98.5)
119.2
(2.1)
1.3
118.4
(26.5)
91.9
(5.5)
4.3
291.7
123.5
(52.6)
(26.7)
(53.6)
(24.0)
(104.3)
258.3
23.9
0.3
282.5
(40.7)
241.8
13.4p
16.9p
36.4p
16.9p
27.4p
16.9p
26.6p
16.7p
64.0
83.6
1.33
1.21
94.4
90.0
1.35
1.38
83.6
89.6
1.26
1.24
91.8
80.5
1.30
1.27
(2.2)
5.4
196.4
(44.3)
19.3
(31.4)
(34.8)
(27.8)
(94.0)
77.4
33.9
0.5
111.8
(25.3)
86.5
12.4p
16.9p
55.9
58.2
1.21
1.27
Ashmore Group plc Annual Report and Accounts 2023
175
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS
A L T E R N A T I V E P E R F O R M A N C E M E A S U R E S
Ashmore discloses APMs in order to assist shareholders’ understanding of the Group’s operational performance during the accounting
period and to allow consistent comparisons with prior periods.
The calculation of APMs is consistent with the financial year ended 30 June 2022. Historical disclosures relating to APMs,
including explanations and reconciliations, can be found in the respective interim financial reports and Annual Reports and Accounts.
Net revenue
As shown in the CSCI, net revenue is total revenue less distribution costs and including FX. This provides a comprehensive view of
the revenues recognised by the Group in the period.
Total revenue
Less:
Distribution costs
Add:
Foreign exchange
Net revenue
Reference
CSCI
CSCI
CSCI
FY2023
£m
193.2
FY2022
£m
254.4
(2.2)
(3.5)
5.4
196.4
11.6
262.5
Net management fees
The principal component of the Group’s revenues is management fees, net of associated distribution costs, earned on AuM.
Management fees
Less:
Distribution costs
Net management fees
Reference
CSCI
CSCI
FY2023
£m
185.4
(2.2)
183.2
FY2022
£m
247.0
(3.5)
243.5
Net management fee margin
The net management fee margin is defined as the ratio of annualised management fees less distribution costs to average AuM for the
period, in US dollars since it is the primary currency in which fees are received and matches the Group’s AuM disclosures. The average
AuM excludes assets where fees are not recognised in revenues, for example AuM related to associates or joint ventures. The margin
is a principal measure of the firm’s revenue generating capability and is a commonly used industry performance measure.
Net management fee income (US$m)
Average AuM (US$bn)
Net management fee margin (bps)
FY2023
220.6
57.7
38
FY2022
323.4
82.8
39
Variable compensation ratio
The variable compensation ratio is defined as the charge for VC as a proportion of EBVCIT. The linking of variable annual pay awards to
the Group’s profitability is one of the principal methods by which the Group controls its operating costs. The charge for VC is a component
of personnel expenses and comprises share-based payments and performance-related cash bonuses.
EBVCIT is operating profit excluding the charge for VC, charitable donations and seed capital-related items. The latter comprises gains/
losses on investment securities, change in third-party interests in consolidated funds, and other expenses in respect of consolidated funds.
Operating profit
Less:
Seed capital-related items
Add:
Variable remuneration
Charitable donations
EBVCIT
VC ratio
Reference
CSCI
FY2023
£m
77.4
FY2022
£m
119.2
CSCI, Note 20c
26.3
46.2
Note 9
34.8
0.5
139.0
25.0%
45.6
0.6
211.6
21.5%
176 Ashmore Group plc Annual Report and Accounts 2023
EBITDA
EBITDA provides a view of the operating performance of the business before certain non-cash items, financing income and charges,
and taxation.
Operating profit
Add:
Depreciation and amortisation
EBITDA
Reference
CSCI
Note 11
FY2023
£m
77.4
3.2
80.6
FY2022
£m
119.2
3.1
122.3
Adjusted net revenue, adjusted operating costs and adjusted EBITDA
Adjusted figures exclude items relating to FX translation and seed capital. This provides an alternative view of performance, excluding the
volatility associated with those items, which is used by management to assess the Group’s operating performance.
