Anti-Corruption Policy

This anti-corruption policy (the “Policy”) applies to all employees and officers of Pareto Securities AS, including all of our branches and subsidiaries in Norway and abroad (“Pareto Securities”).

Pareto Securities is firmly opposed to corruption in all forms. We are committed to conduct  our business with integrity and in accordance with high ethical standards. All Pareto Securities employees are responsible for understanding the legal and ethical issues that affect our business and for acting with integrity at all times.

Pareto Securities’ zero tolerance for corruption and our ethical standards are set out in our Code of Conduct, this Policy and other governing documents. According to principle no 10 in our Code of Conduct, we do not accept inappropriate benefits. The principle relates to giving or receiving benefits intended to influence decisions in an inappropriate way – typically corruption.

The Policy elaborates what Pareto Securities expects from employees, contractors, suppliers and other business partners when this core principle should be adhered to. In short, we never involve in corruption.

The Policy is based on two main concepts: merits and transparency.

Value creation in Pareto Securities is based on interaction between people; between our employees, between our employees and our clients and between our employees and our contractors, suppliers and business partners. These interactions shall be based upon merits. We shall recruit the most talented candidates, our clients should choose us because we offer the best products and we should engage business partners which offer the best services. Interaction which comes into place based on other concepts than merits is not acceptable.

Transparency implies that all actions taken by our employees or someone acting on our behalf should withstand stakeholder scrutiny. If you are contemplating influencing someone, or someone tries to influence you in a way, and you could reasonably believe that knowledge of such action may lead to a reaction by the public, authorities,  the police, the press, clients, colleagues or other stakeholders, do not do it.

The Policy is adopted by the Board of Directors of Pareto Securities AS. The owner of the Policy is the CEO. The Head of Compliance, being the functional owner, bears the responsibiblity for the upkeep, communication, and monitoring of this Policy. This includes the implementation of changes in accordance with applicable regulations.

Corruption is the abuse of entrusted power for private or corporate gain. It is a threat to business and society, and undermines legal business activities.

Corruption occurs when a person requests, receives or accepts an offer of an improper benefit by virtue of his or her position. A benefit is as a rule considered improper if it can influence, or be perceived to influence, the receiver’s ability to make sound and objective business or government decisions.

Improper benefits may include cash, kickbacks, expensive gifts, hospitality/entertainment and travel. Other examples may be more indirect, such as loans with low interest terms, internships or job offers.

Under the Norwegian Criminal Act (Nw: "straffeloven”) corruption by individuals is punishable by up to ten years’ imprisonment and/or an unlimited fine, irrespectively of where the corruption has taken place. The legislation in other countries where we operate have similar penal provisions. If Pareto Securities is found to have taken part in the bribery or has not taken adequate steps to prevent bribery, we could face an unlimited fine, even if no individual is punished for the offence.

Corruption will also have severe reputational and/or financial consequences for Pareto Securities and will erode our business platform.  

Pareto Securities will not tolerate corruption in any form. If corruption is a necessary condition for the realisation of a transaction of any kind, we shall refrain from participating.

Pareto Securities prohibits the offering, giving, solicitation or the acceptance of any corrupt inducement, whether in cash or in any other form:

• to or from any person or company wherever located, whether a public official or public body, or a private person or company;
• by any individual employee, director, agent, consultant, contractor or other person or body acting on Pareto Securities’ behalf;
• in order to gain any commercial, contractual, or regulatory benefit for Pareto Securities in any way which is improper or to gain any personal benefit.

It may not always be a simple matter to determine whether a possible course of action is appropriate. If you are in any doubt as to whether a possible act might be in breach of this Policy or the law in the relevant country, the matter should be referred to your nearest superior or to Head of Compliance.

A facilitation payment is a small amount paid to a public official to secure or accelerate routine government procedures. The payment is usually a cash payment but could also involve other benefits or favours.

Facilitation payments typically involve paying for processing of papers, issuing of official approvals, permits and licences, obtaining customs clearance, returning a passport at a bord control, or uploading shipments within reasonable time (sometimes avoiding costly delays).

Pareto Securities does not permit facilitation payments to public officials, even if the payments are of small value.

If faced with a situation where a facilitation payment is perceived as impossible to avoid, e.g. medical or safety emergencies, common sense must be applied. If possible, Compliance shall be contacted for advice before such payment is made. If this is not possible, Compliance must be informed as soon as possible after the payment has been made and a written report be made.

“Fast tracking”-processes which are available to all on the payment of a regular fee are accepted.

Financial intermediary is a business concept built on relations. Marketing and individual pitching are necessary in order to do business. In this respect it is also important to getting to know the client and understand his/her needs. On the investment banking side the products we offer are made in close cooperation with the issuer. Because of these distinctive features our employees have to spend a lot of time with leads and clients in order to build relations and develop business, often abroad and off hours.  

