Responsible Entities

 

360 Capital Investment Management Limited is the Responsible Entity for the following Managed Investment Schemes regulated by the Australian Securities and Investments Commission (ASIC) under the provisions of the Corporations Act 2001:

Scheme ARSN
360 Capital Total Return Fund 602 304 432

 

The Directors of the Responsible Entity are responsible for the corporate governance practices of the Responsible Entity. The Responsible Entity Board recognises the importance of strong corporate governance and is committed to high standards of compliance. This is achieved through the highly experienced Responsible Entity Board determining appropriate governance arrangements for each Fund and Trust and continually monitoring those arrangements.

The governance framework which sets out the obligations of the Board of the Responsible Entity is embedded in the Board Charter, Policies and Compliance Plans for the Funds and Trusts.

The governance culture and framework of the Responsible Entity are based where applicable on the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations (“ASX Principles and Recommendations”). The Responsible Entity complies with the majority of ASX Principles and Recommendations where the Responsible Entity considers that a recommendation is appropriate for the circumstances of the Funds/Trusts, or the Responsible Entity.

 

Relationships between the Responsible Entity and 360 Capital Group

360 Capital Investment Management Limited is wholly owned by 360 Capital Group Limited the company that, together with 360 Capital Investment Trust, forms the stapled security known as 360 Capital Group. Relationships exist between the Responsible Entity and 360 Capital Group that have implications for the Responsible Entity’s governance practices and the Board Charters.

The Board of 360 Capital Investment Management Limited is separately comprised to the Board of 360 Capital Group. As sole shareholder of the Responsible Entity, 360 Capital Group appoints the Directors of 360 Capital Investment Management Limited.

 

Role of the Board

The role and responsibilities of the Board as they relate to the Responsible Entity and the Funds and Trusts are set out in the Board Charter.

The role of the Board of the Responsible Entity is to ensure that the Funds and Trusts are managed in a manner which protects and enhances the interests of Unitholders and takes into account the interests of officers of the Responsible Entity, customers, suppliers, lenders and the wider community. The Board has overall responsibility for corporate governance, including setting the strategic direction, establishing goals for management and monitoring the achievement of these goals.

This entails:

  • reviewing the investment objectives for the Funds and Trusts to ensure they are consistent with each Fund’s strategic direction;
  • adopting annual operating budgets for the Funds and Trusts and the Responsible Entities and monitoring progress against budgets;
  • monitoring and overseeing the Fund and Trusts’ and Responsible Entities’ financial positions;
  • ensuring compliance with Chapter 2M of the Corporations Act 2001(the Act), (financial reporting);
  • ensuring compliance with Part 5C.7 and Chapter 2E of the Act (related party matters);
  • determining the net income of the Funds and Trusts available for distribution, the distribution amount per Unit and the price of Units offered in accordance with any distribution reinvestment plan;
  • evaluating the performance of the Managing Director and senior executives;
  • determining that satisfactory arrangements are in place for auditing the Fund and Trusts’ and Responsible Entity’s financial affairs;
  • approving the Responsible Entity’s risk management strategy;
  • ensuring that appropriate policies and compliance systems are in place, and that the Responsible Entity and its officers act legally, ethically and responsibly on all matters; and
  • complying with the statutory duties and obligations as imposed by the law.

In protecting the rights and interests of Unitholders, the Board is responsible for ensuring that the Responsible Entity:

  • acts honestly;
  • exercises the degree of care and diligence that a reasonable person would exercise if they were in the Responsible Entity’s position and role;
  • acts in the best interests of Unitholders and, if there is a conflict between the interests of Unitholders and its own interests, give priority to the interests of the Unitholders;
  • treats Unitholders who hold Units of the same class equally and Unitholders who hold Units of different classes, fairly;
  • does not make use of information acquired through being the Responsible Entity in order to gain an improper advantage for itself or any other person, or cause detriment to the Unitholders;
  • ensures at all times that the Fund and Trust Constitutions meet the requirements of Part 5C.3 of the Act and that the Compliance Plans also meet the requirements of Part 5C.4 of the Act;
  • complies with the Compliance Plans;
  • ensures that Fund and Trust assets are clearly identified as “Fund and Trust property” and held separately from property owned or controlled by the Responsible Entity and the property of any other managed investment scheme;
  • ensures that Fund and Trust properties are valued at regular intervals;
  • ensures all payments out of Fund and Trust properties are made strictly in accordance with the Constitution and the Act; and
  • as soon as practical after it becomes aware of any breach of the Act or Constitution that relates to the Funds or Trusts and that has had or is likely to have a materially adverse effect on the interests of Unitholders, reports that breach to the ASIC.
Board composition

The Board of the Responsible Entity is required to comprise a sufficient number of Directors (but not less than four) to ensure the balance of skills, knowledge and experience required. If at any time the number of Directors falls below the minimum, the Board will endeavour to return the number to the minimum in a reasonable period of time.