Net revenue
Less:
FX translation
Adjusted net revenue
Personnel expenses
Other expenses
Less:
Other expenses in consolidated funds
Add:
VC % on FX translation
Adjusted operating costs
EBITDA
Less:
FX translation
VC % on FX translation
Seed capital-related items
Adjusted EBITDA
Reference
CSCI
Note 7
Reference
CSCI
CSCI
Note 20c
Note 7
Reference
Note 7
Note 7
CSCI, Note 20c
FY2023
£m
196.4
(1.0)
195.4
FY2023
£m
(66.2)
(27.8)
FY2022
£m
262.5
(5.3)
257.2
FY2022
£m
(73.4)
(25.1)
1.3
1.4
0.3
(92.4)
FY2023
£m
80.6
(1.0)
0.3
26.3
106.2
1.1
(96.0)
FY2022
£m
122.3
(5.3)
1.1
46.2
164.3
Adjusted EBITDA margin
The ratio of adjusted EBITDA to adjusted net revenue. This is an appropriate measure of the Group’s operational efficiency and its ability
to generate returns for shareholders.
Ashmore Group plc Annual Report and Accounts 2023
177
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS A L T E R N A T I V E P E R F O R M A N C E M E A S U R E S ( C O N T I N U E D )
Adjusted diluted EPS
Diluted EPS excluding items relating to FX translation and seed capital, as described above, and the related tax impact.
Diluted EPS
Less:
FX translation
Tax on FX translation
Seed capital-related items
Tax on seed capital-related items
Adjusted diluted EPS
Reference
CSCI
Note 7
CSCI, Note 8, Note 20c
FY2023
pence
12.2
(0.1)
-
1.2
(0.6)
12.7
FY2022
pence
12.6
(0.6)
0.1
7.1
(0.5)
18.7
Conversion of operating profits to cash
This compares cash generated from operations, excluding consolidated funds, to adjusted EBITDA, and is a measure of the effectiveness
of the Group’s operations in converting profits to cash flows for shareholders. Excluding consolidated funds also ensures consistency
between the cash flow and adjusted EBITDA.
Cash generated from operations
Less:
Reference
Consolidated cash flow statement
Cash flows relating to consolidated funds
Note 20c
Operating cash flow
Adjusted EBITDA
Conversion of operating profits to cash
FY2023
£m
111.6
0.1
111.7
106.2
105%
FY2022
£m
182.1
2.8
184.9
164.3
113%
Capital resources
Ashmore has calculated its capital resources in a manner consistent with the IFPR. Note that goodwill and intangible assets include
associated deferred tax liabilities and deferred acquisition costs, and foreseeable dividends relate to the proposed final dividend of
12.1 pence per share. Other adjustments relate to the cash flow hedging reserve.
Total equity
Less:
Goodwill and intangibles
Deferred tax assets
Foreseeable dividends
Investments in financial sector entities
Other adjustments
Capital resources
Reference
Balance sheet
n/a
Balance sheet
Note 14
n/a
Consolidated statement of changes in equity
30 June 2023
£m
898.8
30 June 2022
£m
945.0
(80.0)
(23.9)
(85.1)
(5.0)
-
704.8
(84.4)
(32.7)
(84.7)
(4.9)
4.9
743.2
178 Ashmore Group plc Annual Report and Accounts 2023
I N F O R M A T I O N F O R S H A R E H O L D E R S
Ashmore Group plc
Registered in England and Wales.
Company No. 3675683
Registered office
61 Aldwych
London WC2B 4AE
Tel: +44 (0) 20 3077 6000
Fax: +44 (0) 20 3077 6001
Principal UK trading subsidiary
Ashmore Investment Management Limited
Registered in England and Wales, Company No. 3344281.
Business address and registered office as above.
Further information on Ashmore can be found
on the Company’s website: www.ashmoregroup.com.
Financial calendar
First quarter AuM statement
Annual General Meeting
Ex-dividend date
Record date
Final dividend payment date
Second quarter AuM statement
Announcement of unaudited interim
results for the six months ended
31 December 2023
Interim dividend payment date
Third quarter AuM statement
Fourth quarter AuM statement
Announcement of results for the year
ended 30 June 2024
13 October 2023
18 October 2023
2 November 2023
3 November 2023
8 December 2023
January 2024
February 2024
March 2024
April 2024
July 2024
September 2024
Registrar
Equiniti Registrars
Aspect House
Spencer Road
West Sussex
BN99 6DA
UK shareholder helpline: +44 (0) 371 384 2812. Lines are open
8.30am to 5.30pm, Monday to Friday. If calling from overseas,
please ensure the country code is used.