Providing or receiving appropriate hospitality and entertainment is an inherent part of building business relationships with the necessary goodwill and trust. The appropriateness of hospitality and entertainment depends on the circumstances and there is no clear acceptable value level. However, “high flyer” hospitality and entertainment is not a part of Pareto Securities’ business culture.

The following principles should be adhered to when assessing the appropriateness of hospitality:

• Openness. Is the guest’s principal aware of the hospitality?
• Given the recipient’s position and the occasion it must be clear that the hospitality or entertainment do not create an appearance which can reasonably be misunderstood by the recipient or others as a bribe
• The frequency of hospitality provided to the recipient should not raise an appearance of inappropriateness
• No conditions may be attached to hospitality or entertainment attendance

On this basis meals and drinks with business partners will as a general rule be deemed appropriate if the hospitality takes place in the course of a meeting or another occasion, the purpose is to hold business discussions and the value is within an ordinary working meal under local standards (extraordinary wines are avoided).

Pre-approval from the Event committee is required if the meal has a value beyond that of an ordinary working meal under local or other applicable standards, will include spouses or is not directly business-related.

Entertainment events (such as concerts or sporting events) tend to have less direct relevance to business and can therefore more easily create an appearance of inappropriateness. For that reason all such events must be pre-approved by the Event committee which will assess the event in light of the principles stated above.

Hospitality, entertainment and events must be recorded fairly and accurately in our books and records.

Gifts to public officials are never accepted.

Pareto Securities maintains a strict policy on receiving or providing gifts from business partners. Gifts must be of limited value, be occasional, without any conditions and must not under any circumstance be perceived as a potential bribe.

Examples of acceptable gifts may be:

• Modest priced bottles of wine
• Assorted chocolates or candy
• Flowers
• Merchandise with corporate logos
• Other gifts of inconsiderable value

Employees must never provide or receive the following from (potential) business partners:

• Cash payments or an asset which easily may be transferred to cash
• Free or rebated use of houses, cars or boats for private use
• Leisure travels
• Services for private use

Some of our assignments are particularly exposed to corruption. Among them are public sector infrastructure/construction projects and exploitation of natural resources, particularly in countries with high corruption perception.

Transactions involving Politically Exposed Persons (“PEP”) or associates to such persons increase the risk of corruption due to the possibility that these persons may misuse their power and influence for personal gain and/or use their close relatives or associates to conceal funds or assets resulting from corruption.

Assignments with clients operating in countries exposed to higher level of corruption and bribery and assignments involving PEPs are identified in the client onboarding process/deal selection process, and will be carefully assessed and monitored.

Counterparties include suppliers, contractors, consultants, and other business partners (a “Counterparty”) that Pareto Securities has entered, or is considering entering, a contractual relationship with.

Entering into a relationship with a Counterparty can expose to reputational, operational, and legal risk if the Counterparty were to engage in misconduct acting on our behalf. Accordingly, a Counterparty must be engaged through merit based and fair processes that include, where appropriate, written anti-corruption requirements.

Risk based due diligence is conducted as an anti-corruption procedure on a Counterparty. Enhanced and continuous due diligence is needed when the Counterparty is operating within a corruption sensitive area/business or in a country with high corruption perception.

Such enhanced and continuous due diligence is also compulsory when a Counterparty has a history involving corruption.

Intermediaries, encompassing agents, consultants, lobbyists and others such entities, serve as conduits between Pareto Securities and a third-party. As a fundamental principle, Pareto Securities shall avoid the engagement of intermediaries in its entirety. However, if deemed necessary in a particular instance, the engagement of such an intermediary warrants thorough examination to avoid corruption and ensure alignment of interests.

The CEO has adopted an Introductory Fees Policy, accessible on the Intranet, which provides guidelines pertaining to the approval and disbursement of introductory fees to external parties, advisers, and consultants. 

It is underlined that no unlawful  payments shall be channelled through intermediaries. All disbursements to intermediaries must be duly authorised and accurately documented in our financial records. 

The prevention, detection and reporting of possible corruption is the responsibility of all employees throughout Pareto Securities.

If you become aware or suspect that an activity or conduct which is proposed or has taken place is corrupt, you have a right and a duty to report this.

Reporting shall be made to the Head of Compliance. You may instead report anonymously through Pareto Securities’ external whistleblowing service: Pareto Securities whistleblower channel.

Pareto Securities will investigate thoroughly any actual or suspected breach of this Policy, or the spirit of the Policy. Employees found to be in breach of the Policy may be subject to disciplinary action which may ultimately result in their dismissal.

Systems and controls under this Policy will be subject to audits via Pareto Securities’ internal audit function in order to test the existing arrangements and provide recommendations to strengthen or amend current policies and practices.

The Head of Compliance and the CEO will be responsible for reviewing the results of the audit and implementing changes at their discretion to current systems and controls.

Changes to the current policy will be communicated to staff via email following any updates.