Ashmore Group PLC (ASHM) 2024年年度報告「LSE」.pdf

《Ashmore Group PLC (ASHM) 2024年年度報告「LSE」.pdf》由會員分享，可在線閱讀，更多相關《Ashmore Group PLC (ASHM) 2024年年度報告「LSE」.pdf（166頁珍藏版）》請在三個皮匠報告上搜索。

1、20 24annual report and accountsStrategic reportAt a glance2Business model4Three-phase strategy5CEO review6Investment opportunities in Emerging Markets9Emerging economies10Emerging Markets12Established specialist investment manager14Local office network16Investment philosophy18Market review20Key perf

2、ormance indicators22Business review24Risk management31Section 172 statement38People&culture42Sustainability46Climate-related financial disclosures50GovernanceBoard of Directors56Corporate governance report58Audit and Risk Committee report66Nominations Committee report70Remuneration report72Statement

3、 of Directors responsibilities91Directors report92Financial statementsIndependent auditors report96Consolidated financial statements104Company financial statements108Notes to the financial statements111Five-year summary152Alternative performancemeasures153Mandatory GHG reporting and SECR requirement

4、s156Information for shareholders159Glossary161ContentsAuM US$49.3bn2023:US$55.9bn-12%YoYProfit before tax128.1m2023:111.8m+15%YoYAuM outperforming benchmarks(3 years)59%2023:69%Diluted EPS13.6p2023:12.2p+12%YoYAdjusted EBITDA margin41%2023:54%Dividends per share16.9p2023:16.9p2024 highlightsSpeciali

5、sm delivers Emerging Markets insights The size,scale and diversity of Emerging Markets are often misunderstood and underappreciated.Ashmores specialist,active approach exploits this inefficiency to deliver long-term investment performance for clients.Economic resilienceEmerging countries have been e

6、xtraordinarily resilient in the face of profound shocks in recent years,due to the quality and effectiveness of policy responses 12Investment opportunitiesMore than 70 emerging countries offer a diverse array of opportunities in equity and fixed income markets16Local presenceAshmores network of loca

7、l offices source and invest capital domestically,and provide insights to the global ICs2At a glanceAshmores purpose is to deliver long-term investment outperformance for clients and to generate value for shareholders over market cycles1014Ashmores proven approachAshmores established investment proce

8、sses have managed Emerging Markets assets for more than three decades.Over this period,the Group has participated in the development of a large,diverse and highly attractive investment universeStrategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 1At a glanc

9、eUnderstanding AshmoreSubstantial long-term growth opportunitiesEmerging 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

10、 consequent investment opportunities,support Ashmores strategic focus on delivering long-term growth and value for clients and shareholders.See more on page 12Ashmore is a specialist Emerging Markets investment manager that has successfully managed its clients capital for more than 30 years.Its purp

11、ose is to deliver long-term investment outperformance for clients and to generate value for shareholders over market cycles.11office locations283employeesAshmores Emerging Markets investments and worldwide networkEmerging Markets consistently deliver superior GDP growth(%)Emerging Markets investedAs

12、hmore presence-5-4-3-2-1012345678PremiumEmerging MarketsDeveloped Markets2029f20172018201920202021201420152016202220232024f2025f2026f2027f2028f2 Ashmore Group plc Annual Report and Accounts 2024Consistent investment philosophyAshmore has implemented its investment philosophy consistently and success

13、fully since it launched its first fund in 1992.Specialist,active investment management enables Ashmore to exploit inefficiencies in a diverse universe of more than 70 Emerging Markets.Ashmore has integrated the analysis of ESG factors into its investment processes,providing a comprehensive view of r

14、isks and opportunities.A specialist active approach to Emerging marketsMacro top-downLiquidity obsessedActive managementProprietary research&ESG integrationBottom-up:credit/value equity/quality growthNetwork of local asset management platformsAshmores local asset management platforms provide diversi

15、fied AuM growth,with compound annual growth of 11%over the past four years.Investment approachEach platform has an independent investment process that benefits from Ashmores macro views and other research,and also provides insights to the Groups global ICs.See more on page 18Diversified client bases

16、The platforms source and manage capital for domestic clients,butalso provide access to local(country/regional)investment opportunities for Ashmores global client base.See more on page 16Locally-managed AuM(US$bn)Diversified businessAshmores AuM is diversified by investment theme,client type and clie

17、nt 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 theme(%)External debt15Local currency36Corporate debt9Blended debt24Equities13Altern

18、atives3Client type(%)Central banks23Sovereign wealth funds22Governments1Pension plans19Corporate/financial institutions21Funds/sub-advisers9Intermediary retail4Foundations/endowments1Client geography(%)Americas12Europe36UK4Middle East and Africa23Asia Pacific25202120202022202320247.57.06.97.24.9Stra

19、tegic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 3Business modelResilient and scalable business modelAshmores business model supports its growth strategy and has distinctive characteristics that enable it to create value for the Groups clients and sharehold

20、ers over market cycles.Focus on managing Emerging Markets investmentsInvestment committees,no star cultureDiversified client baseOperating cost discipline,flexible remuneration philosophyFinancial strength with a liquid,well-capitalised balance sheet,andno debtKey characteristicsInvestment approach

21、to Emerging MarketsDelivering alignment and long-term valueClients59%AuM outperforming over three yearsConsistent implementation of investment philosophy exploits market inefficiencies to deliver long-term outperformance.See more on page 18Employees38%employee equity ownershipAlignment of interests

22、delivered through equity-biased remuneration with five-year deferral period.See more on page 42Communities75projects supported by The Ashmore FoundationAshmore donates 0.5%of profit before tax to charities,including TheAshmore Foundation.See more on page 49Shareholders41%adjusted EBITDA margin High

23、operating margin and significant cash generation(113 million inFY2024)support returns to shareholders.See more on page 24Specialist,active investment managementStrong foundationsPowerful convergenceSpecialist understanding4 Ashmore Group plc Annual Report and Accounts 2024Three-phase strategyCapital

24、ise on long-term growth opportunitiesAshmores 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.Oppo

25、rtunities2024 progressPotential risk sourcesEstablishedEmerging Markets asset classes Developed world investors hold approximately 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

26、 10%to35%The long-term Emerging Markets allocation opportunity remains substantial Fewer redemptions but continued risk aversion by some investors Sentiment towards,andfundamental performance of,Emerging Markets Long-term investment performanceDiversifiedDeveloped world capital sources and themes Th

27、e 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 thecycle Resilient equities AuM,with focus on converting investment pe

28、rformance to client flows Demand for IG strategies continues,particularly from European and Asianclients Intermediary retail AuM impacted by recent market cycle,but stable at 4%of Group AuM Potential constraints on longer-term growth such as competition Long-term investment performanceLocalMobilise

29、Emerging Markets capital 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 term The local platforms delivered a sol

30、id performance with 7%growth in AuM AuM sourced from clients domiciled in Emerging Markets increased from 33%to 37%of Group AuM Managing the development of local asset management platforms in Emerging MarketsStrategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2

31、024 5CEO reviewConsistent,specialist approach across market cycles Emerging Markets are delivering positive investment returns,supported by resilient economic fundamentals,and Ashmore is delivering outperformance for clients across a broad range of strategies.This favourable backdrop means the Group

32、 is well-positioned to benefit from higher capital flows to Emerging Markets as investor risk appetite increases.Emerging Markets assets have generally performed well over the past year,supported by attractive valuations,ongoing reforms in many countries,positive credit rating changes and the delive

33、ry of superior economic growth.As described in the Market review,fixed income indices have outperformed their developed world counterparts,and while equity returns are positive,they were held back by weaker performance in China.Notwithstanding the returns delivered by Emerging Markets in the period,

34、extending the recovery from significantly oversold levels that began in late 2022,there has not yet been a meaningful shift in investor allocations to deliver net inflows to the asset classes.This is in contrast to previous cycles when a prolonged period of strong asset class performance,andoutperfo

35、rmance,has delivered capital flows.The cautious approach by some investors reflects a combination of a rapid shift from a lengthy period of low interest rates to more normal levels in response to higher inflation,ongoing geopolitical issues,and uncertainty with respect to major elections,notably in

36、the US.Greater clarity around these factors will increase risk appetite and the Emerging Markets should be beneficiaries of the resultant capital flows.Ashmores investment processes have delivered outperformance for clients across a broad range of investment themes.Approximately 60%of AuM is outperf

37、orming over three and fiveyears,which includes the challenging market conditions of late 2021 and early 2022,and the delivery of future performance is supported by the resilient underlying economic conditions in emerging countries,together with the attractive valuations and inherent upside reflected

38、 in portfolios.The reduction in outperformance over one year to 40%is attributable to modest underperformance in a number of local currency mandates.Ashmores business model is designed to be effective over the full market cycle,to support the delivery of performance for clients and returns to shareh

39、olders as Ashmore executes its long-term growth strategy.6 Ashmore Group plc Annual Report and Accounts 2024Phase 2The Groups investment in its equities franchise,through both global and local operations,has provided meaningful diversification benefits over the current market cycle.Equities AuM incr

40、eased by US$0.5 billion over the year and represents 13%of Group AuM compared with 11%a year ago.The scale of the equities opportunity for Ashmore is significant.Another consistent diversification theme is the demand for IGstrategies,notably from investors in Europe and Asia.Ashmores investment perf

41、ormance is strong across external debt,corporate debt and blended debt IG strategies,which supports further growth in this increasingly important asset class.Phase 3The performance of local markets,and the behaviour of investors within them,continues to deliver growth in local AuM.Ashmores local ass

42、et management platforms increased AuM by US$0.5 billion over the 12 months to US$7.5 billion.There was notably strong growth in Colombia,India and Saudi Arabia,while the Indonesia asset management industry continues to work through regulatory changes.Overall,clients domiciled in the Emerging Markets

43、 represent 37%of Group AuM,an increase from 33%a year ago.Notably,Ashmore launched a single-country equity fund investing in Qatar and is in the process of establishing additional on the ground capabilities.Ashmore India launched two domestically-focused equity funds to capitalise on the exciting op

44、portunities offered by this large and rapidly growing economy.Established business model is appropriate for the whole market cycleAshmores distinctive business model underpins its ability to deliver long-term outperformance for clients and to create value for shareholders over market cycles.Investme

45、nt performance is delivered by more than 100 investment professionals,with a no star culture sustained by teams operating within IC structures.The remuneration philosophy has a significant bias to long-dated equity awards,which provides a strong alignment of interests between employees and sharehold

46、ers,maintains a team-based culture,and delivers low employee turnover.Non-VC operating costs remain well-controlled notwithstanding recent inflation pressures.The Group therefore delivers a level of profitability over the market cycle that is relatively high compared with its peer group.For example,

47、the Group has delivered a 41%adjusted EBITDA margin even after a meaningful downcycle that has seen AuM fall 50%from US$98 billion to US$49 billion.Ashmores operational architecture is scalable and has significant capacity to support the expansion of the Groups profit margin with higher AuM levels.T

48、he balance sheet remains well-capitalised and liquid,with approximately 700 million of financial resources including more than 500 million of cash and deposits.The business model is designed to operate effectively over the market cycle,and therefore these characteristics will continue to support the

49、 delivery of performance for clients and returns to shareholders as Ashmore executes its long-term growth strategy.A lower level of redemptions means that the Groups net flows improved compared with the prior year,albeit they remain negative in line with the industry.Encouragingly,there is increasin

50、g evidence of sales momentum building with client interest in a range of investment strategies,although as noted above the conversion to actual flows is likely to require continued improvement in the global macro environment.From a reported financial perspective,Ashmore has performed satisfactorily

51、this year as reflected in the 15%increase in profit before tax to 128 million and a 12%rise in diluted EPS to 13.6 pence per share.However,from an operating perspective,the performance is influenced by the 10%lower level of average AuM and higher total operating costs.The main contributor to the inc

52、rease in total operating costs is a higher VC charge at this point in the cycle,reflecting the delivery of a meaningful increase in performance fees and strong balance sheet returns.The resulting adjusted diluted EPS of 10.5 pence per share is 17%lower than in the prior year.The Board has recommende

53、d an unchanged final ordinary dividend per share.Further progress against long-term strategic objectivesPhase 1The Emerging Markets allocation opportunity is substantial,assuperior economic growth leads to greater representation in world capital markets and investors have to reconsider underweight p

54、ositions.While risk aversion has continued for longer than in previous cycles,the outlook for capital flows is supported by a combination of continued performance by Emerging Markets,heavily underweight allocations,and a moderation of some of the macro factors that have reduced risk appetite.Ashmore

55、 is well-positioned to benefit from an increase in capital flows over the medium term.Strategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 7CEO review continuedRegulationThe broad extent of the Groups office network,from Colombia to Tokyo,means it is accoun

56、table to numerous regulators and Ashmores business model has adapted well to the significant changes in the regulatory landscape experienced around the world in recent years.The regulatory requirements of the asset management industry continue to increase,and Ashmores business model will continue to

57、 adapt to meet these changingregulations.EmployeesWhile the past year saw the world continue to return to normal in terms of monetary policies and working practices,it also faced continued uncertainty in respect of geopolitical risks and the potential impact of new technologies on many industries in

58、cluding financial services.I would like to thank all my colleagues across Ashmores offices around the world for their commitment,professionalism and adherence to high standards of conduct that underpin the Groups delivery of performance for its clients and the creation of long-term value for shareho

59、lders.OutlookEmerging Markets are delivering positive investment returns and continue to have attractive valuations,both in their own right and compared with Developed Markets.This is supported by a resilient economic performance in recent years,and an expectation of further superior growth as the e

60、merging countries continue on a long-term convergence path with the developed world.Investors that have moderated their risk appetite and reduced allocations to Emerging Markets have missed out on significant asset class returns over the past 12 to 18 months.However,atcurrent valuations,with substan

61、tially higher yields available in Emerging Markets than in the developed world,and equities markets offering improving growth on low earnings multiples,there remains an attractive opportunity to capture meaningful outperformance over the coming years.For capital flows to respond more powerfully to t

62、his positive backdrop requires near-term uncertainties to be resolved in some investors minds.While it is difficult to predict the outcome of some of the geopolitical issues,factors such as the phasing of the next Fed rate cycle and the outcome of the US election will become clear over the coming mo

63、nths.Therefore,as this pent-up demand is unlocked,the pick up in investor interest in the Emerging Markets asset classes should gather momentum through the second half of 2024 and into 2025.Ashmore is delivering investment outperformance for clients and has a highly-scalable operating platform,which

64、 means it is well-positioned to benefit from capital flows to Emerging Markets as investor risk appetite increases.Mark CoombsChief Executive Officer4 September 2024Emerging Markets are delivering positive investment returns and continue to have attractive valuations.8 Ashmore Group plc Annual Repor

65、t and Accounts 2024Investment opportunities in Emerging MarketsSubstantial opportunities in a diverse US$81 trillion universe,page 12Macroeconomic resilience in Emerging MarketsReflecting lower leverage and effective monetary policies Read more on page 1075+countries represented in client portfolios

66、Local office growth&diversification explored on page 16 Ashmores proven approachGenerating value over market cycles,full story on page 14 The fundamental reason for this resilience is the quality and effectiveness of the policy responses,both monetary and fiscal,across a wide range of emerging count

67、ries and in contrast to the less rigorous approach adopted by many developed countries.Consequently,economic growth across the Emerging Markets has remained robust and sustained a meaningful premium to the developed world.Notwithstanding slower growth in China,all regions are contributing to this tr

68、end and the premium is expected to expand over the coming years.Macroeconomic resilience in Emerging MarketsEmerging economiesEmerging economies have been extremely resilient in the face of several profound shocks in recent years,including the COVID-19 pandemic,a spike in inflation and conflicts.EM

69、vs DM GDP growth premium (ex China)2022:+1.6%(+2.6%)2023:+2.5%(+1.4%)2024f:+2.7%(+2.1%)2025f:+2.6%(+2.3%)Emerging Markets:government gross debt(%GDP)Europe201920202021202220232024f2025fMiddle EastAsiaLatin America0102030405060708090Firm control of leverageAcross the world,the fiscal response to rece

70、nt shocks resulted in rising government debt to GDP levels,the impact of which is felt more acutely in a period of higher interest rates.Notably,emerging countries required a lower level of fiscal expansion than developed countries,and many have subsequently undertaken rapid fiscal consolidation to

71、return indebtedness back to pre-pandemic levels,whereas the developed world has been much slower to unwind the stimulus.10Effective monetary policies Weak outlook for US dollarThe medium-term outlook for the value of the US dollar is relevant to the prospects of emerging economies.There is a high pr

72、obability of a weaker US dollar following a period of strength,for several fundamental reasons.In real terms,the US dollar is at an extremely high valuation,comparable to the levels achieved at the time of the Plaza Accord(1985)and the dotcom bubble peak(2000).After both events,the currency experien

73、ced a significant period of cyclical weakness.It is therefore possible that the currency weakness seen over the past 18 months is the beginning of another meaningful correction,which would be to the benefit of Emerging Markets.The recent combination of loose fiscal and monetary policies in the US,co

74、mbined with the challenging global macro environment,has resulted in substantial capital flows into the US economy,asreflected in the rising net international liabilities position.Significantly,the majority of foreign investors capital is in the US stock market,not US Treasuries,and therefore repres

75、ents a risk on trade that is vulnerable to a reversal of fortunes,including any persistent weakness in the currency that would undermine returns.Finally,the outcome of the US presidential election,while important,may not influence the direction of the currency.Whichever candidate wins will face subs

76、tantial challenges in the form of twin deficits and therefore an incentive to move away from strong dollar policies that have contributed to the trade deficit.Ashmore Annual Report and Accounts 2024Emerging Markets are typically highly sensitive to inflation and the development of local currency bon

77、ds markets,together with independent central banks,means that countries are in a strong position to manage the risks posed by price appreciation.Significantly,many Emerging Markets central banks acted early and aggressively when inflation started to increase in 2020/2021,and well ahead of central ba

78、nks in developed countries.As a consequence of the recent rapid decline in inflation,Emerging Markets have eased monetary policy again,long before the Fed and other central banks in Developed Markets.Given still relatively high real interest rates,the easing cycle has further to go and can continue

79、to underpin economic performance.Overvalued US dollarSignificant rise in US net international liabilitiesUS$index(lhs)US Fed trade-weighted real US$index(rhs)202420192014200419991989198420091974197980859095100105110115120125130708090100110120130140150160170Inflation and local rates%20212023202220202

80、019201820172016201520112009201220102014201320052008200720060251520105Tax Cuts and Jobs ActUS net international liabilities,US$trillionMay 21May 23May 22May 24Sept 21Sep 23Sep 22Jan 22Jan 24Jan 23Jul 21Jul 23Jul 22Nov 21Nov 23Nov 22Mar 22Mar 24Mar 232024 CPI Survey2023 CPI SurveyEM CPIPolicy rate0.02

81、.04.06.08.010.011Substantial investment opportunitiesEmerging Markets Emerging Markets are well-positioned to deliver long-term outperformance.Managing geopolitical risksUnexpected geopolitical events understandably lead to a period of heightened risk aversion.During this period,and before the winne

82、rs and losers become apparent,there is a well-rehearsed and effective approach that investors should follow.This centres on diversifying portfolios and shifting weights towards neutral countries.Increasing allocations to the Emerging Markets can achieve both investment objectives in the current envi

83、ronment.DiversificationEmerging Markets are highly diverse with equity and fixed income investment opportunities in more than 70countries.The majority of assets are denominated in local currencies,and owned and traded domestically.Inexternal debt markets(sovereign and corporate),atleast half the cur

84、rent issuance is rated IG.67countries in EMBI GD(external debt index)10%maximum country weight in GBI-EM(local currency index)50%IG-rated issuers in EMBI GD and CEMBI BD Reflecting the favourable macroeconomic backdrop described on the preceding pages,Emerging Markets have performed well over the 12

85、 months to 30 June 2024.Valuations remain extremely attractive across both fixed income and equity markets,with further strong recovery potential available to investors.On a relative basis,fixed income index spreads are well above historical levels and equity markets trade at a significant discount

86、to world(and,particularly,US)equities.This combination of positive economic backdrop and valuation upside,with an established recovery rally,argues for higher investor allocations to Emerging Markets.Wide range of returns available(EMBI GD,12 months to 30 June 2024)Individual country return150-1012A

87、shmore Annual Report and Accounts 2024Emerging Markets equities have performed well and the positive outlook for this asset class is based on three principal factors.As economic conditions remain supportive,and after several years of earnings headwinds,the outlook is for stronger growth in corporate

88、 earnings,which in turn should lead to a re-rating.There is a strong historical correlation between the relative growth of emerging and developed economies,and the relative performance of Emerging Markets equities and US/world equity markets.This relationship is expected to persist given the importa

89、nce of economic growth to companies earnings growth.A weaker US dollar enhances returns for equity investors whose assets are denominated in local currencies.Positive outlook for Emerging Markets equitiesLarge,underrepresented investment universeWithin fixed income markets,one of the most profound d

90、evelopments in recent decades has been the shift from external to local currency funding,supported by improvements in quality and effectiveness of monetary and fiscal policymaking,and the growth in domestic institutional investors such as pension funds.Local currency funding provides a meaningful bu

91、ffer against external shocks,but also requires vigilance to mitigate domestic risks such as inflation.A notable development is the inclusion of India in the main local currency benchmark index,GBI-EM GD,at the maximum 10%weight.Thisrecognises the countrys strong performance and effective reforms,fur

92、ther diversifies the index,provides the country with additional foreign capital,and gives investors access to one of the largest emerging countries that has attractive demographics,asustainable debt profile,strong growth and is well-positioned geopolitically.While China has the highest index weight(

93、25%)it is followed closely by India and Taiwan(both 19%),and it is less significant in fixed income indices(4%to 10%weight).The technology sector has a significant weight in the MSCI EM index,and includes companies such as silicon chip manufacturers that play an important role in the supply chain fo

94、r more highly-rated companies in Developed Markets.Therefore,in Emerging Markets,investors can gain access to themes such as artificial intelligence at meaningfully lower valuations.25%IT sector weighting in MSCI EMThe Emerging Markets investment universe is vast:it has US$81 trillion of investable

95、securities,split between fixed income and equity markets.Importantly,only a small proportion of each asset class(less than 20%)is included in the main benchmark indices,which means that active management is necessary to access the full range of investment opportunities.Index market value(%of total)N

96、on-index market value02468101214161820US$trn2017201820192014201520162020202120222023LC governmentED governmentLC corporateED corporateNumbers in US$trn39.4 Equities41.6 Fixed income17.3 Local corporate debt19.7 Local sovereign debt2.9 External corporate debt1.7 External sovereign debt74%37%21%3%17%1

97、9%13Ashmores proven approachEstablished specialist investment managerAshmores 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.Ashmore has managed investments in the Eme

98、rging Markets for more than three decades and has participated in the development of a large,diverse and highly attractive investment universe.There is further substantial growth available in these markets as they follow powerful and well-established trends of economic,political and social convergen

99、ce with the developed world.Investment opportunities arise from inefficiencies,as the Emerging Markets are often misunderstood and underappreciated,and these can be exploited by Ashmores specialist,active approach to investment management.Ashmore manages clients capital across a range of diversified

100、 investment themes with dedicated strategies,within each theme providing either global Emerging Markets or specific regional or country exposure.Ashmore will continue to develop strategies to provide clients with access to a broad range of risk and return profiles as the Emerging Markets evolve.The

101、breadth and depth of Ashmores investment teams,its scalable operating platform and the substantial size of the underlying investable asset classes mean that there is significant opportunity to grow the AuM in each theme.Ashmores established investment processes have successfully navigated numerous m

102、arket cycles over the past three decades.While the Emerging Markets look vastly different today than in 1992 when Ashmore launched its first fund,they continue to have significant inefficiencies that Ashmore can exploit to deliver outperformance for its clients.The macroeconomic and market factors d

103、escribed on the preceding pages,together with the attractive valuations available across fixed income and equity markets,underpin the view that there is further substantial performance available in this cycle,and Ashmore is confident in delivering alpha as it has done in previous recoveries.Establis

104、hed investment processesDiversified investment themesExternal debt$7.2bnLocal currency$17.7bnCorporate debt$4.7bnBlended debt$11.7bnEquities$6.7bnAlternatives$1.3bn(AuM at 30 June 2024)AuM outperforming1 year:40%3 years:59%5 years:62%14Ashmore Annual Report and Accounts 2024Statistics59%AuM outperfo

105、rming over three years38%employee equity ownershipEffective business modelDistinctive team-based cultureAshmores investment approach comprises teams aligned with investment themes or strategies,overseen by ICs.This means there is collective responsibility for investment decisions with no individual

106、managing a strategy.Furthermore,there is collaboration between the global and local investment teams,while each retains autonomy and there is no house view promulgated and followed across the firm.The global distribution team is appropriately structured and resourced to originate and maintain strong

107、 relationships across a wide range of institutional clients and retail intermediaries,including those based in the Emerging Markets.The local offices raise capital through domestic distribution teams.Ashmores efficient support functions underpin the Groups scalable global operating model.The current

108、 cycle is unique and has been protracted,with a sharp rise in inflation,rapid tightening of monetary policy,major elections and conflicts following a worldwide pandemic.Nonetheless,Ashmores established business model is designed to cope with the full market cycle and its salient features remain a st

109、rong,liquid balance sheet;a flexible and long-term equity based remuneration philosophy;strict management of operating costs;and consequent delivery of a high operating margin to shareholders.Specialist,active investment managementStrong foundationsPowerful convergenceSpecialist understandingHeadcou

110、nt by roleHeadcount by office type Global 184Local 99Investment professionals 101Support 18228328315Local office growth&diversificationLocal office networkAn important and differentiated element of Ashmores strategy is to mobilise Emerging Markets capital,both into globally-managed products and thro

111、ugh a network of local asset management platforms that source and invest capital domestically.US$1.5bnAuM invested by Latin America officesUS$1.8bnAuM invested by Middle East officesUS$4.2bnAuM invested by Asia officesThe investable capital in Emerging Markets is growing faster than in the developed

112、 world.Ashmore has established a network of local asset management offices to capitalise on this strong growth trend.These offices also deliver diversification with higher revenue and profit margins.The Group has majority equity ownership of each platform,typically with a significant minority owned

113、by local employees and partners.The listing and IPO of Ashmore Indonesia in 2020 demonstrated the value creation opportunity available,with the local business initially valued at 30 x earnings.There is potential for further growth through broadening the capabilities of the existing platforms and con

114、sidering opportunistic expansion into other target markets.16Ashmore Annual Report and Accounts 2024Unconstrained India equity strategy provides access to the fastest growing G-20 economySuccessful private markets track record,diversifying into listed equities and broadening client baseThe Ashmore I

115、ndia team based in Mumbai manages US$1.8 billion and has a long and successful track record of investing in the domestic equity market,with a focus on the significant opportunities in the small and midcap sectors.The investment process is implemented locally,and the team interacts with the Groups ot

116、her ICs to share views and analyses.India has established a reputation for rapid and broad-based economic growth,underpinned by consumption,investment,government spending and exports.Ashmore India recently launched a dedicated country strategy with a value bias and unconstrained by market cap or ind

117、ex sector weights,to provide domestic and international investors with access to the listed equity opportunities in this exciting country.Ashmore IndiaAshmore established its office in Bogota in 2010,and launched a private equity fund to invest in the governments infrastructure programme.The investo

118、rs were primarily localinstitutions.Since then,the business has grown and diversified through raising a senior debt infrastructure fund and two further private equity funds,launching a listed equities strategy and attracting international institutional capital to invest alongside the domestic commit

119、ments.Today it manages US$1.5 billion for clients.As is the case with the other local ICs,the investment process is implemented locally,and the team has frequent interaction with the Groups other ICs in order to share views andanalyses.Ashmore Saudi Arabia Ashmore was the first foreign manager to ob

120、tain an asset management licence in 2014.As with the other local offices,Ashmore Saudi Arabia has developed through the commitment of a local management team and has benefited from the infrastructure and support of the broader Group.The business manages US$1.8 billion and has a diversified range of

121、liquid equity and fixed income strategies alongside thematic private equity capabilities.The team invests for both local clients and international institutional clients seeking Saudi Arabian and regional opportunities.The investment process is implemented locally,and the team interacts with the Grou

122、ps other ICs.The growth opportunity for Ashmore Saudi Arabia is substantial as the regions capital markets continue to develop and governments pursue ambitious reforms in order to diversify theireconomies.Ashmore ColombiaSubstantial growth underpinned by ambitious government reforms17Investment phil

123、osophySpecialist active management in Emerging MarketsAshmore has successfully implemented its investment philosophy for more than 30 years,delivering outperformance for clients over market cycles.Understanding market liquidity has always been central to Ashmores investment processes.Significant inv

124、estment universeUS$42 trillionof Emerging Markets bonds in issueUS$37 trillionof Emerging Markets debt is in local currenciesUS$39 trillionof Emerging Markets equity market capitalisationExternal debtInvests in debt instruments issued by sovereigns and quasi-sovereigns and denominated in foreign cur

125、rencies.Local currencyInvests in local currencies and local currency-denominated debt instruments issued by sovereigns,quasi-sovereigns and companies.Corporate debtInvests in debt instruments issued by public and private sector companies.Blended debtAsset allocation across the external debt,local cu

126、rrency and corporate debt investment themes,measured against tailor-made blended indices.EquitiesInvests in equity and equity-related instruments including global,regional,country,small cap,frontier and multi-asset opportunities.AlternativesInvests in private equity,healthcare,infrastructure,special

127、 situations,distressed debt and real estate opportunities.18 Ashmore Group plc Annual Report and Accounts 2024Investment committeesAt the core of Ashmores philosophy is a committee-based approach to managing client portfolios.This provides a highly institutionalised,team-based framework that results

128、 in a no star culture in which no individual is single-handedly responsible for investment decisions or client portfolios.It is a principal factor in mitigating the key person risk in asset management.Inefficient asset classesThe Emerging Markets fixed income and equity asset classes are large and d

129、iversified,but also remain relatively inefficient.There is relatively low index representation and asset 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 ex

130、ploit these inefficiencies and to generate long-term outperformance for its clients.Proprietary researchProprietary research is an important source of investment ideas,drawing upon Ashmores long history of specialising in Emerging Markets and its extensive network of relationships.These insights are

131、 shared across asset classes,but importantly there is no house view that has to be followed by the investment teams when constructing and managing portfolios.This supports the diversification benefit of managing a range of strategies in multiple distinct investment themes.Ashmores independent local

132、office investment teams in countries such as Colombia,Saudi Arabia,India and Indonesia provide valuable on the ground local market 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 ma

133、cro views and other research to consider as inputs to their own independent investment processes.Active managementAshmore delivers 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

134、 that outperformance versus benchmarks 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

135、 do not conform to the strict eligibility criteria of the index provider.Focus on liquidityUnderstanding market liquidity has always been central to Ashmores investment processes since the investment teams must decide on specific securities to trade and seek to execute any portfolio changes promptly

136、.In addition to pre and post-trade compliance oversight,the ICs review execution outcomes to ensure that they comply with the agreed decisions.The Groups global operating hubs in New York,London and Singapore provide round-the-clock trading capabilities and Ashmore has a wide range of established co

137、unterparty tradingrelationships.Importantly,given that the majority of Emerging Markets securities are issued,owned and traded locally,these relationships include local brokers as well as international investment banks.Hence,as liquidity increasingly moves to local trading venues within Emerging Mar

138、kets,Ashmores portfolio managers are well positioned to source liquidity when executing trading decisions.ESG integrationAshmore 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

139、-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.Ashmores ESG research is primarily proprietary in nature,based on t

140、hird-party data supplemented by research visits and meetings with issuers.Therefore,in accordance with the Groups 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 i

141、nformation on Ashmores responsible investment approach can be found in its Sustainability Report,available on the Groups website().External debt Local currency Corporate debt All cap Active Frontier Multi-assetFixed income ICInvestment teams(sub ICs)ESG integrationAllocationEquities ICInvestment com

142、mittees structure Local officesInvestment teams(sub ICs)Blended debtStrategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 19Market reviewMarket reviewEmerging Markets performed well over the past 12 months,delivering positive returns that reflect the resilie

143、nce and growth of the underlying economies.Fixed income asset classes outperformed developed world equivalents,and equities delivered strong returns even with the headwinds in China.External debtOver the 12 months to 30 June 2024,the EMBI GD delivered a return of+9%and therefore comfortably outperfo

144、rmed world bonds with the Bloomberg Global Aggregate index rising by+1%over the period.The principal driver of the EMBI GD performance was tighter spreads,which reduced from 430bps to 385bps over US Treasuries.The HY sub-index performed particularly well with a return of+16%compared with+3%for the I

145、G sub-index.The external debt market comprises US$1.7 trillion of bonds,ofwhich three-quarters are in the EMBI GD.The index is highly diversified across 67 countries and with 50%of the bonds rated IG.The index yields 8.4%and provides myriad attractive investment opportunities,particularly in the con

146、text of lower global interest rates and the potential for further spread compression back towards the 300bps to 350bps range experienced in the past.Local currencyThe GBI-EM GD returned+1%over the past year,with good performance in rates markets and positive carry held back by the impact of a strong

147、er US dollar for much of the period.It is notable that most of the issuance by Emerging Markets countries is in their domestic currencies rather than US dollars or other hard currencies.For example,the total sovereign issuance in local currency is US$19.7 trillion,more than 10 times the size of the

148、sovereign external debt market,and provides structural resilience to those countries.However,the index representation is lower,with only 21%of bonds in the benchmark index due to strict eligibility criteria including minimum issue size and factors such as the existence of investment quotas or other

149、forms of capital control.The asset class continues to benefit from the quality and effectiveness of policymaking,with many central banks acting early and aggressively to counter inflationary pressures in recent years,and who are now in a position to ease monetary policy as inflation falls back towar

150、ds more normal levels.The still high level of real yields provides attractive income and support for currencies,as well as the scope for a prolonged period of policy easing.Furthermore,the possibility of a weaker US dollar over the medium term could enhance investor returns in this assetclass.20 Ash

151、more Group plc Annual Report and Accounts 2024Corporate debtThe CEMBI BD performed well,increasing+9%over the year and delivering similar returns to the sovereign asset class and US HY bonds(JP Morgan High Yield Bond Index+11%).Alsoechoing the sovereign market performance,HY bonds outperformed IG wi

152、th returns of+13%and+6%,respectively.The 12-month default rate at the end of the period was 5.9%,which is higher than the US and Europe default rates(2.1%and 2.5%,respectively),principally due to a higher level of defaults in Asia.In emerging Europe and Latin America,default rates of 2.6%and 1.6%,re

153、spectively,are in line with or lower than the developed world levels.Similar to sovereign markets,corporate issuance is primarily in local currencies(US$17.3 trillion)rather than hard currencies(US$2.9 trillion).Approximately one third of the bonds in issue are in the CEMBI BD benchmark,which compri

154、ses 724 issuers in 59 countries and of which 59%are IG rated.Corporate debt is therefore a highly diverse asset class that is underpinned by relatively low net leverage,higher spreads than US issuers with equivalent credit ratings,and attractive yields in both HY and IGmarkets.EquitiesThe MSCI EM re

155、turned+13%over the 12 months,with the performance held back somewhat by lower returns in China as the authorities seek to reform the economy and stimulate growth(MSCI EM ex China+18%over the period).Frontier markets performed well with a 12-month return of+13%.Emerging Markets equities trade at a me

156、aningful discount to developed world equities,reflecting in part the performance and valuation of the US stock market,and illustrated by the MSCI EM trading on a forward PER of 12.3x,which is a 34%discount to the MSCI World on 18.6x.This valuation discount is unwarranted given the sound economic bac

157、kdrop across emerging countries and the potential for an inflection in earnings given rising GDP and companies participating in trends such as the demand for technology.Therefore,investors with underweight allocations risk missing outperformance as equity valuations benefit from a weaker USdollar an

158、d the historical correlation between relative equity market performance and the GDP growth premium of Emerging Markets compared with Developed Markets.OutlookMany emerging countries have proven resilient to external shocks over the past few years,as a consequence of pursuing orthodox and effective f

159、iscal and monetary policies.This has delivered a favourable economic backdrop that includes higher GDP growth than in developed countries,falling inflation and relatively high real interest rates,particularly in the less-indebted countries,providing scope for further rate cuts by Emerging Markets ce

160、ntral banks.Importantly,this resilient and stable performance is being recognised through positive credit rating changes,and underpins the positive outlook for each of the main Emerging Markets asset classes.Notably,large emerging countries such as India and Saudi Arabia are delivering strong econom

161、ic and capital markets performance,and the outlook for China is improving as government stimulus and reforms will address some of the challenges of the past fewyears.In the near term,the outcome of the US election is important for global capital markets,but whichever candidate or party wins,the curr

162、ent state of the US economy,with its twin deficits and high indebtedness,provides very little room for manoeuvre.When combined with the likelihood of lower Fed interest rates over the medium term,and intervention by other central banks,the outlook is for further weakness in the US dollar over the me

163、dium term from its recent peak.Regrettably,geopolitical risk,including war,remains an issue in certain parts of the world.Rather than following the knee-jerk reaction to sell risk assets,investors can mitigate the impact of such events through diversification and allocations to neutral countries,man

164、y of which are in the emerging world rather than the developed world.In summary,as there becomes greater certainty over the timing and pace of monetary policy easing by developed countries,withno significant escalation in geopolitical events,and continued delivery of superior economic performance by

165、 emerging economies,investors risk appetite should increase and lead to higher allocations to Emerging Markets.Current valuations across the Emerging Markets asset classes,including yields that are towards the upper end of the range seen over the past decade,support this argument and underpin an exp

166、ectation of outperformance over the next cycle.Strategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 21Key performance indicatorsMeasuring performance at AshmorePerformance measureRelevance to strategy and remunerationFive-year trendAssets under managementTh

167、e 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 Groups man

168、agement fee revenues.Investment performanceThe 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 arrangemen

169、ts.Funds without a performance benchmark,for example overlay strategies,are excluded.Ashmores strategy seeks to capitalise on the growth trends across Emerging Markets to deliver AuM growth overtime.Growth in AuM is a vesting performance condition for ExecutiveDirectors.Ashmores success is dependent

170、 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.Assets under managementUS$49.3bn2023:US$55.9bnInvestment performance(AuM outperfor

171、mance over three years)59%2023:69%83.62020202120222023202494.464.055.949.3202228484520231 year20246949675962403 years5 years202017749202157799622 Ashmore Group plc Annual Report and Accounts 2024Adjusted EBITDA marginThis measure provides a meaningful assessment of the Groups operating performance,e

172、xcluding the mark-to-market volatility of FX translation and seed capital-related items.Diluted EPSProfit attributable to the equity holders of the parent company divided by the weighted average number of all dilutive potential ordinary shares.Balance sheet strengthAshmore maintains a strong balance

173、 sheet over the Emerging Markets cycle.This is measured by the financial resources available to the Group,which are then compared with the Groups capital requirement to provide an excess capital ratio.Delivering a high profit margin demonstrates the benefits of Ashmores global operating platform,ena

174、bles investment in future growth opportunities,supports cash generation to sustain a strong balance sheet,andprovides for attractive returns toshareholders.EPS reflects the overall financial performance of the Group during the period and represents an aspect of value creation for shareholders.Growth

175、 in diluted EPS compared with benchmark indices is a vesting performance condition for ExecutiveDirectors.A strong balance sheet provides opportunities for investment to grow the business including the seeding of funds,enables Ashmore to build a diversified client base,and supports the Groups divide

176、nd policy.Adjusted EBITDA margin41%2023:54%Excess capital 599m2023:624mDiluted EPS13.6p2023:12.2p68202020212022202320246664544125.72020202120222023202434.212.612.213.6202278966412520232024705624816965999720207035551472021765609156Capital requirement(m)Financial resources(m)Excess capital(m)Strategic

177、 reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 23Business review Assets under managementAuM declined by US$6.6 billion over the year to US$49.3 billion,driven by net outflows of US$8.5 billion,partially offset bypositive investment performance of US$2.1 billio

178、n.The average AuM level was 10%lower than in the prior year at US$52.4 billion(FY2023:US$58.2 billion).Gross subscriptions of US$7.2 billion represent 13%of opening AuM,in line with the prior year and at a relatively subdued level given continued risk aversion by some investors(FY2023:US$7.2billion,

179、11%of opening AuM).Subscriptions were strongest in the local currency and equities investment themes,with the latter seeing new mandate wins notably from the Middle East and Asia.Gross redemptions of US$15.7 billion,or 28%of opening AuM(FY2023:US$18.7 billion,29%ofopening AuM)continue to reflect ins

180、titutional decisions to reduce Emerging Markets allocations given ongoing macroeconomic uncertainty and geopolitical tension.This was particularly evident in the fixed income investment themes,notwithstanding good market performance and delivery of medium-term outperformance by Ashmores investment p

181、rocesses.There was a return of capital from the alternatives theme following the successful realisation of private equity investments.As a consequence of lower redemptions,the total net outflow for the period of US$8.5 billion is 26%lower than in the prior year(FY2023:US$11.5 billion).Ashmore delive

182、red US$2.1 billion of positive investment performance over the 12 months,broadly spread across the liquid investment themes with the exception of local currency where a stronger US dollar led to flat performance overall.Total AuM in the Groups local offices increased by 7%to US$7.5 billion(30 June 2

183、023:US$7.0 billion)and therefore continued to demonstrate the diversification benefit of the Groups strategy.There was notable AuM growth in Colombia with capital raised into a third private equity fund;in India due to continued strong equity market returns and fund launches;and in Saudi Arabia as a

184、 consequence of market performance and net fund flows including new mandates.AuM in Indonesia declined due to profit taking in the equity market and a subdued flow environment as the economy faced some headwinds from lower levels of Chinese growth.Effective business modelmFY2024ReportedReconciling i

185、tems:FY2024AdjustedFY2023AdjustedSeed capital(gains)/lossesFX translation(gains)/lossesNet management fees160.4160.4183.2Performance fees22.722.75.1Other revenue3.73.72.7Foreign exchange2.5(1.5)1.04.4Net revenue189.3(1.5)187.8195.4Net losses on investment securities(17.2)17.2Personnel expenses(85.1)

186、0.5(84.6)(65.9)Other expenses excluding depreciation and amortisation(26.7)1.4(25.3)(23.3)EBITDA60.318.6(1.0)77.9106.2EBITDA margin32%41%54%Depreciation and amortisation(3.1)(3.1)(3.2)Operating profit57.218.6(1.0)74.8103.0Finance income65.2(40.3)24.915.9Realised gains on disposal of investments5.25.

187、2Share of profit from associates0.50.50.5Profit before tax128.1(21.7)(1.0)105.4119.4Diluted EPS(p)13.6(3.0)(0.1)10.512.7Reported PBT increased by 15%,with increased performance fees,higher interest income and seed capital returns compensating for the effect of lower average AuM.Ashmores balance shee

188、t remains robust with approximately 700 million of capital resources including more than 500 million of cash and deposits.24 Ashmore Group plc Annual Report and Accounts 2024AuM movements by investment themeThe AuM development by theme is shown inthe table below.The other column includes reclassific

189、ation of funds between external debt,corporate debt and blended debt following changes to investment guidelines and benchmarks;and the other movement in alternatives is due to the sale of the Groups Colombian real estate business.The local currency investment theme includes US$7.6 billion of overlay

190、/liquidity funds(30 June 2023:US$6.3billion).AuM as investedThe charts on page 26 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 andof crossover investment by certain external debtfunds

191、.The geographic split of the Groups AuM remains diverse and consistent with recent periods:38%of AuM is invested in Latin America,25%in Asia Pacific,15%in Eastern Europe and 22%in the Middle East and Africa.ClientsAshmores clients are predominantly a diversified set of institutions,representing 96%o

192、f AuM(30 June 2023:96%),withthe remainder sourced through intermediary retail channels.Segregated accounts represent 82%of AuM(30 June 2023:81%).The mix of clients is broadly stable compared with the prior year,with an increase in AuM from government-related institutions(central banks,sovereign weal

193、th funds and other government entities)from 42%to 46%,offset by a decline in assets managed for pension funds from 23%to 19%.Geographically,the largest change was an increase in AuM from clients domiciled in the Middle East and Africa,from 19%to 23%,compared with a modest reduction in each of the ot

194、her regions.Ashmores principal mutual fund platforms are in Europe and the US,which in total represent AuM of US$4.0 billion in 45 funds.TheEuropean SICAV range comprises 33 funds with AuM of US$3.5 billion(30 June 2023:US$4.8 billion in 31 funds)and theUS 40 Act range has 12 funds with AuM of US$0.

195、5 billion(30June 2023:US$0.9 billion in 12 funds).Investment performanceAs of 30 June 2024,40%of AuM is outperforming over one year,59%over three years and 62%over five years(30 June 2023:67%,69%and 49%,respectively).The proportion of AuM outperforming over one year has reduced.This is principally d

196、ue to underperformance in some local currency funds,without which the proportion of AuM outperforming over the 12 months would be similar to the three and five-year levels.While there is some underperformance in HY corporate debt strategies,this reflects assets with potentially high recovery values.

197、Over the medium to longer term,Ashmore is delivering outperformance in external debt,local currency bonds,blended debt and a range of equity strategies,together with IG strategies across the fixed income themes.Investment themeAuM 30 June 2023 US$bnGross subscriptions US$bnGross redemptions US$bnNet

198、 flows US$bnPerformance US$bnOther US$bnAuM 30 June 2024 US$bnExternal debt11.00.7(2.8)(2.1)0.7(2.4)7.2Local currency18.83.3(4.4)(1.1)17.7Corporate debt6.50.1(1.7)(1.6)0.2(0.4)4.7Blended debt11.90.8(4.6)(3.8)0.82.811.7Fixed income48.24.9(13.5)(8.6)1.741.3Equities6.22.1(2.1)0.56.7Alternatives1.50.2(0

199、.1)0.1(0.1)(0.2)1.3Total55.97.2(15.7)(8.5)2.1(0.2)49.3Strategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 25Business review continuedAshmores diverse investment themes and clients 2024(%)2023(%)External debt 31Local currency 40Corporate debt 15Equities 11A

200、lternatives 3External debt 30Local currency 40Corporate debt 13Equities 14Alternatives 3AuM as investedAmericas 13Europe 37UK 5Middle East and Africa 19Asia Pacific 26Americas 12Europe 36UK 4Middle East and Africa 23Asia Pacific 25AuM by client geographyExternal debt 20Local currency 33Corporate deb

201、t 12Blended debt 21Equities 11Alternatives 3External debt 15Local currency 36Corporate debt 9Blended debt 24Equities 13Alternatives 3AuM by investment themeCentral banks 21Sovereign wealth funds 20Governments 1Pension plans 23Corporates/financial institutions 22Funds/sub-advisers 8Intermediary retai

202、l 4Foundations/endowments 1Central banks 23Sovereign wealth funds 22Governments 1Pension plans 19Corporates/financial institutions 21Funds/sub-advisers 9Intermediary retail 4Foundations/endowments 1AuM by client type26 Ashmore Group plc Annual Report and Accounts 2024Financial reviewRevenuesNet reve

203、nue was 4%lower than in the prior year as a consequence of the impact of lower average AuM on net management fees,mostly offset by higher performance fees.On an adjusted basis,excluding FX translation effects,net revenue also fell by 4%to 187.8 million.Net revenueFY2024 mFY2023 mNet management fees1

204、60.4183.2Performance fees22.75.1Other revenue3.72.7FX:hedges1.04.4Adjusted net revenue187.8195.4FX:balance sheet translation1.51.0Net revenue189.3196.4Net management fee income of 160.4 million fell by 12%as a consequence of 10%lower average AuM and the headwind from a higher average GBP:US$rate.At

205、constant FY2023 exchange rates,net management fee income reduced by 9%.The net management fee margin increased slightly to 39 basis points(FY2023:38 basis points),due to the recognition of one-off fees related to capital raising by Ashmore Colombia.There was an overall positive impact from investmen

206、t theme mix and large mandate flows,offset by competition and other mix effects.Performance fees of 22.7 million(FY2023:5.1 million)were earned in the year,and delivered by a range of funds in the local currency,corporate debt and equities investment themes,together with a notable contribution from

207、the alternatives theme following successful asset realisations.Approximately US$11 billion of the Groups AuM,or 23%of the total,is eligible to earn performance fees as of 30 June 2024.The Group continues to expect its diverse sources of net management fee income to generate the majority of its net r

208、evenues.Translation of the Groups non-Sterling assets and liabilities,excluding seed capital,resulted in an unrealised FX gain of 1.5million(FY2023:1.0 million gain).The Groups effective hedging programme and the active management of FX exposures during the period meant that realised and unrealised

209、hedging gainsof 1.0 million were delivered(FY2023:4.4 million gain).Therefore,the Group recognised a total FX gain of 2.5 million inrevenues(FY2023:5.4 million gain).Other revenue of 3.7 million was broadly comparable to the prior year(FY2023:2.7 million).The table below summarises the net managemen

210、t fee income,performance fee income and net management fee margin by investment theme.Operating costsTotal operating costs of 114.9 million(FY2023:94.0 million)include 1.4 million of expenses incurred by seeded funds that are required to be consolidated(FY2023:1.3 million),as disclosed in note 20.On

211、 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 increased by 22%compared with the prior year.Adjustedoperating costs increased by 24%at constant FY2023 exchange rates.FY

212、2024 mFY2023 mStaff costs(32.2)(31.4)Other operating costs(25.3)(23.3)Depreciation and amortisation(3.1)(3.2)Operating costs before VC(60.6)(57.9)Variable compensation(VC)(52.9)(34.8)VC accrual on FX gains/losses0.50.3Adjusted operating costs(113.0)(92.4)Consolidated funds costs(1.4)(1.3)Add back VC

213、 on FX gains/losses(0.5)(0.3)Total operating costs(114.9)(94.0)Staff costs increased by 3%to 32.2 million due to the full period impact of wage inflation in certain locations,while the average headcount fell by 1%.Other operating costs increased by 9%to 25.3 million due to a higher level of professi

214、onal fees incurred in the current year.Investment themeNet management feesPerformance feesNet management fee marginFY2024 mFY2023 mFY2024 mFY2023 mFY2024 bpsFY2023 bpsExternal debt18.832.53331Local currency40.643.07.43.32928Corporate debt13.516.23330Blended debt40.946.80.11.13744Fixed income113.8138

215、.57.54.43333Equities27.829.50.85558Alternatives18.815.214.40.7162144Total160.4183.222.75.13938Strategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 27Business review continuedAshmore accrued charitable donations of 0.6 million(FY2023:0.5 million),equivalent

216、to 0.5%of profit before tax.Variable compensation has been accrued at 31.0%of EBVCT(asdefined in the APMs section)resulting in a charge of 52.9 million.The charge is higher than in the prior year(FY2023:34.8 million)to reflect the delivery of investment outperformance for clients,a meaningful level

217、of performance fees,the successful realisation of seed capital gains and higher levels of interest income earned on the Groups cash and deposits.The combined depreciation and amortisation charges for the period of 3.1 million were similar to the prior year.Adjusted EBITDAThe impact of the lower reve

218、nue base and higher operating costs means that adjusted EBITDA was 27%lower at 77.9 million(FY2023:106.2 million),resulting in a margin of 41%for the year(FY2023:54%).At constant FY2023 exchange rates,adjusted EBITDA declined by 21%.Finance incomeNet finance income of 70.4 million(FY2023:33.9 millio

219、n)includes gains relating to seed capital investments,which are described in more detail below,and 5.2 million realised gains on the disposal of the Groups Colombian real estate business and the partial disposal of a minority interest in an Indonesian financial services company.Excluding these items

220、,net interest income for the period of 24.9 million increased compared with the prior year(FY2023:15.9 million)due to the benefit of higher market interest rates on the Groups cash and deposits.Seed capitalThe following table summarises the principal IFRS items in the accounts to assist in understan

221、ding the financial impact of the Groups seed capital programme on profits.The seed capital investments generated total realised and unrealised gains of 21.7 million in the year(FY2023:8.3 million loss).Thiscomprises a 4.7 million loss in respect of consolidated funds(FY2023:15.3 million loss)and a 2

222、6.4 million mark-to-market gain in respect of unconsolidated funds(FY2023:7.0 million gain).Impact of seed capital investments on profitsFY2024 mFY2023 mConsolidated funds(note 20):Net losses on investment securities(17.2)(25.0)Operating costs(1.4)(1.3)Investment income13.911.0Sub-total:consolidated

223、 funds(4.7)(15.3)Unconsolidated funds(note 8):Market return23.55.7FX2.91.3Sub-total:unconsolidated funds26.47.0Total seed capital gains/(losses)21.7(8.3)realised11.32.4 unrealised10.4(10.7)Profit before taxStatutory profit before tax was 15%higher at 128.1 million(FY2023:111.8 million),reflecting lo

224、wer operating profit more than offset by higher interest income,gains on seed capital investments and gains on disposal of investments.TaxationThe effective tax rate of 23.3%(FY2023:22.6%)reflects the geographic mix of the Groups profits in the period,the valuation of deferred tax assets relating to

225、 share-based remuneration and the impact of seed capital gains and losses.The effective tax rate is higher compared with the prior year primarily due to a greater proportion of profits generated in jurisdictions with higher tax rates,such as Colombia and the UK.Note 12 to the financial statements pr

226、ovides a reconciliation of the tax charge to the UK corporation tax rate of 25.0%.The Groups current effective tax rate,based on its geographic mix of profits and prevailing tax rates,is approximately 21%to22%.28 Ashmore Group plc Annual Report and Accounts 2024Earnings per shareBasic EPS for the pe

227、riod increased by 12%to 13.9 pence(FY2023:12.4 pence)and diluted EPS also rose by 12%from 12.2 pence to 13.6 pence.On an adjusted basis,excluding the effects of FX translation,seed capital-related items and relevant tax,diluted EPS was 17%lower at 10.5 pence(FY2023:12.7 pence).Balance sheetAshmores

228、consistent approach is to maintain a strong and liquid balance sheet over market cycles,supporting the commercial demands of current and prospective investors,enabling investment in strategic development opportunities and supporting the Groups dividend policy.As of 30 June 2024,total equity attribut

229、able to shareholders of the parent was 882.6 million(30 June 2023:898.8 million).The Group has no debt.The level of capital required to support the Groups activities,including its regulatory requirements,is 97.0 million.As of 30 June 2024,the Group had total capital resources of 696.2 million,equiva

230、lent to 98 pence per share,and therefore representing an excess of 599.2 million over the Boards level of required capital.CashAshmore has maintained a strong cash position with more than 500 million of cash and deposits as of 30 June 2024.Excluding cash held in consolidated funds,the Groups cash an

231、d deposits increased by 37.4 million to 505.7 million(30 June 2023:468.3 million),reflecting post-tax operating cash flows,the proceeds from the effective recycling of seed capital investments and interest income,offset by dividends paid to shareholders.The proportion of cash held in US dollars incr

232、eased as US dollar revenues earned were not sold for Sterling as the GBP:US$rate strengthened over the period.Cash and deposits by currency30 June 2024 m30 June 2023 mSterling241.8374.0US dollar229.871.1Other40.233.5Total511.8478.6The Groups business model delivers a high conversion rate of operatin

233、g profits to cash.Based on operating profit of 57.2 million for the period(FY2023:77.4 million),theGroup generated 112.5 million of cash from operations(FY2023:111.6 million).The operating cash flows after excluding consolidated funds represent 146%of adjusted EBITDA(FY2023:105%).Seed capital invest

234、mentsAshmore invests seed capital in its funds to achieve a number of commercial objectives,including to provide initial scale,to support the development of an investment track record,and to enhance a funds position with intermediary distributors.The programme has delivered growth in third-party AuM

235、 with approximately US$5 billion of current AuM in funds that have been seeded,representing 10%of total Group AuM.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

236、classes,including sovereign and corporate fixed income,listed equities and private equity,and a wide array of industries including basic materials,education,energy,financials,healthcare,media,industrials,infrastructure,real estate,transport and utilities.During the year,the Group made new investment

237、s of 13.7 million and realised 68.9 million from previous investments.The unrealised mark-to-market gain on the portfolio was 21.3million,consistent with the strong returns described in the Market review.Overall,therefore,the market value of the Groups seed capital investments reduced to 257.6 milli

238、on(30 June 2023:291.5million).Subscriptions in the period were focused on developing new funds in the alternatives,local currency and equities themes,including facilitating access to strategies managed by the Groups local offices.Seed capital recycling in the period was achieved through successful a

239、sset realisations in the alternatives theme and the subsequent return of capital to investors,and from globally and locally managed funds in the equities investment theme.The Group realised a gain of 11.3 million in the period,and the life-to-date realised gain on the redeemed investments was 16.1 m

240、illion.This demonstrates the effective use of the Groups balance sheet in supporting strategic development and delivering meaningful realised profits to shareholders.Seed capital market value by currency30 June 2024 m30 June 2023 mUS dollar213.9240.1Colombian peso23.619.7Other20.131.7Total market va

241、lue257.6291.5In addition,Ashmore has made seed capital commitments to funds of 7.2 million that were undrawn at the period end,giving a total value for the Groups seed capital programme of approximately 265 million.Strategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Acc

242、ounts 2024 29Business review continuedShares held by the EBTThe EBT purchased 13.8 million of ordinary shares during the period in anticipation of the vesting of employee share awards.Consequently,as of 30 June 2024,the EBT owned 49,481,410 ordinary shares(30 June 2023:50,834,683 ordinary shares),re

243、presenting 6.9%of the Groups issued share capital(30 June2023:7.1%).Foreign exchangeThe majority of the Groups fee income is received in US dollars and it is the Groups policy to hedge up to two-thirds of the notional value of budgeted foreign currency-denominated net management fees.Foreign currenc

244、y assets and liabilities,including cash,are marked to market at the period end exchange rate with movements reported in either revenues or other comprehensive income(OCI).Movements in the GBP:US$and other exchange rates over the period reduced net management fees by 3%,reduced operating costs by 1%,

245、and resulted in a translation gain in net revenue of 1.5 million on the Groups foreign currency assets and liabilities and a 2.9 million foreign exchange gain on the Groups seed capital investments.Included in OCI is an unrealised FX translation loss on non-Sterling assets and liabilities of 4.6 mil

246、lion(FY2023:26.2 million loss),which primarily comprises FXtranslation movements on cash,seed capital and the Groups subsidiaries.DividendThe Boards policy is to pay a progressive ordinary dividend over time,taking into consideration factors such as the financial performance over the period,the Grou

247、ps strong financial position,cash generation and the near-term outlook.Therefore,the Board has recommended a final dividend of 12.1pence per share,which,if approved by shareholders,willbe paid on 6 December 2024 to all shareholders on the register on 8 November 2024.Tom ShippeyGroup Finance Director

248、4 September 202430 Ashmore Group plc Annual Report and Accounts 2024Risk managementEmbedded risk management cultureAshmore 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

249、identifies,evaluates and manages principal and emerging risks through an established and effective internal control framework supported by an embedded risk management culture.Overview of Ashmores risk management and internal control systemsIn accordance with the Code,the Board is ultimately responsi

250、ble for the Groups 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 mater

251、ial misstatement or loss.Within the Groups 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

252、 can assess the effectiveness of its riskmanagement and internal control systems.The Groups system of internal control is integrated into the Groups strategy and business model and embedded within its routine business processes and operations.A strong control culture includes clear management respon

253、sibility and accountability for individual controls.The internal control framework provides a process for identifying,evaluating and managing the Groups 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

254、.The process is regularly reviewed by the Groups Audit and Risk Committee and accords with the Guidance.The Executive Directors oversee the risk management process on a day-to-day basis,and there is an organisational structure with clearly defined lines of responsibility and delegation ofauthority.T

255、here 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,fi

256、nancial,compliance and other relevant risks,including the Groups ability to comply with applicable laws,regulations and clients requirements.The main features of the Groups risk management and internal control systems are described on the following pages,covering the Groups key policies,governance b

257、odies,business processes,and verification and confirmation activities.Consideration of changes to the CodeThe Board notes the changes to the Code issued by the FRC in January 2024,including the additional requirements relating to risk management and internal controls that will apply to the Group in

258、FY2027.The Groups 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.Read about Ashmores strategy on page 5The Group executes its strategy using a distinctive business

259、model,and identifies,evaluates and manages the emerging and principal risks inherent in this business model.Read about Ashmores business model on page4The Board has ultimate responsibility for the Groups strategy.It formally reviews the strategy at least annually and receives updates at each Board m

260、eeting.Read Ashmores governance report on page 58The Board is responsible for risk management,although it has delegated authority to carry out day-to-day functions to Executive Directors and governance bodies,such as the RCC.Read about Ashmores principal risks on page36Strategic reportGovernanceFina

261、ncial statementsAshmore Group plc Annual Report and Accounts 2024 311.Policies2.Governance bodiesThe Board seeks to maintain a strong corporate culture,employing high standards of integrity and fair dealing in the conduct of the Groups activities,compliance with both the letter and the spirit of rel

262、evant laws and regulations,and standards of good market practice across Ashmores activities.Ashmores compliance approach underpins these objectives,setting out principles to guide employees,officers and Directors to act with integrity when conducting a wide range of business practices.The Groups Com

263、pliance Manual provides employees with relevant information concerning the Groups regulatory environment,to enable all employees to carry out their responsibilities in accordance with applicable laws and regulations and client guidelines.To support its risk management and internal control framework,

264、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 laund

265、ering Conflicts of interest Contact with regulators Data protection ESG Information security Media Valuation and pricing WhistleblowingAdditionally,the Board and its committees are responsible for a number of policies covering the topics below:Corporate FX and liquidity risk management Directors rem

266、uneration Diversity of the Board and Group Dividend Market abuse and disclosure Non-audit services Seed capital TaxThe Board has overall responsibility for risk management,but it has delegated authority to carry out day-to-day functions to the Executive Directors and governance bodies that have been

267、 established to govern relevant matters.The corporate governance framework describes the interrelationships and delegation to these governance bodies.The Operating Committee reviews the Groups financial and operating performance to focus on delivery of the Groups key strategic objectives and impleme

268、ntation.The RCC is responsible for internal control and for assessing the impact of Ashmores activities on the firms risk,regulatory and operational exposures.The Investment Committees and their sub-committees meet weekly,monthly or quarterly depending on investment theme,and ensure that clients fun

269、ds are managed in accordance with the agreed investment strategy and policies.The Foreign Exchange and Liquidity Management Committee is responsible for the oversight and management of the Groups foreign currency cash flows and balance sheet exposures,including the appropriate level of hedging,and e

270、nsures the Group meets its liquidity requirements.The Product Committee has responsibility for product governance including the launch,amendment,periodic review and closure of funds,and also including treating customers fairly and the FCAs Consumer Duty principle.The Global Investment Performance St

271、andards Committee acts as the Groups 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 Research Oversight Committee addresses governance,oversight and review of third-party research procur

272、ed byAshmore.The Awards Committee has delegated authorities from the Boards Remuneration Committee to oversee certain remuneration matters,including employee remuneration and contracts ofemployment.The Disclosure Committee is responsible for considering the assessment of confidential information,det

273、ermining whether it constitutes inside information,and taking appropriate action in accordance with prevailing market regulations.The Pricing Oversight Committee supervises the effectiveness of pricing policies for all investments held in Ashmore sponsored funds where a reliable pricing source is av

274、ailable.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.The Best Execution Committee reviews the effectiveness of trading practices across asset classes and has oversight

275、of the regular compliance testing of tradeexecution.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 ESG Committee has oversight of Ashmores responsible investing framework

276、and focuses on the appropriate implementation of all elements of this framework across Ashmores corporate strategy and investment management activity.The Diversity Committee is responsible for monitoring developments with respect to diversity and inclusion targets in line with corporate governance r

277、equirements and best practice.The IT Steering Group ensures that the IT strategy is aligned with the Groups strategy and objectives,and has responsibility for implementing,managing and supporting the Groups IT systems and projects.The Cyber Security Steering Group is responsible for promoting and en

278、hancing cyber security across the Group,including matters of culture,engagement,education,training and incident response.The Operational Resilience Steering Group is responsible for ensuring that the Ashmore global operating model remains operationally resilient as it changes over time,including cha

279、nges to third-party service providers.The Regulatory Developments Steering Group is responsible for overseeing and monitoring the legislative and regulatory horizon relevant to Ashmore and the implementation of regulatory and legislative-driven change by the relevant businesses and functions.Risk ma

280、nagement continued32 Ashmore Group plc Annual Report and Accounts 20243.Processes4.VerificationThe following business processes underpin the policies and governance bodies,and are components of Ashmores risk management and internal control framework.Risk management and complianceThe Risk Management

281、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 ri

282、sks 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 empl

283、oy 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 othe

284、r management information related to the control of expenditure against budget and the making of investments,and for monitoring the Groups business and itsperformance.The RCC analyses relevant KRI statistics on a monthly basis.The KRIs indicate trends in the Groups risk profile,assist in the reductio

285、n of errors and potential financial losses,and facilitate dealing with a potential risk situation before an event occurs.The Compliance functions responsibilities and processes include ensuring that the Group meets its regulatory obligations;integrating regulatory compliance procedures and best prac

286、tices within the Group,including a compliance monitoring programme that covers all relevant areas of the Groups operations and the results of which are reported to the RCC and the Audit and Risk Committee;identifying any breach of compliance with applicable regulations;and real-time monitoring of cl

287、ient mandate investment restrictions.Operational and governanceAshmore 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 RAS describes the types and

288、levels of risk that the Group is prepared to take in pursuit of its strategic objectives.TheBoard reviews the RAS in line with Ashmores strategy,business model,financial capacity,business opportunities,regulatory constraints and other internal and external factors and,through the Audit and Risk Comm

289、ittee,regularly reviews risk metrics reported against theRAS.The Groups 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

290、the FCAs Senior Managers and Certification Regime,which requires allocation of specific responsibilities to individuals and therecording of this through a management responsibilities map and individual jobdescriptions.The Groups Finance function,managed by appropriately qualified accountants,is resp

291、onsible 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 Groups auditor and other external advisers to ensure

292、 compliance with applicable accounting and reporting standards,prevailing regulations and industry best practice.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 in

293、formation generated.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.Ash

294、more 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 fol

295、lowing activities are intended to provide the Board with independent verification of the effectiveness of the Groups risk management and internal control systems.Internal Audit is responsible for reviewing the Groups assurance map and providing an independent assessment of assurance to the Audit and

296、 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 Groups principal risks.The Internal Audit function undertakes a programme of reviews of systems,processes and proced

297、ures as agreed with the Audit and Risk Committee,reporting the results,together with its advice and recommendations,to the Audit and RiskCommittee.The external auditor expresses an opinion on the annual financial statements and reviews the condensed set of financial statements in the half-yearly fin

298、ancial report.The Groups 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 Groups external auditor,which include any control matters that have come to the auditors attention.S

299、trategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024 335.ConfirmationThe Board has conducted an annual review and assessment of the effectiveness of the Groups risk management and internal control systems,and has not identified any significant failings or we

300、aknesses during this review.In conducting this review,the Board and/or Audit and Risk Committee have considered periodic reports on compliance and risk matters,includingreports provided by the Internal Audit function,and the annual report on risk management and internal control processes.The Board a

301、nd/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.TheBoard is satisfied that appropriate planned actions continue to be effective in improving controls as the Group develops,and its

302、overall assessment of the control framework continues to besatisfactory.The Board also received confirmation that the senior management is not aware of any internal or external fraud against theGroup.Principal and emerging risks,controls and mitigantsThe table on pages 36 and 37 summarises those pri

303、ncipal 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 Ashmores strategy and business model.Ashmores internal control framework considers the assessment and

304、management of emerging risks alongside its principal risks.Current examples of emerging risks considered by the process are:the increased risk of recessions due to higher inflation volatility,higher fiscal deficits and the resulting monetary/fiscal policies;an increase in geopolitical risks;ESG risk

305、s including regulatory and industry focus on potential greenwashing,legal uncertainty and litigation risks arising from the industrys differing interpretation of ESG regulation,and the impact of ESG factors on investors decisions to invest in Emerging Markets;and uncertainty and risks regarding the

306、use of artificial intelligence technologies in the work environment.Three lines of defenceThe Group has three lines of defence against unintended outcomes arising from the risks it faces.Risk ownershipThis rests with line managers,whether they are in portfolio management,distribution or support func

307、tions.The senior management team takes the lead role with respect to implementing and maintaining appropriate controls across the business.Risk controlThis is provided by the Risk Management and Control department,including the Groups Principal Risk Matrix,and Group Compliance,including the complian

308、ce monitoring programme.Independent assuranceGroup 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.1st2nd3rdRisk management

309、continued34 Ashmore Group plc Annual Report and Accounts 2024Longer-term viability statementIn 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 2027,which is consistent with the planning and stress t

310、esting 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 31 to 37.The Board regularly reviews the Groups strategy an

311、d 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 Directors review the

312、 Groups risk metrics quarterly and the RAS annually.The Board reviews regular information in respect of the Groups financial planning,which includes a three-year detailed financial forecast alongside severe but plausible scenario-based stress testing.Thestress tests include the impact of investment

313、underperformance,failure to comply with regulations,breach of client mandate guidelines or restrictions,a substantial decline of up to half of the Groups AuM and ineffective third-party services.Consequently,the Board regularly assesses the amount of capital that the Group holds to cover its princip

314、al risks,including under a range of severe stress test scenarios.The Group delivers a high level of profitability,generates healthy cash flows and has a strong balance sheet and a robust liquidity position,meaning that it can withstand the financial impact of the stress testing scenarios.Consequentl

315、y,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 capital resources over the next three years.Strategic reportGovernanceFinancial statementsAshmore Group plc Annual Report and Accounts 2024

316、 35Principal risks and associated controls and mitigantsDescription of principal risksExamples of associated controls and mitigantsStrategic and business risks(Responsibility:Board of Directors)Long-term downturn in Emerging Markets fundamentals/technicals/sentiment,andimpact of broader industry cha

317、nges(including ESG)on Ashmores strategy and business model Group strategy is reviewed and approved by the Board which has relevant industryexperience Diversification of investment capabilities Ashmore has a strong balance sheet with no debt Governance bodies meet regularly The Nominations Committee

318、reviews diversity data at leastannuallyMarket capacity issues and increased competition constrain growth Experienced Emerging Markets investment professionals with deep marketknowledge Periodic investment theme capacity reviews Emerging Markets asset classes continue to grow,increasing the size of A

319、shmores investable universeFailure to understand and plan for the potential impact of investor sentiment,climate change and ESG regulations on product preferences and underlying asset prices(including effects of transition to a low-carbon economy)ESG integration framework includes scoring and engage

320、ment strategy Head of Responsible Investment and ESG Policy provides updates to the Board ESGC considers and reports on the risks and opportunities relating to climatechangeClient risks(Responsibility:Product Committee,RCC and ESGC)Inappropriate marketing or ESG strategy and/or ineffective managemen

321、t 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 under

322、standing of Ashmore investment themes andproducts ESGC includes distribution team membersInadequate client oversight including alignment of interests Global distribution team appropriately structured for institutional and intermediary retail clients Monitoring of client-related issues including a fo

323、rmal complaint handling process Compliance and legal oversight to ensure clear and fair terms of business,disclosures and financial promotionsTreasury risks(Responsibility:CEO and GFD)Inaccurate financial projections impact decision making including hedging of future cash flows and balance sheet inv

324、estments Defined risk appetite,and risk appetite measures updated quarterly Group FX and Liquidity Management Committee meets frequently and regularlyInvestment risks(Responsibility:Group ICs)Downturn in long-term performance Consistent investment philosophy over more than 30 years and numerous mark

325、et cycles,with dedicated Emerging Markets focus including country visits and network of local officesRisk management continued36 Ashmore Group plc Annual Report and Accounts 2024Description of principal risksExamples of associated controls and mitigantsOperational risks(Responsibility:Governance bod

326、ies)Inadequate security of information including cyber security and data protection Information security and data protection policies,subject to annual review including cyber security review Cyber Security Working Group meets regularly Employees receive online training and undertake mandatory testin

327、gFailure of IT infrastructure,including inability to support business growth Appropriate IT policies with annual review cycle IT systems and environmental monitoring Group IT platform incorporates local officesLegal action,fraud or breach of contract perpetrated by or against the Group,its funds or

328、investments 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 service provider

329、s Insurance policies in place with appropriate cover Insufficient resources,including loss of key employees and inability to attract employees,or health and safety issues,hamper growth or the Groups ability to execute its strategy Committee-based investment management reduces key person risk Appropr

330、iate 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 againstindustry Semi-annual Culture and Conduct repo

331、rt to the BoardLack 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 Regul

332、atory Development Steering Group and compliance monitoring programme Compliance standards cover global and local offices Anti-money laundering,anti-bribery and corruption,and conflicts of interestpolicies Conduct and culture risks considered by the Board on a semi-annual basis ESGC oversight of regu

333、latory and reporting requirements Compliance function manages sanctions restrictionsInadequate oversight of Ashmore overseasoffices GFD has oversight responsibility for overseas offices.Senior employees take local board/advisory positions Dual reporting lines into local management and Group department heads,withadherence to applicable Group policies Local risk and compliance committees held and RC