Further information about the Registrar is available on its website
www.equiniti.com.
Up-to-date information about current holdings on the register
is also available at www.shareview.co.uk.
Shareholders will need their reference number (account number)
and postcode to view information on their own holding.
Share price information
Share price information can be found at www.ashmoregroup.com
or through your broker.
Share dealing
Shares may be sold through a stockbroker or share dealing service.
There are a variety of services available. The Registrar offers an
internet-based share dealing service known as Shareview Dealing.
You can log on at www.shareview.co.uk/dealing to access this
service, or contact the helpline on +44 (0) 345 603 7037 to deal
by telephone.
You may also use the Shareview service to access and manage
your share investments and view balance movements, indicative
share prices, information on recent dividends, portfolio valuation
and general information for shareholders.
Shareholders must register at www.shareview.co.uk,
entering the shareholder reference on the share certificate
and other personal details.
Having selected a personal PIN, a user ID will be issued
by the Registrar.
Electronic copies of the 2023 Annual Report and
Accounts and other publications
Copies of the 2023 Annual Report and Accounts, the Notice
of Annual General Meeting, other corporate publications, press
releases and announcements are available on the Company’s
website at www.ashmoregroup.com.
Ashmore Group plc Annual Report and Accounts 2023
179
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS I N F O R M A T I O N F O R S H A R E H O L D E R S ( C O N T I N U E D )
Transferring Ashmore Group plc shares
Transferring some or all of your shares to someone else (for example
your partner or a member of your family) requires completion of a
share transfer form, which is available from Equiniti Registrars.
The form should be fully completed and returned with your share
certificate representing at least the number of shares being
transferred. The Registrar will then process the transfer and issue
a balance share certificate to you if applicable. The Registrar will
be able to help you with any questions you may have.
Lost share certificate(s)
Shareholders who lose their share certificate(s) or have their
certificate(s) stolen should inform Equiniti Registrars immediately
by calling the shareholder helpline on +44 (0) 371 384 2812
(lines are open 8.30am to 5.30pm, Monday to Friday). If calling from
overseas, please ensure the country code is used.
Disability helpline
For deaf and speech impaired customers, Equiniti welcomes calls
via Relay UK. Please see www.relayuk.bt.com for more information.
Sharegift
Shareholders with only a small number of shares whose value
makes them uneconomic to sell may wish to consider donating
to charity through Sharegift, an independent charity share
donation scheme.
For further information, please contact either the Registrar or
see the Sharegift website at www.sharegift.org.
Frequent shareholder enquiries
Enquiries and notifications concerning dividends, share certificates
or transfers and address changes should be sent to the Registrar;
the Company’s governance reports, corporate governance guidelines
and the terms of reference of the Board committees can be found
on the Company’s website at www.ashmoregroup.com.
Notifying the Company of a change of address
You should notify Equiniti Registrars in writing.
If you hold shares in joint names, the notification to change
address must be signed by the first-named shareholder. You may
choose to do this online, by logging on to www.shareview.co.uk.
You will need your shareholder reference number to access this
service – this can be found on your share certificate or from a
dividend counterfoil.
You will be asked to select your own PIN and a user ID will be
posted to you.
Notifying the Company of a change of name
You should notify Equiniti Registrars in writing of your new name
and previous name. You should attach a copy of your marriage
certificate or your change of name deed, together with your share
certificates and any un-cashed dividend cheques in your old name,
so that the Registrar can reissue them.
Dividend payments directly into bank or building
society accounts
We recommend that all dividend payments are made directly into
a bank or building society account. Dividends are paid via BACS,
providing tighter security and access to funds more quickly.
To apply for a dividend mandate form, contact the Registrar,
or you can find one by logging on to www.shareview.co.uk
(under Frequently Asked Questions) or by calling the helpline
on +44 (0) 371 384 2812 (lines are open 8.30am to 5.30pm,
Monday to Friday). If calling from overseas, please ensure the
country code is used.