It is the Responsible Entity's policy that the Board should have a majority of non-executive Directors and that not less than half of the Directors are external (as defined in section 601JA of the Act). The Directors appoint as Chairman of the Board one of the non-executive, external Directors. The role of the Chairman and Chief Executive Officer (i.e. the Managing Director), should not be exercised by the same individual.

Persons nominated as non-executive Directors shall be expected to:

  • have qualifications, experience and expertise of benefit to the Responsible Entity; and
  • evaluate continually their other commitments to ensure they have sufficient time to fulfil their duties and responsibilities as Directors of the Responsible Entity; and
  • undertake continuing professional development to the extent necessary to ensure they maintain the skills required to discharge their obligations; and
  • be of sufficient stature and security of employment to express independent views on any matter.
Director independence

Directors of the Responsible Entity are expected to bring an independent view to the Board’s deliberations. A majority of non-executive Directors are required to be “independent”. Under the regulations applicable to managed investment schemes, that “independence” is determined according to the definition of “external Directors” in section 601JA of the Corporations Act (“the Act”).

Under section 601JA of the Act, Directors of the Responsible Entity are external Directors if they:

  • are not, and have not been in the previous two years, an employee of the Responsible Entity or a related body corporate; and
  • are not, and have not been in the previous two years, a senior manager of a related body corporate; and
  • are not, and have not been in the previous two years, substantially involved in business dealings, or in a professional capacity, with the Responsible Entity or a related body corporate; and
  • are not a member of a partnership that is, or has been in the previous two years, substantially involved in business dealings, or in a professional capacity, with the Responsible Entity or a related body corporate; and
  • do not have a material interest in the Responsible Entity or a related body corporate; and
  • are not a relative of a person who has a material interest in the Responsible Entity or a related body corporate.

The Board regularly assesses those relationships that may affect independence.

 

Delegation to management

The Board have delegated responsibility for the day to day management of the Funds and Trusts to the Managing Director and Responsible Managers as stated under the Responsible Entity’s AFSL.

The Managing Director delegates a number of the functions, activities and duties required to be performed by the Responsible Entity to Managers and external service providers.

 

Conflicts of interest

The Board of the Responsible Entity has adopted a Managing Conflicts of Interest Policy that ensures there are adequate arrangements for the management of conflicts of interest that may arise wholly, or partially, in relation to the provision of financial services by the Responsible Entity, or its representative, as part of the financial services business of the Responsible Entity or its representatives. This policy applies to all Responsible Entity Directors and Officers.

 

related party transactions

In the normal course of operations, from time to time transactions may occur between the Board of the Responsible Entity and 360 Capital. The Board of the Responsible Entity has adopted a Related Party Transactions Policy to meet the requirement that a registered scheme must get member approval before giving a financial benefit out of scheme property to the Responsible Entity or a related party unless the deal is on arm's length terms.

 

Personal Dealing policy

The Personal Dealing Policy - Share Trading Policy aims to promote transparency and market confidence in 360 Capital by ensuring that key management personnel and employees of 360 Capital know their responsibilities when dealing in its securities.

 

Independent professional advice

Subject to prior approval of the Chairman, Directors may obtain independent professional advice at the expense of the Responsible Entity on matters arising in the course of their Board duties.

 

Code of conduct

The Responsible Entity has adopted a Code of Conduct that sets out the minimum acceptable standards of behaviour. Directors are required to act with honesty, decency and integrity at all times.

Securities dealings by Directors are subject to the restrictions of the Responsible Entity's Personal Dealing – Share Trading Policy. All dealings in Fund and 360 Capital Group securities are reported to the Board in a Register of Directors’ Interests.

 

Committees and other delegations

The Board may from time to time establish committees to assist it in carrying out its responsibilities, and shall adopt charters setting out matters relevant to the composition, responsibilities and administration of such committees, and other matters that the Board may consider appropriate.

 

Audit and Risk Committee

The Board have appointed an Audit and Risk Committee, the membership of which constitutes at least three non-executive Directors with all being independent Directors. The chairperson will be appointed by the Audit and Risk Committee and must be a non-executive Director and not the chairperson of the Board of the Responsible Entity. The chairperson will report the activities of the Audit and Risk Committee to the Board of the Responsible Entity after each meeting. The Audit and Risk Committee Charter sets out the Audit and Risk Committee's role and responsibilities.

 

Nominations Committee and Remuneration Committee

In so far as the Managed Investment Schemes / Funds are concerned remuneration of the Responsible Entity is dealt with comprehensively in the Fund’s Constitutions.

The 360 Capital Group Board has established a Nomination and Remuneration Committee, comprising of two non-executive, independent directors as well as one executive director. The chairman of the Committee is an independent director. The Committee assists the 360 Capital Group Board in its responsibility to oversee the nomination and remuneration of directors and senior executives of 360 Capital Group, including succession planning generally and reviewing board composition to ensure an appropriate mix of skill, knowledge, experience, independence and diversity. Further details about the Committee’s role and responsibilities are set out in the Nomination and Remuneration Committee Charter.

 

Compliance Committee

Under the Act, if less than half of the Directors are external (as defined in Section 601JA), then a registered scheme must have a Compliance Committee.

The Responsible Entity does not intend to establish a Compliance Committee and as a consequence, ensure that not less than half of its Directors are Independent Directors (as defined in the Act).

Provision is made at each regular meeting of the Board for the consideration of critical compliance and risk management issues as they arise. Standard compliance and risk management reporting to the Board occurs on a quarterly basis in the second month following each quarter end.

The Managing Director is responsible for the appointment of a Compliance Manager to assist in the performance and maintenance of the Responsible Entity's risk management and compliance framework.

 

Meetings

The Board should hold a minimum of six meetings each year. In practice, the Board generally hold between nine and 11 meetings each year.

Along with matters of strategic importance, the agenda for regular meetings of the Directors comprises “standard” business items designed to assist in the process of ensuring that the Responsible Entity is complying with Fund and Trust Compliance Plans, their Constitutions and the Act.

The agenda also includes regular reports relating to property investment performance, valuation reports, Fund and Trust performance, income distributions, funding issues, borrowing levels, liquidity, hedging arrangements, compliance with banking covenants and budgets.

Board papers are required to be circulated to Directors in accordance with Board approved procedures. Minutes of meetings and resolutions are required to be circulated to Directors for approval and entered into the minute books in accordance with Board approved procedures.

The Board makes site visits to selected Fund properties as necessary. A Board planning meeting is held at least annually at which the Board reviews and endorses strategies designed to ensure the continued profitable growth of the Funds and Trusts.

 

Board performance

The Board of the Responsible Entity review its performance and that of their committees on average once every two years. Performance is reviewed against the Board Charter and any other Board responsibilities.

 

Board Charter review

The Compliance Plans are reviewed annually and any corresponding amendments are made to the Board Charter where appropriate. Notwithstanding the above review, this Charter is reviewed separately by the Board at least once every two years.

 

Company Secretary

The company secretary supports the effectiveness of the Board by monitoring that Board policy and procedures are followed. The appointment and removal of the company secretary is a matter for decision by the Boards of the Responsible Entity. All Directors have access to the company secretary. The company secretary is accountable to the Boards of the Responsible Entity on all governance matters.

 

Continuous Disclosure Policy and Communication policy

The Board of the Responsible Entity is committed to providing relevant information to Unitholders about the operations of the Fund and Trusts and to fulfil their duties to comply with continuous disclosure obligations to the market generally. The Board of the Responsible Entity has adopted a Continuous Disclosure Policy (Unlisted Funds) and a Communications and ASX Disclosure Policy (Listed Entities) which are designed to ensure compliance with continuous disclosure obligations.

The Board of the Responsible Entity is responsible for:

  • making decisions on what information should be disclosed to the market; and
  • ensuring disclosure is made in a timely and efficient manner.

The Responsible Entity is committed to ensuring Unitholders receive clear, concise and effective information on a timely basis and intend to facilitate the delivery of financial services disclosures through existing and emerging electronic means. The express agreement of Unitholders will be obtained before delivering financial services disclosures by electronic means. Unitholders will receive an annual report and a half yearly report. Newsletters and updates may also be provided from time to time. 