180 Ashmore Group plc Annual Report and Accounts 2023
G L O S S A R Y
AGM
AIFMD
ANZ
APM
Annual General Meeting
Alternative Investment Fund Managers Directive
The Australia and New Zealand Banking Group Limited
Non-GAAP financial alternative performance measures
Ashmore
Ashmore Group plc
AuM
BCP
Assets under management
Business continuity planning
CEMBI BD
J.P. Morgan Corporate Emerging Markets Bond Index Broad Diversified Core Index
CEO
CO2e
Code
Chief Executive Officer
Carbon dioxide equivalent
2018 UK Corporate Governance Code
Companies Act
UK Companies Act 2006
Company
Ashmore Group plc
CPI
CSCI
DTR
EBIT
EBITDA
EBT
EBVCIT
EM
EMBI GD
EMTA
EPS
ESEF
ESG
ESGC
FCA
Fed
FRC
FSC
FTE
Consumer Price Index
Consolidated statement of comprehensive income
FCA’s Disclosure Guidance and Transparency Rules
Earnings before interest and tax
Earnings before interest, tax, depreciation and amortisation
Ashmore 2004 Employee Benefit Trust
Earnings before variable compensation, interest and tax
Emerging Markets
J.P. Morgan Emerging Market Bond Index Global Diversified
Trade Association for the Emerging Markets
Earnings per share
European Single Electronic Format Regulation
Environmental, social and governance
ESG Committee
Financial Conduct Authority of the United Kingdom
Federal Reserve of the United States of America
Financial Reporting Council
Forest Stewardship Council®
Full time equivalent
Ashmore Group plc Annual Report and Accounts 2023
181
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS G L O S S A R Y ( C O N T I N U E D )
FX
GAAP
Foreign exchange
Generally accepted accounting principle
GBI-EM GD
J.P. Morgan Government Bond Index – Emerging Markets Global Diversified
GBP
GDPR
GFD
GHG
GIPS
Group
British pound sterling, the official currency of the United Kingdom and its territories
General Data Protection Regulations
Group Finance Director
Greenhouse gas
Global investment performance standards
Ashmore Group plc and its subsidiaries
Guidance
FRC’s Guidance on Risk Management, Internal Control and Related Financial and Business Reporting 2014
HY
IC
ICAAP
ICARA
IEA
IFPR
IFRS
IG
IMF
High yield
Investment Committee
Internal Capital Adequacy Assessment Process
Internal Capital and Risk Assessment
International Energy Agency
Investment Firms Prudential Regime
International Financial Reporting Standards
Investment grade
International Monetary Fund
ISAE 3402
International Standards on Assurance Engagements 3402
KPI
KRI
Key performance indicators
Key risk indicator
Listing Rules
FCA’s Listing Rules
LTIP
NGOs
NZAMI
OCI
Long-term incentive plan
Non-governmental organisations
Net Zero Asset Managers Initiative
Other comprehensive income
Omnibus Plan
Ashmore Group plc Executive Omnibus Incentive Plan 2015
PPP
RAS
RCC
Purchasing power parity
Risk Appetite Statement
The Group’s Risk and Compliance Committee
Remuneration report
Directors’ Remuneration policy and the Annual Report on Remuneration
182 Ashmore Group plc Annual Report and Accounts 2023
Scope 1
Scope 2
Scope 3
SECR
SFDR
SIEM
Direct emissions from owned or controlled sources, including fuel consumption, fugitive emissions and
vehicle usage
Indirect GHG emissions from the generation of purchased electricity
Indirect GHG emissions including air travel, hotels, water and waste
Streamlined Energy and Carbon Reporting
Sustainable Finance Disclosure Regulation
System information and event management
SSAE 18
Statement on Standards for Attestation Engagements no. 18
TCF
TCFD
TSR
UN PRI
US$
WACI
WBCSD
WRI
YoY
Treating customers fairly
Financial Stability Board’s Task Force on Climate-related Financial Disclosures
Total shareholder return
United Nations Principles for Responsible Investment
US dollar, the official currency of the United States of America
Weighted Average Carbon Intensity
World Business Council for Sustainable Development
World Resources Institute
Year on year
Ashmore Group plc Annual Report and Accounts 2023
183
GOVERNANCESTRATEGIC REPORTFINANCIAL STATEMENTS This report is printed on Essential Velvet, and manufactured
at a mill that is FSC® accredited and certified to the ISO 14001
Environmental Standard.
Printed by Principal Colour. Principal Colour are ISO 14001 certified,
Alcohol Free and FSC® Chain of Custody certified.
Designed and produced by Black Sun Global.
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Ashmore Group plc
61 Aldwych
London WC2B 4AE
United Kingdom
www.ashmoregroup.com