 

Complaints handling process

The Responsible Entity has implemented a Complaints Handling Policy that has been prepared in accordance with the Australian Standard. The Responsible Entity has established a complaints resolution procedure, and are members of the Financial Ombudsman Service. The Board monitors compliance with the Responsible Entity’s Complaints Handling Policy.

If you have a complaint, you may contact the Complaints Officer by phoning 1800 182 257, by emailing investor.relations@360capital.com.au, or by writing to

The Complaints Officer

360 Capital Group

Level 8, 56 Pitt Street

Sydney NSW 2000

360 Capital will endeavour to acknowledge receipt in writing within two business days of receiving a complaint and will try to resolve all issues within a maximum of 45 days of receipt, but in a shorter period if possible. If it is impossible to substantially respond to the complaint within 45 calendar days, the complainant will, before the end of that period, be:

  • informed of the reasons for the delay;
  • advised of their right to complain to the Financial Ombudsman; and
  • provided with the contact details of the Financial Ombudsman Service.
Risk Management

As AFS Licensees, the Responsible Entity is mindful of its obligations to have in place a Risk Management Program (RMP) to specifically deal with the risk that financial resources may not be adequate to ensure that it is able to carry on their business in compliance with its AFS Licence obligations, or to wind-up its business in an orderly manner.

Accordingly, directors and managers continually assess and evaluate risks that may affect the Responsible Entity and the Schemes in the market and the likely impact of risks on existing and potential investors. 360 Capital’s RMP reflects our efforts to ensure longevity of the Responsible Entity and the Schemes.

 

AFS LicencES

The Responsible Entity is authorised to carry on financial services businesses:

Compliance Plan

The purpose of the compliance plan is to clearly set out key processes, systems and measures 360 Capital carries out in managing the Schemes. It provides an outline of the compliance procedures, monitoring and reporting undertaken to ensure 360 Capital and its service providers comply with Scheme Constitutions, financial services laws and other statutory and ASIC requirements. The compliance plan is central to 360 Capital’s risk and compliance management framework and is supported by underlying policies and procedures that provide more detail about how certain tasks will be performed. Compliance plans are reviewed annually to ensure its relevance to the AFS Licensing regime.

 

Compliance Plan Audit

The Responsible Entity must ensure that at all times a “registered company auditor” is engaged to audit compliance with the compliance plan. This requirement is separate from the obligation under the Corporations Act to appoint an auditor of a Scheme’s financial statements. The compliance plan auditor is required to report annually on compliance with the plan and whether the plan continues to meet requirements of Part 5C.4 of the Act. The role, responsibilities and powers of the compliance plan auditor are set out in s601HG of the Corporations Act. The scope of work presented by the responsible entity to the plan auditor includes:

  • annual audit of the plan in line with Auditing Guidance Statement AGS 1052 “Special Considerations in the Audit of Compliance Plans of Managed Investment Schemes”;
  • review of 360 Capital’s monitoring of service providers of the responsible entity in relation to their compliance with the plan, service providers agreements and ASIC requirements;
  • review of proposed changes to the compliance plan prior to adoption by the 360 Capital Board; and
  • provision of guidance to the compliance manager and the Board from time-to-time on how to resolve issues arising out of the operation of the plan.

Internal monitoring of compliance with the plan, evaluation that policies and procedures are operating as expected and assessment of the adequacy of 360 Capital’s compliance framework is undertaken periodically by the compliance manager.

 

Custodian

The Trust Company Limited and 360 Capital Investment Management Limited are custodians for the Schemes and hold Scheme assets on behalf of Unitholders.

The Board approved Custody Policy aims to ensure that 360 Capital’s scheme portfolios are not exposed to unnecessary risks because of the way they are held, that efficient operational arrangements exist for holding and dealing with the scheme portfolios, and the Responsible Entity follows a clear process in monitoring the performance of the Custodian.

 

AML/CTF Act

360 Capital Investment Management Limited is a "reporting entity" under the Anti-Money Laundering and Counter-Terrorism Financing Act (AML/CTF Act) that provides designated services to customers (as those terms are defined in the AML/CTF Act). 360 Capital has procedures in place to identify and report suspicious transactions to the AUSTRAC as required under the AML/CTF Act.

 

Privacy Policy

360 Capital recognises how important your privacy is to you and the Board of the Responsible Entity have adopted a Privacy Policy to reflect this. 360 Capital's firm commitment to comply at all times with the prevailing privacy laws and regulations underpins 360 Capital's policy to safeguard the confidentiality and security of your personal information. While 360 Capital has an obligation to identify investors under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006, 360 Capital only request and keep information that its needs to maintain your account and to process your enquiries effectively. For example, when you complete a prospectus application form, the personal information we ask for may include your name, address, telephone number and email address; tax file number, Australian business number or exemption code and bank account details (for direct credit of distributions).

At 360 Capital, we have in place a range of security methods and technologies to protect your personal details from unauthorised access, modification, misuse, loss, or disclosure. Access to your personal details is restricted to those who require the information to provide you with a complete administration service for your investment. 360 Capital's Unit registrar, Boardroom Pty Limited, uses your personal details to maintain investor registers and to facilitate distribution payments and Unitholder communications. Boardroom Pty Limited also has a privacy policy and has undertaken to keep your information confidential.

If you’d like to know what personal information 360 Capital or Boardroom Pty Limited hold about you or would like us to amend your details, please ring on Freecall 1800 182 257 or by email to investor.relations@360capital.com.au. Depending on the nature of your request, we may ask you to complete a personal information request form.

 

Valuation Policy

360 Capital has a framework in place for the valuation of all investment properties managed by the 360 Capital Group as set out in the Valuation Policy  adopted by the Boards of the Responsible Entity. The policy outlines the process of how we determine the fair market value of our assets.

Valuations for unlisted Funds/Trusts are used for unit pricing purposes. Investment properties are generally carried at their fair market value in accordance with applicable accounting standards. Independent external valuations of direct property investments are obtained at least once in a two year period or earlier if an internal valuation differs materially from the current carrying value of a property. A formal selection process applies with an approved panel of valuers. The panel of valuers must meet pre-determined criteria required by the Corporations Act, financier requirements and surety of business. A rotation policy is embedded into the valuation process. As such, an external valuer may undertake the valuation on a property no more than three times within a 36 month period from the date they first undertook the valuation after which a new external valuer must be appointed.

 

unit pricing policy

The Board approved Unit Pricing Policy aims to ensure that investors understand how the unit prices for their investments are determined. The overriding principle in unit pricing is to act honestly, diligently, impartially and in the best interest of all Unitholders. 360 Capital’s Unit Pricing Policy has been written with regard to the requirements of the Constitutions of the Trusts or Schemes managed by us, the Corporations Act 2001 and ASIC’s RG94 “Unit pricing: Guide to good practice”.

 

Diversity policy

As set out in the Board approved Diversity Policy, 360 Capital encourages diversity in employment and in the composition of its Board as a means of ensuring the organisation has an appropriate mix of skills and talent to conduct its business and achieve 360 Capital's goals.

 

Gearing (LVR) policy

The Board-approved Gearing (LVR) Policy outlines the process of how the Manager governs the LVR of each facility within each Fund or Trust.

 

Interest cover ratio (ICR) policy

The Board-approved ICR Policy outlines the process of how the Manager governs the level of interest cover of each facility within each Fund/Trust.

 

Investment committee charters

The Board has established a Fund Investment Committee for the ASX-listed 360 Capital Industrial Fund, 360 Capital Office Fund and 360 Capital Total Return Fund.

The purpose of the Investment Committees is to assist the Board oversee the investment and administration activities of the Funds.

The respective Investment Committees comprises at least two independent directors of the Responsible Entity and one senior executive of 360 Capital.

  • 360 Capital Industrial Fund's Investment Committee currently comprises the Chairman David van Aanholt (Independent Chairman of the Responsible Entity); John Ballhausen, (Independent Non-Executive Director of the Responsible Entity); and Ben James, (Chief Investment Officer).
  • 360 Capital Office Fund's Investment Committee currently comprises the Chairman John Ballhausen (Independent, Non-Executive Director of the Responsible Entity); David van Aanholt, (Independent Chairman of the Responsible Entity); and Ben James, (Chief Investment Officer).
  • 360 Capital Total Return Fund's Investment Committee currently comprises the Chairman John Ballhausen (Independent, Non-Executive Director of the Responsible Entity); David van Aanholt, (Independent Chairman of the Responsible Entity); and Ben James, (Chief Investment Officer).

The duties and responsibilities of the Fund Investment Committee are contained in the various charters: