IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
## Igniting change. Igniting change.
## Accelerating growth. Accelerating growth.
### IG GROUP HOLDINGS PLC
### ANNUAL REPORT 2022
## Introduction
## IG Group is a leading global
## fintech, led by a clear purpose
## to power the pursuit of financial
## freedom for the ambitious.
AT A GLANCE
PG. 02

| Introduction | Governance Report |
| --- | --- |
| At a Glance 2 | Governance at a Glance 56 |
| Chair’s Statement 4 | Chair’s Introduction to Corporate Governance 58 |
| Chief Executive Officer’s Statement 6 | The Board 60 |

Governance Framework 64

| Strategic Report | Board Governance 66 |
| --- | --- |
| Our Purpose and Values 10 | Nomination Committee Report 76 |
| Key Trends Likely to Affect Our Business 12 | Directors’ Remuneration Report and Policy 79 |
| Business Model 14 | Remuneration At a Glance 82 |
| Key Performance Indicators (KPIs) 16 | Audit Committee Report 102 |
| Strategic Update 18 | ESG Committee Report 110 |
| Stakeholder Engagement 22 | Board Risk Committee Report 112 |
| Section 172(1) Statement 24 | Directors’ Report 115 |
| ESG at a Glance 26 | Statement of Directors’ Responsibilities 118 |
| ESG Report 27 | Independent Auditors’ Report 119 |

Chief Financial Officer’s Statement 36
Business Performance Review 38 Financial Statements 130
Risk Management 46
Going Concern and Viability Statement 54 Shareholder and Company Information
Shareholder and Company Information 192
Appendices 194
Group-wide KPI Definitions 196
THIS REPORT IS ONLINE
IGGROU P.COM
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

# Financial Highlights FY22

BUSINESS PERFORMANCE REVIEW
PG. 38

Total revenue¹

£973.1m

(2021: £837.6m)

Basic earnings per share²

92.9p

(2021: 99.8p)

Total dividend per share

44.2p

(2021: 43.2p)

Profit before tax³

£477.0m

(2021: £446.0m)

Net own funds generated from operations

£437.3m

(2021: £422.8m)

1. Total revenue includes $5.8 million foreign exchange hedging gain associated with the financing of the lastly trade acquisition. On an adjusted basis, total revenue was £847.3m.

2. Profit before tax includes $33.7 million of costs and recurring non-cash costs associated with the lastly trade acquisition and integration and £3.3 million relating to the sale of Ruxles and Small Exchange. On an adjusted basis, profit before tax was £404.3m.

3. Earnings per share include £1.3 million of accelerated financing expense associated with the debt issuance. On an adjusted basis, basic earnings per share was $8.3 pence.

4. The Group uses alternative performance measures to provide additional information on the performance of the business. For more detail, see our KPI definition on page 106.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

1
INTRODUCTION
## At a Glance

| IG Group is a purpose-led global fintech | Our clients are ambitious, and are | IG Group Holdings plc (IGGH or the |
| --- | --- | --- |
| that has been at the forefront of trading | looking to take control of their financial | Company) is an established member of |
| innovation since 1974. | future. Our award-winning products, our | the FTSE 250 and was given a long-term |
|  | educational content and our platforms | investment grade credit rating of BBB– |
|  | empower these ambitious people the | with a stable outlook from Fitch Ratings |
|  | world over to unlock opportunities | in September 2021. |

around the clock, giving them access
toarounto around 19,000 financial markets.
## Our geographies
STOCKHOLM
ZURICH
FRANKFURT
KRAKÓW
GENEVA
NEW YORK LONDON
TOKYO
LIMASSOL SHANGHAI
HAMILTON MILAN
SHENZHEN
DUBAI
HONG KONG
AMSTERDAM
MADRID BANGALORE
CHICAGO
PARIS
SINGAPORE
JOHANNESBURG SYDNEY
MELBOURNE
SALES OFFICE OPERATIONAL LOCATION HQ
CSRC REPRESENTATIVE OFFICE
Employees across 24 offices Active clients in FY22 Markets offered to trade
## 2,507 38 1 ,000+ ~19, 000
2 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Our purpose
## Powering the pursuit
## of financial freedom
## for the ambitious
## Our products Our brands Our proposition
Multiple growth levers
in a significant and
growing global market
High-quality client base,
driving sustained and
enduring value
Market-leading
content,technology
and platforms
Over-the-counter (OTC) 84%
ETD 13% Strong cash flow and
liquidity with robust
Stock trading 3%
riskmanagement
Diversified business by
geography and product
Offices worldwide Hours of educational content Post-tax profits pledged to charities
## 24 4,000+ 1%
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 3
INTRODUCTION
## Chair’s Statement
The Group has had an exceptional
year, both in terms of the record
performance delivered and the strategic
progress made. I am extremely proud
of the ongoing transformation of
the business, and I am confident we
## This has been an
are ideally placed to take advantage
of the opportunities ahead.
The acquisition of tastytrade, Inc.
## exciting year of
(tastytrade) during the year provided
a step-change towards achieving
our diversification strategy, while the
sale of North American Derivatives
## growth and
Exchange, Inc. (Nadex) and Small
Exchange Inc. (Small Exchange)
exemplifies our focus on areas where
we see significant room for growth.
## progress as we
Our clear purpose and strategy has
guided our decision making in the
year, including the formalisation of our
## live our purpose.” Capital Allocation Framework, which
includes our pledge to donate the
equivalent of 1% of post-tax profits to
Mike McTighe
charitable causes each year from 2022
Chair
to 2025, subject to Board approval.
Record performance
The record performance is particularly
pleasing given the exceptional activity
levels seen during the pandemic.
We differentiate ourselves by the
quality of our clients, and this in
turn differentiates our results.
4
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| We are able to continually attract and | shareholders via the repurchase of | focus in particular on governance, |
| --- | --- | --- |
| retain these high-quality clients for | ordinary shares up to an aggregate | regulation and compliance. |
| three key reasons: our product offering, | purchase price of up to £150 million. |  |
| trade execution and client service. Our | We aim to substantially complete this | Supporting our people |
| ever-growing client base continues | buyback programme within FY23. | The past couple of years have |
| to find opportunities to trade, and |  | undoubtedly been a very challenging |
| this underpins our business growth. | We will continue to ensure that we | time for many, due to several factors |
|  | hold sufficient capital resources for | including the global pandemic, |
| Performance in some of our | regulatory purposes and to support | followed by conflict in Ukraine. |
| regions such as the US, Japan | business growth, though we will avoid |  |
| and our pan-European multi- | holding excess capital in the business. | Our people have again proven their |
| lateral trading facility brings |  | dedication and commitment to our |
| diversification and offers significant | Continuing to strengthen our | business, our clients, and society. |
| strategic growth opportunities. | leadership | Collectively, we have taken many steps |
|  | During the year, we welcomed Susan | to address these challenges, both for |
| Focus on capital stewardship | Skerritt (appointed to the Board in July | our employees and for the communities |
| Over the course of the last 12 | 2021) as a Non-Executive Director. | in which we operate. This has been |
| months, the Board has been focused | Susan is an established Non-Executive | a combination of ESG programmes |
| on responsible capital stewardship, | Director and a US resident, and brings | through our Brighter Future Fund and |
| balancing regulatory capital and | significant financial markets experience | employee assistance programmes. |
| liquidity requirements, the need for | of working with US-based companies | In turn, our employees have also |
| investment in the future growth of the | and regulators. That experience and | stepped up and provided support to |
| business, and returns to shareholders. | local knowledge is already proving | those facing undue hardships, which |
|  | invaluable as we increase our focus | has been incredibly moving and |
| As a result, in addition to the | on the US. Susan is a member of | inspiring. We will continue with these |
| comprehensive debt refinancing | both the IG North American Board | endeavours as part of our holistic aim |
| completed during the year, we have | (IGNA) and the IG Group Holdings | to remain a good corporate citizen. |
| established a new Capital Allocation | (IGGH) Board Risk Committee. |  |
| Framework which clearly sets out |  | This has been an exciting year of growth |
| the basis on which the Board will | In support of the acquisition of | and progress as we live our purpose. |
| make capital allocation decisions. | tastytrade, the Board has taken the |  |
| In the framework, we have stated our | opportunity to review the governance |  |
| new policy of an regular distributions of | arrangements in the US to optimise |  |
| around 50% of adjusted profit after tax. | oversight and support of the US |  |

companies by the wider Group. Having
In accordance with this new taken soundings from our external
framework, we also announced our advisers, the Board concluded that a Mike McTighe
Chair
intention to return surplus capital to North American Board was appropriate,
20 July 2022
re-purposing a pre-existing Board to
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 5
INTRODUCTION
## Chief Executive Officer’s Statement
Over the last 12 months we have
delivered exceptional results.
We have achieved outstanding financial
performance while continuing our
journey to become a more diversified,
## Today, we are
innovative, global fintech. We have made
great strides since we announced our
strategy in 2019, and we now see the
emergence of a materially evolved
## apurpose-led
organisation. Today, we are in a very
strong position in multiple markets,
offering our ambitious clients a great
range of products to meet their needs.
## fintech delivering
Through our organic and inorganic
regional expansion, we have created
substantial scope for growth in
significant and larger addressable
## outstanding
markets. I strongly believe that we are
better positioned for future growth than
ever before.
## results.” Our ability to perform in changing
macro conditions and uncertain markets
is the result of the disciplined execution
June Felix
of our strategy, and our business model.
Chief Executive Officer
We are not only increasing revenues but
diversifying the sources of our revenues.
This positions us well for long-term,
sustainable growth.
The performance we have achieved has
not been replicated consistently across
our peer group and is a testament to
several key factors that differentiate
## Key achievements in FY22:
¼ Delivered a record financial performance
¼ Strengthened our strategic position in two
of the world’s largest financial markets
¼ Expanded our large, global, high-quality
clientbase
¼ Committed 1% of post-tax profits to charitable
causes each year from 2022 to 2025
¼ Completed our first corporate bond issuance
¼ Announced our new Capital Allocation
Framework and share buyback programme
6
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| us from others in the sector. These | how we can best serve self-directed | Playing our part in our |
| --- | --- | --- |
| include the size and quality of our client | investors who want to own their financial | communities |
| base of ambitious, active traders, our | futures. To keep meeting our clients’ | We strive to make a difference for our |
| proven market risk management model, | needs, we continually evaluate the | clients and for the wider communities |
| and most of all, the dedication and | changing landscape and respond in | inwhich we operate. |
| commitment of our people, who strive | kind with relevant offerings. We have |  |
| every day to provide a better experience | evolved from a UK-centric, OTC- | We recognise our responsibilities as |
| for our clients and for the communities | focused firm into a global business, | a global corporate citizen, and Iam |
| in which we operate. Iwould like to | strategically and methodically | particularly proud of the steps we |
| begin by expressing my thanks to | expanding by product and by region, | have taken to further embed our |
| everyone at IG Group as we take every | especially in the United States and | environmental, social and governance |
| step together to live ourpurpose. | Asia, which are both large markets with | (ESG) strategy across our business. |
|  | significant growth opportunities. We’ve | In December 2021, we pledged to |
| I’m proud to be able to share how we are | achieved this through a combination | contribute the equivalent of 1% of |
| delivering on our promises. | of organic and inorganic strategies. | our post-tax profits to charitable |

causes from 2022 to 2025, subject

| A purpose-led, global fintech | Our business in Japan shows how | to ongoing Board approval. |
| --- | --- | --- |
| We launched our new purpose over | we applied our winning formula of |  |
| ayear ago, crystallising our vision to | delivering innovative products tailored | This new pledge is part of our ongoing |
| power the pursuit of financial freedom | for local needs backed by our global | commitment to play a part in helping |
| for the ambitious. This ’North Star’ | platforms, expertise and resources. | improve the futures of young people |
| ensures we put our clients at the heart | Revenues have increased more than | around the world – inspiring them to |
| of everything we do and support them | 400% in that business from FY19, | explore possibilities and reach their |
| on their trading and investing journeys. | and it continues to go from strength | potential in life through learning. |
| Today, we are a purpose-led fintech | to strength. As a result, Japan is |  |
| delivering outstanding results. | now one of our largest markets. | The 1% commitment is a natural step |

forour Brighter Future Fund, which

| With operations in 20 countries across | Acquiring tastytrade last year enabled | wasestablished in 2020 with an initial |  |
| --- | --- | --- | --- |
| five continents, we are delivering the | us to accelerate our strategy to expand | £5million contribution from IG. The |  |
| world’s best technology, platforms, | into exchange-traded products | majority of our new 1% pledge will be |  |
| products and exchanges – opening up | and better establish our presence | our mechanism for making regular and |  |
| awider range of trading and investment | in the US, the largest retail financial | substantial payments into this fund each |  |
| opportunities to ambitious people | market in the world. The addition | year until 2025. The Brighter Future |  |
| around the world. | of tastytrade significantly increases | Fund will support projects around the |  |
|  | our total addressable market to over | globe that align with the themes of |  |
| IG Group has a long history of innovating | 21 million active traders, by adding | empowerment through education and |  |
| to meet market needs and to best serve | 14 million active traders of options, | the environment. |  |
| clients. Over the last five decades, | futures and cash equities in the US. |  |  |
| wehave evaluated how the financial | This large market of self-directed, | This builds on our strong track record of |  |
| landscape has evolved and we have | ambitious investors has over 100 million | community outreach, where the level of |  |
| moved in tandem by creating relevant | accounts with the main US brokerages. | our commitment continues to set us |  |
| and responsive products. We are |  | apart from our peers. Key highlights |  |
| already well known for our OTC | In addition, we have a stock trading and | from the last year include: |  |
| derivatives products, allowing traders to | investments business which offers |  | ¼ Continuing to work closely with our |
| take advantage of changes in an asset’s | clients the opportunity to buy and sell a |  | key strategic partner Teach For All |
| price without owning the asset itself. We | range of over 12,000 global shares and |  | and members of their network, |
| enable clients to trade in around 19,000 | exchange traded funds with competitive |  | including Teach First, Teach For |
| markets encompassing indices, | and transparent transaction fees. We |  | Poland and Teach For India. We |
| individual equities, commodities and | believe our success in gaining clients |  | support these charities as they fight |
| foreign exchange. | during the last few years shows that this |  | to make the education system work |
|  | can be another potential growth lever in |  | for every child |
| Our heritage embodies the spirit of | the future. |  | ¼ We are entering a partnership with |
| our future – to consistently determine |  |  | UK-based charity Learning with |

Parents which focuses on financial
literacy and, in particular, looks at
ways to help parents support their
child’s financial education
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 7
INTRODUCTION
### Chief Executive Officer’s Statement continued

| ¼ A new partnership with Chance To | We completed the sale of two | material headroom within our total |
| --- | --- | --- |
| Shine, a programme which helps | businesses, Nadex and Small Exchange, | facilities. The refinancing involved our |
| young girls to become future leaders | in March 2022 for $216 million, | first corporate bond issue of an |
| through the transformative power | representing a significant return on | investment-grade, seven-year, £300 |
| ofcricket | investment for these businesses. This | million, senior unsecured note, and a |
|  | sale gives us the opportunity to reinvest | new £300 million committed revolving |
| In recognition of our credentials as a | into our businesses, expanding our | credit facility, with an initial maturity of |
| responsible and sustainable business, | efforts in tastytrade and in other related | three years. |
| IGhas become a constituent of the | opportunities as they arise. |  |
| FTSE4Good Index. |  | We have also announced our new |
|  | Foundations for success | Capital Allocation Framework, setting |
| Delivering on our promises | Since our earliest days, we have | out how it supports our strategic goals, |
| Through the concerted effort of my | delivered innovative financial solutions | as well as outlining the thinking behind |
| talented and valued colleagues, we | for our clients. This success is | it. This is an important step in shaping |
| made good on our commitment to | underpinned by our people, our | the business, and positioning us for |
| become a more global, diversified and | expertise and our focus on continuous | thefuture. |
| sustainable business. | improvement and innovation. |  |
| We delivered strong strategic progress | This year, we have made some |  |
| across the Group, with stand out | keyleadership changes to further |  |
| performance in product diversification | strengthen our expertise and leverage |  |
| and in extending our platform into new | our capabilities. To represent our |  |
| markets. This focus on growth and | investment in key regions, we have |  |

June Felix
diversification has seen us double our appointed new regional CEOs to drive
Chief Executive Officer
revenues since FY19, with great success in our three key geographies:
20 July 2022
progress made across the key Matt Macklin is the regional CEO for the
geographical regions in which we UK, APAC+ and Emerging Markets, Matt
nowoperate. Brief leads as regional CEO for Europe,
and Joe (JJ) Kinahan has been appointed
We also continue to make progress in as CEO for North America. They all bring
Europe with Spectrum, our Frankfurt- significant experience and expertise to
based pan-European trading venue our regions and to the Executive
forsecuritised derivatives. This year Committee team.
Spectrum welcomed two additional

| brokers and introduced further trading | By combining global resources and |
| --- | --- |
| opportunities on turbo certificates with | regional expertise, we plan to create |
| selected equities and cryptocurrencies. | more innovative, distinctive solutions |
| Further growth is expected in FY23 and | that meet clients’ needs at a more |
| beyond as we integrate additional | targeted level. We will take advantage |
| third-party brokers, as well as integrate | ofour global platform and local insights |
| two tier-1 European banks as product | to deliver sustainable growth through |
| issuers later this year. | both organic and selective inorganic |

investment. Additionally, we have a keen
In Japan, we have enjoyed considerable eye on expanding and fulfilling our ESG
recent success, tailoring our offering to goals. By keeping those goals running in
best suit the needs and wants of local parallel we believe this will ensure we
clients. Our ability to localise continues excel in both the short and long term.
to pay dividends, allowing us to leverage
our platform and technology capability Capital management and liquidity
across different markets. Our balance sheet is strong, and we are
a highly cash-generative business.
This approach of focusing on growth During the year, we successfully
and expansion, while being disciplined in completed a comprehensive debt
the strategic decisions and investments refinancing exercise and implemented
we choose to make, has ensured we are anew long-term funding structure.
outperforming against the strategy we
set ourselves and sets an even stronger These important steps will provide
foundation from which we can grow. additional, significant levels of liquidity
This means being strategic and focused to further support our strategic growth
on what we decide to do and also on ambitions: lengthening the maturity of
what we decide not to do. our debt facilities, enhancing our
financial flexibility, and providing
8 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Capital Allocation Framework

| Our Capital Allocation Framework balances | citizenship commitment of allocating 1% of |
| --- | --- |
| delivering sustainable returns to shareholders | adjusted profit after tax to charitable causes, |
| with ongoing investment in the business to | prior to the declaration of Regular Distributions. |
| execute our growth strategy. | Following these allocations of capital, |

### theGroup will consider inorganic growth
### The Group will retain sufficient capital as investments and Additional Distributions
### required to maintain a strong balance sheet, toshareholders of capital that are surplus
### toinvest in organic growth and fulfil our toour requirements.
1. Regulatory capital 2. Organic investment 3. Commitments
requirements togrowth on citizenship

| Hold an appropriate level of | Generate operating return | Commitment to donate 1% of |
| --- | --- | --- |
| regulatory capital and liquidity. | on existing capital and invest | profit after tax to charitable causes |
|  | organically for future growth. | until 2025. |

4. Regular 5. Inorganic 6. Additional shareholder
distributions investments returns
Regular distribution of around 50% Ongoing disciplined assessment Return of surplus capital not
of adjusted profit after tax, of potential acquisitions. required for other priorities.
delivering modest growth in
dividend per share.

| Regular distributions | The flexibility provided by this approach | Additional distributions |
| --- | --- | --- |
| The Board has adopted a sustainable, | is intended to mitigate the impact of | The Board will continue to keep the level |
| progressive dividend policy. This is | potential short-term fluctuations in the | of capital on the balance sheet under |
| expected to deliver (1) modest annual | business cycle on the annual ordinary | regular review. |
| growth in the dividend per share over | dividend per share paid to shareholders. |  |
| the current planning cycle, and (2) an |  | Capital that is not required to fund |
| interim dividend set at 30% of the prior |  | either planned business investment or |
| year, full year dividend. |  | potential inorganic investment to |

accelerate delivery of the Group’s

| The Board expects aggregate regular | strategic plans will be periodically |
| --- | --- |
| annual distributions to shareholders of | returned to shareholders as Additional |
| around 50% of adjusted profit after tax | Distributions, over and above Regular |
| each year. The Group will retain an | Distributions. Such distributions will |
| element of discretion on the methods | bethrough share buybacks or special |
| ofreturn which may include share | dividends with the Board considering |
| buybacks or special dividends. | anumber of factors to determine the |

mechanism which is most accretive to
shareholder value.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 9
STRATEGIC REPORT
## Our Purpose and Values
## Powering the pursuit
## of financial freedom
## for the ambitious
FIND OUT MORE AT
IGGROUP.COM/ABOUTUS
## Our purpose
### Our blueprint for the future.
### It will deliberately stretch us for years to come.
### It provides us with a fundamental question
### against which to assess decisions – ‘is what
### we’re doing powering the pursuit of financial
### freedom for the ambitious?’. It requires us to
### have a deep understanding of our clients, and
### to diversify into new markets and products.
### As we make further progress towards achieving
### our purpose, we will enable more people to
### become financially self-reliant and therefore
### make a greater contribution to society.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202210
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Strategy Diversification
By delivering on our strategy we are diversifying our revenue. We have
Our strategic drivers
already seen the benefit from our geographic expansion, and now we
Every ambitious person arediversifying the business by product. This is in the form of organic
Unrelenting in our drive to reach ambitious people across andinorganic growth. While our OTC business has continued to deliver
the globe. Ambitious people, wherever they are, all share exceptional performance, our diversification strategy is beginning to
similar characteristics: they’re driven and self-directed. shape a new IG Group.
Weexist to help them in their pursuit of financial freedom,
and we acknowledge that this means something different
for everyone.
FY19
Stock trading
2% Interest
Products that power 1%
Evolving our product portfolio to provide greater choice
and flexibility in the pursuit of financial freedom. Through
innovation, we can power every ambitious person with
market-leading technology, platforms, products and
exchanges. Our focus on education gives clients the OTC
understanding and confidence to harness that power 97%
toachieve their goals.
ETD
0%
Inspiring experiences
Creating personalised experiences that engage, educate
and empower. We invest in our award-winning platforms in FY22
order to provide faster, clearer and smarter ways to trade.
User experience is the top reason clients trade with us.
We also encourage our employees to work collaboratively
to produce excellent results and get the most out of
their roles.
Tuned for growth
Developing our capabilities and infrastructure for growth,
balancing the need for agility with robust controls and risk
management. Successfully diversifying our business
geographically and by product has been possible due to
our strong scalable foundations. As we continue to grow,
this remains a key focus in our technology, our operations
and our financial strength.
## Client focus
Client onboarding Client education
¼ Market to a clearly defined target audience ¼ Encourage clients to engage with us and to learn
¼ Ensure marketing is clear, fair and not misleading about our products and how to trade effectively
¼ Wealth, income and risk appetite andresponsibly
assessment prior to trading our products ¼ Promote responsible trading through an engaging
¼ Ongoing checks to assess potentially introductory programme, targeted at client needs
vulnerable existing clients ¼ Provide a wide range of trading aids, such as
strategic trading content, charting packages,
news, commentary and analysis
### Clients at
### the centre
### of everything
### Client outcomes we do Risk management
¼ Invest in process, training and culture to ¼ Negative balance protection and limited-risk accounts
continually improve experiences and outcomes ¼ Close-out monitor to warn and ultimately liquidate
¼ Evaluate across a broad range of metrics – including client positions when their margin has been
satisfaction, appropriateness, complaints and financial significantly eroded
outcomes – to ensure we are doing the right thing ¼ Option to attach guaranteed stops to identify the
Stock trading

| 3% | ¼ Focus on best possible service by continuous |  | maximum possible loss at the outset of a trade |
| --- | --- | --- | --- |
|  | investment in our platform, to maximise its | ETD | ¼ A business model which aligns our outcomes with |
|  | offering, availability and performance | 13% | those of our clients |

OTC
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 84% 11
Interest
0%
STRATEGIC REPORT
## Key Trends Likely to Affect Our Business
## Realising the value
## of forward thinking
We are continually looking externally at key trends in our are many external factors which may impact our business,
sector, the industry and in the world more generally, to wehave highlighted below the key trends we see, and their
understand the impact they may have on our business, either potential impact.
to spot an opportunity, or to mitigate a risk. Although there
## Structural shift to
## Financial markets self-directed trading
Description Description
Higher volatility tends to generate more opportunities in With the evolution of technology, and freely accessible online
financial markets, which attracts clients – increasing trading educational content, the online trading industry has seen
activity and client income. However, at all times we seek to ashift away from financial advisers and a move towards
maximise hedging efficiency while staying within our risk self-directed trading. Individuals want more control over their
appetite, in order to limit volatility of revenues. finances, and have the knowledge and confidence to be able
to do it.
During the past couple of years, there have been a number of
events which have caused an increase in volatility, from the This structural change has been playing out for some years,
Covid-19 pandemic, to the ‘meme stock’ short squeeze in but has recently been accelerated by the long period of high
January 2021, to the conflict in Ukraine. These led to elevated volatility from the Covid-19 pandemic. The financial markets
levels of account applications which put increased demand on have never been as interesting to trade, nor as accessible to
our systems and people. such a vast potential audience, accelerating this shift towards
individuals taking control of their own financial futures.
In the wider financial markets, we are now seeing rising
interest rates and increasing levels of inflation. These will What does it mean for IG?
provide trading opportunities, but may also impact levels of Our target market is ambitious, self-directed individuals.
disposable income for our clients. Weserve hundreds of thousands of those individuals already,
and the size of the addressable market is growing. We have
What does it mean for IG? astrong reputation as the market leader in OTC derivatives,
Lower volatility could have a negative effect on revenue and are building out offerings in turbos, options and futures,
growth, through lower active client numbers and lower activity and other areas of the market.
per client – both impacted by market conditions. We now
serve an active client base which is materially larger than We are able to rely on our cutting-edge technology, our
before the pandemic. platform reliability, our expertise in risk management and our
strong financial foundations to continue to grow and improve
We have managed to sustain revenues despite less market as a business, and to attract clients all over the world.
volatility in this financial year. Although we believe that we
willbe able to grow the business over time, a long period of Our business is aimed at active traders, but with the range of
lower volatility may have a negative impact on our revenues. support features on our platform, as well as our educational
Conversely, events which cause higher levels of volatility in the content and our increasing product offering, we are confident
markets are likely to be beneficial to our revenue. that we will be able to attract clients from other platforms as
they look to upgrade, as well as those who are newer to
theindustry.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202212
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Sector developments Technology
Description Description
Across all of our products, we operate in a highly competitive We are a fintech business; technology is at the core of what
environment. Our competitor set has evolved considerably we do. Our technology is constantly evolving and improving,
over the past five years, with our traditional competitors being and our success as a business is a testament to being able to
challenged by new market entrants. stay at the forefront of technological advances.
With heightened demand for investing and trading in recent Predicting the future of technology is hard, but it is likely to
years, we have seen elevated marketing spend from impact the way in which we do business, the way we interact
competitors, which has reduced our share of voice in certain with clients, and the way clients trade and interact with their
markets. However, this spend is primarily focused on the lower finances.
value end of the retail trader market.
Clients will continue to demand faster platforms, better
We remain a market leader in the breadth and depth of our execution, more analysis, more tools and an improved
product offering, but as competitors add products we need userexperience.
torespond to maintain this point of differentiation.
What does it mean for IG?
What does it mean for IG? Companies that will succeed in the future are those that are
To date, elevated marketing spend from competitors able to listen to, understand and respond to their clients and
hasnotimpacted our ability to attract and onboard our their evolving needs, while remaining at the forefront of
targetedhigh-value clients nor to retain our loyal and technological advances.
activeexisting clients.
We are well positioned to face this ongoing challenge. Almost
To respond to the threat of new entrants, we closely monitor 40% of our employees work in technology and we have a
any changes in the competitive landscape through local history of innovation, having built web platforms, mobile apps,
knowledge and market research. Our sophisticated Search risk management models, a pan-European exchange and
Engine Optimisation techniques ensure we are the first choice market makers. We also have a dedicated team tasked with
for active traders. We put client needs at the heart of exploring technology future design to ensure what we build is
everything we do in order to stay ahead. resilient, scalable and cutting-edge. We are confident in our
ability to continue to succeed in this area.
Leveraged derivative products are not suitable for all
individuals. We have rigorous onboarding criteria to ensure
that only appropriate clients are able to access our products.
Our competitors’ actions, including new entrants to the
market, may affect the reputation of the industry as a whole.
Our purpose compels us to add new products in addition
toOTC derivatives for the wider needs of ambitious,
self-directed individuals.
We regularly monitor the financial results and actions of our
competitors at executive and Board level.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 13
STRATEGIC REPORT
## Business Model
## Focused on the future,
## positioned for success
## Our resources Our products
Our resources and strengths as a business come
Technology
together to provide four products for our clients:
¼ Continued investment in product
development and resilience
OTC ETD
¼ Award winning options platform
¼ Contracts For ¼ On-exchange
¼ Direct market access (DMA) platform
Difference (CFDs) leveraged securities
¼ Sophisticated web application
¼ OTC FX (EU)
programming interface (API)
¼ OTC options ¼ Options and futures
¼ Range of leading-edge tools and
(US)
charting to inform clients
Brand and reputation
¼ Global leader in online trading, trusted
partner for over 380,000 active clients
¼ FTSE 250 company with £3.1 billion
market cap as at 31 May 2022 and
along history of profitability and
financial strength
¼ Content with cutting-edge research
and actionable trading insights
¼ Client surveys show our reputation is
one of the top reasons they choose us
People and culture
¼ Culture expressed through values –
‘champion the client’, ‘learn fast
together’, and ‘raise the bar’
¼ Tradition of innovation throughout
thebusiness
## ¼ Experienced Executive team who Market risk management
understand our clients
We look to support our clients at all stages of
theirjourney.
Financial capacity This starts with our onboarding process, continues
¼ High level of cash generation through to our educational offerings, client service
andliquidity support and trade execution, which always benefits
¼ Strong balance sheet with the financial the client.
capacity to support business growth
This can also be seen in the risk management model
inour OTC business, which is a key differentiating
feature for us as a business.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202214
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Creating value for
## ourstakeholders
Investors
Delivering attractive returns across an
increasingly diversified business from
Stock trading Content and
astrong financial position.

| ¼ Share trading | education |  |
| --- | --- | --- |
| ¼ IG Smart Portfolios |  | ¼ 10hrs daily live |
| (in association with |  | programming |
| BlackRock) |  | ¼ News and original |
| ¼ ISA and SIPPs (via |  | content |
| share trading) |  | ¼ Webinars and |

tutorials
Clients
Providing a quality global platform,
excellent client service and a range
ofdistinctive educational content
tosupport the trading of our
ambitiousclients.
Society
Playing our part to support our
communities, with a focus on financial
literacy and the environment.
We offset client exposures and hedge any residual
exposure in excess of pre-agreed risk limits in the
external market.
Employees
This is key to our business model. It also allows us to Recruiting, retaining and engaging
manage our market risk while lowering our cost of ourpeople through an inclusive
hedging, And by hedging residual exposure, means environment that enables them to
that our interests are aligned with those of our clients. develop as professionals with best-in-
class resources, training and support.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 15
STRATEGIC REPORT

# Key Performance Indicators (KPIs)

We have maintained our six KPIs from last year as they continue to provide the most comprehensive reflection of how the business is managed.

This is split into four financial metrics and two non-financial metrics¹.

# Financial KPIs

Our financial metrics cover four key areas of our finances: revenue, profitability, diversification and cash flow.

Strong performance in all of these areas is critical to the success of the business in achieving our strategy.

We have updated our revenue KPI to adjusted total revenue, which includes interest on client money, reflecting the increasing importance of interest as a component of our total income. Accordingly we have also updated our profitability KPI to be adjusted profit before tax margin based on total revenue. Both of these measures are on a continuing operations basis.

FIND OUT MORE ON
PG. 38

Adjusted total revenue

£967.3m

FY22 £867.3m
FY21 £845.5m

Adjusted total revenue represents revenue from products and services and interest on client money less cost of hedging, excluding certain costs relating to the tastytrade acquisition.

Adjusted profit before tax margin

51.1%

FY22 51.1%
FY21 64.0%

Our profitability measure indicates the extent to which we're able to convert our revenue into profit by well-controlled cost management, as we work to maximise value for investors while investing in appropriate initiatives for growth and resilience.

Adjusted net trading revenue from non-OTC products

16%

FY22 16%
FY21 7%

OTC activity remains our primary source of revenue, however as we continue to diversify our revenue base, we expect the proportion of revenue from non-OTC products to increase.

Net own funds generated from operations

£437.3m

FY22 £437.3m
FY21 £422.8m

Our balance sheet strength metric measures the cash we generate. It indicates our ability to keep meeting our financial obligations as they fall due, including broker margin requirements and dividend payments.

1 Definitions for the individual metrics can be found in Group-wise KPI Definitions on page 136.

16

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Total number of active OTC derivative Platform uptime
## Non-financial KPIs
clients
## 200,000 99.9+%
Our non-financial KPIs focus on the
FY22 200,000 FY22 99.9+%
size of our core client base and our
FY21 216,000 FY21 100%
platform reliability.
This is a measure of client trading This measures the percentage of time
We work to retain and grow a high-
activity. We use OTC derivative clients that our trading platforms were online
quality, loyal client base, and deliver
rather than total active clients, as these during the financial year.
platform reliability to provide the best
represent the majority of our revenues
experience for those clients. Please also
in FY22.
refer to the ESG KPIs on pages 26 and
33 for information on our progress in
our commitment to our stakeholders,
environment and community.
These client and ESG metrics help
to provide context for our broader
progress, beyond our financial KPIs.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 17
0 216000 0 100
STRATEGIC REPORT
## Strategic Update
## Shifting towards
## greater opportunities
### Our strategy is driven by our purpose. value for all of our stakeholders. Over the
### Ourbusiness investment case provides a nextfew pages we will look at some of our
### clearpicture of how our strategy has been businesses within the Core Markets+ and
### successful in the past, and why we believe HighPotential Markets portfolios.
### itwillcontinue to be successful in the future.
### Our business is in an exceptionally strong place
FIND OUT MORE AT
### to be able to deliver our strategy and provide IGGROU P.COM
## Investment case
Growth levers Diversification Market-leading Quality clients Balance sheet
¼ Multiple growth ¼ Increasingly technology and ¼ Significant amount strength
levers across the diversified business of revenue ¼ Strong and
platforms
business through organic generated from consistent cash
¼ Leading-edge
¼ Market share in and inorganic long-term clients flow generation
research and
some of the world’s growth ¼ Consistent due to our business
actionable trading
largest markets ¼ Footprint which onboarding criteria model
insights
¼ Perfectly continues to has ensured the ¼ Prudent headroom
¼ On-going
positioned to expand quality of clients over capital
investment in
benefit from the geographically has remained high requirements
resilience, capacity
shift towards ¼ Meaningful steps ¼ Retention curves ¼ Strong liquidity
and platform tools
self-directed taken towards have remained position
¼ Sophisticated
trading product consistent ¼ Clear Capital
market risk
diversification throughout the Allocation
management
pandemic Framework
technology
IG GROUP HOLDINGS PLC ANNUAL REPORT 202218
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Core Markets+
Our Core Markets+ portfolio includes locations, including some of our Medium-term growth forecast
our most established businesses, which faster-growing, newer businesses
have been around for a number of years, such as Japan.
and have an existing market share.
## 5-7%
Thisincludes all of our OTC businesses Our focus in this portfolio is on
outside of the US, as well as our stock continuing to service our high-value
trading businesses. client base, ensuring reliable access
toour platforms, customer support,
FIND OUT MORE AT
We anticipate portfolio growth to be onlinecontent and a wide range of
IGGROU P.COM
slightly above market growth, as we markets to trade.
continue to win market share across our
Core Markets+ revenue Japan revenue Number of stock trading clients
## £828.7m +43% 93,200
(2021: £825.2m) (FY22: £98.5m, FY21: £68.7m) (2021: 89,500)
Spotlight on Japan

| Driven by: | Tailored marketing – we combined our | Future opportunities: |
| --- | --- | --- |
| Localised platform – following thorough | central marketing expertise with our | We have seen very strong growth in |
| marketing research and a partnership | local marketing experts to explore | firsttrades – up 53% – in FY22, giving |
| with a Japanese design agency, we | andtarget the appropriate marketing | confidence in the continued growth in |
| tailored the front-end of our application | channels in Japan, including using a | the client base and overall business as |
| to appeal to the Japanese market, rather | well-known Japanese actor to be the | we continue to gain market share. This |
| than using the same front-end used | face of our marketing campaign – a | will be supplemented by new product |
| elsewhere. This is evidence of our ‘local | move which proved very successful | launches and further platform |
| approach’ in international markets. | inbuilding the brand and attracting | improvements. |

newclients.
Net trading revenue and active client growth
£19.2m £46.6m £68.7m £98.5m
£35m 30k
414% growth FY19–FY22
£30m
25k
£25m FY19 FY20 FY21 FY22
20k
£20m
15k
£15m
10k
£10m
5k
£5m
£0m 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
FY20FY19 FY22FY21
Revenue Active clients
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 19
STRATEGIC REPORT
### Strategic Update continued
### High Potential Markets
Our High Potential Markets portfolio able to grow market share quickly, Medium-term growth forecast
includes our newer businesses which asthey expand into the large
have significant addressable markets. addressable markets.
This includes all of our ETD businesses,
## 25-30%
as well as our Retail Foreign Exchange The businesses within this portfolio
Dealer (RFED) in the US. require additional attention from our
management team to ensure the
We anticipate growth of around 25-30% correct strategic decisions are made
FIND OUT MORE AT
over the medium term in this portfolio as during their early growth stages.
IGGROU P.COM
we believe that these businesses will be
tastyworks growth MTF growth High Potential Markets clients
## +16% +90% 116,000
Spotlight on Spectrum

| ¼ Spectrum provides pan-European | ¼ The Spectrum business model | ¼ We have a pipeline of brokers |
| --- | --- | --- |
| market infrastructure for product | isdriven by creating flow across | expected to join in FY23, able to |
| issuers and market makers to | theexchange. This growth will | tradeBrightpool and third-party |
| distribute their products across an | besupported by introducing | issued products |
| increasing distribution network | third-party brokers and issuers | ¼ We are anticipating two Tier 1 global |
| ¼ All components of the multi-lateral | ontothe exchange | institutions to commence issuing |
| trading facility (MTF) have been | ¼ Two Italian brokers, Intermonte and | products on Spectrum in H1 FY23 |
| internal to date: we are the exchange, | Equita, joined Spectrum in Q4 FY22 |  |

the product issuer and the broker
Retail
Pricing
orders
Net trading revenue and turbos traded
£0.7m £4.9m £9.3m
400m
350m
300m
FY20 FY21 FY22
250m
£3.5m
200m
£3.0m
150m

| £2.5m |  |  |  | 100m |
| --- | --- | --- | --- | --- |
| £2.0m |  |  |  | 50m |
|  | £0m |  |  | 0 |
| £1.5m |  | Q1 Q2 Q3 | Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 |  |

FY20 FY22FY21
£1.0m Revenue Number of Turbos/Units
£0.5m
20 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Insights into tastytrade At a glance
tastyworks FY22 revenue
## Q&A with
## the CEOs
Commissions 54%

| Tom Sosnoff | Scott Sheridan |  |  |
| --- | --- | --- | --- |
| Executive Vice Chair | CEO, tastyworks |  | 1 |
|  |  | PFOF | 42% |

Tastytrade Global;

|  |  | CEO, tastytrade |  |  |  | Interest 4% |
| --- | --- | --- | --- | --- | --- | --- |
| Previously: |  |  | Previously: |  |  |  |
|  | ¼ Co-founder, thinkorswim |  |  | ¼ Co-founder, thinkorswim | FY22 products by contract |  |
|  | ¼ Co-founder, Sosnoff Sheridan |  |  | ¼ Co-founder, Sosnoff Sheridan |  |  |
|  | Corporation |  |  | Corporation |  |  |
|  | ¼ CBOE Floor Trader |  |  | ¼ CBOE Floor Trader |  |  |


| Q: What inspired you to | With integration now materially |  |
| --- | --- | --- |
| set up tastytrade? | complete, our co-founder Kristi Ross |  |
| As traders ourselves, we wanted to | has decided to move to a strategic |  |
| create a financial network which | advisory role and step back from |  |
| brought traders together, providing a | day-to-day responsibilities at tastytrade |  |
| place for them to educate themselves | and IG, from 1 July 2022. We’re really |  |
| about trading and take control of their | pleased that Kristi is staying on as a | Equity Options 85% |
| financial decisions. That’s why we say | strategic adviser and look forward to |  |

Index Options 10%
tastyworks is a platform built by traders, continuing to work with her.
for traders. Future Options 5%
At the same time, it’s great to see
Q: Why is quantitative ourVice President and Chief Market
content such an important Strategist, JJ Kinahan, take on an
expanded leadership role as Regional Equity revenue by
part of your business?
CEO for IG, North America. underlying asset
Our content is such a key part of the
business, and it was how the whole
business started. We deliver cutting- Q: What makes you confident
edge research and actionable trading of future growth?
strategies, making the complex world of There are so many things which I could
options simple to understand for our mention here, from embedding a more
customers. It’s also a great way to build sophisticated marketing function, the
awareness and a steady pipeline of potential for international expansion,
potential new customers who already future product launches in the digital
know and trust us. asset space, platform improvements to
improve our client journey, and in the

| Q: How is the integration | short term, interest rates will benefit |  |  |
| --- | --- | --- | --- |
| with IG going? | us too. |  |  |
|  |  | Other 80% | AMZN 3% |

Becoming part of IG Group is really

| exciting for us. Integration has gone very | Hopefully that gives you a flavour of why | TSLA 7% | NVDA 3% |
| --- | --- | --- | --- |
| well and the collaboration between all of | we are so excited about the future. |  |  |
|  |  | AAPL 4% | AMD 3% |

our teams from technology to marketing
has been exceptional, and will continue
to drive us from strength to strength.
1 Payment For Order Flow.
Other 80%
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 21
TSLA 7%
AAPL 4%
Commissions 54%

| Equity Options 85% Other 80% AMZN 3% |  | AMZN 3% |
| --- | --- | --- |
| PFOF | 1 42% |  |
| Index Options 10% TSLA 7% |  | NVDA 3% |

NVDA 3%
Interest 4%
Future Options 5% AAPL 4% AMD 3%
AMD 3%
STRATEGIC REPORT
## Stakeholder Engagement
### Ongoing engagement with our stakeholders
### helps to foster trust, transparency and collaboration.
### Through ongoing dialogue, we can work together
### toevolve our organisation to meet the needs of
### stakeholders and ensure our long-term sustainability.
### Below, we identify our key stakeholders, how we
### engage with each of them, and why it matters.
### Our clients Our people Our investors

| Why we engage | Why we engage | Why we engage |
| --- | --- | --- |
| We aim to provide a holistic experience | Our people are at the centre of all we do. | Creating value for our investors is critical. |
| combining high-quality products, robust | We focus on cultivating talented and | Staying informed of their views gives us |
| customer service and dynamic content with | dedicated individuals for our growing, | insight into their priorities when assessing |
| a client-centric approach. | global team, so we can continue to | us as an organisation. By delivering for both |
|  | deliver high-quality, innovative products, | our shareholders and bondholders, we help |
| Our customer loyalty exceeds many others’ | robust customer service support, and | to ensure that our business continues to be |
| – but we don’t take this for granted. We | informative content that differentiate us | successful in the long term. |
| work to offer our clients an exceptional | from competitors. |  |
| experience every day. |  | How we engage |
|  | How we engage | Throughout this financial year we have |
| How we engage | Employee engagement takes many forms | adopted a hybrid model, hosting in-person |
| Our multilingual, highly trained customer | at IG, including surveys, internal social | investor meetings as well as continuing |
| support teams are available 6.5 days a | channels, townhalls, smaller group | virtual meetings where appropriate. |
| week, 363 days a year (with closures on | meetings and through feedback obtained | This flexible approach allows us to |
| Christmas day and New Year’s Day). | via our employee communication portal. | build relationships with our investors, |
| Ongoing investment in communications | We have also developed employee | while providing greater flexibility to |
| and customer relationship management | network groups as a crucial channel | accommodate health restrictions as |
| help nurture client engagement and loyalty. | to better understand the experience | well as time or location constraints. |

of our employees who are currently

| Our platform offers a range of tools | underrepresented. | We have maintained open dialogue with our |
| --- | --- | --- |
| andfeatures to help clients, including |  | shareholders and bondholders through a |
| educational resources, breaking financial | Our People Forum, a body that acts | variety of channels including one-to-one |
| news and live analysis of the markets. | as a conduit for more formal feedback | and group meetings, results webcasts and |
|  | and interactions with the Board, brings | roadshows, conferences, and via questions |
| Our clients use our trading platforms on a | employee voices into Board decision | submitted by investors on an ad hoc basis. |
| daily basis, making them our most valuable | making. The People Forum is chaired by | Investor feedback, along with details of |
| source of feedback. We use their feedback | our Chief People Officer and attended by | major movements in our investor base, is |
| to help us continually improve our service. | Non-Executive Director Sally-Ann Hibberd. | reported to and discussed by the Board |
|  | Employee representatives are | regularly and incorporated into the |
| What matters most | democratically elected by our people | decision-making process. |
| Products: We are a market leader in the | and serve two-year terms. |  |
| breadth and depth of our product offering, |  | What matters most |
| diversifying in response to clients’ needs. | What matters most | Key to our engagement with investors is |
|  | Employee engagement is vital in two main | that management and our Investor |
| Knowledge: We create content and | ways: 1) how we share information about | Relations team are accessible, open and |
| marketanalysis to give our clients the | our business strategy and industry updates, | well-informed about the business. This |
| confidence to understand and use our | and 2) how we gather feedback from our | allows for high-quality discussions, which |
| products to meet their financial goals. | employees to continually enhance our | provide investors with the information they |
| Wealso offer demo accounts, where | employee experience, which we believe will | need to make informed decisions. |
| clientscan experience our products in | also strengthen the quality of service to |  |
| alow-risk environment. | ourclients and the communities in which | Investor discussions cover a wide range of |
|  | we operate. | topics, including financial performance, |
| Technology reliability: We strive to provide |  | strategy, capital allocation, client |
| astable, secure, reliable platform, so that | This two-way dialogue enables us to get the | characteristics, cost control, regulation and |
| trade execution is seamless. | best from our talented, experienced people | competitive position. The receptiveness of |
|  | and helps us achieve our ambition to be a | management and the Board to the views of |
| Support: 24-hour trading coverage enables | top workplace and employer. | investors is integral to the development of |
| our clients to trade ‘around the clock’. |  | investor trust. |

Clients can rely on us whenever they
needassistance.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202222
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Our regulatorsOur communities Our suppliers

| Why we engage | Why we engage | Why we engage |
| --- | --- | --- |
| Our long-term success relies on an | Regulations influence how we are able to | Suppliers are crucial to the quality of |
| unwavering commitment to sustainability | operate in the marketplace. We recognise | service we provide to our clients, and as |
| and social responsibility. This commitment | how vital it is to maintain constructive, | such, we aim to develop mutually beneficial |
| is a driving force for our business purpose, | ongoing dialogue with regulators to | and lasting relationships with our vendors. |
| our ESG strategy, our corporate social | ensure they understand our products and | We recognise the importance our supply |
| responsibility programmes and our culture. | our business model, so we can continue to | chain plays in delivering our ESG strategy |
|  | be active in countries we currently serve | and expect our suppliers to embody our |
| How we engage | and keep growing into new markets. | commitments to responsible business, |
| Our Brighter Future framework shapes how |  | education and the communities in which |
| we reach our ESG goals, centring around | Engaging with local regulators helps foster | weoperate. |
| four main pillars: Products, People, | our relationships with them and gives |  |
| Partnerships and Best Practice. At the heart | us a better view of upcoming regulatory | How we engage |
| of this strategy is our Brighter Future Fund, | changes, which in turn informs how we can | We understand the importance of selecting |
| which was established in 2020 with an | best respond to those changes to meet the | partners with effective controls and |
| initial £5 million commitment. Through the | needs of our key stakeholders. | high-quality standards as we look for |
| Brighter Future Fund, we build partnerships |  | longer-term relationships. As a result, |
| with local, national and global charities, | How we engage | wehave implemented a robust diligence |
| with the aim to have a positive impact on | Constructive dialogue and transparency are | process to screen our suppliers to ensure |
| the communities in which we operate. We | at the foundation of our relationships with | that together we continue to meet the high |
| make substantial cash donations to these | regulators, helping to demonstrate that our | quality of service our clients expect. |
| partners and offer employee time through | actions and business model are consistent | Frequent dialogue with our suppliers is |
| corporate volunteering. These activities are | with regulatory expectations. Working with | acore way that we ensure that all parties |
| managed by our dedicated ESG team and | regulators takes shape in several ways, | are getting the desired value from our |
| our Executive Committee and are overseen | ranging from proactive engagement on | relationship. Generally, our engagement |
| by our ESG Board Committee. | new business proposals to assisting with | ranges from informal conversations for |
|  | their regulatory requests and investigations. | exchanging information and discussing |
| In December 2021, we pledged the |  | priorities to more formal interactions. |
| equivalent of 1% of the prior financial year’s | What matters most |  |
| post-tax profits to charitable causes each | Regulators aim to safeguard individuals’ | What matters most |
| year from 2022 to 2025, subject to Board | best interests and ensure that all clients are | Long-term partnerships: our suppliers |
| approval. These contributions aim to tackle | treated fairly. They also focus on protecting | value clarity on our expectations of the |
| educational inequality and to create | the integrity of financial markets, as well | relationship and the services they provide, |
| long-term, sustainable societal impact. | ascapital and liquidity issues. We work to | along with timely and reliable payment. |
|  | respect and follow both the letter and spirit | Oursuppliers also appreciate fair, open and |
| What matters most | of the regulations set out by local regulators | honest two-way communication and value |
| We aim to provide sustained and long-term | to demonstrate that we share their vision. | the feedback we can give them. |

support to the communities in which we
operate. This support takes many forms –
through ongoing dialogue, sustained
contributions and through meaningful
employee engagement.
As part of our considerations, we also
focuson the environment, and address
thisthrough partnerships and charitable
programmes among other initiatives.
See page 26 for more details.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 23
STRATEGIC REPORT
## Section 172(1) Statement

| We are committed to upholding the very | be considered and taken in the best | Principal decision 1: |
| --- | --- | --- |
| highest standards of conduct and all | interests of the Group and stakeholders. | Comprehensive debt |
| decisions we make are for the long-term |  | refinancing programme |
| success of the business. We believe that | Methods used by the Board to fulfil |  |
| our business will continue to grow and | s172duties | Background |
| prosper if we understand and respect | The Board sets the purpose, values and |  |

Following the acquisition of tastytrade,
the views and needs of our stakeholders. strategy, and carefully ensures that it is
the Board approved the issuance of £300
aligned appropriately with stakeholder
million of senior unsecured loan notes,
Under Section 172 (s172) of the interests, while also taking our culture
the proceeds of which were used to
Companies Act 2006 (CA2006), into consideration.
repay the Group’s £250 million bank debt,
theDirectors must act in a way that
comprising a £150 million three-year term
theyconsider, in good faith, would be Consideration of key stakeholders is an
loan facility and a £100 million existing
most likely to promote the success integral part of all decision making by
term loan, both of which were due to
ofthe Company for the benefit of its the Board and every paper presented to
mature in June 2023. In addition, the
members as a whole. In doing this, the the Board clearly sets out the impact on
Board agreed the renegotiation of our
Directors must have regard to, among any stakeholders for whom it is relevant.
revolving credit facility (RCF), increasing
other factors: This analysis assists the Directors in
the size to £300 million with an initial
¼ The likely consequences of any performing their duties under s172,
maturity of three years.
decision in the long term andfurther, the Board receives external
¼ The interests of the Company’s challenge and assurance on this,
Board considerations

|  | employees | together with reports from brokers |  |  |
| --- | --- | --- | --- | --- |
|  | ¼ The need to foster our business | andadvisers. | The Board considered and approved |  |
|  | relationships with suppliers, |  | the establishment of a Euro |  |
|  | customers and others | Directors receive specific training | Medium Term Note Programme |  |
|  | ¼ The impact of our operations on the | including tailored induction processes | (EMTNProgramme). The establishment |  |
|  | community and the environment | for new Directors together with an | of theEMTN Programme included |  |
|  | ¼ The desirability of the Company | ongoing programme of training on | the publication ofthe associated |  |
|  | maintaining a reputation for high | strategic, legal and regulatory | Prospectus on 29 October 2021. |  |
|  | standards of business conduct | developments relevant to the Group’s | The Directors considered that the |  |
|  | ¼ The need to act fairly between | activities. This enables the Directors to | EMTN Programme would bring |  |
|  | shareholders of the Company | comply with their legal duties under | numerous benefits, including: |  |
|  |  | s172 of the CA2006. |  | ¼ An enhanced opportunity to time the |
| Our key stakeholders |  |  |  | market, reducing the transaction |
| We have identified certain key |  | Principal Board decisions taken during |  | time from 10-12 weeks to two weeks |
| stakeholders who are essential to the |  | the year |  | ¼ Flexibility in the types of notes that |
| success of our business. Details of these |  | Stakeholder engagement allows us to |  | could be issued |
| stakeholders and why and how we |  | understand the impact of decisions on |  | ¼ Cost effectiveness, as issuing notes |
| engage with them can be found on |  | key stakeholders and the wider market |  | from an EMTN Programme was |
| pages 22-23. |  | implications of these decisions. By |  | significantly cheaper when compared |
|  |  | listening to our stakeholders, we are |  | to a standalone issuance |
| The Board has direct engagement with |  | able to identify emerging risks and |  | ¼ The ability to make the most of |
| our employees and shareholders and is |  | trends, which can then be factored into |  | private placement opportunities |
| kept fully informed of material issues of |  | strategy discussions. |  |  |
| all stakeholders by the Executive team |  |  | Following the establishment of the |  |
| and external advisers. |  | We give three examples of how the | EMTN Programme, the Board approved |  |
|  |  | Directors have considered the matters | the issuance of £300 million senior |  |
| Long-term decision making |  | set out in s172 of the CA2006, when | unsecured notes, using the majority of |  |
| Our strategy is to sustainably generate |  | discharging their duties, and how this | the proceeds to repay its existing debt |  |
| and preserve value for stakeholders and |  | has affected certain principal decisions | facilities. The Board also approved a new |  |
| wider society over the long term by |  | taken by them. We define ‘principal | RCF facility which: |  |
| facilitating a wider range of trading and |  | decisions’ as those that are material to |  | ¼ Provides significant levels |
| investment opportunities for ambitious |  | the Group and are significant to any one |  | of liquidity to support our |
| people around the world. This long-term |  | or more of our key stakeholder groups. |  | strategic-growth ambitions |
| view drives the annual review of strategy |  |  |  | ¼ Lengthens the maturity of |
| undertaken by the Board and the setting |  | In making the following decisions, the |  | the debt facilities, enhancing |
| of objectives for employees. Our |  | Board considered the outcome for our |  | ourfinancial flexibility |
| risk-management procedures identify |  | stakeholders based on engagement |  | ¼ Provides material headroom within |
| the potential consequences of decisions |  | with them, as well as the need to |  | our total facilities |
| being made in the short, medium and |  | maintain a reputation for high standards |  |  |
| long term so that appropriate levels of |  | of business conduct and the need to act |  |  |
| identification, mitigation, reduction, |  | fairly between our shareholders. |  |  |

management or elimination of risk can
IG GROUP HOLDINGS PLC ANNUAL REPORT 202224
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
strategic donations aligned with the Principal decision 3: Sale of Nadex
Stakeholder impact and
themes of empowerment through and Small Exchange
considerations
education and the environment.
Clients The 1% will also be used to meet Background
By providing ready, flexible and better- our employee matched fundraising
Following receipt of a non-binding offer
timed access to capital and liquidity, promise and will include employee time
from crypto.com, theBoard approved
wewould be better placed to support spent volunteering.
the sale of the entire issued share
our clients’ demands and expectations.
capitalof Nadex by IGNA, and sale of the
Board considerations
issued share capital of Small Exchange
Shareholders
The Board considered the fact that as held by tastytrade for $216 million.
The Board considered the impact of
our businesses grow, so too does our
thenew debt structure for shareholders
impact on our communities and on the Board considerations
and agreed that the EMTN Programme
environment. It is increasingly important
and new debt facility represented The transaction represented a
that we manage this impact in a
anappropriate long-term strategic significant return on the investments
responsible and sustainable manner.
opportunity which would create value, made, creating the potential for
Tothis end, the 1% pledge represents
promoting the success of the Group in additional investment across the
asignificant step towards sharing our
the long term including for shareholders business. Completion of the sale was
successes with the communities in
as a whole. announced on 2 March 2022.
which we operate.
Regulators The Board focused in particular on the
As stated in our purpose, we exist for
The Board considered the positive potential anti-money laundering risk,
every ambitious person, regardless of
impact of the EMTN Programme from political risks and regulatory risks,
their background. The primary goal for
aregulatory perspective. Specifically, andthe retention of key people.
the Brighter Future Fund is to improve
the enhancement of our ability to raise
educational opportunities for the least
capital and to access liquidity on short The Board considered this sale in line
privileged in our global communities. The
notice (and therefore more effectively with our strategic direction and in the
Board considered that the 1% pledge was
mitigate the risk of capital and liquidity best interests of our stakeholders.
therefore in line with our purpose-led
shortages) were considered to be
direction and in the best interests of
aspects of the proposal that would be Stakeholder impact and
ourstakeholders.
viewed favourably by our regulators, in considerations
light of the positive impact on our ability
Stakeholder impact and Employees
to serve our clients.
considerations The Directors considered the impact
ofthe proposed sale on employees.
Commitment to the business plan and Communities
Inparticular, the Board considered key
long-term success The Board recognised the significant
person risk and the views of impacted
The Board fully considered the benefits of positive impact this pledge could
staff members, with a focus on the views
implementing the EMTN Programme and haveon the communities in which
and interests of employees who would
agreed that the proposal provided an weoperate.
be transferred to crypto.com as a result.
opportunity for us to move at pace
towards realising our strategic vision, and Employees
Shareholders
enabled us to operate under a more The Board considered how employees
The Board was kept apprised of each
efficient and flexible debt structure would be invited to participate in
key stage of the transaction and any
aligned to our growth opportunities. community outreach activities via the
significant developments were reported
Brighter Future Fund, with a particular
to the Board, including in relation to
Principal decision 2: Pledging 1% focus on how employees could donate
dealstructure and key terms of the
of post-tax profits to charitable their time by using volunteering days
transaction documents. The Board
causes and directing money from the Fund by
considered the returns acceptable from
accessing the matched-giving promise.
a shareholder perspective and agreed
Background The Board also considered how
that the sale represented good value.
community outreach commitments
In 2020 we established our Brighter
were becoming increasingly important
Future Fund with a Board-approved Commitment to the business plan
to prospective employees.
payment of £5 million. This year, as a sign andlong-term success
of our commitment to responsible The Board considered that the sale
Commitment to the business plan and
business, the Board approved a pledge of would be in line with ourstrategic
long-term success
the equivalent of 1% of the prior financial priorities as it would allow resources
The Board considered that the 1%
year’s post-tax profits towards charitable tobe redeployed into key strategic
pledge would be in line with our
causes each year from 2022 to 2025, opportunities and markets identified
purpose and values, each of which had
subject to ongoing Board approval. The aspart of our strategy.
been carefully articulated to ensure
majority of this will be paid into the
long-term success.
Brighter Future Fund and used to make
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 25
STRATEGIC REPORT
## ESG at a Glance

| Powering the pursuit of financial freedom for | Targets initiative, we’ve taken huge steps to |
| --- | --- |
| the ambitious is about making a positive and | embed our Brighter Future framework across |
| inclusive contribution to society. FY22 has been | our business. The following section showcases |
| a successful year for our ESG ambition. From | some highlights and signposts where you can |
| starting a review of the ESG impacts of our | find out more. |

### products to committing to the Science Based
By proudly developing a diverse We amplify our impact through
and inclusive team of talented meaningful collaboration with
people, where wellbeing comes like-minded patners to champion
first and ambition is nutured, responsible business, education
we improve our employees’ lives. and the environment throughout
our supply chain.
P a 
l e t n
Our tools give p e
o r s
e h We want to raise
people access to the P i p
s
the bar for business.
financial markets and, to
This means we are
suppot that, we produce
governed by accountable
a huge range of excellent
B
e leadership, uphold
financial education s
s t
t exemplary ethics, and
materials. We onboard c P
u r are transparent in our
our clients responsibly a
d c
o communications.
and are vigilant for r t
i c
P
client vulnerability. e
### Empowering our stakeholders to unlock a Brighter Future

| The Brighter Future framework is at the | have made some really meaningful | Young people benefiting from our |
| --- | --- | --- |
| core of our ESG strategy. Launched in | contributions towards the aims of the | Brighter Future initiatives globally |
| FY21, it identifies the potential key risks | UN Sustainable Development Goals. |  |

posed by our business, and the key
benefits that we offer to our clients and We are proud to have our progress
## 94,751
communities, and commits to managing recognised with a number of ESG
these in a responsible and sustainable awards and ratings, and to be active
manner. Twelve priority areas were members of several important
Scope 1-3 greenhouse gas emissions

| identified, split across four pillars: | communities. We are particularly |  |  |
| --- | --- | --- | --- |
|  |  | per employee (TCO | 2 e) |
| Products, People, Partnerships and Best | pleased to have become a constituent |  |  |
| Practice. We’ve made great progress in | of the FTSE4Good Index. |  |  |

each of these areas, and in doing so
## 10.56
26 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

# ESG Report

FIND OUT MORE AT
IGGROUP.COM/OUR-
COMMITMENT-SUSTAINABILITY

# UN Sustainable Development Goals¹

We want to make it easy for stakeholders to understand how we demonstrate our commitment to responsible and sustainable business, and to see how these activities

interact with and complement activities pursued by wider society. This is why we have aligned our ESG strategy with the following seven UN Sustainable Development Goals:

# UN SDG

# Key achievements in FY22

# References

Takes inclusive and equitable quality education and promote lifelong learning opportunities for all

- Removed barriers to accessing IG Academy, with this financial content now being available to all
- Created an internal 'Learning Hub' to help employees curate learning journeys tailored to their needs
- Money and time donated to charities promoting equal access to quality education, such as Teach the Nation in South Africa, Teach for America and Teach for Australia

Pages 29, 30 and 32 of the Annual Report

Initiates gender equality and empower all women and girls

- Made key changes to our recruitment processes to make them more inclusive
- Launched the DailyFX Women in Finance Hub, offering content designed to help women become more informed, engaged and educated leaders
- Facilitated community outreach events focused on supporting and inspiring young women in collaboration with UK strategic charity partner Teach First
- Improved confidence and leadership skills of young women and girls through our Chance to Show Partnership

Pages 24 and 30 of the Annual Report

Protests sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all

- Employed 2,507 people globally (as at 31 May 2022)
- London Living Wage employer in the UK, and looking to ensure this is replicated for all employees across the globe, using appropriate local benchmarks
- Participated in community outreach events focused on improving employability prospects of young people from underrepresented communities. For example, in Chicago we hosted an intern through the Greenwood Project and we collaborated with partner Teach For Poland to help Ukrainian refugees with teaching qualifications to receive training and find employment

Page 33 of the Annual Report

Inclusive inequality within and among countries

- Pledged 1% of prior financial year's post-tax profits to charitable causes each year from 2022 to 2025, subject to board approval, and a significant portion of this will focus on the theme of empowerment through education, including projects in developing nations such as India and South Africa
- This year we paid £131.3 million (2021: £119.6 million) to tax authorities globally and £97.4 million in corporate income taxes (2021: £83.0 million)
- Gifted a total of 67 laptops to refugees and partner schools from the Teach For All network

Financial Statements for FY22

Ensure sustainable consumption and production patterns

- Maintained a C grade with the Carbon Disclosure Project
- Taken deep in further embed environmental considerations in our procurement activities, engaging an environmental consultant to help us develop a suite of new procurement standards

Pages 32 and 33 of the Annual Report

Taking agent action to combat climate change and its impacts

- Formally began our journey with the Science Based Targets initiative, with a commitment to producing a pathway to net zero by the end of summer 2024
- Offset our scope 1, 2 and upstream scope 3 carbon emissions for the third year running and maintained lifetime carbon neutral status
- Further embedded climate-related risks and opportunities into our Risk Management Framework, in line with the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD)

Pages 32, 33 and 34 of the Annual Report

Incorporate the means of implementation and revitalise the global partnership for sustainable development

- Became a member of the Business For Societal Impact² network to collaborate with peers and to benchmark our community outreach activities
- Made donations to 45 different charities spread across 14 different countries
- In the UK, we participated in a cross-sector collaboration looking at improving female representation in the STEM³ subjects. Co-collaborators included the UK Shadow Minister for Digital Science and Technology, the Institute of Physics, the Royal Society of Chemists and the Education Policy Institute

Page 32 of the Annual Report

1 The Sustainable Development Goals are a collection of 17 interlinked global goals designed to ensure a more sustainable and just future. They were created in 2015 by the United Nations General Assembly and are intended to be achieved by 2030.
2 Business For Societal Impact (B4S6 is a global standard for measuring and managing a company's investment for social impact.
3 Science, Technology, Engineering and Maths.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

27
STRATEGIC REPORT
### ESG Report continued
Non-financial information statement
Section 414CA of the CA2006 requires the Company to include within its Strategic Report a non-financial information
statement setting out such information as is required by Section 414CB of the CA2006. The table below and the information
itrefers to are intended to help stakeholders understand IG’s position on key non-financial matters.
Reporting requirement Policies governing our approach Find out more
Environmental ESG Policy ESG Report, pages 32 to 35
matters
Employees Equality, Diversity and Inclusion Policy (includes Anti-Discrimination ESG Report, pages 30 to 31
and Harassment Policy)
Recruitment Policy
Absence Management Policy
Annual Leave Policy
Parental Leave Policy
Group Whistleblowing Policy
Transitioning at Work Policy
IG Health and Safety Policy

| Social, community | Equality, Diversity and Inclusion Policy | ESG Report, page 30 |
| --- | --- | --- |
| matters | ESG Policy/Approach Document |  |
| Human rights issues Statement on Slavery and Human Trafficking (Modern Slavery) |  | ESG Report, pages 33 and 35 |

Vendor Management Policy
Anti-bribery and IG Group Anti-Bribery Policy ESG Report, page 35
corruption IG Group Gifts and Hospitality Policy
IG Share Dealing Code
IG Personal Account Dealing Policy
Group Market Abuse Policy
Group Conflicts of Interest Policy
PEPs and Sanctions Policy
Client Risk Categorisation Policy
Group Whistleblowing Policy
Group Global Anti-Money Laundering (AML) (including Counter
Terrorist Financing)
Description of principal risks and impact on business activity Key Trends Likely to Affect Our
Business, pages 12-13, Risk
Management, pages 46-53
Description of business model Business Model, pages 14-15
Non-financial key performance indicators KPIs, page 16
IG GROUP HOLDINGS PLC ANNUAL REPORT 202228
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### This year we began a project Onboarding and safeguards
Our products give our clients access
## Products to apply an ESG lens to
to opportunities in financial markets.
### theproducts we offer, However, we are conscious of the
### toassess their societal and impact that unaffordable losses can
have and we have identified this as one
### environmental impacts on
of the most material of our ESG risks. We
### different stakeholder groups. take a number of measures to make sure
### This is being carried out by our our products are appropriate for those
using them. These steps range from
### internal analysts, and we are
responsible marketing and onboarding,
### using ESG rating data where through to monitoring for behaviour
### available and applicable. that could be indicative of vulnerability.
### This project will continue over
We set ourselves very high standards in
### Pillar 1 the course of next year.
this area. Not only do all of our systems
### We offer a wide range of meet the requirements set by the
Financial education Financial Conduct Authority (FCA) and
### products. The first pillar of our
We are proud to provide excellent other international regulators, but we
### Brighter Future framework is educational content. This is intrinsic to
think beyond these obligations and
our purpose and an expression of our ensure that we exemplify all three of
### about how we manage the
values to champion the client, learn fast ourvalues.
### impact that these products
together and raise the bar.
### can have on our clients
Data security
We exist for every ambitious person. Our clients trust us with data and, in
### andcommunities.
This means we are focused on inclusivity some cases, with their funds. We take
– both in terms of the accessibility of this responsibility seriously and have
Stakeholders
our content and the suitability of our state-of-the-art systems in place to
¼ Our clients
content to different audiences. As an ensure that these are protected. We
¼ Our communities

|  | example of accessibility, anyone can | continue to manage and maintain an |
| --- | --- | --- |
|  | now reach the resources on IG Academy | Information Security Strategy and |
|  | without the need for an IG demo | supporting framework with a focus |
|  | account. As an example of suitability, | onkeeping our client data and funds |
|  | in October 2021 we launched the | secure, as well as the services we |
|  | DailyFX Women In Finance Hub. Women | provide to our clients. As we operate |
|  | represent nearly 30% of DailyFX’s | within various global geographical |
|  | audience and the hub offers them ways | jurisdictions, we also seek to maintain |
| 1,063,480 | to build and refine their skills through | the highest levels of information security |
|  | inspiring video stories, interviews with | compliance with applicable regulations. |

total number of IG Academy users
market movers and shakers, Q&As with
inFY22
female clients, and how-to content to FIND OUT MORE AT
help women become more informed, IGGROUP.COM/OUR
engaged and educated traders. COMMITMENTSUSTAINABILITY
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 29
STRATEGIC REPORT
### ESG Report continued
Equality, diversity and inclusion experts Nomensa and produced a
Our aim is to ensure that our Company number of recommendations that
## People
isa safe, welcoming environment where wewill look to implement over the next
everyone can be themselves and grow 12 months.
to their full potential. This year we have

| maintained our focus on gender | Talent development |
| --- | --- |
| diversity and have increased the | We strive to attract people with the right |
| percentage of female employees by | skills, experience and behaviours, and |
| 1%;from 33% to 34%. This represents | toretain these people and help them |
| progress towards our target of 35% | continue their journey of development. |
| butclearly there is still more to be done. | In FY22 we improved our Employee |

Value Proposition to ensure it better
A key focus for this year’s diversity reflects our warm, vibrant and dynamic
agenda was inclusive recruitment, culture, and supports our purpose and
following our analysis of values. The new design, narrative and
Pillar 2
underrepresentation and how it may tone of voice was then used to reshape
### Nurturing talented, dedicated arise. Our technology department our recruitment materials and used in
hasbeen piloting initiatives to reduce external campaigns targeting our key
### people enables us to deliver
potential bias in our recruitment talent groups.
### the products and services that
processes, such as setting a target
### keep us at the forefront of our forall roles to have a minimum of 25% In relation to retention, we have made a
female representation on the shortlist number of significant improvements to
### industry. The second pillar of
based on merit, and that all interview our employee learning and development
### our Brighter Future framework
panels are gender-balanced where offering. This has centred around
### focuses on how we manage possible. These changes contributed thelaunch of a new Learning and
toimprovement in the diversity of the Development (L&D) Hub, bringing all
### our responsibilities as
talent pipeline across all grades, as well learning resources into one place. We
### an employer.
as an improved ratio between female have also created a Skills Share forum
leavers and joiners. These pilot initiatives where employees deliver talks about
Stakeholders
have been supplemented by our their area of expertise. These talks
¼ Our people
engagement in specialist recruitment regularly attract over 400 employees
¼ Our communities
events, such as the Women of the and exemplify our value to learn
Silicon Roundabout, and we have fasttogether.
partnered with specialised recruitment

| agencies such as TargetJobs to reach | We continue to curate a range of |
| --- | --- |
| the widest talent pool available. We have | learning resources and give access to |
| a goal of a 50/50 gender-balanced | learning platforms and courses such as |
| graduate cohort in FY23. | LinkedIn Learning, Coursera, O’Reilly |

and Gartner. We also completed an

|  | This year we have also taken significant | exciting pilot programme for new |
| --- | --- | --- |
| 82% | steps to raise awareness of Equality, | managers, and will be rolling this out |
|  | Diversity and Inclusion (EDI) issues | globally in FY23. |

of our workforce would recommend
among our employees. For example, our
us as a great place to work
technology department invited external Wellbeing
(FY21: 80%)

| speakers to a series of monthly talks | This year has been another challenging |
| --- | --- |
| aspart of a ‘Belonging’ series. Also, | year from a wellbeing perspective. Our |
| coinciding with International Women’s | employees have continued to navigate |
| Day, our global women’s employee | the challenges posed by the Covid-19 |
| network, Inspire, organised a full week | pandemic, the emerging cost of living |
| of educational panel sessions and | crisis and, for many colleagues in our |
| networking events. | Krakow office, impacts of the conflict |

in Ukraine.
In addition to progressing our gender

| diversity agenda and raising awareness | Listening to our people is paramount |
| --- | --- |
| among our employees, we continue to | toa successful wellbeing strategy. |
| consider other elements of EDI, such as | Inrecognition of the increases to |
| ethnic diversity and disabilities. A good | livingcosts and after the issue being |
| example of this is that we have been | discussed at our global People Forum, |
| undertaking a review of our trading | we brought forward our annual |
| products to identify potential barriers | inflationary-linked pay review. 50.4% of |
| toaccess that we’d not previously | our staff received immediate pay rises, |
| considered. This project was undertaken | four months ahead of the scheduled |

in collaboration with accessibility
IG GROUP HOLDINGS PLC ANNUAL REPORT 202230
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
review. Additionally, our Board, Executive metrics against peers in the Financial 1 These are awarded by the Top Employers Institute and
Great Place to Work, respectively, both recognised
Directors and the wider Executive Services sector and we were pleased
authorities on excellence in people practices. These
Committee decided to forego their pay tofind ourselves above the benchmark awards are based on HR-related surveys, looking at
rises or take materially reduced rises this across 18 of these metrics. people practices across key HR themes.
year. The money saved was used to

| create a pool of money to increase the | We were delighted to maintain our |
| --- | --- |
| salaries of employees feeling the biggest | status as a Top Employer in the UK for |
| impact of the cost of living. | 2022. We have gone on to receive the |

Great Place to Work certification in
In addition, on the theme of listening, Poland and India – demonstrating
weran our annual engagement survey thetruly global commitment to
1
inJanuary 2022. The results enabled HRexcellence.
usto compare our performance on 21
### Gender breakdown across our workforce
Male Female
Board Senior leadership team
Female
Female 23%
33%
Male Male
67% 77%
Executive Committee Total

| Female |  | Female |  |
| --- | --- | --- | --- |
| 38% |  | 34% |  |
|  | Male |  | Male |
|  | 62% |  | 66% |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 31
STRATEGIC REPORT
### ESG Report continued
Educational equality Environment
We firmly believe that a good quality For the third year running, we have
## Partnerships

| education is the key to realising ambition | achieved carbon-neutral status, |
| --- | --- |
| and to unlocking potential. Therefore, | offsetting our scope 1, 2 and 3 |
| asan expression of our purpose, | emissions. Our other top priority has |
| we’vecontinued to focus much of our | been to continue developing a strategy |
| community outreach work on removing | to reduce our relative emissions. |
| barriers that are restricting access to | Last year we set ourselves the goal |
| education in our communities. | of committing to the Science Based |

1

|  | Targets initiative | by the end of FY22. |
| --- | --- | --- |
| In FY22 we have continued to work | We achieved this goal, and now have |  |
| closely with Teach For All and a number | 24 months to define our pathway |  |
| of their network partners. Our support | to net zero. We have also continued |  |
| for these partners, such as Teach For | to look for improvements to our |  |
| Poland, Teach For India and Teach For | environmental reporting. For example, |  |

Pillar 3
Australia, has helped them continue to we are transitioning to a new process of
### We amplify our ESG impact find excellent teachers and place them collecting emissions data on a quarterly
into the schools and communities where basis rather than an annual basis. We
### through collaboration
they are needed the most. As well were also pleased to retain our C grade
### with like-minded partners.
assupporting these organisations with the Carbon Disclosure Project.
### The third pillar of our Brighter financially, colleagues have used our
volunteering days to provide support Streamlined energy and carbon
### Future framework focuses
totrainee teachers and directly to their reporting
### on how collaboration helps

|  | student. For example, a group of | Our carbon footprint for FY22 has been |
| --- | --- | --- |
| us address challenges around | colleagues have been helping students | prepared by an external consultant, |
|  | in the UK and South Africa as they work | Energise, and includes our scope 1, 2 |

### educational equality, the
on job applications. and upstream scope 3 emissions across
### environment and the principles
all Group companies. The data was

| of responsible business. | We had a target of positively impacting | quantified in line with the GHG Protocol |
| --- | --- | --- |
|  | the lives of 100,000 young people by | standard and applying the most relevant |
| Stakeholders | 2025. After extraordinary commitment | emissions factors sourced from the |
| ¼ Our people | from our passionate colleagues and | Department for Environment, Food |
| ¼ Our communities | charity partners, we are proud to have | and Rural Affairs’ 2020 UK Greenhouse |
| ¼ Our suppliers | achieved this target several years early. | Conversion Factors for Company |
|  | During FY23 we will develop new | Reporting, and other equivalent data |
|  | ambitious targets for the outcomes and | sources for our emissions outside of |
|  | impact of our Brighter Future Fund. | the UK. Where data is not available, |

standard estimation methods have been
Another significant focus for our applied to account for these emissions.
community outreach work this year was

| offering support to those impacted by | In relation to scope 1 and 2 emissions, |
| --- | --- |
| the terrible events unfolding in the | our total carbon footprint for the year, |
| Ukraine. For example, colleagues in | using a location-based methodology, |

## 94,751
Poland had their volunteering leave was 2,682.05 tCO 2 e, or 1.12 tonnes per
young lives positively impacted
entitlement increased from two to five employee. This is a 22.2% reduction
through Brighter Future
days, to help Ukrainian refugees as they from last year. The reduction is mainly
Fundinitiatives

|  | escaped across the border to Krakow | due to the emissions associated |
| --- | --- | --- |
| (FY21: 22,284, FY20: 3,819) | and beyond. We set up a charitable | with operating our facilities falling |
|  | giving page in favour of Polska Akcja | to zero for the year. After replacing |
|  | Humanitarna and double-matched all | equipment last year, we did not need |
|  | funds raised on this page – using money | to recharge any F-Gas in our data |
|  | from our Brighter Future Fund to triple | centres which has had a significant |
|  | the total. More information on this and | impact on our scope 1 emissions. |

our other community outreach work can
be found on our website.
FIND OUT MORE AT
IGGROUP.COM/OUR
COMMITMENTSUSTAINABILITY
IG GROUP HOLDINGS PLC ANNUAL REPORT 202232
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Year ended Year ended
GHG protocol scope Sub-category 31 May 2022 tCO 2 e 31 May 2021 tCO 2 e
Scope 1 Operation of facilities 0.00 4 37.18
Scope 1 Combustion 287.86 168.36
Scope 1 287.86 605.54
Scope 2 Purchased energy 2,394.18 2,320.83
Scope 2 2,394.18 2,320.83
Scope 1 and 2 emissions 2,682.05 2,926.37
Employees 2,393.00 2,034.50
2
Intensity ratio Scope 1 and 2 emissions 1.12 1.44
Relevant change -22.1%
Global energy use 10,272,137 kWh 8,635,343 kWh
UK energy use 7,888,644 kWh 7,211,827 kWh
Overseas energy use 2,383,493 kWh 1,423,516 kWh
Scope 3 Business travel 83.51 15.36
Employee commuting 297. 28 1.51
Fuel and energy-related activities 860.33 566.31
Purchased goods and services 20,297.48 17,892.12
Waste generated in operations 116 . 5 0 57. 3 4
Homeworking 931.89 704.72
Scope 3 22,586.98 19, 237. 36
Grand total All three scopes (including homeworking) 25,269.03 22,163.73
Employees 2,393.00 2,034.50
Performance indicator All three scopes (including homeworking) 10.56 10.89
Relevant change -3.07%

| There have been some significant | and are carbon neutral in line with | We are also looking for equivalent |
| --- | --- | --- |
| changes compared to last year, most | PAS2060. All offsets are verified | standards to adopt in all of the countries |
| notably the acquisition of tastytrade, | by either the Gold Standard or UN | in which we have employees or, in lieu |
| which increased our scope 2 and 3 | Clean Development Mechanism. | ofsuch standards, will look to develop |
| emissions. As some of our offices |  | our own. |
| started to reopen after the pandemic, | Suppliers |  |

1 The Science Based Targets initiative (SBTi) is a
we have also seen increases in We have continued to embed the
partnership between Carbon Disclosure Project (CDP),
our business travel and employee principles of responsible and sustainable
the United Nations Global Compact, World Resources
commuting. However, our employee business in our procurement processes Institute and the World Wide Fund for Nature. They
headcount has also increased and and in our collaboration with existing drive ambitious climate action in the private sector by
enabling organisations to set science-based emissions
therefore when viewed on a relative suppliers. For example, we published a
reduction targets.

| basis, our emissions per employee | new Vendor Code of Conduct, setting | 2 As an intensity ratio we monitor our emissions |  |
| --- | --- | --- | --- |
| have reduced by -3.07%, exceeding | out what suppliers can expect when |  | peremployee. |
| our target of a -2.5% relative reduction. | working with us and setting out our |  |  |
| We are actively managing our energy | expectations for suppliers. Furthermore, |  |  |
| efficiency. For example, we are working | in FY22 we completed a review of our |  |  |
| on a set of new procurement standards | facilities contractors and increased |  |  |
| across the business in key areas which | pay where necessary to ensure we are |  |  |
| will help us define our pathway to net | fully compliant with the London Living |  |  |
| zero. We are committed to completing | Wage recommendations. We are now a |  |  |
| this work by 2024. In the meantime, | signed-up member of the Living Wage |  |  |
| wecontinue to offset all scope 1, 2 and | community and will ensure we align with |  |  |
| upstream scope 3 carbon emissions | their recommendations in the future. |  |  |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 33
STRATEGIC REPORT
### ESG Report continued
### Task Force on Climate-related Financial Disclosures

| In accordance with the TCFD | disclosures with extra information on | emissions associated with the use of |
| --- | --- | --- |
| recommendations, all material and | our website. | our products but note that doing so is |
| significant climate-related information |  | optional under the Greenhouse Gas |
| can be found in this Annual Report, as | We believe that these disclosures are | Protocols (GHG). In any case, we are |
| signposted in the table below. We have | fully consistent with the task force’s | working to better understand these |
| chosen to supplement these | recommendations. We do not yet | emissions but do not anticipate that |
|  | measure or report downstream scope 3 | they will be significant. |

Summary of disclosure References to Annual Report
Governance ¼ See Chair’s
The Board approves environmental strategy and targets and has responsibility for budgets and funding. Introduction to
Climate-related risks and opportunities are integrated into the Group’s Risk Management Framework and Corporate
the Board has overall accountability for the management of risk. Some of these risk governance Governance
responsibilities are delegated to Board Committees. statement,
page58
Board and management responsibilities in relation to climate-related risks and opportunities are set out in ¼ See pages 35, 93
our ESG governance table and in our Corporate Governance Statement. Furthermore, the management of
climate-related risks and opportunities is incorporated into the environmental impact non-financial metric
in our bonus and sustained performance plan remuneration structures.
We first introduced a carbon-literacy training programme in FY21. In FY22 this was improved and updated
and sessions were run for the Board and our Executive Committee. This training will be updated and
delivered on an annual basis.
Strategy ¼ See Risk
Over the course of FY22, our understanding of the climate-related risks and opportunities affecting our Management
business has improved, enabling us to develop an environmental strategy. The aim of this strategy is to section, pages
have a clearly defined pathway to net zero in place by 2024. Progress towards defining our pathway is 46-53
improving our financial resilience in the face of the changing climate. Key achievements include:
¼ Formal commitment to the Science Based Target Initiative
¼ Starting to develop environmental procurement standards for key business areas including operations,
buildings, travel and other services
¼ Carbon literacy training for the Board and Executive Committee
¼ Maintaining carbon-neutral status in line with PAS 2060 (offsetting our scope 1 and 2 emissions and
upstream scope 3 emissions)
Risk management ¼ See Risk
In order to fully understand the climate-related risks and opportunities applicable to our business, we Management
engaged a consultant to help us produce a detailed climate-related risks and opportunities register. This section, pages
exercise was then repeated in the second half of FY22 and will be repeated on a bi-annual basis going 46-53
forward. A summary of the risks identified can be found on our Group website. It has been concluded that, ¼ https://www.
for now, neither these risks nor opportunities are material. iggroup.com/
our-commitment-
We identify climate-related risks, opportunities and materiality based on the We Mean Business risk sustainability/
taxonomy and TCFD guidance. We group climate-related risks into two categories: physical risks which our-environment
relate to the physical impacts of climate change, and transition risks, which relate to the transition to
alow-carbon economy. They are analysed in relation to three possible climate-related scenarios:
(1)asmooth transition to <2ºC, (2) a disruptive transition to <2ºC, and (3) no acceleration of action (>3ºC),
andconsidered in relation to the short, medium and long term.
Metrics and targets ¼ See pages 32
We assess climate-related risks and opportunities by looking at absolute and intensity-based energy and 33
and(GHG) emission metrics, using ‘CO 2 per employee’ as our intensity metric. These are set out in our
Streamlined Energy and Carbon Report. We have been reporting scope 1 and 2 emissions since FY13 and
first reported upstream scope 3 emissions in FY20. We do not yet measure or report downstream scope 3
emissions but hope to include these emissions in our reporting when we have our pathway to net zero
defined – aiming for 2024. We do not anticipate that these emissions will be significant.
In May 2022 we made a formal commitment to the SBTi, and are working hard to develop an ambitious
science-based target. Pending this target, we aim to reduce our year-on-year carbon emissions by 2.5%.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202234
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Business ethics Accountable leadership
We maintain high standards of ethics In FY22 we focused on three elements
## Best Practice
across all elements of our business. of accountable leadership. Firstly, we
Weconduct our business in an ethical maintained a diverse leadership team
manner, protecting principles of human interms of ethnic and gender diversity.
rights in all of our operations. For more Secondly, we worked hard to ensure
information about how the principles of ourleadership team have access to the
ethical business are embedded into our learning opportunities they need. For
governance, please refer to our ESG example, we offered carbon literacy
Policy on our website. training to the Board and Executive
Committee for the second year running.

| As a UK-incorporated Company, we | Thirdly, we continued to ensure the |
| --- | --- |
| abide by the UK Bribery Act 2010 | leadership team is incentivised to deliver |
| and we have a Share Dealing Code, | on our commitment to sustainable and |
| aDisclosure Committee and associated | responsible business. For more details |

Pillar 4

|  | policies to ensure that we meet | about how ESG is integrated into the |
| --- | --- | --- |
| The fourth pillar of our | the requirements of market abuse | sustained performance plan and the |
|  | regulations. Furthermore, we have | bonus, see page 93. |

### Brighter Future framework
global policies to comply with anti-
### is concerned with setting
bribery and anti-corruption laws, which Open and transparent
### high standards of business include employees wishing to give or Operating in an open and transparent
receive gifts or hospitality. We do not manner remains a top priority. Last year
### ethics, accountability and
make or endorse facilitation payments. we published our ESG Policy and
### transparency, and ensuring
Every year all employees receive created an ESG reporting map to
### that our policies and mandatory anti-bribery and corruption demonstrate how we approach
training, and market abuse training, responsible and sustainable business.
### governance structures help
through an e-learning module which We’ve updated the reporting map for
### meet these standards.
includes a knowledge assessment. FY22 and will keep the policy up to date.
Stakeholders
We make charitable donations that Our tax strategy is published on our
¼ Our shareholders
arelegal and ethical under local laws website. This year we paid £131.3 million
¼ Our regulators
and practices, but we don’t make (2021: £119.0 million) to tax authorities
¼ Our people
contributions to political parties. globally. As was the case last year, we
¼ Our clients
did not accept any government support
¼ Our communities
in relation to the Covid-19 pandemic.
We paid £97.4 million in corporate
income taxes (2021: £83.0million).
More details on our taxes paid and
onour effective tax rate for FY22 can
be found in the Financial Statements.
ESG governance
## 43.3% Oversight IG Group Board of Directors
ESG factors contribute to 43.3% of
ESG Committee
Sustained Performance Plan non-
Chair: Sally-Ann Hibberd
financial metrics
Board Committees as appropriate
Responsible IG Group Executive Committee
Sponsor: Jon Noble
Executive Committee ESG working group
Delivery Group Head of ESG
ESG Officer
Brighter Future Enterprise IG Employee
Champions Leadership Group Networks
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 35
STRATEGIC REPORT
## Chief Financial Officer’s Statement
## Another year of
## record performance
I am delighted to report another year
## Another year of record revenue
of record revenue and profits, against
## performance puts us in a very a challenging comparative which
included the peaks of pandemic-related
## strong financial position as we
market volatility. Total revenue from
continuing operations was £973.1
## execute our strategy to become
million, up 16% (FY21: £837.6 million).
## amore diversified business.” Excluding the foreign exchange gain
associated with the financing of the
Charles A Rozes
tastytrade acquisition, adjusted total
Chief Financial Officer
revenue was £967.3 million, up14%.
Excluding tastytrade, adjusted total
revenue was still up 1%. This outstanding
performance is reflective of the high-
quality client base of ambitious, active
traders that we are able to attract,
and the excellent client service and
educational resources and support
that we provide in order to retain
them. We reiterate our medium-term
guidance for total revenue of 5-7%
in Core Markets+ and 25-30% in the
High Potential Markets segments.
We continue to practice good cost
management, while also ensuring that
we invest steadily and appropriately
in our businesses and functions.
We recognise technology as a key
asset, in which we continually invest
to innovate and increase resilience,
security, and capacity. Over the
last for years, for example, we have
invested approximately £125 million
in these areas, demonstrating our
ability to continually invest and stay
atthe forefront of technology trends.
During the year, we incurred some
one-off and non-cash recurring items.
These were related to the tastytrade
transaction, the sale of Nadex and Small
Exchange, the debt refinancing and the
revaluation of the Zero Hash convertible
note. Excluding these items, our
adjusted profit before tax margin for
FY22 was 51% (FY21: 56%).
36
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| Profit before tax for the year was up | Our new RCF further expands our | dividend of 44.2 pence per share, an |
| --- | --- | --- |
| 7% to £477.0 million (FY21: £446.0 | on-demand available liquidity to support | increase of 1 pence from our FY21 |
| million). On an adjusted basis, profit | our strategic growth plans. | dividend of 43.2 pence per share. |

before tax was £494.3 million, up 4%

| on prior year (FY21: £473.6 million). | The Group’s broker margin requirement | Given our current strong financial |
| --- | --- | --- |
| The adjusted effective tax rate was | in support of our risk management | position following three consecutive |
| 17.0%, driven by standard UK tax | program at year end was £629.5 million, | record years of revenues and profits, |
| incentives and adjustments to prior | and reached a peak during the year of | wehave also announced a share |
| year estimates. Our profit after tax for | £774.7 million in comparison to a year | buyback programme of up to £150 |
| the year was £396.1 million, or £410.5 | end requirement of £590.9 million and | million. We would expect this to be |
| million on an adjusted basis, up 4%. | peak requirement of £683.3 million in | substantially completed within FY23. |
| Including profit from discontinued | FY21. As a result of our record profits, |  |
| operations, profit for the period was | strong cash conversion, as well as | We have reconfirmed our medium- |
| £503.9 million, up 36%. Basic earnings | purchases and disposals during the year, | term total revenue guidance of 5-7% |
| per share from continuing operations | own funds at 31 May 2022 were | in the Core Markets+ and 25-30% in |
| was 92.9 pence (FY21: 99.8 pence), or | £1,253.8 million, up from £1,058.5 | the High Potential Markets portfolio |
| 96.3 pence on an adjusted basis (FY21: | million at 31 May 2021. | and remain confident in achieving this |
| 107.3 pence), down due to the shares |  | guidance. We anticipate a profit before |
| issued for the tastytrade acquisition. | Our record profits and comprehensive | tax margin just above the mid-40s in |
|  | risk management programme further | FY23, and then increasing slightly over |
| We are a highly cash-generative | strengthened our capital resources. | the medium term to the high-40s, which |
| business, able to convert our OTC | In January 2022, we adopted a new | we see as the sustainable margin for the |
| derivatives revenue to cash on the same | regulatory capital framework, the | Group. We anticipate an effective tax |
| day. The conversion rate of operating | Investment Firms Prudential Regime | rate in FY23 of around 19%, and then |
| profit to own funds remains consistently | (IFPR). For an initial transitory period, | increasing beyond FY23 to be closer to |
| above 100%. | our regulatory capital requirement | the forecasted UK Corporate Tax rates. |

remains at a fixed amount of £497.4

| During the year, we have seen some | million. At 31 May 2022 our regulatory | In summary, another year of record |
| --- | --- | --- |
| significant balance sheet movements, | capital resources were £1,025.6 million, | revenue performance puts us in a very |
| with our goodwill and intangibles | up from £860.7 million at 31 May 2021. | strong financial position as we execute |
| balances increasing due to the | This translates to a headroom above | our strategy to become a more |
| tastytrade acquisition. Own funds | the regulatory capital requirement of | diversified business. |
| increased due to profits made during | £528.2 million, including all profits from |  |
| the year, the sale of Nadex and Small | FY22, though prior to the execution |  |
| Exchange, offset by the cash | of the share buyback programme. |  |

consideration paid for tastytrade.
During the year, the Board conducted

| Regulatory capital and liquidity | a number of discussions around our |  |
| --- | --- | --- |
| remained very strong through the | uses of capital. The outcome of these |  |
| period, bolstered by our inaugural public | discussions is set out in our new capital |  |
| debt issuance of £300 million of | allocation framework. The framework | Charles A Rozes |
| investment-grade, 7-year senior | provides the right balance for all | Chief Financial Officer |

20 July 2022

| unsecured notes and the increased size | our stakeholders, ensuring there is |
| --- | --- |
| of our committed revolving credit | sufficient ability for investment in the |
| facility, which is now a £300 million | Company, as well as returns for our |
| facility. The debt capital markets | shareholders. In line with the capital |
| issuance in November 2021 attracted | allocation framework, the Board has |
| strong investor demand, and provided | approved a final dividend of 31.24 |
| longer-term financing through 2028. | pence, which would result in a full-year |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 37
STRATEGIC REPORT

## Business Performance Review

### Summary Group Income Statement

|  £ million (continuing operations) | FY22 | FY22 Adjusted | FY21 | FY21 Adjusted | Adjusted Change % | Adjusted Change %  |
| --- | --- | --- | --- | --- | --- | --- |
|  **Net trading revenue^{1}** | **972.3** | **966.5** | **837.3** | **845.2** | **16%** | **14%**  |
|  Net interest on client money | 0.8 | 0.8 | 0.3 | 0.3 |  |   |
|  **Total revenue** | **973.1** | **967.3** | **837.6** | **845.5** | **16%** | **14%**  |
|  Other operating income and betting duty | 6.1 | 4.6 | 6.1 | 6.1 |  |   |
|  **Net operating income** | **979.2** | **971.9** | **843.7** | **851.6** |  |   |
|  **Total operating costs^{2, 3}** | **(501.9)** | **(464.9)** | **(393.4)** | **(373.8)** | **28%** | **24%**  |
|  **Operating profit** | **477.3** | **507.0** | **450.2** | **477.8** | **6%** | **6%**  |
|  Other net gains/(losses)^{4} | 11.1 | (2.3) | (0.4) | (0.4) |  |   |
|  Net finance cost^{5} | (11.4) | (10.4) | (3.8) | (3.8) |  |   |
|  **Profit before tax** | **477.0** | **494.3** | **446.0** | **473.6** | **7%** | **4%**  |

1 Adjusted excludes £5.8 million foreign exchange hedging gain associated with the financing of the tastytrade acquisition (FY21 loss of £7.9 million)

2 Operating costs include net credit losses on financial assets

3 Adjusted operating costs excludes £33.7 million of cash and recurring non-cash costs associated with the tastytrade acquisition and integration and £3.3 million relating to the proposed sale of Nadex and Small Exchange (FY21 £16bn of one-time cash associated with the tastytrade acquisition)

4 Adjusted other net gains / (losses) excludes £8.3 million FY gain on revaluation of Zero Hash Holdings Limited (Zero Hash), and £4.1 million of gains on sale of Small Exchange and disposal of Zero Hash, £3.3 million loss from associate

5 Adjusted excludes £1.0 million of accelerated financing expense associated with the debt issuance

### Statutory results

On 1 March 2022 we completed the sale of Nadex and Small Exchange to crypto.com, therefore Nadex is presented as a discontinued operation. Our share of the losses from our minority investment in Small Exchange for the period during which we owned it will continue to be presented within continuing operations.

On a statutory basis, net trading revenue was £972.3 million, up 16% on prior year, reflecting the inclusion of tastytrade revenue from 28 June 2021 following completion.

Revenue performance benefited from the size and quality of the active client base, which now includes 98,000 tastytrade clients, who share a similar demographic profile to those of IG. Total active clients, excluding those from tastytrade, remains significantly larger than the pre-pandemic period.

Statutory operating costs were £501.9 million, 28% higher than FY21, reflecting the inclusion of tastytrade's cost base, and one-off and recurring non-cash costs in relation to the tastytrade acquisition and integration, and costs relating to the sale of Nadex and Small Exchange.

Other net gains of £11.1 million arise from transactions relating to the Group's investments in its associates during the year. The net gains include the Group's share of losses from associates, the movement of the fair value of convertible debt associated with Zero Hash, and gains from sale of holdings in associates.

Net finance costs were £11.4 million, increasing from prior year due to additional debt in the period.

The Group's statutory profit before tax for FY22 was £477.0 million, 7% higher than FY21.

### Adjusted results

The following section analyses results from continuing operations on an adjusted basis, which excludes a £5.8 million foreign exchange gain related to financing of the tastytrade acquisition; £33.7 million of costs relating to the tastytrade acquisition, including £28.0 million of amortisation of acquisition related intangibles; £3.3 million relating to the sale of Nadex and our investment in Small Exchange; £1.0 million of financing costs relating to the new debt issuance; other net gains related to the sale of Small Exchange and disposal of Zero Hash of £4.1 million, and £9.3 million fair value gain on Zero Hash on a convertible note revalued in the period.

Adjusted net trading revenue was £966.5 million, 14% higher than prior year. Excluding tastytrade, which the Group acquired on 28 June 2021, the adjusted net trading revenue was £856.4 million, 1% higher than FY21, reflecting the continued strength of our core business despite less favourable market conditions.

38

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

Total revenue, which includes interest income, was £967.3m, up 14% on FY21.

Adjusted operating costs from continuing operations were £464.9 million, 24% higher than prior year, reflecting the addition of tastytrade.

Adjusted operating profit from continuing operations was £507.0 million, up 6% on FY21, and profit before tax was £494.3 million 4% higher than prior year.

#### Net trading revenue performance by product

Adjusted net trading revenue from continuing operations (£ million)

|   | FY22 | FY21 | Change %  |
| --- | --- | --- | --- |
|  OTC derivatives | 811.5 | 798.2 | 2%  |
|  Exchange traded derivatives | 121.2 | 8.3 | nm  |
|  Stock trading and investments | 33.8 | 38.7 | (13%)  |
|  **Group** | **966.5** | **845.2** | **14%**  |

|   | Active clients (000) |   |   | Revenue per client (£)  |   |   |
| --- | --- | --- | --- | --- | --- | --- |
|   |  FY22 | FY21 | Change % | FY22 | FY21 | Change %  |
|  OTC derivatives | 199.8 | 216.3 | (8%) | 4,063 | 3,690 | 10%  |
|  Exchange traded derivatives^{1} | 104.5 | 5.4 | nm | 1,142 | 913 | 25%  |
|  Stock trading and investments | 93.2 | 89.5 | 4% | 363 | 432 | (16%)  |
|  **Group^{2}** | **381.5** | **291.2** | **31%** |  |  |   |

1 Exchange traded derivatives revenue per client calculation excludes revenue generated from the Group's market maker on flastex.

2 Total Group active clients have been adjusted to remove the clients who are active in more than one product category (multi-product clients) to give a unique client count. In FY22 there were 16,000 multi-product clients, compared with 15,000 in FY21.

#### OTC derivatives

OTC derivatives net trading revenue in FY22 was £811.5 million, 2% higher than FY21. OTC revenue now represents 84% of Group revenue, down from 94% in FY21, consistent with our strategic goal of diversifying our sources of revenue through growth in exchange traded derivatives and stock trading revenues.

OTC active clients were down 8% on FY21 reflecting the moderation in trading activity and reduced levels of new clients onboarded, down 32% from the elevated levels of demand seen in FY21, however remain at levels materially higher than the pre-pandemic period. Average revenue per client however was 10% higher reflecting a change in client mix with less dilution of revenue per client from new clients, as seen in FY21.

UK and EU revenue in FY22 was £431.5 million, 3% higher than in FY21. The impact of a 14% reduction in active clients was offset by a 20% increase in the average revenue per client, the result of a change in the client mix, consistent with other areas of the business.

Japan revenue of £98.5 million was 43% higher than FY21 driven by a 53% increase in active clients as new client acquisition continued to be exceptionally strong in the year. First trades increased 53% as Japan continues to benefit from the increased focus on localisation, brand building, and successful marketing relationships.

Australia revenue of £88.3 million was 26% lower than FY21, reflecting the impact of Australian Securities & Investments Commission (ASIC) regulations, which were introduced in FY21. As a result, the active clients in the period decreased by 28%, although revenue per client increased by 2% due to the change in client mix. Revenue from Australia remains higher than the pre-pandemic period.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

39
STRATEGIC REPORT

## Business Performance Review continued

### Exchange traded derivatives

Net trading revenue from exchange traded derivatives, excluding Nadex as a discontinued operation, was £121.2 million, and represented 13% of Group revenue (FY21: 1%). tastytrade net trading revenue was £110.1 million, while revenue from Spectrum, the Group's multi-lateral trading facility, was £9.3 million.

With the addition of tastytrade, the number of exchange traded derivatives clients increased to 104,500 (FY21: 5,400), 27% of the total active client base of the Group. First trades increased significantly, reflecting the inclusion of tastytrade.

tastytrade net trading revenue was £110.1 million, up 15% on the prior year on a pro forma basis. Total revenue for tastytrade was £112.0 million, which includes interest income, increasing 16% on a pro forma basis. Active clients reduced by 2%, reflecting some normalisation from the high levels of activity in FY21, which was more than offset by a 17% increase in average revenue per client.

Spectrum revenue of £9.3 million nearly doubled and was 90% higher, driven by a 27% increase in the active client base and a 50% increase in average revenue per client as the client base continues to establish. This year Spectrum welcomed two additional brokers and further growth is expected in FY23 and beyond, as we integrate additional third-party brokers and plan to integrate two tier 1 European banks as product issuers later this year.

### Stock trading and investments

Revenue from stock trading and investments was £33.8 million (FY21: £38.7 million) with assets under administration of £3.3 billion at the period end (31 May 2021: £3.2 billion). In the year, stock trading transaction fees, which were previously netted off against revenue, were reallocated to operating costs, increasing both net trading revenue and costs by £3.0 million. Including this, net trading revenue was down 13%. Active clients increased 4% and average revenue per client reduced by 16% due to both a reduction in trade frequency as market conditions have moderated, and a change in equity mix, with clients trading fewer US equities.

### Operating costs

Total adjusted operating costs for FY22 were £464.9 million, 24% higher than FY21 primarily reflecting the acquisition of tastytrade.

### Adjusted operating costs from continuing operations

|  £ million (unless stated) | FY22 | FY21 | Change %  |
| --- | --- | --- | --- |
|  Fixed remuneration | 150.1 | 127.0 | 18%  |
|  Advertising and marketing | 87.1 | 67.4 | 29%  |
|  Revenue related costs | 45.3 | 28.3 | 60%  |
|  IT, structural market data and comms | 35.0 | 24.4 | 43%  |
|  Regulatory fees | 12.9 | 9.1 | 41%  |
|  Depreciation and amortisation | 28.5 | 24.8 | 15%  |
|  Other costs | 48.1 | 42.1 | 14%  |
|  General bonus | 32.6 | 29.7 | 10%  |
|  Share-based compensation | 17.8 | 11.2 | 60%  |
|  Sales bonuses | 7.5 | 9.8 | (23%)  |
|  **Total operating costs** | **464.9** | **373.8** | **24%**  |
|  **Headcount at period end** | **2,507** | **2,067** | **21%**  |

Fixed remuneration was £150.1 million, an increase of 18%. Group headcount at 31 May 2022 was 2,507, up 21% on 31 May 2021, reflecting the addition of around 200 tastytrade employees, and additional headcount in our technology, operations, risk and compliance functions to add capacity to the larger business and support on key projects.

This increase also reflects some inflationary pay increases, offset by favourable translational foreign-exchange rates compared with the prior year.

Advertising and marketing spend increased by 29% to £87.1 million, reflecting the addition of tastytrade costs.

40

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

Revenue related costs are variable items which typically fluctuate with the level of client activity and include trading fees for share dealing and US options and futures, client payment charges, variable market data charges, and provisions for client and counterparty credit losses. In total they were £45.3 million, 60% higher than FY21, reflecting the addition of the tastytrade costs. This also includes the impact of reclassifying £3.0 million of stock trading transaction fees, which in FY21 were reported as an offset to revenue.

IT maintenance, structural market data charges and communications costs were £35.0 million, an increase of 43% on FY21. This reflects additional investment in technology to innovate new platform features, support the larger active client base, and build capacity for future growth as well as the addition of tastytrade costs.

Regulatory fees, which include the Financial Services Compensation Scheme (FSCS) levy were £12.9 million in FY22, 41% higher than FY21. This reflects the increased eligible income of the relevant entities, as well as the addition of tastytrade costs.

Depreciation and amortisation costs increased 15% to £28.5 million reflecting the addition of tastytrade costs.

The charge for the general bonus pool was £32.6 million, up 10% on FY21. This reflects an increase in eligible employees but was offset by a release of prior period accruals.

Share-based compensation costs relate to the share incentive plans for executives and senior management. These costs increased by 60%, reflecting an increased number of participants, and outperformance on internal targets, compared with a prior year charge which was lower due to staff departures in the year.

Sales bonuses decreased by 23% to £7.5 million, reflecting lower commission payments to sales staff for the onboarding and management of their own-sourced high-value clients.

# Earnings Per Share

|  £ million (unexercised) | FY22 | FY22 Adjusted | FY21 | FY21 Adjusted | Change % | Adjusted Change %  |
| --- | --- | --- | --- | --- | --- | --- |
|  Profit before taxation from continuing operations | 477.0 | 494.3 | 446.0 | 473.6 | 7% | 4%  |
|  Taxation | (80.9) | (83.8) | (77.4) | (77.4) | 5% | 8%  |
|  Profit after taxation from continuing operations | 396.1 | 410.5 | 368.6 | 396.2 | 7% | 4%  |
|  Profit after taxation from discontinued operations | 107.8 | 107.8 | 3.3 | 3.3 | Nm | Nm  |
|  Profit after tax for the period | 503.9 | 518.3 | 371.9 | 399.5 | 36% | 30%  |
|  Weighted average number of shares for the calculation of EPS (millions) | 426.3 | 426.3 | 369.2 | 369.2 | 15% | 15%  |
|  Basic earnings per share (pence per share) | 92.9 | 96.3 | 99.8 | 107.3 | (7%) | (10%)  |

Profit before tax was £477.0 million in FY22, and £494.3 million on an adjusted basis, 4% higher than FY21.

The FY22 effective tax rate (ETR) was 17.0% based on profit before tax from continuing operations and 17.0% based on adjusted profit before taxation (FY21: 16.3%). The ETR is lower than the main rate of corporation tax of 19% in the UK, where the majority of the Group's profits are taxed, primarily as a result of standard UK tax incentives and adjustments to prior year estimates. The ETR for FY23 is anticipated to be approximately 19% on an adjusted basis. The ETR is dependent on a mix of factors including taxable profit by geography, tax rates levied in those geographies and the availability and use of taxable losses. The future ETR may also be impacted by changes in our business activities, client composition and regulatory status, which could affect our exemption from the UK Bank Corporation Tax surcharge.

Profit after tax was 36% higher than FY21 and 30% higher on an adjusted basis. Basic EPS was 7% lower than FY21 and 10% lower on an adjusted basis. This is primarily a result of the additional 61 million shares issued by the Group as part of the consideration to acquire tastytrade.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

41
STRATEGIC REPORT

## Business Performance Review continued

### Dividend

A proposed final dividend of 31.24 pence per share will be paid on 20 October 2022 to those shareholders on the register at the close of business on 23 September 2022. This would represent a total FY22 dividend paid of 44.2 pence per share (FY21: 43.2 pence per share).

### Summary Group Balance Sheet

The balance sheet is presented on a management basis which reflects the Group's use of alternative performance measures to monitor its financial position, with particular focus on own funds and liquid assets which are deployed to meet the Group's liquidity requirements. These alternative performance measures are reconciled to the corresponding UK adopted IAS balances in the appendix.

|  £ million | 31 May 2022 | 31 May 2021 | Change %  |
| --- | --- | --- | --- |
|  Goodwill | 604.7 | 107.3 | 468%  |
|  Intangible assets | 292.1 | 32.7 | 793%  |
|  Property, plant and equipment^{1} | 16.7 | 17.4 | (4%)  |
|  Operating lease net assets | (2.0) | (1.9) | 5%  |
|  Investments in associates | 14.8 | - | nm  |
|  **Fixed assets** | **926.3** | **155.5** | **495%**  |
|  Own cash | 1,245.9 | 655.2 | 89%  |
|  Issued debt/long-term bank borrowings^{2} | (299.2) | (100.0) | 199%  |
|  Client funds held on balance sheet^{3} | (520.9) | (354.3) | 47%  |
|  Amounts due from brokers | 657.1 | 710.6 | (7%)  |
|  Own funds in client money | 64.2 | 60.9 | 5%  |
|  Liquid assets threshold requirement/Liquid asset buffer | 106.7 | 86.1 | 23%  |
|  **Own funds** | **1,253.8** | **1,058.5** | **18%**  |
|  Working capital | (82.5) | (86.4) | (5%)  |
|  Net current assets held for sale | 0.4 | - | nm  |
|  Tax payable | (20.5) | (6.4) | 220%  |
|  Net deferred tax (liability)/asset | (49.7) | 12.1 | 511%  |
|  **Net assets** | **2,027.8** | **1133.3** | **79%**  |

1 Excludes right-of-use assets

2 Excludes capitalised fees

3 Includes turbo-earners

The Group has recognised a £770.8 million increase in fixed assets during the period, primarily as a result of the acquisition of tastytrade, which completed on 28 June 2021.

The Group has assessed the impact of climate risk on the balance sheet and have concluded that there is no material impact on the financial position of the Group for the year ended 31 May 2022.

### Liquidity

The Group maintains a strong liquidity position, ensuring that it has sufficient liquidity under both normal circumstances and stressed conditions to meet its working capital and other liquidity requirements, which include broker margin requirements, the regulatory and working capital needs of its subsidiaries, and the funding of adequate buffers in client money accounts.

The Group's available liquidity comprises assets that are available at short notice to meet additional liquidity requirements, which are typically increases in broker margin. The Group's liquid assets increased by £561.1 million during the period, compared to a smaller £164.1 million increase for liquidity requirements comprising broker margin, overseas cash balances, own funds in client money and assets held to satisfy the liquid assets threshold requirement.

42

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction Strategic Report Governance Report Financial Statements Shareholder and Company Information

|  In million | 31 May 2022 | 31 May 2021 | Change %  |
| --- | --- | --- | --- |
|  Own cash | 1,245.9 | 655.2 | 90%  |
|  Amounts due from brokers | 657.1 | 710.6 | (8%)  |
|  Own funds in client money | 64.2 | 60.9 | 5%  |
|  Liquid assets threshold requirement/Liquid asset buffer | 106.7 | 86.1 | 23%  |
|  **Liquid assets** | **2,073.9** | **1,512.8** | **37%**  |
|  Broker margin requirement | (629.5) | (590.9) | 7%  |
|  Cash balances in non-UK subsidiaries | (342.9) | (248.0) | 38%  |
|  Own funds in client money | (64.2) | (60.9) | 5%  |
|  **Available liquidity** | **1,037.3** | **613.0** | **69%**  |
|  of which: |  |  |   |
|  Held to meet regulatory liquidity requirements | 106.7 | 86.1 | 24%  |
|  Dividend due | 134.8 | 130.4 | 3%  |

The Group's own cash balance of £1,245.9 million has increased by £590.7 million driven by a £199.2 million increase in third party debt, £166.6 million increase in client funds held on balance sheet and £53.5 million decrease in amounts at brokers. The Group measures the strength of its balance sheet using its 'own funds' balance which is a broader and more stable measure of the Group's liquidity position than cash. The Group's own funds position is explained in the next section.

Amounts due from brokers comprises cash and UK Government securities held on account by the Group's hedging counterparties, the valuation of open derivative positions and the valuation of physical cryptocurrency assets. During FY22 and driven by the ongoing high frequency and mix of client trading activity, the Group experienced record levels of broker margin, with a maximum margin requirement of £774.7 million in November 2021.

Own funds in client money represents the Group's own cash held in segregated client funds in accordance with regulatory requirements, including the UK's FCA Client Asset Sourcebook (CASS) rules. This increased by £3.3 million to £64.2 million, as a result of trading conditions on the last day of the month.

The Group holds a combination of UK Government securities and cash to meet its regulatory liquidity requirements, which have increased during the period. From 1 January 2022, the liquid asset buffer requirement that the Group had been subject to has been replaced by a new regime within the Investment Firms Prudential Regime rules. This includes a basic liquid assets requirement and a liquid assets threshold requirement, which can be met with a broader range of assets. As at 31 May 2022, this requirement was £106.7 million, 24% higher than the liquid assets buffer requirement at 31 May 2021.

The increase in liquidity requirements was primarily driven by an increase in funds in non-UK entities. The Group regularly repatriates cash from its overseas subsidiaries and for liquidity management and planning purposes, the Group conservatively excludes cash held by subsidiaries outside the UK from available liquidity. The amount of cash held in entities outside the UK was £342.9 million as at 31 May 2022 (31 May 2021: £248.0 million), £94.9 million higher than as at 31 May 2021, due to increased overseas cash requirements arising from the acquisition of tastytrade and increased client funds recognised on balance sheet in overseas entities, along with additional funds held in the US to settle tax payable following the sale of Nadex and Small Exchange.

In addition to the cash recognised on the balance sheet, as at 31 May 2022, the Group held £2,577.9 million (31 May 2021: £2,710.3 million) of client money in segregated bank accounts, which are not recognised on the Group's balance sheet. These funds are held separately from the Group's own cash balances and are excluded from the Group's liquid assets.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

43
STRATEGIC REPORT

## Business Performance Review continued

### Own Funds

Own funds include liquid assets, less debt and client funds on its balance sheet. As at 31 May 2022, the Group had a cash balance of £1,245.9 million (31 May 2021: £655.2 million) compared with an own funds balance of £1,253.8 million (31 May 2021: £1,058.5 million).

|  6 million | 31 May 2022 | 31 May 2021 | Change %  |
| --- | --- | --- | --- |
|  Liquid assets | 2,073.9 | 1,512.8 | 37%  |
|  Client funds on balance sheet | (520.9) | (354.3) | 47%  |
|  Issued debt/Long-term borrowings | (299.2) | (100.0) | 199%  |
|  **Own funds** | **1,253.8** | **1,058.5** | **18%**  |

Client funds on balance sheet are funds which are deposited with the Group's Swiss banking subsidiary, IG Bank SA, and client funds held by other subsidiaries which are not subject to the same legal or regulatory protections as client money held off balance sheet, including funds held by the Group under title-transfer collateral arrangements.

The Group issued £300 million of investment-grade, 7-year senior unsecured bonds as part of a comprehensive debt refinancing exercise. The majority of the proceeds were used to repay £250 million, short-dated term loans and following the refinancing exercise, total available credit facilities have risen from £375 million as at 31 May 2021, to £600 million as at 31 May 2022, with the potential to rise to £700 million if the new revolving credit facility is increased in size. The £300 million committed revolving credit facility was undrawn at 31 May 2022 (31 May 2021: undrawn).

### Own Funds Flow

Own funds of the Group have increased by £195.3 million during the period, predominantly as a result of own funds generated from operations and the sale of Nadex and Small Exchange, which offset the consideration paid to acquire tastytrade and the dividends paid by the Group.

|  6 million | FY22 | FY21  |
| --- | --- | --- |
|  **Own funds generated from operations** | **536.5** | **505.8**  |
|  as % of operating profit | 112% | 111%  |
|  Taxes paid | (99.2) | (83.0)  |
|  **Net own funds generated from operations** | **437.3** | **422.8**  |
|  Net interest and fees paid | (13.2) | (4.8)  |
|  Capital expenditure and capitalised development costs | (17.5) | (16.0)  |
|  Net own funds movement from acquisitions and disposals of subsidiaries and investments in associates | (14.7) | –  |
|  Purchase of own shares held in employee benefit trusts | (6.7) | (0.2)  |
|  **Pre-dividend increase in own funds** | **385.2** | **401.8**  |
|  Dividends paid | (186.2) | (159.7)  |
|  **Increase in own funds** | **199.0** | **242.1**  |
|  **Own funds at start of the period** | **1,058.5** | **832.5**  |
|  Increase in own funds | 199.0 | 242.1  |
|  Impact of movement in exchange rates | (3.7) | (16.1)  |
|  **Own funds at the end of period** | **1,253.8** | **1,058.5**  |

The Group's own funds generated from operations of £536.5 million, £30.7 million higher than in FY21. These funds were reduced by comparatively higher taxes paid driven by the sale of Nadex and Small Exchange, and the own funds used to acquire tastytrade which were partially offset by the net own funds generated from sale of Nadex and Small Exchange.

The Group recognised an increased own funds outflow to acquire shares in the employee benefit trust, as shares in the market were used to satisfy vesting awards rather than the issue of new shares.

The Group also recognised an increased dividend outflow during the year following the issue of 61 million shares to acquire tastytrade.

44

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

# **Regulatory Capital**

The Group is supervised on a consolidated basis by the FCA in the UK, which requires it to hold sufficient regulatory capital at both Group and individual entity levels to cover risk exposures, valued according to applicable rules, and any additional regulatory financial obligations imposed.

Shareholders' funds comprise share capital, share premium, retained earnings and other reserves, and as at 31 May 2022 totalled £2,027.8 million (31 May 2021: £1,133.3 million). The Group's regulatory capital resources are an adjusted measure of shareholders' funds, and as at 31 May 2022 totalled £1,025.6 million (31 May 2021: £860.7 million), taking into account FY22 profits which are included in the regulatory capital calculation following approval from the FCA.

|  £ million | 31 May 2022 | 31 May 2021  |
| --- | --- | --- |
|  **Shareholders' funds** | **2,027.8** | **1,133.3**  |
|  Less foreseeable/declared dividends | (134.8) | (130.4)  |
|  Less goodwill and intangible assets | (833.7) | (140.0)  |
|  Less Deferred tax assets and significant investments in financial sector entities | (32.3) | –  |
|  Less adjustment for prudent valuation | (1.4) | (2.2)  |
|  **Regulatory capital resources** | **1,025.6** | **860.7**  |
|  **Total requirement – £ million** | **497.4** | **491.1**  |
|  **Capital headroom – £ million** | **528.2** | **369.6**  |

From 1 January 2022 the Group is subject to the Investment Firms Prudential Regime, which has changed the basis of calculation of the Group's regulatory capital. During the transitional period, the regulatory capital requirement remains broadly unchanged.

The Group's regulatory capital resources as at 31 May 2022 were £1,025.6 million (31 May 2021: £860.7 million) and the capital requirement as at 31 May 2022 was £497.4 million (31 May 2021: £491.1 million). This translates to a capital headroom of £528.2 million (31 May 2021: £369.6 million), demonstrating the Group's solid capital base and the minimal impact of the change in regulatory rules.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

45
STRATEGIC REPORT
## Risk Management
### Effective risk management is Risk Management Framework
### essential in achieving our
### strategy and business We have an established framework to our strategic objectives, are understood
identify, measure, manage, monitor and and managed in accordance with our
### objectives, and to preserve our
report the risks faced by the business. appetite and tolerance levels.
### strong financial position and This includes the risk that our conduct
### regulatory reputation. The may pose to the achievement of fair The RMF is supported by policies such
outcomes for clients, or to the sound, as credit risk, market risk, liquidity,
### Board is responsible for
stable, resilient and transparent technology, operational risk, information
### ensuring that we maintain an operation of financial markets. security, vendor, business continuity,
### appropriate risk management conduct and whistleblowing. The RMF
This framework provides the Board with and supporting frameworks are
### culture, supported by a robust
assurance that our risks, including the extended across tastytrade and the
### Risk Management Framework. risks relating to the achievement of the business model has been considered.
### Risk culture

| Embedding a sound risk culture is | 1. Business functions | 3. Internal Audit |
| --- | --- | --- |
| fundamental to the effective operation | 1st Line functions have the primary | The 3rd Line function has responsibility |
| of our Risk Management Framework and | responsibility for the risk management | for assurance and is performed by |
| sets the tone for broader conduct in all | of their respective risks, including | Internal Audit. Internal Audit helps the |
| business activities, values and expected | day-to-day responsibility for ensuring | Board and Executive team protect the |
| behaviours. Central to our risk culture | that business areas operate within their | assets, reputation and sustainability |
| isa commitment to integrity and to | risk appetite. They are responsible for | of the organisation by providing |
| principles of responsible business. | the identification, assessment and | independent, objective assurance |
| Thisis driven by individuals with defined | management of risks faced, in line with | reviews designed to add value and |
| rolesand responsibilities over their | the approved policies and procedures. | improve our operations. The scope of |
| respective areas as detailed under the |  | the annual audit plan includes reviews |
| Senior Managers Certification Regime | 2. Risk and control functions | of the Risk Management Framework, |
| inthe UK. | The 2nd Line functions operate | along with the management of the |
|  | independently from 1st Line functions, | Group’s principal risks. This includes |
| We operate a ‘three lines’ Risk | with the dual objective of providing | assessments of the design and |
| Governance Model. | advisory and oversight services. While | operating effectiveness of controls, |
|  | other functions may perform some | governance structures and processes. |

advisory and oversight activities,
Three lines of defence
this is the main role of the Risk and
Compliance functions. The Risk and
1 Compliance teams maintain our risk
management and control policies,
provide independent analysis and
2 monitoring of our risks against appetite,
while staying abreast of industry
and regulatory developments that
3 might require enhancements to the
Risk Management Framework.
### Risk governance
Non-Executive oversight of the Risk The ERC meets weekly to discuss risks Specific sub-committees are
Management Governance Framework requiring executive-level oversight and delegatedadditional oversight
has been delegated by the Board to management, with the frequency withmembership comprised of
theBoard Risk Committee, with reflecting the commitment of senior management with subject matter
executive and operational oversight management to play an active role in expertise. Examples of these committees
provided through the Executive Risk day-to-day risk management. are: Best Execution, Technology,
Committee (ERC). Information Security, Capital & Liquidity,
Vendor, Conduct &Operational Risk,
andTransaction Reporting.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202246
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Risk appetite
Our Risk Appetite Statement (RAS) It is the responsibility of the risk
details the acceptable levels of risk owner to manage and explain what
towhich we are willing to be exposed, actions have been taken once an
soas to allow for a profitable business. Amber threshold has been breached.
Risk Risk Risk
All efforts must be made to avoid
Appetite Tolerance Threshold
The RAS is supported by Key Risk aRed breach. In the event of a
Indicators (KRIs) that are used to identify Redbreach, action must be taken,
instances which require escalation without discretion, to ensure
andinvestigation. wecome back insidethe BAL.
Anexplanation must be provided
KRIs consist of two distinct categories: tothe Board detailing the matter
andwhy the BAL was breached.
1. Board-Approved Limits (BALs)

| Board approved thresholds and | 2. Escalation thresholds |  |
| --- | --- | --- |
| limitsare set which serve to raise |  | For risks where limits cannot be |
| awareness of increased levels of risk. |  | set,abreach of a defined Amber |
| Early warning (Amber) thresholds |  | threshold triggers escalation to |
| areused to highlight increasing risk |  | management, which should result |
| exposure, enabling action to be taken |  | inconsideration being given as to |
| prior to exceeding a pre-defined risk |  | what appropriate actions, if any, are |
| limit (Red). |  | taken.Red threshold breaches are |

reported to the Group Board either
immediately or on a monthly basis,
depending on whether the KRI has
been flagged for immediate
escalation by the Board.
### Risk taxonomy

| 1. Regulatory environment risk |  | 2. Commercial risk |  | 4. Conduct and operational risk |  |
| --- | --- | --- | --- | --- | --- |
|  | The risk that we face enhanced |  | The risk that our performance |  | The risk that our conduct poses |
|  | regulatory scrutiny with a higher |  | isaffected by adverse market |  | tothe achievement of fair outcomes |
|  | chance of regulatory action, or the |  | conditions, failure to adopt an |  | for consumers or the financial |
|  | risk that the regulatory environment |  | effective business strategy |  | markets. The risk of loss resulting |
|  | in any of the jurisdictions in which |  | orcompetitors offering more |  | from inadequate or failed internal |
|  | wecurrently operate, or may wish |  | attractive products or services. |  | processes, people, systems |
|  | tooperate, changes in a way that |  |  |  | orexternal events. |
|  | has an adverse effect on our | 3. Business model risk |  |  |  |
|  | business or operations, through |  | The risk we face arising from | Within each of these broad |  |
|  | reduction in revenue, increases in |  | thenature of our business and | categories the taxonomy identifies |  |
|  | costs, or increases in capital and |  | business model, including market, | more detailed risks as outlined in the |  |
|  | liquidity requirements. |  | credit and liquidity risks and capital | tables on the following pages (48-53). |  |

adequacy adherence.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 47
STRATEGIC REPORT
## Principal Risks
### 1. Regulatory environment risk
Regulatory risk
Risk Mitigation and controls
We are subject to enhanced regulatory scrutiny ¼ Monitor operations to ensure they adhere to regulatory requirements and standards
andtherefore face a higher chance of investigation, ¼ Continuously review all regulatory incidents and breaches
enforcement or sanction by financial services ¼ Define and embed policies and procedures across the Group to ensure regulatory
regulators. This may be driven by internal factors, compliance
suchas the strength of our control framework or its
interpretation, or the awareness, understanding or
implementation of relevant regulatory requirements.
This risk can also arise from external factors, such as
the current and changing priorities of our regulators’
policy and supervision departments.
Regulatory change
Risk Mitigation and controls
We operate across highly regulated environments ¼ Maintain strong relationships with key regulators and actively seek to converse in an effort
which are continually evolving, and face the risk of to keep abreast of, contribute to and correctly implement regulatory changes
governments or regulators introducing legislation ¼ Monitor relevant public statements by regulators that affect our industry
ornew regulations and requirements in any of the ¼ Maintain current and emerging risk reports which timeline incoming changes
jurisdictions in which we operates. This could result
inan adverse effect on our business or operations,
through reduction in revenue, increases in costs
orincreases in capital and liquidity requirements.
Tax
Risk Mitigation and controls
The risk of significant adverse changes in the manner ¼ Monitor developments in international tax laws to ensure continued compliance and that
in which we are taxed. stakeholders are aware of any significant adverse changes that might impact us
¼ Where appropriate and possible, collaborate with tax and regulatory authorities to
Examples of tax risks we face include the risk of provide input on tax policy, or changes in law
theimposition of a financial transactions tax, which
could severely impact the economics of trading and
developments in international tax law, which in turn
could impact the amount of tax that we pay.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202248
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### 2. Commercial risk
Strategic delivery
Risk Mitigation and controls
The risk that our competitive position weakens ¼ The Board receive strategy updates from the Executive Directors throughout the year
orprofits are impacted due to the failure to adopt detailing the strategic progress of the business
orimplement an effective business strategy, ¼ Undertake external consultation and extensive market research in advance of committing
includingthe risk of failing to appropriately to any strategy in order to test and validate a concept
integratean acquisition. ¼ Manage projects via a phased investment process, with regular review periods, in order
toassess performance and determine if further investment is justified
Financial market conditions
Risk Mitigation and controls
The risk that our performance is affected by client ¼ Review daily revenue, monthly financial information, KPIs and regular reforecasts
sensitivity to adverse market conditions, making it ofexpected financial performance
harder to recruit new clients and reducing the ¼ Use forecasts to determine actions necessary to manage performance and
willingness of existing clients to trade. productsindifferent geographical locations, with consideration given to changes
inmarket conditions
¼ Regularly update investors and market analysts on revenue performance, and engage
with them to manage the impact of market conditions on performance expectations
Competitor risk
Risk Mitigation and controls
We operate in a highly competitive environment and ¼ Monitor conduct to ensure we do not engage in questionable practices, regardless
seek to mitigate competitor risk by maintaining a clear ofwhether they would prove to be commercially attractive to clients
distinction in the market. This is achieved through ¼ Ensure that our product offering remains attractive, taking into account the other
compelling and innovative product development and benefits that we offer our clients, including brand, strength of technology and
quality of service, all while closely monitoring the servicequality
activity and performance of our competitors.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 49
STRATEGIC REPORT
### Principal Risks continued
### 3. Business model risk
Market risk
Risk Mitigation and controls
The risk of loss due to movements in market prices ¼ Use a real-time market position monitoring system
arising from our net position in financial instruments. ¼ Monitor market risk exposures with hourly scenario-based stress tests which analyse the
We seek to manage our market risk so our trading impact of potential stress and market gap events
revenue predominantly reflects client transaction fees ¼ Take appropriate action to reduce risk exposures as required. If exposures exceed
net of hedging costs and is not driven by market risk pre-determined limits, hedging is undertaken to bring the exposure back within the limits
gains or losses. ¼ Our framework consists of dynamic limits which can be fully utilised during market
opening hours and contract in less liquid periods. Market risk limits have been increased
We are also exposed to interest rate risk through our over the year in line with the growth of the Group, bringing greater efficiency of
debt and holdings of cash and investments. internalisation of client flow. All increases are reviewed and approved by the Board
Credit risk – Client
Risk Mitigation and controls
The risk that a client fails to meet their obligations ¼ Set client margin requirements considering the market for each instrument, requiring
tous, resulting in a financial loss. Client credit risk clients to deposit additional collateral or reduce positions where necessary
principally arises when a client’s total funds deposited ¼ Manage client credit risk in real time via our ‘Close-out monitor’ system. Monitor
are insufficient to cover any trading losses incurred. andmanage client margin calls via automatic liquidation of account positions once
pre-determined account close-out levels are breached
¼ Offer risk management training to clients which encourages them to collateralise their
accounts at an appropriate level and set a level at which an individual deal will be closed
Credit risk – Financial institution
Risk Mitigation and controls
We have financial exposure to a number of financial ¼ Perform credit reviews on financial institutional counterparties when a new relationship
institutions, owing to the placement of financial isentered into; this is updated semi-annually (or ad hoc upon an event)
assetsat banks and the hedging of market risk in the ¼ Actively manage credit exposure to each of our broking counterparties, settling or
wholesale markets, which requires us to place margin recalling balances at each broker on a daily basis in line with the collateral requirements
with our hedging brokers. ¼ Ensure the majority of deposits are demand or overnight deposits, enabling us to react
immediately to any deterioration in credit quality
Liquidity
Risk Mitigation and controls
This is the risk that the we are unable to meet our ¼ Manage liquidity within the UK Defined Liquidity Group (UK DLG) comprising of IG Markets
financial obligations as they fall due. (IGM), IG Index (IGI) and IG Trading and Investments (IGT&I)
¼ The UK DLG carries out a liquidity assessment each year to ascertain if it has sufficient
liquidity to continue in operation under liquidity stress and provides mitigating actions to
improve the liquidity position in these stress scenarios
¼ Mitigate liquidity risk through access to committed unsecured bank facilities and debt
Capital adequacy
Risk Mitigation and controls
The risk that the we hold insufficient capital to ¼ Manage capital resources with the objectives of facilitating business growth, maintaining
cover our risk exposures and have to curtail or our dividend policy and complying with the regulatory capital resource requirements
cease operations. ¼ Undertake an annual capital assessment and apply a series of stress-testing scenarios to
our base financial projections, approved by the Board
We are supervised on a consolidated basis by the UK’s ¼ Operate a monitoring framework over our capital resources and minimum capital
FCA and our global entities’ operations are directly requirements daily
authorised by the respective local regulators.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202250
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### 4. Conduct and operational risk
Platform outage
Risk Mitigation and controls
The risk that clients are unable to trade on the ¼ Maintain a 24/7 Incident Management function to manage the resolution of incidents.
platform due to an operational outage and the risk ¼ Perform regular disaster recovery capability testing to ensure that standby services are
that our operations are affected due to inadequate effective and minimise the impact to operations
disaster recovery capabilities and delays in our ability ¼ Apply denial-of-service (DOS) protection against cyber-attacks that would impact
to recover within appetite. platform availability
¼ Maintain a Change Management function which undertakes risk assessments and utilises
defined maintenance windows to protect core trading periods and client impact
System performance and capacity issues
Risk Mitigation and controls
The risk that system capability limitations or ¼ Undertake regular performance and capacity stress testing to ensure our platforms have
unexpected client activity results in degradation of sufficient headroom and resilience to perform in times of heightened volatility and
client platforms or internal business service to clients. increased demand
We need to ensure we have sufficient capacity to flex ¼ Maintain an Enterprise Change function to manage business change and the
with client demand. development of new products and services
¼ Maintain a Quality Assurance function to test and identify system defects through the
development lifecycle and resolve these before they impact applications
Information security
Risk Mitigation and controls
This is the risk of data loss that results in a regulatory ¼ Maintain a 24/7 Security Operations Centre for the review and triage of information
breach or fine. This can be due to employee or vendor security incidents, and employ mitigation services for threats such as hacking, malware,
activity, non-compliance with data regulations, data loss and data gathering
cyber-attack or data integrity issues. ¼ Host a dedicated Information Security Forum, through which senior management are
updated on the strategy and progress of the Information Security Programme and the
status of threats and risks
Employee working conditions issues
Risk Mitigation and controls
The risk that we have inadequate employment ¼ Continuously refresh our employment policies and processes to ensure they match
practices which are detrimental to staff or can create thelatest industry standards and best practices
conflict with the business. Employees should be ¼ Obtain regular feedback from staff members on employment practices and
confident that they work in a safe environment. working conditions in order to assess and improve our practices and continue
to be a top employer
¼ Undertake annual engagement surveys to identify any employee dissatisfaction which
can then be investigated and improved upon
¼ Purchase suitable insurance programmes which cover employee requirements globally
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 51
STRATEGIC REPORT
### Principal Risks continued
### 4. Conduct and operational risk continued
Trading issues
Risk Mitigation and controls
The risk related to any issues with the processes ¼ Internalise client flow and hedge efficiently with return to volume of client income being
around our internal hedging and client trading. This akey monitoring metric
also considers how we process clients’ corporate ¼ Put in place market risk limits and have very low tolerance for operational issues that
action events, dividends and stock transfers. result in a market risk loss
¼ Strictly adhere to best execution rules which are monitored through the Best Execution
Committee, applying the highest standards to all jurisdictions in which we operate
¼ Take a ‘follow the sun’ approach with trading desks located in Australia and London with
shift patterns
Client management issues
Risk Mitigation and controls
This is the risk related to the operational and ¼ Regular assessments of services which have been identified as being critical to clients
conductissues in the client lifecycle spanning from and are required to be operationally resilient, with single points of failure identified
the customer agreement, account set-up, interaction and back-ups set in place
with us, and appropriateness of account types and ¼ Cross-team training to ensure resources are adequate to flex with demand
product offerings. ¼ Establish KPIs to monitor levels of service provided, and invite clients to provide feedback,
with any issues identified being investigated
Financial crime
Risk Mitigation and controls
The failure to identify and report financial crime, and ¼ Have a mature control framework for identifying suspicious transactions related
inadequate client due diligence and oversight, can to market abuse which must then be reported on
result in a breach of regulatory requirements. Clients ¼ Establish appropriate onboarding processes for different clients and vendors with
may attempt to use us to commit fraud or launder anenhanced due diligence process
money, third parties may try to extract client or ¼ Ensure Group policies and processes have segregated duties to ensure adequate
corporate funds, and employees could misappropriate oversight and control over internal fraud
funds if an opportunity arose.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202252
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Business support process issues
Risk Mitigation and controls
The risk that inadequate business processes and ¼ Our operational risk framework ensures the control environment is monitored
oversight can lead to internal issues within the and aim toreduce the operational events which occur
business. These can relate to inaccurate or late client ¼ Escalation procedures efficiently manage the occurrence of these risks
money or asset management, mismanaged corporate ¼ Specific committees and audits monitor topics such as client money and
cash, unintentional breach of market risk limits, asset management
incorrect revenue calculation or allocation, or ¼ Ensure correct resourcing to flex with client volumes and monitor attrition rates
incorrect or late payroll processing. at a functional level
Financial integrity and statutory reporting issues
Risk Mitigation and controls
The risk of production issues which could lead ¼ Monitor and enhance our control environment, which aims to reduce the number,
tountimely, incomplete or inaccurate Financial size of and impact of these events which occur
Statements, transaction reporting, tax filing, ¼ Implement escalation procedures to efficiently manage the occurrence of these risks
regulatory capital, financial crime reporting ¼ Specific steering committees help manage areas such as transaction reporting, financial
and forecasting. Any issues or errors can crime reporting, financial reporting and forecasting, Internal Capital Adequacy and Risk
have a detrimental impact on clients, markets Assessment (ICARA) production and annual report production
and shareholders.
Threats to employees and assets
Risk Mitigation and controls
The risk related to dangers to employees and damage ¼ Secure data centres and offices and with state-of-the-art cyber security and fire safety
to physical and non-physical property or assets from protocols in place
natural or non-natural external causes. We recognise ¼ Purchase suitable commercial insurance globally for assets and each of our premises
the growing risks associated with climate change and ¼ Engage with an external environmental consultant to help conduct climate-related risk
a warming planet. These include the physical risks assessments bi-annually
from changing weather patterns, and the transition
risks arising from movement towards a less polluting,
greener economy.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 53
STRATEGIC REPORT
## Going Concern and Viability Statement

| Going Concern | Viability Statement | No significant changes to regulatory |
| --- | --- | --- |
| The Group meets its day-to-day working | The UK Corporate Governance Code | capital and liquidity requirements have |
| capital requirements through its | (the Code) requires the Directors | been assumed over the forecasting |
| available liquid assets and committed | to make a statement regarding the | period. The Group is subject to the |
| banking facilities. The Group’s liquid | viability of the Group, including | new IFPR which has not resulted in |
| assets exclude all monies held in | explaining how they have assessed the | a significant change in the Group’s |
| segregated client money accounts. | prospects of the Group, the period of | capital and liquidity requirements and |
| In assessing whether it is appropriate | time over which they have made the | resources since its introduction on |
| to adopt the going concern basis in | assessment and why they consider | 1 January 2022. As the risk profile of |
| preparing the Financial Statements, | that period to be appropriate. | tastytrade is similar to the Group, it |
| the Directors have considered the |  | has not contributed to a significant |
| resilience of the Group, taking account | The Group has a forecasting and | increase in capital requirements since |
| of its liquidity position and cash | planning cycle consisting of a strategic | acquisition, although the payment to |
| generation, the adequacy of capital | plan, an annual budget for the current | acquire tastytrade did result in a one- |
| resources, the availability of external | year and financial projections for a | off reduction in capital resources. |
| credit facilities and the associated | further three years. The output from this |  |
| financial covenants, stress-testing of | business planning process is used in the | The first year of the planning period |
| liquidity and capital adequacy that | Group’s capital and liquidity planning, | has a greater degree of certainty. It is |
| takes into account the principal risks | and the most recent forecasts are for | therefore used to set detailed financial |
| faced by the business, in addition to the | the four-year period ending May 2026. | targets across the Group. It is also used |
| impact of the tastytrade acquisition. |  | by the Remuneration Committee to set |
| Further details of these principal | The Group’s revenue, which is driven by | targets for the annual incentive scheme. |
| risks and how they are mitigated and | client transaction fees, has continued to | Caution about the degree of certainty |
| managed is documented in the Risk | benefit from financial market volatility | needs to be exercised – in the short |
| Management section on page 46. | over the course FY22, along with the | term, the performance of the Group’s |
|  | revenue generated following the | business is impacted by influences such |
| The Directors’ assessment has | acquisition of tastytrade. Projections of | as market conditions and regulatory |
| considered future performance, | the Group’s revenue have conservatively | changes that it cannot control. |
| solvency and liquidity over a period of | considered financial market volatility |  |
| at least twelve months from the date | returning to normal levels throughout | The further three-year period provides |
| ofapproval of the Financial Statements. | the four-year period. Projections also | less certainty of outcome, but provides |
| The Board, following the review by the | include assumptions on interest rates | a robust planning tool against which |
| Audit Committee, has a reasonable | that will result in increased interest on | strategic decisions can be made. These |
| expectation that the Group has | client funds in the tastytrade business. | forecasts are also considered when |
| adequate resources for that period, and | The Group has conservatively excluded | setting targets for the executive and |
| confirm that they consider it appropriate | the impact of potential interest rate rises | senior management share plans. |
| to adopt the going concern basis in | on its business outside of the US. |  |
| preparing the Financial Statements. |  | The Group undertakes stress testing on |
|  | The four-year forecasting period is the | these forecasts through the Individual |
|  | length of time over which the Board | Liquidity Adequacy Assessment |
|  | strategically assesses the business and | (ILAA), Internal Capital Adequacy |
|  | the period of time over which the Board | Assessment Process (ICAAP) and |
|  | would typically look for investments to | Recovery Plan, providing the Board with |
|  | pay back. | a robust assessment of the possible |

consequences of principal risks facing
the Group, including those that would
threaten its business model, future
performance, solvency and liquidity.
The introduction of the IFPR for FCA-
regulated investment firms from 1st
January 2022 means that in future
periods, the Group will perform an
ICARA that will combine the ICAAP,
ILAA and Recovery Plan processes.
IG GROUP HOLDINGS PLC ANNUAL REPORT 202254
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| The types of scenarios used include the | The Group continues to actively | The Board regularly assesses the |
| --- | --- | --- |
| collapse of a major financial services | monitor and refine its comprehensive | principal risks facing the Group. These |
| firm, an unexpected global economic | business continuity plan which was | risks include regulatory, legislative, or |
| event followed by a market dislocation | successfully implemented at the onset | tax changes which may detrimentally |
| and operational IT failures. The stress | of the Covid-19 pandemic during | impact our business in the jurisdictions |
| tests evaluate the impact of the | FY20. The Group’s significant long- | we operate or seek to operate in. In |
| scenarios on the relevant principal risks | term investment in communications | particular a change that impacts on the |
| captured by the Group’s Risk | and technology infrastructure has | Group’s ability to sell or trade OTC |
| Management Framework. | enabled the Group to transition to | derivatives may have a fundamental |
|  | a hybrid-working environment, with | effect on the viability of the Group and |
| Additionally, the Group has undertaken | all employees given the opportunity | its businesses. Further details of these |
| reverse stress testing to understand | to work safely from home, and IG | principal risks and how they are |
| the circumstances under which the | continues to provide the best possible | mitigated and managed is documented |
| Group’s business model is no longer | service for its clients when they choose | in the Risk Management section on |
| viable. This information is used to ensure | to trade the financial markets. | pages 48 to 53. The Board receives |
| the relevant risks are sufficiently well- |  | reports on these and new emerging |
| understood and appropriately managed. | The conflict in Ukraine has had minimal | risks through the Risk Management |
| Scenarios are reviewed at least annually | impact on the commercial operations | Framework. On the basis of these and |
| to ensure they remain relevant, with | of the Group and steps were taken | other matters considered and reviewed |
| any updates being incorporated | in the early stages to minimise any | by the Board during the year, the |
| into the ICARA accordingly. | prospective future exposure to | Directors have reasonable expectations |
|  | sanctions on clients and suppliers. | that the Group will be able to continue in |
| The Group has undertaken extensive | Additional employee support has | operation and meet its liabilities as they |
| modelling and analysis for potential | been provided to employees based | fall due over the four-year period ending |
| changes in the regulatory landscape, in | in Poland, many of whom have been | 31 May 2026. |
| order to prepare the financial forecasts, | assisting refugees arriving from |  |
| and there is a range of potential | neighbouring Ukraine, to ensure their | The Strategic Report up to and including |
| outcomes. The Group is planning | continued health and wellbeing. | page 55 was approved for issue by the |
| investments in new countries and in new |  | Board on 20 July 2022 and signed on its |
| products, that may be less successful | Overall the Directors consider the | behalf by: |
| than assumed by the financial forecasts | Group well-placed to manage its |  |
| and that are dependant on regulatory | business risks successfully, having taken |  |
| applications being successful. | into account the current economic |  |

outlook, the possible consequences
The Directors are satisfied that these of principal risks facing the business in
and other uncertainties have been severe but plausible scenarios, and the
assessed, and that the financial effectiveness of any mitigating actions
forecasts reflect an appropriate balance on the Group’s profitability and liquidity.
Charles A Rozes
of the potential outcomes. The Group’s business model provides
Chief Financial Officer
the Directors with comfort that the
business is being run in a sustainable
way, acting in the interests of its clients
and acting responsibly in managing
relationships with other stakeholders.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 55
GOVERNANCE REPORT
## Governance at a Glance
## A strong core is
## the key to success
Statement of compliance Annual General Meeting
During FY22, we have applied the principles and complied The Board is looking forward to meeting shareholders,
with all the provisions of the Code. The Governance Report, hearing their views and answering their questions at this
which includes the principal Committee Reports listed year’s Annual General Meeting (AGM), which will be held
onpage 64, outlines the key features of the Corporate on21 September 2022.
Governance Framework and sets out how the Group has
applied the principles of the Code. Further information about our AGM arrangements will
be set out in the Notice of AGM.
A copy of the Code is available on the Financial Reporting
Council’s (FRC’s) website at www.frc.org.uk.
## Key decisions

| ¼ Approved a £1 billion EMTN Programme | ¼ Established a North American Board, |
| --- | --- |
| (pages 24 to 25) | IGNA (pages 58 and 59) |
| ¼ Approved the sale of Nadex and Small Exchange | ¼ Approved the Group’s Equality, Diversity and |
| (page 25) | Inclusion strategy |
| ¼ Pledged 1% of post-tax profits to charitable | ¼ Approved the Group’s Financial Education |
| causes from 2022 to 2025 (page 25) | strategy (page 110) |

¼ Appointed Susan Skerritt as a Non-Executive
Director (pages 76 and 77)
56 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### The Board
Composition of the Board Gender
Independent Chair 1 Female 4
Executive Directors 3
Length of tenure Ethnicity
0–3 years 7 Ethnically diverse 3
3–6 years 3
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 57
Male 8 Over 6 years 2 White 9 Independent Non-Executive Directors 8
GOVERNANCE REPORT
### Mike McTighe, Chair of the
### Board, gives his introduction
## Chair’s
### tocorporate governance in
### respect of the financial year.
## Introduction During the year, the Board has been
ableto come together again in person,
whichhas enabled us to consolidate the
building blocks put in place last year as
## to Corporate we become an ever-more cohesive and
effective Board.
In support of the acquisition of
tastytrade, the Board took the
## Governance
opportunity to review the governance
arrangements in the US to optimise
oversight and support of the US
companies by the wider IG Group. The
Board decided that a North American
Board should focus on governance,
## We have made significant progress during the
regulation and compliance in particular.
## year to implement governance best practice, The IGNA Board is chaired by IGGH
Non-Executive Director Malcolm Le May
## but there is still more work to be done as we
and comprises IGGH Non-Executive
## strive to become ‘best in class’.” Director Susan Skerritt, IGGH Executive
Director Charlie Rozes and Joe (JJ)
Mike McTighe Kinahan, the regional CEO for North
Chair America. In the year ahead, governance
arrangements for IGNA will remain
under review as the business develops,
to ensure that optimal governance is in
place to support the region’s success.
During the financial year, a new UK
regulated entity, IGT&I received FCA
authorisation. In the early part of FY23,
IG’s UK non-leveraged business,
currently within IGM will be transferred
to this entity, allowing IGM to focus on
the CFD business, including external-
hedging arrangements. As with our
other UK-regulated entities, IGM and IGI,
the Board of IGT&I will mirror that of
IGGH, with Non-Executive Directors
providing enhanced oversight, and
support and meetings for all four boards
being held concurrently.
58
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| Governance structure | to the Board have benefited from | Priorities for the year ahead |
| --- | --- | --- |
| To ensure Board discussions are of | in-depth ‘deep-dive’ sessions to help | Following the establishment of the IGNA |
| appropriate length and with the right | them understand our operations | Board, as anticipated, a project has |
| balance of time spent on historical, | and culture, and build stronger | begun to review the Board structures |
| current and forward-looking agenda | relationships withmanagement. | for our other Regulated Entities across |
| items, we have reviewed the Terms of |  | the globe through the creation of a new |
| Reference of each of our Committees | A review of the effectiveness of the | Subsidiary Governance Framework |
| and ensured that as much delegation | Board, its Committees and individual | that also supports our business |
| asappropriate has been made. We also | Directors was undertaken by the | model. Regional CEOs and leadership |
| delegated some of IGGH’s authority to | Company, with facilitation from | teams will be attending IGGH Board |
| the IGNA Board. All of this is to ensure | Lintstock, an independent consultancy. | meetings and every financial year |
| we are making the most effective use of | The evaluation showed that the Board | the Board will visit one of the regions, |
| our time, moving governance oversight | has performed well as a collaborative | starting with North America in FY23. |
| closer to our individual businesses | team and continues to build good- |  |
| where it is proportionate to do so and | quality relationships between ourselves | As a purpose-led global fintech, |
| generally instilling good governance | and with management. | we continue to power the pursuit |
| atthe heart of our businesses |  | of financial freedom for the |
| andprocesses. | During the year we progressed the | ambitious, growing and becoming |
|  | actions from the 2021 evaluation, | an ever more global, diversified |
| The Board remains committed to | including consideration of the structure | and sustainable business. |
| ensuring the highest standards of | and frequency of Board and Committee |  |
| governance throughout the organisation | meetings and holding additional | Following strong performance in |
| and continuously strengthening our | workshops in between formal meetings | FY22, we continue to stand out from |
| governance arrangements, as you will | to provide the Non-Executive Directors | other companies, as we strive to |
| see reflected in the following pages of | with more in-depth and focused | make a difference for our clients and |
| this report. As a key part of this, our | sessions into key areas of the Group’s | for the wider societies in which we |
| ESG Committee goes from strength | activities. Further details can be found | operate. Wehave made significant |
| to strength as we embed ESG values | on page 70. | process during the year to implement |
| into the heart of everything we do and |  | governance best practice, but there |
| deliver on our commitment to donate | Outside of Board meetings, we held a | is still more work to be done as we |
| the equivalent of 1% of prior-year post- | number of additional in-depth strategy | strive to become ‘best in class’. |
| tax profits to the Brighter Future Fund. | sessions on a range of topics to support |  |

the Board in their knowledge and

| Board and Committee changes | understanding of our operations, |
| --- | --- |
| During the year, we have welcomed | particularly from an international |
| Susan Skerritt (appointed to the Board | perspective, focusing in on each |
| in July 2021) as a Non-Executive Director | ofthegeographic regions. |

Mike McTighe
of the Company. Susan is an established
Chair
Non-Executive Director and a US Diversity, inclusion and equality
20 July 2022
resident. She brings significant financial The Board is committed to having
markets experience working with adiverse and inclusive membership,
US-based companies and regulators. which helps us to make good
That experience and local knowledge decisions by having a broad range
is already proving invaluable to us as of perspectives. I’m pleased that
we increase our focus on the US. Susan we continue to meet the Hampton-
is a member of both the IGNA Board Alexander target of at least one-third
and the IGGH Board Risk Committee. female representation on the Board
and exceed the Parker Review target
A particular focus for the Board has of one ethnic minority Director on the
been developing strong working Board well ahead of the 2024 deadline.
relationships and getting to know

| each other in order to work together | The Board currently consists of nine |
| --- | --- |
| effectively. While the Board has | Non-Executive Directors and three |
| continued to work together effectively | Executive Directors. While the Executive |
| remotely throughout the restrictions | Directors run the operational aspects |
| imposed by the Covid-19 pandemic, | ofthe business on a day-to-day basis, |
| we have been particularly pleased | theNon-Executive Directors provide |
| to be able to come back together in | appropriate guidance, challenge |
| person, which has helped to deepen | andsupport. |

these relationships. Newer Directors
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 59
GOVERNANCE REPORT
## The Board
as at the date of this Report
### The Board is responsible for
### determining the Group’s
### strategy and for promoting our
### long-term success, through
### creating and delivering long-
### term value for shareholders.
Mike McTighe June Felix Charlie Rozes Jon Noble Jonathan Moulds Rakesh Bhasin
Chair Chief Executive Officer Chief Financial Officer Chief Operating Officer Senior Independent Non-Executive Director
Non-Executive Director
Nationality: British Nationality: American Nationality: British/American Nationality: British Nationality: British Nationality: American/British
Ethnicity: White Ethnicity: Chinese Ethnicity: White Ethnicity: White Ethnicity: White Ethnicity: Indian
### Committee membership
Time on Board: Two years Time on Board: Six years Time on Board: Two years Time on Board: Four years Time on Board: Three years Time on Board: Two years
(Appointed 3 February 2020) (Appointed Non-Executive Director (Appointed 1 June 2020) (Appointed 1 June 2018) (Appointed 20 September 2018) (Appointed 6 July 2020)
on4 September 2015; and CEO on
30 October 2018)
Audit Committee
Committee membership: Committee membership: Committee membership: Committee membership: Committee membership: Committee membership:
Board Risk Committee
None
C C C
Disclosure Committee

|  |  | Mike has a wealth of leadership, | June was appointed as CEO on | Charlie was appointed as | Jon was appointed COO on 14 June | Jonathan is the Chair of Citi Group’s | Rakesh brings extensive technology |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  | ESG Committee | board and regulatory experience | 30 October 2018, having previously | CFO on 1 June 2020. | 2019 with responsibility for Trading | largest global subsidiary CGML and | and global markets experience, |
|  |  | from both public and private | served as a Non-Executive Director |  | and Operations, and is a member of | is also the Chair of Litigation Capital | specifically in Asia-Pacific. He is a |
|  | Nomination Committee | companies. Mike is the Chair of | of the Company since 4 September | Charlie has a proven track record | the Executive Committee. Jon also | Management Limited, an AIM-listed | Non-Executive Director for a portfolio |
|  |  | Openreach Limited and Together | 2015. June has had a successful | of, and accountability for, financial | leads the business change office and | litigation finance company. He has | of companies in multiple sectors |
|  | Remuneration Committee | Financial Services Limited. For | career, growing and leading | control and reporting, accounting, | chairs a number of the Company’s | extensive experience in financial | and is also Chair of CMC Networks, |
|  |  | over 20 years he has held various | global financial services and tech | tax, M&A, investor relations, risk | management committees. Jon | markets and has worked in the US, | aCarlyle Group investment company |
| C | Chair of the Committee | non-executive director roles in a | companies, and living and working | and compliance, and audit. He | is also a standing attendee of | Asia and the UK during his career. He | based in Africa, focused on providing |
|  |  | range of regulated and unregulated | inHong Kong, London and New York. | is a highly experienced finance | the Board ESG Committee, | served as the Group Chief Operating | telecommunications services |

(in the colour of the relevant Committee)

|  | industries while also spending eight |  | leader having held other executive | providing Executive guidance. | Officer of Barclays plc until 2016. | across Africa and the Middle East. |
| --- | --- | --- | --- | --- | --- | --- |
|  | years on the board of Ofcom and one | June brings to the role over 25 years’ | director roles in the financial |  |  |  |
|  | year on the board of Postcomm. | experience in both the finance | services sector prior to joining | Jon first joined IG in 2000 as a trainee | Prior to Barclays, Jonathan had a | In his executive career, Rakesh |
|  |  | and digital technology sectors. | IG, and having driven a number of | dealer, rising to Dealing Director in | 20-year career with Bank of America | was the Chief Executive Officer |
|  | Mike has held many chairships over | June is a Non-Executive Director | substantial change programmes | 2007. In 2010, Jon became Dealing | and was Chief Executive Officer of | and a member of the Board of Colt |
|  | the years, including chairing several | of RELX PLC and also sits on the | both in the UK and internationally. | & Operations Director and in 2012 | Merrill Lynch International following | Technology Services, a Fidelity- |
|  | UK and US public company boards. | Board of Advisors of the London |  | was appointed Chief Information | the merger of the two institutions in | owned company providing network, |
|  |  | Technology Club. June has no other | Charlie began his professional career | Officer. In 2015, Jon was appointed | 2008, with responsibility for Bank of | voice and data centre services |
|  | Mike spent most of his executive | current external appointments. | with PricewaterhouseCoopers LLP, | as Head of IG’s Delivery pillar. He | America’s European businesses. He | globally. Rakesh was appointed |
|  | career at Cable and Wireless, |  | and became a Partner in 2001 in | was appointed to the Board as Chief | was a member of Bank of America’s | into the role of Chief Executive |
|  | Philips, Motorola and GE. | Until the sale of Verifone Inc., June | the US management consulting | Information Officer on 1 June 2018. | Global Operating Committee. | Officer in December 2006 and |
|  |  | was President of Verifone Europe | practice. Following that he held |  |  | completed his tenure at the end of |
|  | Mike holds a BSc(Eng) honours | and Russia with responsibility for | senior executive roles at IBM and | As Chief Information Officer, | Jonathan has served widely on key | 2015, concluding his secondment |
|  | degree in Electrical Engineering. | over 2,000 employees with the | Bank of America. In 2007, he joined | Jon had responsibility for setting | industry associations including as | from Fidelity. Concurrently, he was |
|  |  | operation of the business throughout | Barclays plc where he was the Chief | and delivering our IT strategy, | Chair of the International Swaps | Non-Executive Chair of KVH, an |
|  |  | those territories. Prior to her role | Financial Officer of Barclays UK Retail | delivery of all programmes of work | and Derivatives Association (ISDA) | Asian-based technology company |
|  |  | at Verifone, June held various | and Business Bank, and became the | and for keeping the production | from 2004 until 2008, and as a | with headquarters in Tokyo and |
|  |  | executive management positions | Global Head of Investor Relations in | environment stable and secure. He | Director of the Association for | operations in Hong Kong, Seoul and |
|  |  | at a number of large multi-national | September 2011 until August 2015. | was responsible for IG’s IT systems, | Financial Markets in Europe (AFME). | Singapore, and Non-Executive Chair |
|  |  | businesses. These included Citibank |  | including its client interface systems. | He remains a member of AFME’s | of Market Prizm, a financial services- |
|  |  | where she was Managing Director | He was the Group Finance Director |  | Advisory Board. Jonathan was a | focused technology company. |
|  |  | of Global Healthcare, Citi Enterprise | at Jardine Lloyd Thompson plc from | Jon has no current external | member of the Capital Markets |  |
|  |  | Payments, IBM Corporation where | September 2015 until April 2019 | appointments. | Senior Practitioners of the UK | Rakesh has also previously held |
|  |  | she was Global General Manager | when it was acquired by Marsh |  | Financial Services Authority and the | senior positions within AT&T, |
|  |  | for the Global Banking and Financial | & McLennan Companies Inc. | Jon graduated from Durham | Global Financial Markets Association. | including Head of AT&T Asia- |
|  |  | Markets industry sector, and Chase |  | University with a degree in Economics |  | Pacific’s managed network services |
|  |  | Manhattan Bank where she was APAC | Charlie has no current | and obtained an Executive MBA from | Jonathan has a first-class honours | business and President, AT&T |
|  |  | Region Head of GPTS. June has also | external appointments. | London Business School in 2007. | in Mathematics from the University | Japan Limited. He was also formerly |
|  |  | worked as a strategy consultant at |  |  | of Cambridge. He was also awarded | Senior Managing Director of Japan |
|  |  | Booz, Allen & Hamilton, in strategy | Charlie has an undergraduate |  | a CBE in the 2014 Honours List | Telecom Company Limited. |
|  |  | roles at Chase Manhattan Bank, and | degree from Tufts University |  | for services to philanthropy. |  |
|  |  | as Chief Executive Officer of Certco, | and an MBA from the Southern |  |  | Rakesh has a BSc in Electrical |
| Former Directors who served during the year |  | a risk management technology | Methodist University. |  |  | Engineering from George |
|  |  | firm for global broker dealers. |  |  |  | Washington University. |

Bridget Messer
Bridget stepped down from the Board on 22 September 2021. June graduated from the University
of Pittsburgh with a summa cum
Lisa Pollina laude (first class honours) degree in
Lisa stepped down from the Board on 9 July 2021. Chemical Engineering and Pre-Med.
FIND OUT MORE AT
IGGROUP.COM/ABOUTUS/LEADERSHIP
60 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Mike McTighe June Felix Charlie Rozes Jon Noble Jonathan Moulds Rakesh Bhasin
Chair Chief Executive Officer Chief Financial Officer Chief Operating Officer Senior Independent Non-Executive Director
Non-Executive Director

| Nationality: British | Nationality: American | Nationality: British/American | Nationality: British | Nationality: British | Nationality: American/British |
| --- | --- | --- | --- | --- | --- |
| Ethnicity: White | Ethnicity: Chinese | Ethnicity: White | Ethnicity: White | Ethnicity: White | Ethnicity: Indian |
| Time on Board: Two years | Time on Board: Six years | Time on Board: Two years | Time on Board: Four years | Time on Board: Three years | Time on Board: Two years |
| (Appointed 3 February 2020) | (Appointed Non-Executive Director | (Appointed 1 June 2020) | (Appointed 1 June 2018) | (Appointed 20 September 2018) | (Appointed 6 July 2020) |

on4 September 2015; and CEO on
30 October 2018)
Committee membership: Committee membership: Committee membership: Committee membership: Committee membership: Committee membership:
None

| C | C |  |  | C |  |
| --- | --- | --- | --- | --- | --- |
| Mike has a wealth of leadership, | June was appointed as CEO on | Charlie was appointed as | Jon was appointed COO on 14 June | Jonathan is the Chair of Citi Group’s | Rakesh brings extensive technology |
| board and regulatory experience | 30 October 2018, having previously | CFO on 1 June 2020. | 2019 with responsibility for Trading | largest global subsidiary CGML and | and global markets experience, |
| from both public and private | served as a Non-Executive Director |  | and Operations, and is a member of | is also the Chair of Litigation Capital | specifically in Asia-Pacific. He is a |
| companies. Mike is the Chair of | of the Company since 4 September | Charlie has a proven track record | the Executive Committee. Jon also | Management Limited, an AIM-listed | Non-Executive Director for a portfolio |
| Openreach Limited and Together | 2015. June has had a successful | of, and accountability for, financial | leads the business change office and | litigation finance company. He has | of companies in multiple sectors |
| Financial Services Limited. For | career, growing and leading | control and reporting, accounting, | chairs a number of the Company’s | extensive experience in financial | and is also Chair of CMC Networks, |
| over 20 years he has held various | global financial services and tech | tax, M&A, investor relations, risk | management committees. Jon | markets and has worked in the US, | aCarlyle Group investment company |
| non-executive director roles in a | companies, and living and working | and compliance, and audit. He | is also a standing attendee of | Asia and the UK during his career. He | based in Africa, focused on providing |
| range of regulated and unregulated | inHong Kong, London and New York. | is a highly experienced finance | the Board ESG Committee, | served as the Group Chief Operating | telecommunications services |
| industries while also spending eight |  | leader having held other executive | providing Executive guidance. | Officer of Barclays plc until 2016. | across Africa and the Middle East. |
| years on the board of Ofcom and one | June brings to the role over 25 years’ | director roles in the financial |  |  |  |
| year on the board of Postcomm. | experience in both the finance | services sector prior to joining | Jon first joined IG in 2000 as a trainee | Prior to Barclays, Jonathan had a | In his executive career, Rakesh |
|  | and digital technology sectors. | IG, and having driven a number of | dealer, rising to Dealing Director in | 20-year career with Bank of America | was the Chief Executive Officer |
| Mike has held many chairships over | June is a Non-Executive Director | substantial change programmes | 2007. In 2010, Jon became Dealing | and was Chief Executive Officer of | and a member of the Board of Colt |
| the years, including chairing several | of RELX PLC and also sits on the | both in the UK and internationally. | & Operations Director and in 2012 | Merrill Lynch International following | Technology Services, a Fidelity- |
| UK and US public company boards. | Board of Advisors of the London |  | was appointed Chief Information | the merger of the two institutions in | owned company providing network, |
|  | Technology Club. June has no other | Charlie began his professional career | Officer. In 2015, Jon was appointed | 2008, with responsibility for Bank of | voice and data centre services |
| Mike spent most of his executive | current external appointments. | with PricewaterhouseCoopers LLP, | as Head of IG’s Delivery pillar. He | America’s European businesses. He | globally. Rakesh was appointed |
| career at Cable and Wireless, |  | and became a Partner in 2001 in | was appointed to the Board as Chief | was a member of Bank of America’s | into the role of Chief Executive |
| Philips, Motorola and GE. | Until the sale of Verifone Inc., June | the US management consulting | Information Officer on 1 June 2018. | Global Operating Committee. | Officer in December 2006 and |
|  | was President of Verifone Europe | practice. Following that he held |  |  | completed his tenure at the end of |
| Mike holds a BSc(Eng) honours | and Russia with responsibility for | senior executive roles at IBM and | As Chief Information Officer, | Jonathan has served widely on key | 2015, concluding his secondment |
| degree in Electrical Engineering. | over 2,000 employees with the | Bank of America. In 2007, he joined | Jon had responsibility for setting | industry associations including as | from Fidelity. Concurrently, he was |
|  | operation of the business throughout | Barclays plc where he was the Chief | and delivering our IT strategy, | Chair of the International Swaps | Non-Executive Chair of KVH, an |
|  | those territories. Prior to her role | Financial Officer of Barclays UK Retail | delivery of all programmes of work | and Derivatives Association (ISDA) | Asian-based technology company |
|  | at Verifone, June held various | and Business Bank, and became the | and for keeping the production | from 2004 until 2008, and as a | with headquarters in Tokyo and |
|  | executive management positions | Global Head of Investor Relations in | environment stable and secure. He | Director of the Association for | operations in Hong Kong, Seoul and |
|  | at a number of large multi-national | September 2011 until August 2015. | was responsible for IG’s IT systems, | Financial Markets in Europe (AFME). | Singapore, and Non-Executive Chair |
|  | businesses. These included Citibank |  | including its client interface systems. | He remains a member of AFME’s | of Market Prizm, a financial services- |
|  | where she was Managing Director | He was the Group Finance Director |  | Advisory Board. Jonathan was a | focused technology company. |
|  | of Global Healthcare, Citi Enterprise | at Jardine Lloyd Thompson plc from | Jon has no current external | member of the Capital Markets |  |
|  | Payments, IBM Corporation where | September 2015 until April 2019 | appointments. | Senior Practitioners of the UK | Rakesh has also previously held |
|  | she was Global General Manager | when it was acquired by Marsh |  | Financial Services Authority and the | senior positions within AT&T, |
|  | for the Global Banking and Financial | & McLennan Companies Inc. | Jon graduated from Durham | Global Financial Markets Association. | including Head of AT&T Asia- |
|  | Markets industry sector, and Chase |  | University with a degree in Economics |  | Pacific’s managed network services |
|  | Manhattan Bank where she was APAC | Charlie has no current | and obtained an Executive MBA from | Jonathan has a first-class honours | business and President, AT&T |
|  | Region Head of GPTS. June has also | external appointments. | London Business School in 2007. | in Mathematics from the University | Japan Limited. He was also formerly |
|  | worked as a strategy consultant at |  |  | of Cambridge. He was also awarded | Senior Managing Director of Japan |
|  | Booz, Allen & Hamilton, in strategy | Charlie has an undergraduate |  | a CBE in the 2014 Honours List | Telecom Company Limited. |
|  | roles at Chase Manhattan Bank, and | degree from Tufts University |  | for services to philanthropy. |  |
|  | as Chief Executive Officer of Certco, | and an MBA from the Southern |  |  | Rakesh has a BSc in Electrical |
|  | a risk management technology | Methodist University. |  |  | Engineering from George |
|  | firm for global broker dealers. |  |  |  | Washington University. |

June graduated from the University
of Pittsburgh with a summa cum
laude (first class honours) degree in
Chemical Engineering and Pre-Med.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 61
GOVERNANCE REPORT
### The Board continued

| Andrew Didham | Wu Gang | Sally-Ann Hibberd | Malcolm Le May | Susan Skerritt | Helen Stevenson |
| --- | --- | --- | --- | --- | --- |
| Non-Executive Director | Non-Executive Director | Non-Executive Director | Non-Executive Director | Non-Executive Director | Non-Executive Director |
| Nationality: British | Nationality: British | Nationality: British | Nationality: British | Nationality: American | Nationality: British |
| Ethnicity: White | Ethnicity: Chinese | Ethnicity: White | Ethnicity: White | Ethnicity: White | Ethnicity: White |
| Time on Board: Two years | Time on Board: One year | Time on Board: Three years | Time on Board: Six years | Time on Board: One year | Time on Board: Two years |
| (Appointed 19 September 2019) | (Appointed 30 September 2020) | (Appointed 20 September 2018) | (Appointed 10 September 2015) | (Appointed 9 July 2021) | (Appointed 18 March 2020) |
| Committee membership: | Committee membership: | Committee membership: | Committee membership: | Committee membership: Committee membership: |  |
| C |  | C |  |  | C |


| Andrew is currently Non-Executive | Wu Gang has a strong strategic and | Sally-Ann has a broad background | Malcolm has broad experience and | Susan is an Independent Director | Helen brings extensive marketing |
| --- | --- | --- | --- | --- | --- |
| Director and Chair of GCP | financial advisory background and | in financial services and technology. | knowledge of the financial services | of Community Bank System, a | and digital experience from a |
| Infrastructure Investments Limited, | a wealth of international experience | She previously served as Chief | and investment sectors, along with | commercial bank providing services | range of industries, together with |
| a Director of N.M. Rothschild & | gained from a career of over 25 | Operating Officer of the International | extensive experience on the boards | across the north-eastern US, Tanger | strong customer focus. Helen is |
| Sons Limited and is also Chair of | years in investment banking in Asia | Division, and latterly as Group | of publicly listed companies. | Factory Outlet Centers, an owner and | an experienced Non-Executive |
| the N.M. Rothschild Pension Trust. | and Europe. He set up and led the | Operations and Technology |  | operator of North American outlet | Director with particular experience |
| In 2017 Andrew was appointed to | European investment banking team | Director, of Willis Group, held a | Malcolm was Remuneration | centres, and Falcon Group, a leading | regarding remuneration matters. |
| the Board of Shawbrook Group plc | at CLSA Securities, the international | number of senior executive roles | Committee Chair and Senior | worldwide inventory management | Helen is currently the Senior |
| where he is a Non-Executive Director | investment banking platform of CITIC | at Lloyds TSB and was a Non- | Independent Director of IGGH from | solutions business. Susan previously | Independent Director of Reach plc, |
| and Chair of its Audit Committee. | Securities, from 2015 to January | Executive Director of Shawbrook | September 2015 to September 2020. | served as Chair, CEO and President | a Non-Executive Director of Skipton |
|  | 2019. Prior to CLSA Securities, | Group plc until January 2019. |  | at Deutsche Bank Trust Company | Building Society, and Non-Executive |
| From 2017 to 2021 Andrew was a | he was head of M&A and General |  | Malcolm was appointed as Chief | Americas, Non-Executive Director | Director and Chair of RM plc. |
| Non-Executive Director and, from | Industrials at ICBC International. Wu | Sally-Ann serves as a Non-Executive | Executive Officer of Provident | to Royal Bank of Canada US Group |  |
| 2017, Senior Independent Director of | Gang also held senior level positions | Director of Simon Midco Limited | Financial plc in February 2018, | and Executive Board Member at | Helen served on the board of Kin and |
| Charles Stanley Group plc, where he | at Royal Bank of Scotland, HSBC | and the Co-operative Bank plc | having previously been its Senior | Deutsche Bank USA and Bank of | Carta from May 2012 to December |
| also served as Non-Executive Chair | and Merrill Lynch in Hong Kong and | where she is a member of its Audit, | Independent Director until November | New York Mellon Trust Company. | 2021, where she was Remuneration |
| of its principal operating company | London. He started his investment | Remuneration and Risk Committees. | 2017 and, following the death of |  | Committee Chair and Senior |
| Charles Stanley & Co. Limited. From | banking career at Goldman Sachs. |  | its Chair, Interim Executive Chair. | Susan is a commercial banker, | Independent Director, and as Chief |
| 2017 to 2019 Andrew served as |  | In addition, Sally-Ann is a non- |  | industry consultant and corporate | Marketing Officer UK at Yell Group |
| Non-Executive Director and Chair | Wu Gang is currently a Non-Executive | executive member of the governing | Malcolm served as a Non- | treasury professional with expertise | plc from 2006 to 2012 and, prior |
| of the Audit and Risk Committees of | Director of Tritax Big Box REIT plc | body of Loughborough University. | Executive Director and Chair of | in global financial markets, regulatory | to this, served as Lloyds TSB Group |
| Jardine Lloyd Thompson Group plc. | and Ashurst LLP, where he is also |  | the Remuneration Committee of | matters and strategic project | Marketing Director. Helen started |
|  | Chair of the Risk Committee, and | Sally-Ann holds a BSc in Civil | Hastings Group Holdings plc prior | management. Susan has chaired | her career with Mars Inc., where |
| Andrew was a Partner at KPMG from | a senior adviser at Rothschild & | Engineering from Loughborough | to his resignation in April 2018. He | and been a member of a number | she spent 19 years, culminating |
| 1990 to 1997 and is a Fellow of the | Co Hong Kong Limited. He served | University and an MBA from | also served as Senior Independent | of board committees during her | in her role as European Marketing |
| Institute of Chartered Accountants | as a Non-Executive Director and | CASS Business School. | Director of Pendragon plc, and | career, including Chair of the | Director, leading category strategy |
| in England and Wales. Upon leaving | member of the Remuneration |  | was a Non-Executive Director and | Human Resources and Corporate | development across Europe. |
| KPMG, Andrew served as Group | Committee of Laird plc from |  | Chair of the Investment Committee | Governance Committee at Royal |  |
| Finance Director of the worldwide | January 2017 to June 2018. |  | at RSA Insurance Group plc. Prior | Bank of Canada US Group. She is | Helen is a member of the Henley |
| Rothschild group for 16 years |  |  | to this, he held various executive | currently Chair of the Audit and | Business School Strategy |
| from 1997 to 2012. From 2012 he | Wu Gang has an MBA from INSEAD, |  | roles at Morgan Grenfell plc, Drexel | Risk Committee at Falcon Group, | Board, and serves as a Governor |
| has served as an Executive Vice | Fontainebleau, an MA in Asia Area |  | Burnham Lambert, Barclays de | Chair of the Audit Committee of | of Wellington College. |
| Chair in the Rothschild group. | Studies from SOAS, University |  | Zoete Wedd Holdings, UBS AG, | Tanger Factory Outlet Centers and |  |
|  | of London, and a BA in English |  | ING Barings Limited, Morley Fund | a member of the Audit Committee | Helen has a BA (Hons) Degree |
| Andrew has a BA(Hons) in | and American Literature from |  | Managers (now Aviva Investors) | of the Community Bank System. | in Chemical Engineering from |
| Business Studies (Finance). | Fudan University in Shanghai. |  | and JER Partners Limited, where |  | Cambridge University. |
|  |  |  | he was European President and | Susan is a Trustee of the |  |
|  |  |  | Matrix Securities Limited. | Village of Saltaire. |  |

Susan has an MBA in Finance and
International Business from New
York University Stern School of
Business and a BA in Economics
from Hamilton College.
62 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| Andrew Didham | Wu Gang | Sally-Ann Hibberd | Malcolm Le May | Susan Skerritt | Helen Stevenson |
| --- | --- | --- | --- | --- | --- |
| Non-Executive Director | Non-Executive Director | Non-Executive Director | Non-Executive Director | Non-Executive Director | Non-Executive Director |
| Nationality: British | Nationality: British | Nationality: British | Nationality: British | Nationality: American | Nationality: British |
| Ethnicity: White | Ethnicity: Chinese | Ethnicity: White | Ethnicity: White | Ethnicity: White | Ethnicity: White |
| Time on Board: Two years | Time on Board: One year | Time on Board: Three years | Time on Board: Six years | Time on Board: One year | Time on Board: Two years |
| (Appointed 19 September 2019) | (Appointed 30 September 2020) | (Appointed 20 September 2018) | (Appointed 10 September 2015) | (Appointed 9 July 2021) | (Appointed 18 March 2020) |
| Committee membership: | Committee membership: | Committee membership: | Committee membership: | Committee membership: Committee membership: |  |
| C |  | C |  |  | C |


| Andrew is currently Non-Executive | Wu Gang has a strong strategic and | Sally-Ann has a broad background | Malcolm has broad experience and | Susan is an Independent Director | Helen brings extensive marketing |
| --- | --- | --- | --- | --- | --- |
| Director and Chair of GCP | financial advisory background and | in financial services and technology. | knowledge of the financial services | of Community Bank System, a | and digital experience from a |
| Infrastructure Investments Limited, | a wealth of international experience | She previously served as Chief | and investment sectors, along with | commercial bank providing services | range of industries, together with |
| a Director of N.M. Rothschild & | gained from a career of over 25 | Operating Officer of the International | extensive experience on the boards | across the north-eastern US, Tanger | strong customer focus. Helen is |
| Sons Limited and is also Chair of | years in investment banking in Asia | Division, and latterly as Group | of publicly listed companies. | Factory Outlet Centers, an owner and | an experienced Non-Executive |
| the N.M. Rothschild Pension Trust. | and Europe. He set up and led the | Operations and Technology |  | operator of North American outlet | Director with particular experience |
| In 2017 Andrew was appointed to | European investment banking team | Director, of Willis Group, held a | Malcolm was Remuneration | centres, and Falcon Group, a leading | regarding remuneration matters. |
| the Board of Shawbrook Group plc | at CLSA Securities, the international | number of senior executive roles | Committee Chair and Senior | worldwide inventory management | Helen is currently the Senior |
| where he is a Non-Executive Director | investment banking platform of CITIC | at Lloyds TSB and was a Non- | Independent Director of IGGH from | solutions business. Susan previously | Independent Director of Reach plc, |
| and Chair of its Audit Committee. | Securities, from 2015 to January | Executive Director of Shawbrook | September 2015 to September 2020. | served as Chair, CEO and President | a Non-Executive Director of Skipton |
|  | 2019. Prior to CLSA Securities, | Group plc until January 2019. |  | at Deutsche Bank Trust Company | Building Society, and Non-Executive |
| From 2017 to 2021 Andrew was a | he was head of M&A and General |  | Malcolm was appointed as Chief | Americas, Non-Executive Director | Director and Chair of RM plc. |
| Non-Executive Director and, from | Industrials at ICBC International. Wu | Sally-Ann serves as a Non-Executive | Executive Officer of Provident | to Royal Bank of Canada US Group |  |
| 2017, Senior Independent Director of | Gang also held senior level positions | Director of Simon Midco Limited | Financial plc in February 2018, | and Executive Board Member at | Helen served on the board of Kin and |
| Charles Stanley Group plc, where he | at Royal Bank of Scotland, HSBC | and the Co-operative Bank plc | having previously been its Senior | Deutsche Bank USA and Bank of | Carta from May 2012 to December |
| also served as Non-Executive Chair | and Merrill Lynch in Hong Kong and | where she is a member of its Audit, | Independent Director until November | New York Mellon Trust Company. | 2021, where she was Remuneration |
| of its principal operating company | London. He started his investment | Remuneration and Risk Committees. | 2017 and, following the death of |  | Committee Chair and Senior |
| Charles Stanley & Co. Limited. From | banking career at Goldman Sachs. |  | its Chair, Interim Executive Chair. | Susan is a commercial banker, | Independent Director, and as Chief |
| 2017 to 2019 Andrew served as |  | In addition, Sally-Ann is a non- |  | industry consultant and corporate | Marketing Officer UK at Yell Group |
| Non-Executive Director and Chair | Wu Gang is currently a Non-Executive | executive member of the governing | Malcolm served as a Non- | treasury professional with expertise | plc from 2006 to 2012 and, prior |
| of the Audit and Risk Committees of | Director of Tritax Big Box REIT plc | body of Loughborough University. | Executive Director and Chair of | in global financial markets, regulatory | to this, served as Lloyds TSB Group |
| Jardine Lloyd Thompson Group plc. | and Ashurst LLP, where he is also |  | the Remuneration Committee of | matters and strategic project | Marketing Director. Helen started |
|  | Chair of the Risk Committee, and | Sally-Ann holds a BSc in Civil | Hastings Group Holdings plc prior | management. Susan has chaired | her career with Mars Inc., where |
| Andrew was a Partner at KPMG from | a senior adviser at Rothschild & | Engineering from Loughborough | to his resignation in April 2018. He | and been a member of a number | she spent 19 years, culminating |
| 1990 to 1997 and is a Fellow of the | Co Hong Kong Limited. He served | University and an MBA from | also served as Senior Independent | of board committees during her | in her role as European Marketing |
| Institute of Chartered Accountants | as a Non-Executive Director and | CASS Business School. | Director of Pendragon plc, and | career, including Chair of the | Director, leading category strategy |
| in England and Wales. Upon leaving | member of the Remuneration |  | was a Non-Executive Director and | Human Resources and Corporate | development across Europe. |
| KPMG, Andrew served as Group | Committee of Laird plc from |  | Chair of the Investment Committee | Governance Committee at Royal |  |
| Finance Director of the worldwide | January 2017 to June 2018. |  | at RSA Insurance Group plc. Prior | Bank of Canada US Group. She is | Helen is a member of the Henley |
| Rothschild group for 16 years |  |  | to this, he held various executive | currently Chair of the Audit and | Business School Strategy |
| from 1997 to 2012. From 2012 he | Wu Gang has an MBA from INSEAD, |  | roles at Morgan Grenfell plc, Drexel | Risk Committee at Falcon Group, | Board, and serves as a Governor |
| has served as an Executive Vice | Fontainebleau, an MA in Asia Area |  | Burnham Lambert, Barclays de | Chair of the Audit Committee of | of Wellington College. |
| Chair in the Rothschild group. | Studies from SOAS, University |  | Zoete Wedd Holdings, UBS AG, | Tanger Factory Outlet Centers and |  |
|  | of London, and a BA in English |  | ING Barings Limited, Morley Fund | a member of the Audit Committee | Helen has a BA (Hons) Degree |
| Andrew has a BA(Hons) in | and American Literature from |  | Managers (now Aviva Investors) | of the Community Bank System. | in Chemical Engineering from |
| Business Studies (Finance). | Fudan University in Shanghai. |  | and JER Partners Limited, where |  | Cambridge University. |
|  |  |  | he was European President and | Susan is a Trustee of the |  |
|  |  |  | Matrix Securities Limited. | Village of Saltaire. |  |

Susan has an MBA in Finance and
International Business from New
York University Stern School of
Business and a BA in Economics
from Hamilton College.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 63
GOVERNANCE REPORT
## Governance Framework
### Shareholders and stakeholders
### The Board delegates certain matters
### THE BOARD
### to its five principal Committees
The Board provides leadership by setting our strategic Nomination Committee
direction, overseeing and supporting management in Ensures the Board and its Committees have the
execution of our strategy. It is responsible for establishing appropriate balance of skills, knowledge, diversity,
our purpose and values, and for ensuring that our culture experience and independence.
and behaviours are both appropriate and consistent. It
SEE REPORT ON
provides robust challenge, within a framework of prudent
PAGE 76
and effective risk management and internal controls.
Remuneration Committee
OUR STRATEGY OUR PRINCIPAL RISKS
Establishes our Remuneration Policy and ensures there
PAG E 11 PAGE 48
is a clear link between performance and remuneration.
SEE REPORT ON

| SECTION 172 | KEY ACTIVITIES OF | PAGE 79 |
| --- | --- | --- |
| STATEMENT | THE BOARD |  |
| PAGE 24 | PAGE 74 |  |

Audit Committee
Oversees our financial reporting, maintains an
appropriate relationship with the internal and
externalauditors and monitors our internal controls.
SEE REPORT ON
PAGE 102
ESG Committee
Provides oversight and advice to the Board in relation
to our ESG strategy.
SEE REPORT ON
PAG E 110
Board Risk Committee
Reviews and monitors our principal and emerging risks
and the effectiveness of our risk management systems.
SEE REPORT ON
PAG E 112
64 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Shareholders and stakeholders
### EXECUTIVE COMMITTEE SUPPORTING COMMITTEES
The Board delegates the execution of the Company’s The Executive Committee operates a number of
strategy and the day-to-day management of the business supporting committees that provide oversight
to the Executive Committee. on key business activities and risks.
CEO STATEMENT OUR BUSINESS MODEL EXECUTIVE RISK TECHNOLOGY
PAGE 6 PAGE 14 COMMITTEE COMMITTEE

| OUR PURPOSE AND | BUSINESS | CLIENT MONEY & | IG PEOPLE |
| --- | --- | --- | --- |
| VALUES | PERFORMANCE REVIEW | ASSETS COMMITTEE | FORUM |
| PAGE 10 | PAGE 38 |  |  |

INVESTMENT
COMMITTEE
Our shareholders and other key stakeholders play
animportant role in monitoring and safeguarding
ourgovernance. Further information on how
weengage with our shareholders is on page 72,
employees on pages 22 and 30-31, and other key
stakeholders on page 73.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 65
GOVERNANCE REPORT
## Board Governance
Leadership and responsibilities
### Division of Responsibilities
The role of the Board
The Board provides leadership by setting our strategic
direction and overseeing management’s execution of the
### strategy. It is responsible for establishing our purpose and Chair
values, and for ensuring that our culture and behaviours are
both appropriate and consistent. It provides robust challenge
¼ Leadership of the Board and promoting the highest
within a framework of prudent and effective risk management
standards of corporate governance
and internal controls. The Board is provided with timely and
¼ Setting the tone and culture for an effective Board,
comprehensive information to enable it to discharge its
facilitating productive meetings
responsibilities, to encourage strategic debate and to facilitate
¼ Supporting and challenging management
robust, informed and timely decision making. In addition,
in the development of our strategy and
Directors receive briefings from the CEO, CFO and other
commercial objectives
members of the Executive Committee in between meetings.
¼ Setting the Board agenda, allowing appropriate time
for open and constructive discussion and challenge
The Board is collectively responsible for promoting our
¼ Engaging with major shareholders to understand
long-term sustainable success for the benefit of the
their views on governance and strategy
Company’s shareholders, through the creation of long-term
value and contribution to wider society. In exercising this
responsibility, the Board takes into account the needs of, and
ensures effective engagement with, all relevant stakeholders
– including clients, regulators, the workforce, suppliers and
the wider community in which we operate – and the effect of
our activities on the environment.
### The Stakeholder Engagement section of the Strategic Report Chief Operating Officer (COO)
on pages 22 to 23 sets out the stakeholder engagement
mechanisms that are currently in place, and identifies our key
¼ Delegated authority in respect of trading,
stakeholders and engagement undertaken with them during
operations, business change and ESG
the year. It also highlights the principal issues that matter to
¼ Developing and maintaining our processes
each stakeholder group, our governance activities, and the
andensuring effective management for
actions and outcomes from these engagements that the
internal operations
Board takes into consideration when making decisions.
¼ Responsibility for our Global Service Centres
¼ Chairing a number of the management committees
The Board considers Section 172 stakeholder interests in all
ofits discussions to which they are relevant. This requirement
is integral to the procedure for preparing Board agendas,
andthere is a template identifying the relevant stakeholder
considerations for inclusion in the Board papers that
accompany such discussions.
As a collective body and as individual Directors, the Board
### Company Secretary, Chief Legal and
isresponsible for ensuring that it has the appropriate skills,
### Governance Officer
knowledge, diversity and experience to perform its role
effectively and independently.
¼ Works closely with the Chair, the CEO the CFO and
the Board Committee Chairs in setting agendas for
There is a comprehensive schedule of matters reserved for
Board and Committee meetings
thedecision making of the Board. These include agreeing the
¼ Facilitates the accurate, timely and clear information
strategy, approving major transactions, annual budgets and
flow to and from the Board, its Committees, and
changes to our capital and governance structure. The matters
between Directors and senior management
reserved to the Board are supplemented by an annual Board
¼ Supports the Chair in designing and delivering
calendar that provides for, among other things, regular reviews
Directors’ induction programmes, and the Board and
of operational and financial performance; reviews of succession
Committee performance evaluations
planning for the Board and senior management; setting our risk
¼ Advises the Board on corporate governance matters
appetite; and approving any changes to our Risk Management
and Board procedures
and Internal Control Framework.
¼ Responsible for administering IG’s Share Dealing
Code of Conduct and the AGM
Specific matters for approval and recommendation to the
Board have been formally delegated to certain Committees.
The matters reserved to the Board and Committee Terms of
Reference are available on the Group website.
66 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Division of Responsibilities
### Chief Financial Officer (CFO)Chief Executive Officer (CEO)
¼ Developing and executing our strategy ¼ Supporting the CEO in implementing our strategy and
¼ Specific authority for day-to-day decision making financial and risk management
relating to the management of our affairs, including: ¼ Recommending the annual budget and four-year
– Delivering financial performance in line with the financial plan
agreed budget ¼ Management of our internal financial control systems,
– Organisational design of our operations including those relating to safeguarding of client
– Recruitment, leadership and development of our money and assets
Executive team ¼ Oversight of liquidity
– Proposing to the Board our approach to vision, ¼ Maintaining relationships with key stakeholders
values, culture, diversity and inclusion
– Maintaining relationships with key internal and
external stakeholders
### Non-Executive DirectorsSenior Independent Director
¼ Acting as a sounding board for the Chair ¼ Independent of management
¼ Serving as an intermediary for the other Directors ¼ Advising and constructively challenging management
when necessary ¼ Monitoring management’s success in delivering
¼ Available to shareholders if they have concerns when the agreed strategy within the Risk Appetite and
communication via the normal channels is Control Framework
inappropriate or has already been exhausted ¼ Determining appropriate levels of remuneration and
¼ Evaluating the performance of the Chair on behalf of reward for the Executive Directors
the other Directors ¼ The Chair of the Audit Committee has responsibility
for Internal Audit, including ensuring the
independence of the function
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 67
GOVERNANCE REPORT
### Board Governance continued
### How the Board operates
The Board meets regularly, at least six Attendance at Board meetings
times a year, and during the year held The number of scheduled Board meetings attended by each Director during the
six scheduled meetings. In addition, year is set out below. Where Directors are unable to attend meetings, they are
the Board has a Standing Committee encouraged to give the Chair their views in advance on the matters to be discussed.
whose responsibility is to consider
Board-reserved matters at short notice,
where full attendance is not possible Meeting attendedBoard member Did not attend
or where there are administrative
matters requiring evidencing that do Chair
not warrant a full Board meeting.
Mike McTighe
Senior executives below Board level are Independent Non-Executive Directors
invited to attend meetings as required
Jonathan Moulds
to present and discuss matters relating
to their business areas and functions. Rakesh Bhasin
Andrew Didham
The full Board also meets when
necessary to discuss important 1
Wu Gang
ad hoc emerging issues that require
Sally-Ann Hibberd
consideration between scheduled Board
meetings. The Chair and the Executive
Malcolm Le May
Directors meet once a year, as the
Board, to consider Non-Executive Susan Skerritt
Directors’ fees.
Helen Stevenson
Each Director commits an appropriate Executive Directors
amount of time to their duties during
June Felix
thefinancial year. The Non-Executive
Directors met the time commitment Charlie Rozes
reasonably expected of them pursuant
Jon Noble
to their letters of appointment.
Past Directors
The Chair and Non-Executive Directors
2
Bridget Messer
regularly meet in the absence of the
Executive Directors, and also separately 3
Lisa Pollina N/A
with just the CEO present.
1 Wu Gang was unable to attend one Board meeting due to illness.
During the year, the Non-Executive 2 Bridget Messer stepped down from the Board on 22 September 2021.
3 Lisa Pollina stepped down from the Board on 9 July 2021.
Directors, led by the Senior Independent
Director, met without the Chair, to
evaluate the Chair’s performance.
The Senior Independent Director also
met with the Executive Directors,
without the Chair, for this purpose.
68 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Board effectiveness
Board composition, balance Director independence Conflicts of interest
anddiversity The Company is fully compliant with the Directors have a statutory duty to avoid
The Board’s size – and the skills and Code, which requires that at least half of situations in which they may have
experience of its members – have a the Board, excluding the Chair, should interests that conflict with those of
significant impact on its effectiveness. It comprise Non-Executive Directors theGroup. Directors are required to
aims to maintain a balance of experience whoare determined by the Board disclose both the nature and extent of
and skills of individual Board members. tobeindependent. any potential or actual conflicts at the
The breadth of skills and experience beginning of every Board and
currently on the Board includes Committee meeting.
experience in key areas such as listed

| environments, international financial | In accordance with the CA2006, the |
| --- | --- |
| services, finance and accountancy, | Company’s Articles of Association allow |
| strategy, information technology, | the Board to authorise potential |
| financial services regulation, marketing, | conflicts that may arise, and to impose |
| risk management, investor relations, | such conditions or limitations as it sees |
| technology and digital. One Non- | fit. During the year, potential conflicts |
| Executive Director currently undertakes | were considered and assessed by the |
| an external executive role and one | Board and approved where appropriate. |

Executive Director currently undertakes
an external non-executive role. The Board has access to independent
professional advice, at IG’s expense,
There is an appropriate combination of Executive Directors 3 ifrequired.
Executive Directors and Non-Executive
Independent
Directors, such that no individual or Succession planning and
Non-Executive Directors
small group of individuals can dominate appointments to the Board
the Board’s decision making. The Nomination Committee has specific
responsibility for considering the
The independence of the Non-Executive
We continue to meet the Hampton- appointment of Non-Executive and
Directors is considered by the
Alexander target of at least one-third Executive Directors and recommending
Nomination Committee on behalf
female representation on the Board and new appointments to the Board and
of the Board and reviewed annually.
exceed the Parker Review target of one takes a proactive approach to
The Directors consider factors such as
ethnic minority Director on the Board succession planning.
length of tenure and relationships or
by2024.
circumstances that are likely to affect,
More information on the work of the
or may appear to affect, the Directors’
Nomination Committee can be found in
judgement in determining whether they
the Nomination Committee Report on
remain independent.
pages 76 to 78. The whole Board is also
involved in overseeing the development
Following this year’s review, the Board
of management resources across
concluded that all the Non-Executive
theGroup.
Directors continue to be independent in
character and judgement and are free
from any business or other relationships
that could materially affect the exercise
of their judgement.
Female 4
Male 8
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 69
(excluding the Chair) 8
GOVERNANCE REPORT
### Board Governance continued
### Board effectiveness continued
Board tenure Induction Board evaluation
Following appointment, each Director Each year, an evaluation of the
receives a comprehensive and formal effectiveness of the Board, its
induction, linked to their individual Committees and individual Directors
experience, to familiarise them with isundertaken.
their duties and our business operations,
risk and governance arrangements. The evaluation last year was facilitated
The induction programme, which internally by the Company Secretary.
is coordinated with the help of the The Board agreed the following areas of
Company Secretary, may include development, in respect of which there
briefings on industry and regulatory has been significant progress:
matters relating to us, our strategy ¼ The structure and frequency of
and business model, our history, risk Boardand Committee meetings
management and risk appetite, as well wasreviewed to ensure sufficient
as meetings with senior management time for key discussions to take
in key areas of the business. These placeby the Committees and
are supplemented by induction timelyescalation to the Board,
0-3 years 1

|  | materials such as recent Board papers | as well as ensuring the Board |
| --- | --- | --- |
| 3-6 years 1 | and minutes, organisation structure | agenda contained the appropriate |
|  | charts, governance matters and | balance of historical, current and |
|  | relevant policies. Newly appointed | forward-looking agenda items |
|  | Directors may also meet the Company’s | ¼ Additional workshops were held |
|  | external auditor, brokers and advisers, | in-between formal meetings to |
|  | and attend a presentation from the | provide the Non-Executive Directors |
|  | Company Secretary (who is also the | with more in-depth and focused |
|  | Chief Legal and Governance Officer) | overviews on key areas of our |
|  | and the Company’s corporate counsel | activities. This was also designed to |
|  | on the roles and responsibilities of | support the newer Non-Executive |
|  | a UK-listed company director. | Directors with their learning and |

understanding of our activities
Ongoing professional development

| To facilitate greater awareness and | In 2022, an internal evaluation was |
| --- | --- |
| understanding of our business and | carried out, facilitated by Lintstock. |
| operating environment, all Directors are | Thereview consisted of the completion |
| given regular updates on changes and | of performance evaluation surveys. |

developments in the business.
The responses were collated and shared
0-3 years 6 Training opportunities are provided with the Board, together with a report
through internal meetings, workshops, summarising the output of the
3-6 years 2

| presentations and briefings by internal | evaluation and suggested areas for |
| --- | --- |
| advisers and management, as well as | focus and discussion. A final report |
| external advisers. The Company | wascirculated to the Board and its |
| Secretary regularly updates the Board | Committees and improvement actions |
| on any relevant legislative and regulatory | agreed for FY23. |

corporate governance-related changes.
We will report on the action plan,
The Directors meet with executives actions taken and progress made in next
toreceive further insights into the year’s Annual Report.
operations of the business in the
jurisdictions where we operate.
The Chair ensures that the Directors
continually update and refresh their
skills and knowledge.
Non-Executive Directors
(including the Chair) Executive Directors
70 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
6+ years 1 6+ years 1
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
### Board accountability

| Financial and business reporting | The Directors confirm that the Board has | Internal controls over financial |
| --- | --- | --- |
| The Strategic Report on pages 10 to 55 | carried out a robust assessment of the | reporting |
| describes our purpose, strategy and | principal and emerging risks we face, | Our financial reporting process has |
| business model, whereby we generate | including those that would threaten our | been designed to provide reasonable |
| and preserve value over the long term | business model, future performance, | assurance regarding the reliability of |
| and deliver our objectives. | solvency and liquidity. We outline the | the financial reporting and preparation |
|  | risks to which we’re exposed and the | of Financial Statements, including |
| A Statement of the Directors’ | framework under which these risks are | consolidated Financial Statements, for |
| Responsibilities in respect of the | managed, including a description of | external purposes in accordance with |
| Financial Statements is set out on page | the system of internal controls, in the | UK-adopted international accounting |
| 118, and a statement regarding the use | Risk Management section on pages 46 | standards. The assessment of the overall |
| of the going-concern basis in preparing | to 53, and in the Going Concern and | effectiveness of the governance, and |
| these Financial Statements is provided | Viability Statement on pages 54 and 55. | risk and control framework included |
| in the Going Concern and Viability |  | reviews of systems and controls relating |
| Statement on pages 54 and 55. | An annual formal review of the | to the financial reporting process. |

effectiveness of our system of risk

| Risk management and | management and internal controls has | Internal controls over financial reporting |  |
| --- | --- | --- | --- |
| internalcontrol | been carried out which supports the | include procedures and policies that: |  |
| We are exposed to a number of business | statements included in the Annual |  | ¼ Relate to the maintenance of records |
| risks in providing products and services | Report and Financial Statements. |  | that, in reasonable detail, accurately |
| to our clients. The Board is responsible | Thereview focused on the overall Risk |  | and fairly reflect the transactions and |
| for establishing the overall appetite | Governance Framework and the setting |  | disposals of our assets and liabilities |
| forthese risks, which is detailed and | of our risk appetite. It considered the |  | ¼ Provide reasonable assurance that |
| approved in the Risk Appetite Statement | key risk assessment and monitoring |  | transactions are recorded as |
| set out on page 47. The Board | activities, as well as the processes |  | necessary to permit the preparation |
| hasresponsibility for ensuring the | andcontrols in place to manage our |  | of Financial Statements, and that |
| maintenance of our risk management | principal and emerging risks and for |  | receipts and expenditures are being |
| and internal-control systems, and for | escalating exceptions highlighted |  | made only in accordance with |
| annually reviewing them. | bytherisk-management processes. |  | authorisations of management and |
|  | Nosignificant failings or weaknesses |  | respective Directors |
| The framework under which risk is | were identified during the year. |  | ¼ Provide reasonable assurance |
| managed in the business is supported |  |  | regarding prevention or timely |
| by a system of internal controls, | There are risk management and internal |  | detection of unauthorised |
| designed to embed within the business | control systems in place for identifying, |  | acquisition, use or disposal of assets |
| the effective management of our key | evaluating and managing the principal |  | that could have a material effect on |
| business risks. The risk management | and emerging risks facing us in |  | our Financial Statements |
| and internal control systems are | accordance with the Guidance on Risk |  |  |
| designed to manage, rather than | Management, Internal Control and |  |  |
| eliminate, the risk of failure to achieve | Related Financial and Business |  |  |
| business objectives and can only provide | Reporting published by the FRC. |  |  |

reasonable assurance against material
misstatement or loss. Throughout the year and up to the date
of this report, we have operated a
Through reports from the Board Risk system of internal controls that provides
Committee and the Audit Committee, reasonable assurance of effective
and consideration of the ICAAP, operations covering all controls,
ILAAand Recovery Plans, the Board including financial and operational
regularly reviews and monitors our controls and compliance with laws
riskmanagement and internal control andregulations.
systems and the effectiveness with
which we manage the emerging and
principal risks we face.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 71
GOVERNANCE REPORT
### Board Governance continued
### Board accountability continued

| Engagement with shareholders | To ensure that members of the | AGM |
| --- | --- | --- |
| The Board recognises the importance | Board understand the views of major | The AGM provides the Board with the |
| ofmaintaining good and constructive | shareholders, feedback is provided | opportunity to communicate with |
| communication with our stakeholders – | to the Board on any opinions or | private and institutional investors, |
| including shareholders – and has in | concerns expressed by shareholders | andwe welcome and encourage their |
| place a comprehensive programme to | identified through the investor | participation at the meeting. The Chair |
| facilitate this each year. | relations activity. The Directors also | aims to ensure that all the Directors, |
|  | receive from the Executive team, as | including the Chairs of the Board |
| Our Annual Report is an important way | well as external sources, including | Committees, are available at the AGM |
| of communicating with shareholders, | brokers and financial advisers, regular | toanswer questions. |
| setting out detailed reviews of the | updates on the market and share |  |
| business and its future developments | price performance, shareholder | At the 2021 AGM, all the proposed |
| inthe Chair’s Statement, the CEO’s | activity, and significant equity analysts’ | resolutions were passed on a poll, with |
| Statement, the CFO’s Statement and the | research, and are made aware of the | the percentage of votes in favour of |
| Strategic Report. | consensus financial expectations of | each resolution ranging from 92.3% |
|  | the Group from the outside market. | to100.0%. |

As part of the ongoing investor

| relations programme, the Executive | The Chair, the Senior Independent | The 2022 AGM will be held on |
| --- | --- | --- |
| team regularly meet with investors | Director, the Audit Committee Chair, | 21 September 2022. The Notice of |
| and market analysts to discuss market | and the Remuneration Committee Chair | AGMwill set out the resolutions to be |
| developments, business strategy and | are available to meet shareholders | proposed at the meeting. A copy of the |
| financial performance. This programme | as part of the AGM and on request to | Notice will be available on our website. |
| includes presentations by management, | discuss governance matters, succession | We send our Annual Report and Notice |
| investor roadshows, attendance at | planning, remuneration policy, or | to shareholders, or make them available |
| investor conferences and other events. | any other matters, and to ensure | on our website, at least 20 working days |
| Following the debt issuance during | the Board is aware of shareholder | before the date of the meeting. The |
| the year, this programme has been | concerns not resolved through | Notice sets out a clear explanation of |
| extended to include debt investors | other communication mechanisms. | each resolution to be proposed at the |
| and rating agencies as appropriate. | The Directors provide feedback to | meeting. After the meeting, we will |
| Materials and presentations used | the Board on any views or concerns | make available to shareholders full |
| during these events are made available | expressed to them by shareholders. | details of the votes, including proxy |
| on the Group website, which also |  | votes, received on each resolution, and |
| provides a wide range of other useful |  | will publish these on our website on the |
| information for both existing and |  | same day. |

prospective shareholders. We also
respond to ad hoc requests from Further information about our AGM
shareholders on a regular basis. arrangements will be set out in the
Notice of AGM.
72 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Engagement with stakeholders ability to engage effectively and work number of key stakeholder groups as
In addition to the shareholder constructively with all key stakeholder follows. Details of the approach of the
engagement activities discussed in this groups, and their views to be taken into business to dealing with these various
section, the Board recognises that the consideration in Board discussions and groups are discussed throughout the
success of the business depends on its decisions. The Board has identified a Annual Report as set out below:
### Clients People Investors

| ¼ Strategic Report | ¼ Strategic Report | ¼ Strategic Report |
| --- | --- | --- |
| ¼ S172 Statement | ¼ S172 Statement | ¼ S172 Statement |
| ¼ Business Model | ¼ Business Model | ¼ Business Model |
| ¼ Key Trends Likely to Affect | ¼ Stakeholder Engagement | ¼ Stakeholder Engagement |
| OurBusiness | ¼ ESG Report (People pillar) |  |

¼ Stakeholder Engagement
¼ ESG Report (Productspillar)
READ MORE ON READ MORE ON READ MORE ON
PAGES 1215, 2225, 29 PAGES 1415, 2225, 3031 PAGES 1415, 2225
### Communities Regulators Suppliers

| ¼ Strategic Report | ¼ Strategic Report | ¼ Strategic Report |
| --- | --- | --- |
| ¼ S172 Statement | ¼ S172 Statement | ¼ Stakeholder Engagement |
| ¼ Business Model | ¼ Key Trends Likely to Affect | ¼ ESGReport (Partnerships pillar) |
| ¼ Stakeholder Engagement | OurBusiness |  |

¼ ESG Report (Products and
Partnerships pillar)
¼ TCFD reporting
READ MORE ON READ MORE ON READ MORE ON
PAGES 1415, 2225, 29, 3234 PAGES 1213, 2325 PAGES 2223, 3233
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 73
GOVERNANCE REPORT
### Board Governance continued
### Board activities during the year
### Board meeting agendas during the year
### included consideration across the key areas
### of strategy, governance, risk and financial
### performance, as set out in the schedule of
### matters reserved to the Board and the agreed
### annual forward calendar.

| Strategy |  | Business, operational highlights |  | Quarterly forecast and budget |  |
| --- | --- | --- | --- | --- | --- |
|  | ¼ Held four strategy sessions and a | and current trading |  |  | ¼ Received updates on performance |
|  | number of other deep-dive sessions, |  | ¼ Received regular business |  | against budget, prior year, and |
|  | as well as discussions on strategy |  | performance updates on business |  | market analyst consensus |
|  | during Board meetings. This focused |  | progress and the issues and |  | ¼ Discussed risks and opportunities for |
|  | on the strategic development of the |  | challenges faced by management |  | the FY22 budget, and approved the |
|  | business, at which the Board analysed |  | through the CEO Report, CFO Report |  | FY23 budget and four-year plan, |
|  | strategic business initiatives, our |  | and COO Report and reports from |  | including integration of tastytrade |
|  | client base and their feedback |  | the Chief Risk Officer on risk and |  |  |
|  | ¼ Held detailed workshop on the |  | compliance matters |  |  |
|  | four-year plan |  | ¼ Reported on matters of interest |  |  |
|  | ¼ Received regional updates |  | suchas the future of work, cyber |  |  |
|  | ¼ Examined sector themes and trends |  | security including protection from |  |  |
|  | that could be used to help inform |  | ransomware attacks, and IT resilience |  |  |

strategic development. The Board
also reviewed the competitive
environment, identified and
developed strategic options and
opportunities through internal teams,
and agreed strategic development
priorities, including the sale of Nadex
and Small Exchange.
June 2021 July September October November December January 2022 March May
Board and Committee ¼ Nomination Committee ¼ Board ¼ Board ¼ Standing Committee ¼ Board ¼ Standing Committee ¼ Board ¼ Board ¼ Board
meetings ¼ Remuneration ¼ Board Risk Committee ¼ Nomination Committee ¼ Board Risk Committee ¼ Audit Committee ¼ Board Risk Committee ¼ Audit Committee
Committee ¼ Audit Committee ¼ Remuneration ¼ Remuneration ¼ Remuneration ¼ Remuneration ¼ Board Risk Committee
¼ Remuneration Committee Committee Committee Committee ¼ Remuneration
Committee ¼ Audit Committee ¼ Nomination Committee ¼ Nomination Committee ¼ Nomination Committee Committee
¼ ESG Committee ¼ Board Risk Committee ¼ ESG Committee ¼ ESG Committee ¼ Nomination Committee
¼ Joint Audit and Board ¼ ESG Committee
Risk Committee

| Key announcements ¼ Board change |  | ¼ FY21 results | ¼ Result of AGM | ¼ Publication of | ¼ Completion of debt | ¼ Proposed sale of Nadex | ¼ HY22 results ¼ Q3 revenue update |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  | (resignation of Lisa | ¼ Board change | ¼ Q1 revenue update | prospectus for EMTN | refinancing exercise | and Small Exchange |  | ¼ Completion of sale of |
|  | Pollina) | (appointment of Susan |  | Programme |  |  |  | Nadex and Small |
|  | ¼ Completion of | Skerritt) |  |  |  |  |  | Exchange |
|  | tastytrade acquisition | ¼ Board change |  |  |  |  |  |  |

(resignation of Bridget
Messer – took effect on
22 September 2021)
74 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Culture, people, governance, risk Financial performance Other
and regulation ¼ Reviewed our financial performance ¼ Considered the shareholder
¼ Evaluated the effectiveness of and approved all financial engagement programme
ourrisk management and internal- resultsannouncements and ¼ Received regular reports from
control systems, reviewed and theAnnual Report Board Committee Chairs, including
approved our Risk Appetite ¼ Discussed our proposed Capital onwhistleblowing
Statement and key regulatory Allocation Framework ¼ Approved a comprehensive debt
documents, including the ICAAP, the refinancing programme
ILAA documents and Recovery Plans Dividends ¼ Reviewed our corporate insurance
¼ Discussed the employee engagement ¼ Approved and recommended the programme
survey results payment of dividends throughout the ¼ Evaluated the effectiveness of the
¼ Analysed the impact of emerging year in line with our policy Board, each Board Committee and
risks, including those related to tax individual Director
¼ Received progress updates for the ¼ Approved the annual review of the
IGBrighter Future Strategy Modern Slavery Statement
¼ Approved our Financial Education ¼ Approved the Tax Strategy and the
Strategy Tax Risk Management Policy
¼ Approved our Equality, Diversity and ¼ Attended a TCFD training session
Inclusion Strategy and Operation Plan
¼ Approved the Health and Safety Policy
June 2021 July September October November December January 2022 March May
Board and Committee ¼ Nomination Committee ¼ Board ¼ Board ¼ Standing Committee ¼ Board ¼ Standing Committee ¼ Board ¼ Board ¼ Board
meetings ¼ Remuneration ¼ Board Risk Committee ¼ Nomination Committee ¼ Board Risk Committee ¼ Audit Committee ¼ Board Risk Committee ¼ Audit Committee
Committee ¼ Audit Committee ¼ Remuneration ¼ Remuneration ¼ Remuneration ¼ Remuneration ¼ Board Risk Committee
¼ Remuneration Committee Committee Committee Committee ¼ Remuneration
Committee ¼ Audit Committee ¼ Nomination Committee ¼ Nomination Committee ¼ Nomination Committee Committee
¼ ESG Committee ¼ Board Risk Committee ¼ ESG Committee ¼ ESG Committee ¼ Nomination Committee
¼ Joint Audit and Board ¼ ESG Committee
Risk Committee

| Key announcements ¼ Board change |  | ¼ FY21 results | ¼ Result of AGM | ¼ Publication of | ¼ Completion of debt | ¼ Proposed sale of Nadex | ¼ HY22 results ¼ Q3 revenue update |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  | (resignation of Lisa | ¼ Board change | ¼ Q1 revenue update | prospectus for EMTN | refinancing exercise | and Small Exchange |  | ¼ Completion of sale of |
|  | Pollina) | (appointment of Susan |  | Programme |  |  |  | Nadex and Small |
|  | ¼ Completion of | Skerritt) |  |  |  |  |  | Exchange |
|  | tastytrade acquisition | ¼ Board change |  |  |  |  |  |  |

(resignation of Bridget
Messer – took effect on
22 September 2021)
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 75
GOVERNANCE REPORT
## Nomination Committee Report
### Mike McTighe, Chair of the
### Nomination Committee, gives
### his review of the Committee’s
### activities during the
### Mike McTighe
### financialyear.
### Chair of the
### Nomination Committee Chair’s overview
The Nomination Committee reviews
the structure, size, composition and
independence of the Board and leads
the process for Board appointments,
including identifying and recommending
suitable candidates. It ensures that the
Board’s composition meets our needs,
using external search consultancies
## Following a period of reconfiguring Board to help source candidates based
on objective criteria. The Board and
## roles and Executive structures...focushas now
Committee are committed to ensuring
## turned to individual and teamdevelopment, that we are a truly diverse organisation
in all respects, which includes gender,
## succession plans for theExecutive Committee social and ethnic backgrounds, cognitive
and personal strengths and experience.
## and development plans for potential internal
The Committee also ensures
## CEO candidates.” that plans are in place for orderly
succession to the Board and senior
management positions, with a diverse
pipeline identified for succession.
### Members and attendance
The Committee is responsible for
ensuring that the Board has the
Where Directors were unable to attend meetings, they gave the Chair their views necessary combination of skills,
in advance on the matters to be discussed. experience, knowledge, diversity and
independence needed to lead us and to
Meeting attended Did not attend
support the development and delivery
of our strategy.
1
Mike McTighe Wu Gang
Chair of the Committee Committee Member
During the year, the Committee
engaged Audeliss to facilitate
therecruitment of Susan Skerritt,
who,following the Committee’s

|  |  | 1 | recommendation, was appointed |
| --- | --- | --- | --- |
| Jonathan Moulds | Helen Stevenson |  |  |
| Committee Member | Committee Member |  | totheBoard on 9 July 2021. Audeliss is |

independent of, and has no connection
with, the Company or its individual
Directors, other than in its role as a
1 Unable to attend as meetings were held on an ad hoc basis during the year.
professional recruitment consultant
forthe Company. Russell Reynolds
Associates, an independent external
### FY22 key focus areas executive search firm, was appointed
tosupport with a comprehensive CEO
succession-planning process allowing
¼ Non-Executive Director appointment
the Committee to identify potential
¼ CEO succession planning
internal candidates and establish
¼ Appointments to the IGNA and IGT&I Boards
appropriate development plans.
76 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Following a period of reconfiguring Membership and attendance Oversight of IGNA Board Directors
Board roles and Executive structures, The Committee currently consists of included recommending to that Board
the Committee is confident that the four independent Non-Executive the appointment of JJ Kinahan as CEO.
structure and composition of the Board Directors. It met six times during the
of IGGH and the other nested entities year. Going forward, the Committee will CEO succession plans
and their sub-committees, as well as hold four scheduled meetings each year. The Committee appointed Russell
theBoard of IGNA, provides effective Reynolds Associates to provide support
leadership to support our future growth The Chair of the Board is also the Chair with CEO succession planning and the
and strategy. Focus has now turned to of the Committee. The CEO and Chief identification and development of
individual and team development, People Officer are standing attendees. potential internal candidates and
succession plans for the Executive considered the capabilities, experience
Committee and development plans How the Committee operates and personal attributes required of
forpotential internal CEO candidates. To ensure the Committee discharges afuture CEO.
its responsibilities appropriately, an
Role of the Nomination Committee annual forward calendar, linked to Other activities
The principal roles and responsibilities of the Committee’s Terms of Reference, Membership of the Boards of IGNA and
the Committee include: is approved by the Committee. IGT&I has also been a focus. During the
¼ Reviewing the structure, size and The Company Secretary and Chief year all Non-Executive Directors were
composition of the Board and its People Officer assist the Chair of the appointed as Directors of the IGT&I
Committees to ensure that they Committee in drafting the agenda Board and two Non-Executive Directors
areappropriately balanced in for each Committee meeting. (Malcolm Le May and Susan Skerritt) and
termsof skills, knowledge, diversity, one Executive Director (the CFO) were
experience and independence, Following each Committee meeting, appointed to the Board of IGNA.
andmaking appropriate aformal report is made to the Board
recommendations to the Board inwhich the Chair of the Committee, Board and Committee evaluation
relating to succession planning describes the discussions and An internal evaluation of the
atBoard level challenges from the Committee performance of the Committee was
¼ Ensuring that there is a formal, meeting, and has the opportunity undertaken in line with the Committee’s
rigorous and transparent procedure toescalate any items and make Terms of Reference. The evaluation
for the appointment of new Directors recommendations to the Board process was facilitated by Lintstock,
to the Board asappropriate. anindependent consultancy.
¼ Identifying, and nominating for Board

| approval, suitable candidates to | Main activities during the |  | The 2022 Board and Committee review |  |
| --- | --- | --- | --- | --- |
| fillBoard vacancies as and when | financialyear |  | process consisted of the following |  |
| theyarise | During the year, the Committee met |  | keyelements: |  |
| ¼ Reviewing leadership needs, | principally to consider: |  |  | ¼ Performance evaluation surveys |
| with a view to ensuring our |  | ¼ The structure and composition of the |  | prepared and issued |
| continued ability to compete |  | Board and its Committees |  | ¼ Feedback was analysed and |
| effectively in our marketplace |  | ¼ The appointment of Susan Skerritt as |  | outcomes presented to the Board |
| anddeliver on our strategy |  | a Non-Executive Director |  | and Committees |
| ¼ Keeping apprised of strategic issues |  | ¼ The normal process of CEO |  | ¼ The outcomes were discussed at |
| and commercial changes affecting us |  | succession planning and the |  | Board and Committee meetings, |
| and the market in which we operate |  | identification and development of |  | withaction plans and priorities set |
| ¼ Performance evaluation of the Board |  | potential internal candidates |  | for2023 |

¼ Appointments and changes to the

| The Terms of Reference of the | IGNA Board and appointments to the | Further information on the outcome of |
| --- | --- | --- |
| Committee, which were last reviewed in | IGT&I Board (the new UK-regulated | the evaluation of the Board and its |
| May 2022, are available on our website. | entity) (the latter as part of the nested | Committees is given on page 70, |
|  | board structure) | together with a review of the progress |
|  | ¼ Considered and, if appropriate, | on actions arising from the 2021 review. |

recommended that the Board
approve the proposed external
appointments of Non-Executive
Directors
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 77
GOVERNANCE REPORT
### Nomination Committee Report continued
Senior management gender balance
The table below analyses the gender balance of the Executive Committee and their direct reports as at 31 May 2022.
Wearepleased to see a slight increase to 34% total female representation despite a higher proportion of men in tastytrade.
Wecontinue to aspire to increase diversity across and at every level of our organisation. Our Diversity Commitment
isavailableon our website.
31 May 2022 31 May 2021
Numbers % Numbers % % Change
Board Female 4 33% 5 38% -5%
Male 8 67% 8 62%
Executive Committee Female 5 38% 4 40% -2%
Male 8 62% 6 60%
1
Senior leadership team Female 8 23% 8 29% -6%
Male 27 77% 20 71%
Total employees Female 811 34% 668 33% 1%
Male 1,608 66% 1,336 67%
1 The gender disclosure shown here relates to the senior leadership team, who are the Executive Committee and the next level of leadership below them, as opposed to including more
junior team members who may also report directly to Executive Committee members.

| Diversity statement | At the financial year end, the Board | The Directors recognise the importance |
| --- | --- | --- |
| As a business, we believe that a diverse | had 33.3% female representation | of diversity, in all of its forms, and |
| workforce brings creative energy to our | (2021: 33.3%,) continuing to meet | understand the significant benefits that |
| business, powers innovation and sets us | the Hampton-Alexander target of at | come with having a truly diverse Board. |
| up for continued global success. We’re | least one-third female representation |  |
| committed to developing teams of | on the Board and exceeding the | The Board continues to appoint |
| individuals with a wide variety of | Parker Review target of one ethnic | on merit, based on the skills and |
| perspectives, skills and thinking | minority Director on the Board ahead | experience required for membership, |
| approaches to help us realise our vision | of time (deadline by 2024). We have | while giving consideration to all forms |
| and strategy. We welcome people of any | three ethnic-minority Directors. | of diversity, aswell as independence. |
| age, ethnicity, culture, faith, gender |  | The Company insists on search |
| identity or expression, sexual orientation | The Committee notes the recent FCA | firms presenting adiverse pool |
| or physical capacity who connect with | policy on Diversity and Inclusion issued | of candidates for consideration |
| our values and bring something fresh to | in April 2022 and the Board will report | during the search process. |
| our business. Our Equality, Diversity and | on a comply or explain basis in next |  |
| Inclusion Policy is available on request. | year’s report as to how it has met the |  |

prescribed targets.
Mike McTighe
Chair of the Nomination Committee
20 July 2022
78 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Directors’ Remuneration Report and Policy
CONTENTS PAGE
Chair’s overview 79
Remuneration at a Glance 82
Summary of 2020 Directors’
Remuneration Policy 83
### Helen Stevenson
Annual Report on Remuneration 84
### Chair of the Remuneration
### Committee Helen Stevenson, Chair of the
### Remuneration Committee,
### gives her review of the
### Committee’s activities during
### the financial year.
Chair’s overview
On behalf of the Board, I am pleased to
## 2022 has been another strong year for us,
present the Directors’ Remuneration
## where overall performance exceeded Report for the year to 31 May 2022.
This report includes a summary
## expectations at the start of the year. In addition,
of our Directors’ Remuneration
## the Company continues to deliver on its Policy which was approved at the
2020 AGM, details of remuneration
## strategy to expand and diversify the business arrangements in respect of the year
to 31 May 2022 and a summary of
## and is well positioned for future growth.”
how we intend to apply the Policy
during the year to 31 May 2023.
### Members and attendance
Performance in FY22
We have had one of the busiest years
Where Directors were unable to attend meetings, they gave the Chair their views
inour history, and have delivered
in advance on the matters to be discussed.
recordrevenues, driven by continuing
Meeting attended Did not attend momentum across our businesses as we
deliver on our strategy to expand and
Helen Stevenson Mike McTighe diversify. Overall performance was
Chair of the Committee Committee member excellent across the majority of regions,
reflecting increased trading by a record
number of clients in a number of key
areas of the business. Throughout the
period we have remained committed to
Jonathan Moulds Sally-Ann Hibberd
client quality and we continue to be
Committee member Committee member
defined and differentiated by our good
conduct and client-centric business
model, highlighted by our client loyalty
and successful retention programmes.
Andrew Didham
Committee member
### FY22 key focus areas
¼ IFPR and Investment Firm Directive (IFD) readiness
¼ Continued diversification of theGroup
¼ Preparation for and stakeholder engagement ahead of the FY23Directors
Remuneration Policyreview
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 79
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued

| We are continuing to deliver on our | Based on the above, while the | Board changes |
| --- | --- | --- |
| strategy, diversifying into new product | outcome of the SPP award for FY22 | Executive Directors |
| lines and into new geographies. | was calculated at 99% of maximum, | As detailed in last year’s report, Bridget |
| The integration of tastytrade is on | the Committee elected to apply a | Messer, Chief Commercial Officer, |
| track, with a focus on operations | discretionary adjustment for the | stepped down from the Board on |
| and marketing, and the business is | Executive Directors of -5% to the | 22 September 2021, remaining with the |
| confident about theopportunities that | outcome reflecting the relative | Company until the completion of her |
| it brings to theCompany given the | performance against internal targets | notice period on 21 January 2022. |
| large total addressable market in the | for some individual businesses. This | Bridget will be treated as a good leaver |
| US, and also for further international | has resulted in a final vesting outcome | for the purposes of the SPP. More details |
| expansion. In addition, we completed | for FY22 of 94% of maximum. | on this can be found on page 96. |

the sale of Nadex and Small Exchange,

| delivering a significant return on | This award will be granted following the | Non-Executive Directors and fees |
| --- | --- | --- |
| previous investments and allowing | announcement of results for the year | During the year, we welcomed Susan |
| us to further sharpen our focus on | and will be delivered following Policy | Skerritt to the Board as a Non-Executive |
| integrating and expanding the US | requirements in 30% in cash, 20% in | Director. As disclosed in last year’s |
| options and futures business where | share options released in July 2025, and | Directors’ Remuneration Report, Lisa |
| we see significant room for growth. | 50% share options released in July 2026. | Pollina stepped down from the Board as |
| Further details on our strategic progress |  | a Non-Executive Director on 9 July 2021. |
| can be found on pages 18 to 21. | COO salary increase to reflect |  |
|  | increase in his responsibilities | During the year we established a North |
| Incentive outcomes for FY22 | During the year, the Committee | American Board and additional fees and |
| The sustained performance plan (SPP) | reviewed the salary level for Jon Noble, | travel expenses have been provided to |
| for the 2022 financial year operated in | our COO. Over the previous two years, | the North American Board Chair and |
| line with the Policy. The SPP award for | the scope and responsibilities of the | Group non-executive representative |
| the 2022 financial year was based on | COO role have expanded significantly, | on the Board to reflect the additional |
| three metrics: earnings per share | including the leadership of the data | time commitment and responsibilities |
| (EPS)(55% weighting), relative Total | science and governance strategy, and | in undertaking these roles. More details |
| Shareholder Return (TSR) (25% | leading our approach on ESG. The | on this can be found on page 89. |
| weighting) and non-financial measures | outcome of this review was that the |  |
| (20% weighting). EPS performance for | Committee determined to increase the | In light of inflation and the impact on |
| FY22 was 96.3 pence, which was | COO’s salary to £410k (an increase of | thecost of living, the Chair and Non- |
| significantly ahead of the maximum | 8.2%), effective from 1 October 2021, | Executive Directors elected not to |
| target and our TSR over the period | in order to reflect the expansion in the | receive an increase in fees for FY23 and |
| 1 June 2019 to 31 May 2022 was well | role’s scope and responsibilities – the | requested that any increase be diverted |
| above upper quartile compared to the | Committee is of the view that such an | to lower paid employees who are feeling |
| FTSE 250 (excluding investment trusts). | increase is appropriate in this context. | the greatest impact in the rising cost |

ofliving.

| Non-financial performance during the | IFPR/IFD |  |
| --- | --- | --- |
| year was measured and assessed giving | A large part of our agenda during the | Looking ahead |
| due consideration to, amongst other | year has been reviewing the new | Salaries for FY23 |
| factors, the successful ongoing | requirements of the IFPR in the UK and | Salaries for the Executive Directors for |
| integration of tastytrade and | the IFD in Europe. The Committee | 2022 will be increased by 3%. The new |
| tastytrade’s revenue performance | carefully considered and made changes | salaries for June Felix (CEO), Charlie |
| versus initial expectations for FY22 set | to our remuneration arrangements, | Rozes (CFO) and Jon Noble (COO), which |
| against our confidence in the long-term | policies, documentation and processes | apply from 1 June 2022, are £633k, |
| opportunities that tastytrade brings to | to ensure that we comply with these | £508.5k and £422.5k, respectively. |
| the wider Group. Consideration was also | requirements. | Thisis below the 5.5% average increase |
| given to an improved overall client |  | awarded to the wider UK workforce. |
| experience, increased employee | There are no significant changes | Similarly, the difference in the actual pay |
| engagement, and improved societal and | totheremuneration arrangements for | awarded and the average increase for |
| environmental impacts. After careful | Executive Directors, other than for SPP | the wider UK workforce will be diverted |
| assessment, the Committee judged that | awards granted in respect of FY23 | to lower paid employees in the same |
| non-financial performance was 95% out | onwards, Executive Directors will be | way as the increase for the Chairman |
| of 100%. | required to hold any shares that vest for | and Non-Executive Directors. |

a further six months following vesting
tocomply with the IFPR. Malus and
clawback provisions have also
beenexpanded.
80 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| Incentives for FY23 | The Company has a People Forum which |
| --- | --- |
| There are no changes to the incentive | is attended by employee representatives |
| levels for FY23, with the maximum | from across the business. The People |
| opportunity under the SPP remaining at | Forum discusses pay as well as other |
| 500% of salary for the CEO and 400% of | matters which affect employees. The |
| salary for the CFO and COO. SPP awards | impact of the rising cost of living was |
| for FY23 will continue to be based 55% | also discussed with the People Forum |
| on EPS performance, 25% on TSR | aswell as what the Company is doing |
| performance relative to the FTSE 250 | tosupport employees with this. It was |
| (excluding investment trusts) and 20% | explained to employees that the |
| on non-financial measures. Further | Directors of the Company had decided |
| details of performance conditions | to either give up their increase for |
| attached to FY23 incentives can be | thisyear or take a materially reduced |
| found below on page 88. | increase, with the money given up being |

used to increase salaries of lower-paid

| Directors’ Remuneration Policy | employees. I attended the People Forum |
| --- | --- |
| Our current Remuneration Policy will | during the year and was able to hear |
| reach the end of its life at the 2023 AGM | participants’ views on pay – I would like |
| and therefore over the course of FY23 | to thank participants, whose feedback |
| the Committee will undertake a detailed | and views were considered by the |
| reviewed of the Policy to ensure that it | Committee as part of its annual process. |

isappropriate for, and aligned to, our

| evolving strategy, while ensuring that | Conclusion |
| --- | --- |
| remuneration outcomes remain aligned | The Committee is satisfied that our |
| to the experiences of our shareholders, | outcomes for FY22 are aligned with |
| employees and other stakeholders. As | theinterests of shareholders, that they |
| part of this we will carefully consider | reflect our strong performance over this |
| whether the SPP remains the right | year and that the Policy has operated |
| incentive plan or whether an alternative | asintended. I look forward to receiving |
| approach would be more appropriate. | your support for the Directors’ |
| The Committee believes that the current | Remuneration Report at the AGM |
| Policy has operated as we intended | on21 September 2022. |

during the year.
Wider workforce remuneration
The Committee has consistently
considered wider colleague pay as
context for the decisions it makes. The
Helen Stevenson
Committee is kept updated through the
Chair of the Remuneration Committee
year on general employment conditions,
20 July 2022
basic salary increase budgets (with
particular focus on this in FY22 in the
context of inflation levels and increases
in the cost of living), the level of bonus
pools and payouts, and participation in
share plans. The Committee is therefore
aware of how total remuneration at the
Executive Director level compares to the
total remuneration of the general
population of employees.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 81
GOVERNANCE REPORT
## Remuneration at a Glance
Remuneration in FY22

| We have delivered an excellent set of results | The following section shows a summary |
| --- | --- |
| inFY22 as well as continued to deliver on our | oftheperformance measures we use, and |
| strategy to expand and diversify, and this is | theresulting pay for Executive Directors. |

### reflected in pay outcomes.
### Total remuneration (£000)
Total |
Total | £2,639
Total | £1,951
### FY22 SPP outcome
Threshold Maximum
Metric Weighting EPS: 0% payout, TSR: 25% payout 100% payout Outcome
EPS 55% 100%
Actual: 96.3p
62.2p 76.0p
TSR 25% 100%
Actual: 90th percentile
Median ranking Upper quartile ranking
Non-financial 20% 95%
Details of performance are set out Actual: 95%
on page88
0% 100%
Total 100% 99%
Discretionary adjustment -5%
Final 94%
SPP outcome
Delivered in cash Deferred into shares
Maximum opportunity % of maximum % of salary (30%) (70%)
June Felix 500% of salary 94% 470% £866,000 £2,022,000
Charlie Rozes 400% of salary 94% 376% £557,000 £1,299,000
Jon Noble 400% of salary 94% 376% £451,000 £1,052,000
June Felix £3,579
Charlie Rozes
Jon Noble 82 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Salary Pension and benefits SPP Buyout awards
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Summary of 2020 Directors’ Remuneration Policy
The Directors’ Remuneration Policy describes the framework, principles and structures that guide the Remuneration
Committee’s decision-making process in relation to Directors’ remuneration arrangements.
Objectives of the Remuneration Policy
The Remuneration Policy is set to ensure that remuneration is sufficiently competitive to attract and retain Senior Executives
ofa high calibre and to provide a suitable incentive to drive performance, while remaining appropriate in the context of our
approach to pay throughout the organisation. The Policy has been designed taking into account the principles of Provision 40
ofthe Code, and the table below sets out how the Policy aligns with these principles.
Clarity We provide open and transparent disclosures regarding our executive remuneration arrangements.
OurRemuneration Policy is designed to recognise and reward performance that supports the execution
of strategy and helps drive sustainable shareholder value growth.
Simplicity Our Remuneration Policy is designed to be straightforward, easy for shareholders and employees to
understand, and simple for the Group to monitor.
Predictability Our Remuneration Policy contains details of the maximum opportunity levels for each component
of pay. Actual incentive outcomes vary depending on the level of the performance achieved against
specific measures.
Proportionality, We believe the Remuneration Policy is consistent with regulatory and corporate governance
risk and alignment requirements. It is also designed to achieve effective risk management through the choice of
toculture performance measures and targets, shareholding requirements and malus and clawback provisions.
Remuneration Policy table
The following table summarises each element of the Remuneration Policy for the Executive Directors and provides an overview
of how the Remuneration Policy will be implemented for FY23.
We have not made any changes to the Directors’ Remuneration Policy that was approved at the 2020 AGM on 17 September
2020. Full details of the approved Policy are included within the 2020 Annual Report and Accounts, which can be viewed in the
‘investors’ section on our website iggroup.com. In line with the DRR reporting regulations we will be reviewing our Policy during
the year and will be submitting a new policy to shareholders for approval at the 2023 AGM.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 83
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued
Purpose and link to strategy Operation Opportunity Implementation for FY23
Base salary

| To recruit and retain key | Base salaries are normally |  | While there is no maximum | During the year the |
| --- | --- | --- | --- | --- |
| employees of an appropriate | reviewed by the Committee |  | salary, increases will normally | Committee reviewed the |
| calibre to deliver the strategic | annually, with salary increases |  | be in line with the typical | COO’s salary in light of the |
| objectives of the Group. | effective from 1 June. |  | increases awarded to | broadening of his role to |
|  |  |  | otheremployees. | include responsibilities such |
|  | Base salaries are set taking |  |  | as leadership of the data |
|  | into account: |  | However, increases may be | science and governance |
|  |  | ¼ Scale, scope and | above this level in certain | strategy, and of our approach |
|  |  | responsibility of the role | circumstances. | to ESG. Taking into account |
|  |  | ¼ Experience of the individual |  | the increase in the COO’s |
|  |  | and their performance |  | responsibilities, the |
|  |  | ¼ Pay and workforce policies |  | Committee determined that it |
|  |  | elsewhere in the Group |  | was appropriate to increase |
|  |  | ¼ Business performance and |  | the COO’s salary to £410,000 |
|  |  | prevailing market conditions |  | per annum (8.2% increase) |
|  |  | ¼ Salary levels at other |  | from 1 October 2021. |

companies of a similar size,
complexity, geographic As part of the normal annual
spread and business focus salary review, the Committee
has agreed that salaries for
Executive Directors will be
increased by 3% this year,
below the average increase
for the wider workforce of
5.5%. This difference in the
actual pay awarded and the
average increase for the wider
UK workforce will be diverted
to lower-paid employees
whoare feeling the greatest
impact from the rising cost of
living. Salaries from 1 June
2022 are therefore:
¼ CEO – £633k
¼ CFO – £508.5k
¼ COO – £422.5k
84 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Purpose and link to strategy Operation Opportunity Implementation for FY23
Pension and benefits

| Competitive, cost-effective | Executive Directors are eligible | The maximum pension | Pension and benefits |
| --- | --- | --- | --- |
| flexible pension and benefits | to participate in the Company’s | andbenefits allowance for | allowances for Executive |
| allowance to help recruit and | flexible pension and benefits | Executive Directors will be | Directors for FY23 are |
| retain Executive Directors. | plan, from which Executive | inline with the allowance | unchanged and are as follows: |
|  | Directors can receive a range | available to the wider | ¼ CEO – 12% of salary |
|  | of benefits, Company pension | workforce in the UK. This rate | ¼ CFO – 12% of salary |
|  | contribution or cash allowance. | is currently 12% of salary. | ¼ COO – 12% of salary |
|  | Executive Directors may | Executive Directors may | This is in line with the |
|  | participate in a share-incentive | participate in a SIP, SAYE | rateavailable to the |
|  | plan (SIP), savings-related share | orother all-employee plan | widerworkforce. |
|  | option scheme (SAYE) or any | upto the same maximum |  |
|  | other all-employee plans on the | asother employees. |  |

same basis as other employees
up to HMRC-approved limits.
The Committee may introduce
other benefits if it is considered
appropriate to do so.
Where appropriate, the
Company may provide support
to Executive Directors in the
preparation of their tax returns.
Executive Directors shall be
reimbursed for all reasonable
expenses and the Company
may settle any tax incurred.
Where an Executive Director is
required to relocate to perform
their role, the appropriate
one-off or ongoing benefits
may be provided (eg housing,
schooling etc).
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 85
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued
Purpose and link to strategy Operation Opportunity Implementation for FY23
Share ownership policy

| This aligns the interests | Executive Directors are | Not applicable The current shareholdings of |  |
| --- | --- | --- | --- |
| ofmanagement and | expected to build a holding |  | the Executive Directors are: |
| shareholders both in and post | ofshares to the value |  | ¼ CEO – 630% of salary |
| employment and promotes a | ofaminimum of 200% |  | ¼ CFO – 206% of salary |
| long-term approach | ofbasesalary. |  | ¼ COO – 392% of salary |

toperformance
andriskmanagement. It is normally expected that
theshareholding guideline
would be met within five years
from the date of appointment
(unless exceptional
circumstances apply).
The Committee will review
progress annually, with an
expectation that Executive
Directors will make progress
towards achieving the
shareholding policy each year.
Following ceasing to be an
Executive Director, Executive
Directors will normally be
expected to maintain a
minimum shareholding of
200% of salary (or actual
shareholding if lower) for two
years. This guideline applies
toshares that are released
from the SPP on or after the
adoption of the new Policy at
the 2020 AGM. Any shares
purchased by the Executive
Directors will not be subject to
the guideline.
86 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Purpose and link to strategy Operation Opportunity Performance metrics Implementation for FY23
Sustained performance plan

| The SPP provides a | Awards are made after |  | The maximum plan | Awards are determined | For FY23 the maximum |  |
| --- | --- | --- | --- | --- | --- | --- |
| single incentive plan for | the announcement of |  | contribution in respect | based on performance | plan contribution will |  |
| Executive Directors | results relating to each |  | of a plan year is 500% of | for the prior financial | continue to be 500% |  |
| rather than having | ‘plan year’. |  | salary for the CEO and | year (financial and | ofsalary for the CEO |  |
| separate annual and |  |  | 400% of salary for other | strategic measures) and | and 400% for other |  |
| long-term plans. | For FY21 onwards, plan |  | Executive Directors. | for up to three financial | Executive Directors. |  |
|  | contributions pay out |  |  | years ending with the |  |  |
| It provides a simple and | asfollows: |  |  | plan year TSR measures. | For FY23 the level of |  |
| competitive incentive |  | ¼ 30% of the award is |  |  | plan contribution will be |  |
| mechanism that |  | delivered in cash |  | Performance measures | based on: |  |
| encourages and |  | shortly following the |  | may comprise, for |  | ¼ 55% EPS |
| rewards both annual |  | end of the plan year |  | example, EPS targets, |  | performance |
| and sustained long- |  | ¼ 20% of the amount |  | TSR and strategic |  | ¼ 25% on relative TSR |
| term performance, |  | earned will be |  | non-financial measures. |  | compared to the |
| linked to the Group’s |  | awarded in shares |  | The Committee may |  | FTSE 250 (excluding |
| strategic objectives. |  | which will be |  | vary performance |  | investment trusts) |
|  |  | released to |  | measures from year to |  | ¼ 20% on non-financial |
| A significant portion of |  | participants following |  | year in accordance with |  | measures, see below |
| the SPP award is in |  | the end of the fourth |  | strategic priorities and |  | for further details |
| shares, encouraging |  | financial year that |  | the regulatory |  |  |
| Executive Directors to |  | follows the start of |  | environment. | Performance for EPS |  |
| build up a substantial |  | the plan year |  |  | and non-financial |  |
| stake in the Company, |  | ¼ 50% of the amount |  | No more than 25% of | measures will be |  |
| thereby aligning |  | earned will be |  | the award will normally | assessed over FY23. |  |
| theinterests of |  | awarded in shares |  | be payable for threshold |  |  |
| management with |  | which will be |  | levels of performance. | TSR performance |  |
| shareholders. |  | released to |  |  | willbe assessed over |  |
|  |  | participants following |  | The Committee may, in | the three-year period |  |
|  |  | the end of the fifth |  | its discretion, adjust SPP | from 1 June 2020 to |  |
|  |  | financial year that |  | awards, if it considers | 31 May 2023. |  |
|  |  | follows the start of |  | that the outcome |  |  |
|  |  | the plan year |  | doesnot reflect the | EPS targets and |  |
|  |  |  |  | underlying financial | non-financial measures |  |
|  | The Committee retains |  |  | ornon-financial | are considered to be |  |
|  | discretion to scale back |  |  | performance of the | commercially sensitive |  |
|  | the vesting of awards |  |  | participant and/or the | and therefore have not |  |
|  | atthe end of years |  |  | Group over the relevant | been disclosed. The |  |
|  | fourand five if the |  |  | period or that such | Committee’s intention |  |
|  | underlying performance |  |  | vesting level is not | isthat these targets |  |
|  | of the participant and/ |  |  | appropriate in | willbe disclosed |  |
|  | or the Group does not |  |  | thecontext of | retrospectively in |  |
|  | justify the payout of |  |  | circumstances that | nextyear’s annual |  |
|  | theaward. |  |  | were unexpected or | remuneration report. |  |

unforeseen when the
targets were set. When
making this judgement
the Committee may
take into account
suchfactors as
theCommittee
considers relevant.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 87
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued
Further details on performance measures
For FY23 it is intended that SPP awards will be based on a combination of EPS, TSR and non-financial strategic and operational
performance measures.
Metrics Rationale and link to the strategic KPIs Further details

| TSR relative to the FTSE 250 | TSR measures the total return to | TSR will be assessed over the period |
| --- | --- | --- |
| (excluding investment trusts) | theCompany’s shareholders, both | 1 June 2020 to 31 May 2023. |
| 25% weighting | through share price growth and |  |
|  | dividendspaid, and as such it is aligned | 25% of this portion will be awarded for |
|  | toshareholder interests. | median performance with 100% of this |

portion being awarded for upper quartile
TSR is influenced by how well the Group performance (straight-line assessment
performs on a range of other metrics, in-between).
including financial indicators such
asrevenue, profit, cash generation
anddividends, and non-financial
indicatorssuch as client satisfaction
andoperational performance.

| EPS | EPS is a key indicator of the profits | EPS targets will be assessed based |
| --- | --- | --- |
| 55% weighting | generated for shareholders, and a | onperformance for the year ending |
|  | reflection of both revenue growth | 31 May 2023. |

and cost control.
The Committee sets EPS targets
takinginto account relevant factors
including Board-approved budget,
marketconsensus expectations and
historical targets.
Payouts start to accrue for reaching
threshold levels of performance with
100% of this portion being awarded for
the achievement of maximum
performance.
Non-financial strategic and operational performance schemes (20% weighting)
The non-financial metrics are specifically designed to measure factors important to IG in continuing to operate on a profitable
and sustainable basis for the long term. These goals include a number of objectives which are focused on our sustainability
agenda both from an environmental, people and societal perspective. Non-financial measures have been grouped into three
categories: strategic enablers (50%), people and culture (including diversity and inclusion) (25%) and client experience (25%).
When assessing the non-financial metrics, the Committee deliberately separates the assessment from any review of financial
performance, viewing them both as important, but recognising they are assessed and rewarded separately. This is to ensure
that management are incentivised to deliver in-year non-financial milestones which are important to maintaining sound
operations and delivering profit and shareholder value in the future.
1
Strategic enablers Driving the longer-term diversification and strategic direction of the organisation by
50% weighting measuring progress against key projects and initiatives that will deliver on our purpose
to power the pursuit of financial freedom for the ambitious.
People and culture (including diversity Considering the development and conduct of our people, reinforcing our reputation as
1
and inclusion) a responsible company and promoting a culture that champions the client, learns fast
25% weighting together to raise the bar.
Client experience The short and longer-term development of the client-focused initiatives to provide an
1
25% weighting outstanding client experience to our growing and diverse client base.
1 At IG we believe that in order to deliver sustainable progress it is important that a focus on ESG is embedded through the business strategy and its operation. In keeping with this we
have embedded ESG-aligned metrics in the ‘strategic enablers’, ‘people and culture’ and ‘client experience’ sections of our non-financial metrics. For example, diversity and inclusion,
business ethics and information security. ESG-aligned measures will account for at least 15% of the overall SPP.
88 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Chair and Non-Executive Directors
The table below summarises each element of the Remuneration Policy applicable to the Chair and the Non-Executive Directors.
Purpose and link to strategy Operation Opportunity Implementation for FY23

| To attract and retain Non- | The Committee determines | The Chair receives a single | In light of inflation and the |
| --- | --- | --- | --- |
| Executive Directors of | the fee for the Chair (without | feeto cover all of their | impact on the cost of living, |
| appropriate calibre and | the Chair present). | Boardduties. | theChair and Non-Executive |
| experience. |  |  | Directors elected not to receive |
|  | The Board is responsible | Non-Executive Directors | an increase in fees for FY23 |
|  | forsetting Non-Executive | receive a fee for carrying out | andrequested any increase |
|  | Directors’ fees. The Non- | their duties. They may receive | bediverted to lower-paid |
|  | Executive Directors are not | additional fees if they chair | employees feeling the greatest |
|  | involved in any discussions or | the Board Committees, and | impact from the rising cost of |
|  | decisions by the Board about | for holding the post of Senior | living. The fees from 1 June |
|  | their own remuneration. | Independent Director. | 2022 are therefore as follows: |

¼ Non-Executive Director base

| Fees are set taking | Additional fees may be |  | fee – £65,500 |
| --- | --- | --- | --- |
| intoaccount the time | paidfor additional time |  | ¼ Committee Chairs (other |
| commitment required to fulfil | commitments if considered |  | than the Nomination |
| the role and typical practice | appropriate. |  | Committee) – £25,000 |
| at other similar companies. |  |  | ¼ Senior Independent Director |
|  | Committee membership fees |  | – £15,000 |
| Fees are within the limits set | may be paid. |  | ¼ Committee membership |
| by the Articles of Association |  |  | fees (excluding the |
| and take account of | Reasonable costs in relation |  | Nomination Committee |
| thecommitment and | to travel and accommodation |  | and the Group Board Chair) |
| responsibilities of the | for business purposes are |  | – £3,000 |
| relevantrole. | reimbursed to the Chair and |  | ¼ North American Board Chair |
|  | Non-Executive Directors. The |  | – £65,000 |
|  | Company may meet any tax |  | ¼ North American Board |
|  | liabilities that may arise on |  | member – £25,000 |
|  | such expenses. |  | ¼ Chair fee – £302,000 |
|  | The Chair and Non-Executive | With effect from 1 November |  |
|  | Directors do not receive | 2021, taking into account the |  |
|  | apension and benefits | additional responsibilities and |  |
|  | allowance or participate | time commitment, an additional |  |
|  | inincentive schemes. | fee of £65,000 was introduced |  |

for the Chair of the North

| Non-significant benefits | American Board and an |
| --- | --- |
| maybe introduced if | additional fee of £25,000 was |
| considered appropriate. | introduced for being a member |

of the North American Board.
The Chair of the North
American Board also receives
an additional £20,000 per
annum to compensate for time
spent in travel to attending
Board meetings.
Board Non-Executive Directors
required to travel a significant
distance to attend Board
meetings receive an additional
£20,000 per annum to
compensate for time spent
travelling. This has been applied
for Susan Skerritt from
December 2021.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 89
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued
Executive Directors’ service contracts
Executive Directors are employed under a service contract with IG Group Limited (a wholly owned intermediate holding
company) for the benefit of the Company and the Group.
The dates on which service contracts are entered into and notice periods are as follows:
¼ June Felix – 30 October 2018 (12 months’ notice from either party)
¼ Charlie Rozes – 1 June 2020 (12 months’ notice from either party)
¼ Jon Noble – 22 May 2018 (12 months’ notice from either party). Note: Jon Noble’s notice period increased from six months to
12 months with effect from 1 October 2021.
Non-Executive Directors’ service contracts
Non-Executive Directors do not have service contracts; they are engaged by letters of appointment. Each Non-Executive
Director is appointed for an initial term of three years subject to re-election, but the appointment can be terminated on three
months’ notice. Non-Executive Directors may receive reimbursement for business expenses incurred in the course of their
duties, including tax therein if applicable.
Annual Report on Remuneration
This report has been prepared in accordance with the Companies Act 2006, Schedule 8 of the Large and Medium-sized
Companies and Groups (Accounts and Reports) Regulations 2008 (as amended in 2013, 2018 and 2019) and the FCA’s Listing
Rules. TheDirectors’ Remuneration Report, excluding the Policy, will be subject to an advisory shareholder vote at the AGM on
21September 2022.
This part of the report includes a summary of how we implemented the Policy in the financial year ended 31 May 2022.
The parts of the report that are subject to audit have been marked.
Implementation of Remuneration Policy in the financial year ending 31 May 2022
Total single figure of remuneration – Executive Directors (audited)
Contribution to SPP account 6
Benefits

|  | Fees/basic |  | allowance/ |  |  |  |  | Total | Buy-out |  | Vested | Deferred |  |  | Total |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Name of |  | salary | benefits |  | 3,4 | Pension | fixed pay |  | awards | 5 | element | element |  | variable pay |  | Total |
| Director Year |  | £000 |  | £000 |  | £000 |  | £000 | £000 |  | £000 |  | £000 |  | £000 | £000 |

J Felix 2022 615 76 – 691 – 866 2,022 2,888 3,579
2021 610 87 – 695 – 855 1,994 2,849 3,546
C Rozes 2022 494 55 4 553 230 557 1,299 2,086 2,639
2021 490 56 3 549 309 549 1,282 2,14 0 2,689
1
J Noble 2022 400 44 4 448 – 451 1,052 1,503 1,951
2021 376 41 4 421 – 422 985 1,407 1,828
Former Executive Director
2
B Messer 2022 118 13 1 132 – 133 310 443 575
2021 376 42 4 422 – 422 985 1,407 1,829
1 J Noble received a salary increase from £379,000 to £410,000 (8.2% increase), effective from 1 October 2021. For further details see page 80.
2 B Messer stepped down from the Board on 22 September 2021. Remuneration is shown to this date. She remained with the business for the remainder of her notice providing
handover, ceasing employment on 21 January 2022. She was entitled to a pro-rated SPP award in respect of her period of employment (to 21 January 2022) with a value totalling
£913,484. This will be delivered 30% in cash and 70% in share options (which will be released 20% of the total amount in July 2025 and 50% of the total amount in July 2026).
3 Benefits can include critical illness cover, dental cover, health assessments, income protection cover, life assurance, travel insurance and private medical cover. It was agreed under the
updated Remuneration Policy for FY21 that, where appropriate, the Company may provide support to Executive Directors in the preparation of their tax returns. J Felix, C Rozes, J Noble
and B Messer received a flexible benefits and pensions allowance of 12% of base salary less any benefits taken. Executives have the option to receive part, or all, of their pension and
benefits entitlement in cash.
4 The 2022 benefits figure for J Felix and the restated 2021 benefits figure includes the £1.8k of matching shares J Felix received as a participant in the share-incentive plan. The 2021
benefits figure has also been restated to include the £1.8k of matching shares J Felix received as a participant in the share incentive plan in 2021.
5 As disclosed in the 2020 Annual Report, C Rozes forfeited a number of share awards which the Company bought out on a like-for-like basis. As part of his buy-out, Charlie was granted
an award over 35,616 shares which vested on 30 June 2022 based on the average of the performance outcome of the SPP for FY21 and FY22, which was 93.7% of maximum. This
resulted in 33,372 shares vesting, with an additional 3,828 shares accrued in respect of dividends. For the purpose of the single figure this award has been valued based on the share
price on the date of vesting of £6.905. The share price used to determine the level of award was £7.34 and the share price on the date vesting was £6.905 therefore none of the value in
the single figure table is attributable to share price appreciation. The Committee did not exercise discretion in relation to this share price appreciation.
6 Figures provided are the cash values of the SPP contributions in respect of performance for the period ending 31 May 2022 (ie plan year 9). The vested element is the proportion of the
plan year contribution for the relevant period that is paid in cash shortly following the end of the financial year (30% of the total amount). The deferred element is the proportion that is
awarded in share options that will be released 20% of the total amount in July 2025 and 50% of the total amount in July 2026. Details of SPP awards held in the plan account related to
awards for prior years are provided in the Other share awards outstanding table on page 94. As awards are included based on their value at the date of grant, no portion of the award
disclosed is attributable to share price growth and the Committee did not exercise discretion in relation to share price.
90 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

# **Total single figure of remuneration – Non-Executive Directors (audited)**

|  Name of Director | Year | Fees^{1/} £000 | Benefits^{1/} £000 | Total £000  |
| --- | --- | --- | --- | --- |
|  M McTighe | 2022 | 302 | – | 302  |
|   |  2021 | 300 | – | 300  |
|  J Moulds | 2022 | 109 | – | 109  |
|   |  2021 | 102 | – | 102  |
|  R Bhasin^{1} | 2022 | 72 | – | 72  |
|   |  2021 | 63 | – | 63  |
|  A Didham | 2022 | 97 | – | 97  |
|   |  2021 | 81 | – | 81  |
|  Wu Gang^{2} | 2022 | 69 | – | 69  |
|   |  2021 | 45 | – | 45  |
|  S-A Hibberd | 2022 | 97 | – | 97  |
|   |  2021 | 94 | – | 94  |
|  M Le May | 2022 | 114 | 4 | 118  |
|   |  2021 | 79 | – | 79  |
|  S Skerritt^{3} | 2022 | 83 | 14 | 97  |
|   |  2021 | – | – | –  |
|  H Stevenson | 2022 | 94 | – | 94  |
|   |  2021 | 86 | – | 86  |
|  **Former Directors**  |   |   |   |   |
|  L Pollina^{4} | 2022 | 16 | – | 16  |
|   |  2021 | 16 | – | 16  |

1 R Bhasin joined the Board on 6 July 2020. Remuneration for FY21 is shown from this date.

2 Wu Gang joined the Board on 30 September 2020. Remuneration for FY21 is shown from this date.

3 S Skerritt joined the Board on 9 July 2021. Remuneration is shown from this date.

4 L Pollina joined the Board on 4 March 2021. Remuneration for FY21 is shown from this date. L Pollina stepped down from the Board on 9 July 2021. Remuneration for FY22 is shown to this date.

5 Other than in respect of the Cheir, basic Non-Executive Director fees were £65,000 per annum in FY22; £95,000 per annum in FY23 with an additional £25,000 paid for sharing a Board Committee (other than the Nomination Committee) and £5,000 for membership of a Committee (excluding the Nomination Committee). The Senior Independent Director also receives an additional fee. This was £10,000 until 17 September 2020 and was increased to £10,000 from this date. With effect from 1 November 2021, taking into account the additional responsibilities and time commitment, an additional fee of £60,000 was introduced for the Chair of the North American Board and an additional fee of £20,000 was introduced for being a member of the North American Board. The Chair of the North American Board also receives an additional £20,000 per annum to compensate them for the additional time spent in travel to attending Board meetings.

6 S Skerritt receives an additional £30,000 per annum for compensation for the additional time spent in travel attending Group Board meetings.

7 Certain Non-Executive Directors' expenses relating to the performance of a Director's duties, such as travel to and from Company meetings and related accommodation, have been classified as taxable benefits. In such cases, the Company will ensure that the Director is kept whole by settling the expense and any related tax. The figures shown include the cost of the taxable benefit plus the related personal tax charge.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

91
GOVERNANCE REPORT

## Directors' Remuneration Report and Policy continued

### Sustained performance plan (SPP)

Determination of SPP contribution for the financial year ending 31 May 2022 (audited)

Performance targets for plan year 9 (financial year ending 31 May 2022) comprised EPS targets, TSR and non-financial measures. TSR performance was measured over the three-year period from 1 June 2019 to 31 May 2022, and EPS and non-financial measures over the financial year ending 31 May 2022.

|  Performance measure | Weighting | Threshold (25% payout for TSR and 0% for EPS) | Maximum (100% payout) | Actual performance | Percentage of maximum award to Directors  |
| --- | --- | --- | --- | --- | --- |
|  EPS | 55% | 62.2p | 76.0p | 96.3p | 100%  |
|  TSR | 25% | Median ranking | Upper quartile ranking | +74.9% TSR | 100%  |
|  Non-financial | 20% | 0% | 100% | 18th out 164 companies 95% of maximum awarded (see below for details) | 95%  |
|  **Total** | **100%** |  |  |  | **99%**  |
|  **Discretionary adjustment** |  |  |  |  | **-5%**  |
|  **Final** |  |  |  |  | **94%**  |

The maximum award for the CEO role is 500% of basic salary, with all other Executive Directors being eligible for a maximum award of 400% of basic salary.

Performance measures: how these are set, and a review of performance for the year ended 31 May 2022

#### EPS (55% weighting)

At the start of the financial year, the Committee established an EPS range in order to measure the performance and determine the payouts under the SPP. In doing this, the Committee took into account a number of relevant factors, including the Board-approved budget and market consensus expectations.

EPS performance for FY22 was 96.3 pence, which is materially ahead of internal and external expectations of performance at the start of the year. While EPS is lower than our record performance in FY21 it is still significantly ahead of our performance for FY20 and prior years, demonstrating the long-term progress we are making in the execution of our strategy.

#### TSR (25% weighting)

TSR performance is assessed against the FTSE 250 (excluding investment trusts). 25% of this element is awarded for median performance with the full portion being awarded for upper quartile performance or above with straight-line vesting in between.

For the award to be granted in respect of the year to 31 May 2022, TSR was measured over the three-year period from 1 June 2019 to 31 May 2022. Actual TSR performance for the three-year period was 74.9% (2021: 29.4%). TSR was positioned above the upper quartile compared to the comparator group over the three-year period and therefore 100% of this element will be awarded.

#### Non-financial measures (20% weighting)

The Committee approved a series of non-financial measures comprising strategic drivers, client experience, people and culture and environmental and societal impact during the year ended 31 May 2022. These measures are also used for determining a portion of the staff general bonus pool.

An average of the performance under the specific objectives resulted in an overall assessment of 95% (2021: 94%) of the potential payout under this element.

92

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
The table below provides details of the individual measures considered and their performance assessment for the year ended
31 May 2022.
Component Detail FY22 outcome
Strategic drivers ¼ Completion of tastytrade acquisition. Excellent progress on 37%
40% weighting integration from a talent, marketing, risk and controls, technology
and operations perspective. Synergies workstreams
progressingwell
¼ Excellent progress in technology development providing more
capacity headroom for peak trading
¼ Good progress in our exchange traded derivatives business
inEurope
Client experience ¼ Excellent systems uptime reflecting the investment made 23%
25% weighting in this area in recent years
¼ Reduction in number of complaints and enhanced customer
satisfaction
People and culture ¼ Excellent progress in embedding our purpose throughout 25%
25% weighting theorganisation. Improved employee engagement driven
bystrength of leadership team
¼ Maintained good regulatory compliance and relationship
withregulators
¼ Improvement in gender diversity throughout the organisation,
drivenby changes in policies and practices
Environmental and societal impact ¼ Programmes implemented to support young people, significant 10%
10% weighting donations to charitable causes and increase in volunteering days
¼ Improved ESG rating from external rating agencies, maintained
carbon neutral status. Carbon literacy training for all Board and
senior executives
Discretionary adjustment
The Group has continued to perform strongly during the year, with financial outperformance, upper quartile shareholder
returns and excellent progress against our operational and strategic objectives.
Non-financial performance during the year was measured and assessed giving due consideration to, amongst other factors,
thesuccessful ongoing integration of tastytrade and tastytrade’s revenue performance versus initial expectations for FY22 set
against our confidence in the long-term opportunities that tastytrade brings to the wider Group. Consideration was also given
to an improved overall client experience, increased employee engagement, and improved societal and environmental impacts.
After careful assessment, the Committee judged that non-financial performance was 95% out of 100%.
Based on the above, while the outcome of the SPP award for the FY22 was calculated at 99% of maximum, the Committee
elected to apply a discretionary adjustment for the Executive Directors of -5% to the outcome reflecting the relative
performance against internal targets for some individual businesses. This has resulted in a final vesting outcome for FY22 SPP
of94% of maximum.
Following this discretionary adjustment, the Committee concluded that the level of the SPP award for FY22 was a fair reflection
of the shareholder value delivered, as well as the enhanced financial performance, and that it was appropriate in the context of
the experience of our other stakeholders.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 93
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued
Overall summary
Based on the performance for the financial year ending 31 May 2022, we will grant awards under the SPP at 94% of the
maximum potential payout to the Executive Directors after the announcement of the results. The actual number of shares that
will be contributed to a Director’s plan account will be based on the ten-day average share price immediately prior to grant.
Since its introduction nine years ago, the average payout under the SPP is 66% of the maximum. The Committee considers that
the outcomes under the SPP are a fair reflection of performance delivered, and that they are aligned with value achieved for
shareholders over this period.
9-year
Financial year 2014 2015 2016 2017 2018 2019 2020 2021 2022 average
SPP contribution
(% maximum) 54% 41% 90% 27% 80% 18.6% 97. 2% 93.4% 94.0% 66%
Awards granted during the year ended 31 May 2022 (audited)
The SPP awards granted during the financial year ended 31 May 2022 in respect of performance to 31 May 2021 (plan year 8)
are as follows:
Contribution
Number of

|  |  |  |  |  |  | options in the plan |  |  |  | Number of |  |  |  |  |  | Number of |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  | account after |  | options vested |  |  |  |  | options in the plan |  |  |
|  |  | Value of options |  |  | Number of |  | plan year 8 |  | and exercised |  |  |  | Number of |  | account at the |  |
| % of salary | 1 |  | awarded | options awarded |  | 2 | contribution | 3 | during the year |  | 4 | options lapsed |  |  | end of the year |  |

J Felix 467% £1,994,988 224,610 529,833 101,741 – 428,092
C Rozes 374% £1,281,442 144,339 144,339 – – 144,339
J Noble 374% £984,623 110 , 9 0 6 353,918 81,003 – 272,915
B Messer 374% £984,623 110, 9 0 6 3 47,577 78,890 – 268,687
1 30% of the award is delivered in cash following the end of the plan year. The remaining 70% of the award is delivered in nominal cost options (the number and value of which are shown
above).
2 The number of options contributed to the plan account was based on the ten-business-day average share price immediately post the announcement date of the Group’s results for the
year ended 31 May 2021 of 887.8 pence per share. Awards were granted in the form of nominal cost options and are subject to continued employment. The release of shares is subject
to the satisfaction of the underlying financial performance to be tested in the final year of the plan. Full details of performance targets applied to the FY21 SPP awards and the
assessment of performance against targets are set on out pages 89 to 92 of the 2021 Directors’ Remuneration Report.
3 In addition to the awards made in respect of plan year 8, this also includes the brought forward number of options in the plan account from plan years 1 – 7 (where relevant) with its
respective accrued dividend shares.
4 The closing share price on 5 August 2021, the date of exercise, was £9.115 and the exercise price of the share options was 0.005p.
For awards granted in respect of years up to and including the financial year ending 31 May 2020 (plan years 1 – 7), in
accordance with the scheme rules 33.3% of the cumulative awards in the plan account will vest in July 2022, with the vesting of
the remaining options deferred. The July 2022 vesting will include additional dividend shares accrued as follows in respect of
plan year 1 – 7 awards held in the plan account: J Felix 16,234, J Noble 12,926 and B Messer 12,733 based on reinvestment at
the dividend payment date.
The SPP reaches the end of its ten-year life following the end of FY23. In accordance with the plan rules 50% of the remaining
balance of the participants’ plan account will be released in July 2023, with a further 25% of the remaining balance released in
both July 2024 and July 2025. J Felix and J Noble have 143,181 shares and 113,997 shares, respectively, which will be subject to
this treatment. Awards granted in relation to plan years from FY21 onwards will continue to vest according to their normal
payout schedule following the termination of the SPP.
The vesting schedule for SPP award granted in respect of FY21 onwards are unaffected.
Buy-out awards for C Rozes (audited)
On leaving his previous role, C Rozes forfeited a number of share awards which the Company bought out on a like-for-like basis.
All awards were granted by the Company on 6 August 2020 and were in the form of nominal cost options. Part of C Rozes’
buy-out was in the form of nil-cost options which vest subject to continued employment between 1 May 2021 and 1 May 2023.
As part of his buy-out, C Rozes was also granted an award over 35,616 shares which vested on 30 June 2022 based on the
average of the performance outcome of the SPP for FY21 and FY22, which was 93.7% of maximum. This resulted in 33,372
shares vesting, with an additional 3,828 shares accrued in respect of dividends.
Awards to be granted in respect of the year ended 31 May 2022
SPP awards for the financial year ending 31 May 2022 will be delivered 30% in cash, 20% in share options released in July 2025
and 50% in share options released in July 2026.
94 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Details of the 70% of the SPP award due to be awarded in shares, using an estimate of the options to be granted in respect of
plan year 9 (ie performance to 31 May 2022), are set out below:
Plan contribution in respect of
period ended 31 May 2022
Event (estimated number of options) 1
J Felix Plan year 9 282,558
C Rozes Plan year 9 181,536
J Noble Plan year 9 147,019
1 Executive Directors will be granted awards, in respect of 70% of the amount earned, for plan year 9 following the announcement of results for the year ended 31 May 2022 on 20 July
2022. The share price used to calculate the number of awards to be granted will be the ten-day average share price after this date. As the actual average share price is not known at the
time of signing of the Annual Report, the above number of awards has been estimated using a share price of 715.5 pence, being the share price on 31 May 2022. Share awards have an
exercise price of 0.005 pence.
Other share awards outstanding (audited)
Number
Share price at Number as at Number awarded Number lapsed Number exercised outstanding at
Award date award date 31 May 2021 during the year during the year during the year 31 May 22
J Felix
SIP: matching shares 6 Aug 19 565.29p 318 0 0 0 318
SIP: matching shares 6 Aug 20 74 3.66p 242 0 0 0 242
SIP: matching shares 5 Aug 21 909.24p 0 198 0 0 198
Total 560 198 0 0 758
Number
Share price at Number as at Number awarded Number lapsed Number exercised outstanding at
Award date award date 31 May 2021 during the year during the year during the year 31 May 22
J Noble
SIP: matching shares 6 Aug 19 565.29p 318 0 0 0 318
Total 318 0 0 0 318
Number of

|  |  |  |  |  |  | dividend |  |  | Number |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  | Share price at | Number as at | Number awarded | Number lapsed | equivalents added |  | Number exercised | outstanding at |  |
| Award date | award date | 31 May 2021 | during the year | during the year |  | at vesting | during the year |  | 31 May 22 |

1
C Rozes
Buy-out
2
award 6 Aug 20 734.00p 17,814 0 0 2,041 19,855 0
Buy-out
3
award 6 Aug 20 734.00p 35,616 0 0 0 0 35,616
Buy-out
4
award 6 Aug 20 734.00p 4,357 0 0 248 2,426 2,179
Total 57,787 0 0 2,289 22,281 37,795
1 On leaving his previous role, C Rozes forfeited a number of share awards which the Company has bought out on a like-for-like basis as summarised in the table above. For details of
these awards see the 2020 Annual Report.
2 An award of restricted shares vesting in equal tranches on 1 May 2021 and 1 May 2022 (subject to continued employment).
3 An award of performance shares vesting on 30 June 2022 to the same extent as the average vesting outcome for the financial years ending 31 May 2021 and 31 May 2022 of awards
granted under the IG Group sustained performance plan which was 93.7% of maximum. This resulted in 33,372 shares vesting, with an additional 3,828 shares accrued in respect
ofdividends.
4 An award of restricted shares vesting in equal tranches on 1 May 2021, 1 May 2022 and 1 May 2023 (subject to continued employment).
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 95
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued
Table of Directors’ share interests (audited)
% of salary held
under shareholding

|  | Legally owned | 4 |  |  |  |  |  | Total | policy | 7 |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  | Share with | Share options |  |  |  |  |  |  |
|  |  |  | performance |  | without |  | Vested but |  |  |  |
| 31 May 2021 31 May 2022 |  |  | conditions | performance |  | 5,6 | unexercised 31 May 2022 % salary |  |  |  |

Executive Directors
J Felix 20 6,111 318,626 – 428,850 – 747,476 630%
C Rozes 25,111 48,120 35,616 146,518 – 230,254 206%
J Noble 83,207 83,207 – 273,233 – 356,440 392%
Non-Executive Directors
M McTighe 6,600 6,600 – – – 6,600 –
J Moulds – 100,000 – – – 100,000 –
R Bhasin – – – – – – –
A Didham – 4,894 – – – 4,894 –
S-A Hibberd – – – – – – –
Wu Gang – – – – – – –
M Le May – – – – – – –
1
S Skerritt – – – – – – –
H Stevenson – – – – – – –
Former Directors
2
B Messer 53,172 – – 268,687 – 268,687 262%
3
L Pollina – – – – – – –
1 S Skerritt joined the Board on 9 July 2021.
2 B Messer stepped down from the Board on 22 September 2021.
3 L Pollina stepped down from the Board on 9 July 2021.
4 This figure includes partnership shares that are purchased as part of the Group’s share-incentive plan (SIP) which are not subject to vesting conditions.
5 These figures include the number of matching shares held at 31 May 2022 as part of the Group’s SIP, which will vest after three years from the respective award date, as long as
employees remain employed by the Group.
6 This figure excludes awards under the SPP scheme for performance year ending 31 May 2022, which will be granted following the announcement of the Group’s results on 20 July
2022. The awards held in the SPP plan account include those in respect of plan years 1 – 8 as at 31 May 2022.
7 Calculated as shares owned on 31 May 2022 plus the unvested shares held within the SPP on a net of tax basis at the closing mid-market share price of 715.5 pence on 31 May 2022.
Under the share ownership policy, the Executive Directors are expected to hold shares to the value of a minimum of 200% of
base salary. Shares owned by the Executive Directors as well as unvested SPP share options (on a net of tax basis) count towards
this guideline. It is expected that this guideline is achieved within five years of the date of appointment.
C Rozes’ performance-based buyout award vested on 30 June and as a result his share interest increased by 19,215 after
accounting for shares sold to settle tax and dealing costs. There have been no other changes to any of the Directors’ share
interests between 31 May 2022 and the date of this report.
The awards to be made under the Company’s SPP in respect of the performance period ending on 31 May 2022 are not
included in this table (see page 94 for details).
Leaving arrangements for B Messer (audited)
B Messer, Chief Commercial Officer, stepped down from the Board on 22 September 2021, remaining with the Company until
the completion of her notice period on 21 January 2022 providing handover. Between 22 September 2021 and 21 January
2022, B Messer continued to receive her base salary for this period totalling £125,229. B Messer also received £19,678 for
accrued unused annual leave. B Messer also received income protection, life assurance and private medical insurance,
andherfixed benefits allowance in cash for the period with a total value of £15,027. Tax and legal assistance was also provided
to B Messer and these costs came to £35,101 (including any applicable tax costs).
B Messer was treated as a good leaver for the purposes of the SPP awards which she held in her plan account on cessation of
employment. Outstanding awards in relation to plan years up to and including FY20 will be released one-third in July 2023,
one-third in July 2024 and one-third in July 2025. Awards granted in respect of FY21 will be released in accordance with the
normal vesting schedule. B Messer was also eligible to receive a pro-rated SPP award in respect of FY22 for her period in
employment (to 21 January 2022). As noted above, the SPP in respect of FY22 vested at 94% of maximum and therefore the
total value of this pro-rated award was £913,484. This will be delivered 30% in cash and 70% in share options (which will be
released 20% of the total amount in July 2025 and 50% of the total amount in July 2026). All awards are subject to malus and
clawback provisions.
96 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

B Messer is subject to our post-employment shareholding guideline and is required to retain 200% of base salary in shares (or actual shareholding if lower) for a period of two years from stepping down from the Board.

# **Payments to past Directors (audited)**

No payments were made to past Directors in the year.

# **Change in Directors' remuneration compared to Group UK employees**

The table below sets out the percentage change in remuneration for each of the Directors and UK Group employees over each of the last two years. There are no employees in IG Group Holdings plc, and therefore we have voluntarily disclosed the change in remuneration for UK Group employees.

|   | FY21/2020 |   |   | FY22/2021  |   |   |
| --- | --- | --- | --- | --- | --- | --- |
|   |  Base salary % change | Taxable benefits % change | Performance-related remuneration % change | Base salary % change | Taxable benefits % change | Performance-related remuneration % change  |
|  **Executive Directors**  |   |   |   |   |   |   |
|  J Felix | 1.7% | -21% | -2.3% | 0.7% | -12.9% | 1.4%  |
|  C Rozes^{1} | - | - | - | 0.7% | -1.7% | 1.4%  |
|  J Noble | 1.7% | 1.7% | -2.3% | 8.9% | 7.3% | 6.7%  |
|  **Non-Executive Directors**  |   |   |   |   |   |   |
|  M McTighe | 300% | - | - | 0.7% | - | -  |
|  J Moulds | -39% | - | - | 0.7% | - | -  |
|  R Bhasin^{2} | - | - | - | 0.7% | - | -  |
|  A Didham | 72% | - | - | 0.7% | - | -  |
|  S-A Hibberd | 32% | -100% | - | 0.7% | - | -  |
|  Wu Gang^{3} | - | - | - | 0.7% | - | -  |
|  M Le May | -23% | - | - | 0.7% | - | -  |
|  S Skerritt^{4} | - | - | - | - | - | -  |
|  H Stevenson | 614% | - | - | 0.7% | - | -  |
|  **Group UK employees^{5}** | **10%** | **10%** | **17%** | **12%** | **12%** | **33%**  |

1 C Rozes joined the Board on 1 June 2020.

2 R Bhasin joined the Board on 6 July 2020.

3 Wu Gang joined the Board on 30 September 2020.

4 S Skerritt joined the Board on 9 July 2021.

5 Employee group consists of individuals employed by IG Index Limited the main UK employing entity as IG Holdings Group plc, does not have any employees. Median employee salary, benefits and bonus have been calculated on a full-time equivalent basis. Salary and benefits are calculated as at 31 May, bonus is that earned during the year ending 31 May.

# **Relative importance of spend on pay**

The following table sets out the dividends and overall spend on pay over the past financial year:

|   | 2022 £m | 2021 £m | Percentage change  |
| --- | --- | --- | --- |
|  Dividends | **186.2** | 159.7 | 16.6%  |
|  Employee remuneration costs | **214.2** | 177.5 | 20.7%  |

# **CEO to all employees pay ratio**

The CEO's total remuneration as a ratio against the full-time equivalent remuneration of UK employees is detailed in the table below:

|  Year | Method | 25th percentile pay ratio | Median pay ratio | 75th percentile pay ratio  |
| --- | --- | --- | --- | --- |
|  2022 | A | 50:1 | 36:1 | 25:1  |
|  2021 | A | 55:1 | 40:1 | 29:1  |
|  2020 | A | 65:1 | 46:1 | 34:1  |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

97
GOVERNANCE REPORT

## Directors' Remuneration Report and Policy continued

The Company has calculated the ratio in line with the reporting regulations using 'option A' (determine total full-time equivalent remuneration for all UK employees for the relevant financial year; rank the data and identify employees whose remuneration places them at the 25th, 50th and 75th percentile). We have used option A as we believe it provides the most consistent and comparable outcome. Data used to determine the pay ratios was taken as at 31 May 2022 and any part-time employees' salary and bonus have been pro-rated to convert them into a full-time equivalent.

|   | Base salary | Total remuneration  |
| --- | --- | --- |
|  25th percentile^{1} | £55,700 | £71,634  |
|  50th percentile^{1} | £70,250 | £98,930  |
|  75th percentile | £94,950 | £139,594  |

$^{1}$ Employees on 25th and 50th percentiles were not considered representative therefore the closest employees we considered to be representative were used.

The CEO pay ratio has been rounded to the nearest whole number. The ratios for FY22 are slightly lower than FY21 and FY20, which reflects the increase in salaries applied to UK employees during FY22.

During the year the Board has received presentations from management on the approach to the Company's wider policies on employee pay, reward and progression. The Committee also reviewed year-end incentive outcomes.

Taking into account the above, the Committee believes that the CEO's pay ratio and the year-on-year change is fair in the context of our approach to remuneration more broadly within the organisation.

### Statement of shareholder voting

The Directors' Remuneration Policy was approved at the 2020 AGM. The Directors' Remuneration Report for the financial year ended 31 May 2021 was approved at the 2021 AGM. The following votes were received:

|   | 2020 Remuneration Policy  |   |
| --- | --- | --- |
|   | Total number of votes/2020d | % of votes/card  |
|  For^{1} | 268,201 | 88.1%  |
|  Against | 36,221 | 11.9%  |
|  Total | 304,422 | 100%  |
|  Withheld | 9,350 | -  |

$^{1}$ For includes votes at the Chairman's discretion.

|   | 2021 Annual Report on Remuneration  |   |
| --- | --- | --- |
|   | Total number of votes/2020d | % of votes/card  |
|  For^{1} | 350,242 | 97.8%  |
|  Against | 7,999 | 2.2%  |
|  Total | 358,241 | 100%  |
|  Withheld | 137 | -  |

$^{1}$ For includes votes at the Chairman's discretion.

98

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Total Shareholder Return chart
This graph shows the value, by 31 May 2022, of £100 invested in the Group on 31 May 2012 compared with the value of £100
invested in the FTSE 250 Index and the FTSE 350 Financial Services Index. As the Group is a member of both of these indices,
the Committee believes it is appropriate to compare the Group’s performance against them.
300
200
100
0
May-12 May-13 May-14 May-15 May-16 May-17 May-18 May-19 May-20 May-21 May-22
CEO earnings history
T Howkins P Hetherington J Felix

|  |  |  |  | LTIP/VSP/SPP |  |  |  |  |  | LTIP/VSP/SPP |  |  |  |  |  | LTIP/VSP/SPP |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Single figure | Annual bonus |  |  |  | vesting | Single figure | Annual bonus |  |  |  | vesting | Single figure | Annual bonus |  |  |  | vesting |
| remuneration |  | outcome | 1 |  | outcome | remuneration |  | outcome | 1 |  | outcome | remuneration |  | outcome | 1 |  | outcome |

2013 1,103 47% 6% – – – – – –
2
2014 1,970 – 3% – – – – – –
3
54%
2015 1,519 – 41% – – – – – –
4
2016 210 – 0% 2,641 – 90% – – –
2017 – – – 1,452 – 27.1% – – –
2018 – – – 2, 974 – 80% – – –
5 6, 7
2019 – – – 777 – 18.64% 823 – 18.64%
2020 – – – – – – 3,640 – 97. 2%
2021 – – – – – – 3,544 – 93.4%
2022 – – – – – – 3,577 – 94%
1 The SPP replaced the annual bonus and value-sharing plan schemes from the financial year ending 31 May 2014.
2 Relates to Value Sharing Plan (VSP) award to T Howkins.
3 Relates to SPP award to T Howkins.
4 P Hetherington was appointed CEO on 15 October 2015; prior to this he was COO. This figure includes a portion of the remuneration that he received during thisperiod.
5 P Hetherington stepped down as CEO on 26 September 2018. The figure shows salary, benefits and pension to this date. The full value of his SPP for FY19 is included in this figure.
6 P Mainwaring performed the role of acting CEO for the period between 26 September 2018 and 30 October 2018 but received no additional remuneration for this period. This figure
400 therefore includes one month of P Mainwaring’s compensation equating to £66k.
7 J Felix was appointed CEO on 30 October 2018; prior to this she was a Non-Executive Director on the Board. The figure excludes a portion of the remuneration that she received as a
Non-Executive Director between 1 June 2018 and 30 October 2018, which equated to £23k.
Value (£) rebased
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 99
IG Group FTSE 250 Index FTSE 350 Financial Services Index Source: Datastream
GOVERNANCE REPORT
### Directors’ Remuneration Report and Policy continued
Role of the Remuneration Committee
The Committee’s principal roles are summarised below:
¼ Make recommendations to the Board on our Senior Executive Remuneration Policy
¼ Determine an overall remuneration package for the Executive Directors in order to attract and retain high-quality Directors
capable of achieving our objectives
¼ Set and agree with the Board a competitive and transparent remuneration framework which is aligned to our strategy
and is in the interests of both the Company and its shareholders
¼ Determine the contractual terms, remuneration and other benefits for the Executive Directors, Chair and senior
management – including the Company Secretary
¼ Determine and review our Remuneration Policy, ensuring it is consistent with effective risk management, and consider
theimplications of this Remuneration Policy for risk and risk management
¼ Determine and agree the policy for the remuneration of the Company Chair and the Executive Directors
¼ Review pay, benefits and employment conditions and the remuneration trends
¼ Approve the structure of share-based awards under our employee incentive schemes, to determine each year whether
awards will be made and, if awards are made, to monitor their operation, the size of such awards and the performance
targets to be used
¼ Ensure that contractual terms on termination, and any payments made, are fair to the individual and the Group, that failure
isnot rewarded and that the duty to mitigate loss is fully recognised
¼ Receive and review reports annually directly from the risk management function on the implications of our Remuneration
Policy for risk and risk management
¼ Monitor relevant regulatory developments, including those affecting UK-listed companies and financial services firms,
toensure the Company’s Remuneration Policy and its operation is consistent with these
¼ Establish the selection criteria, appoint and set the Terms of Reference for any remuneration consultants who advise
theCommittee
The full Terms of Reference for the Committee can be found on our website, iggroup.com. To ensure the Committee discharges
its responsibilities appropriately, an annual forward calendar, linked to the Committee’s ToR, is approved by the Committee.
Main activities during the financial year
During the year, the Committee’s key activities included:
¼ Reviewing the Directors’ Remuneration Policy and the operation of the SPP
¼ Reviewing the Directors’ Remuneration Report published in the 2021 Annual Report and Accounts
¼ Reviewing the fee for the Company Chair and Executive Directors’ remuneration for the 2022 financial year
¼ Reviewing performance against targets for the 2021 SPP award, the vesting of long-term incentive plan awards and for the
determination of the bonus pool
¼ Reviewing the remuneration and bonus awards, including for senior management
¼ Reviewing the proposed targets for the 2022 financial year SPP, including agreeing the non-financial metrics
¼ Reviewing the performance of our sales incentive plans to gain assurance that their design helps promote good conduct
¼ Reviewed and agreed changes required to remuneration arrangements, processes and documentation to comply with
requirements under IFPR and IFD
¼ Reviewing remuneration-related risks, remuneration Code Staff reward outcomes and gender pay gap reporting
¼ Reviewing developments in market practice and corporate governance relating to remuneration
Membership and attendance of the Remuneration Committee
The Remuneration Committee is composed of independent Non-Executive Directors. Following the Board reorganisation there
have been a number of changes to Committee membership this year. The current members of the Committee are Helen
Stevenson (Chair), Jonathan Moulds, Sally-Ann Hibberd, Andrew Didham and Mike McTighe.
The CEO and the CFO attend the Committee meetings by invitation. The Company Chair is a member of the Committee
although the Company Chair and Executive Directors do not attend or take part when matters relating to their own
remuneration are discussed. The Chief People Officer and representatives from other areas of the business attend the
Committee meetings by invitation as appropriate to the matter under consideration.
Following each Committee meeting, a formal report is made to the Board in which the Chair of the Committee describes the
proceedings of the Committee meeting and makes recommendations to the Board as appropriate.
100 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Advice to the Committee
During the financial year ended 31 May 2022, the Committee consulted the CEO about remuneration matters relating to
individuals other than herself. The Chief People Officer and the Senior Reward Manager provide support to the Committee.
TheCompany Secretary is secretary to the Committee and also provided advice and support as required.
External advisers attend Committee meetings at the invitation of the Committee Chair.
The Remuneration Committee appointed Deloitte LLP (Deloitte) as advisers to the Committee in April 2019, following
acompetitive tender process.
Deloitte’s fees for advice provided to the Committee during the financial year ending 31 May 2022 were £182,800
(excludingVAT). Fees are charged on a time and material basis.
Deloitte are founding members of the Remuneration Consulting Group and are signatories to its Code of Conduct, which
requires its advice to be objective and impartial. During the year, Deloitte also provided unrelated advisory services in respect of
regulatory, risk management and tax advice, Internal Audit services and agreed-upon procedures-based assurance services.
It is the view of the Committee that the engagement team at Deloitte that provided remuneration advice to the Committee
during the year do not have connections with the Group or its Directors that may impair their independence. The Committee
reviewed the potential for conflicts of interest and judged that there were appropriate safeguards against such conflicts.
TheCommittee considers that the advice received from the advisers is independent, straightforward, relevant and appropriate,
and that it has an appropriate level of access to them and has confidence in their advice.
Committee evaluation
During the year, an evaluation of the performance of the Committee and its members was undertaken in line with the
Committee’s Terms of Reference. The evaluation process was facilitated by the Company Secretariat as part of the overall
annual Board and Committee effectiveness review.
Further information of the evaluation of the Board and its Committees and of individual Directors is given on page 70, together
with a review of the progress on actions arising from the internally run performance review undertaken during 2021.
This report was approved by the Board of Directors on 20 July 2022 and signed on its behalf by:
Helen Stevenson
Chair of the Remuneration Committee
20 July 2022
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 101
GOVERNANCE REPORT
## Audit Committee Report
### Andrew Didham, Chair of the
### Audit Committee, gives his
### review of the Committee’s
### activities during the
### Andrew Didham
### financialyear.
### Chair of the
### Audit Committee Chair’s overview
I am pleased to present the Audit
Committee Report setting out the
Committee’s activities during the
year and how it has discharged its
responsibilities. The Committee has
continued to work closely with other
Board Committees, in particular the
Board Risk Committee, in respect to
## Our key focus is oversight of financial relevant issues affecting more than
one Committee, including operational
## reporting and the surrounding internal
risk and control developments
## control environment.” and strategic developments.
The acquisition of tastytrade and the
subsequent disposal of Nadex and
### Members and attendance Small Exchange has been an area
of focus for the Committee during
Meeting attended Did not attend FY22. The Committee has received
regular updates on the finance
integration of the tastytrade business
Andrew Didham Rakesh Bhasin
Chair of the Committee Committee member and in relation to the appropriate
reporting of the transactions.
During the financial year, we held a joint
meeting with the Board Risk Committee
Malcolm Le May
to review and discuss matters common
Committee member
to both Committees. This included
review of the Risk Acceptance Policy
and Procedure; our ICAAP, ILAA and
Recovery Plans; financial and regulatory
capital forecasts; and privileged access
### FY22 key focus areas management. All members of the Audit
Committee and Board Risk Committee
attended this meeting. It was agreed
¼ Client money and assets review
that this would take place on an annual
¼ tastytrade acquisition accounting
basis going forward.
¼ Privileged access management
¼ Disposal of Nadex and Small Exchange
Role of the Audit Committee
The principal roles and responsibilities of
the Committee are set out in its Terms
of Reference, and include, but are not
limited to:
¼ Reviewing the clarity, completeness
and appropriateness of disclosures
inthe IGGH, IGM, IGI and IGT&I
financial statements and the context
in which statements are made,
including the Going Concern and
Viability Statement
¼ Reviewing and assessing the
controlenvironment via Internal
Auditreports
102 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| ¼ Reviewing and assessing the progress | How the Committee operates | ¼ Reviewing the processes to support |
| --- | --- | --- |
| on implementation of audit | To ensure the Committee discharges its | the assessment and determination of |
| recommendations via the Control | responsibilities appropriately, an annual | the principal risks that may have an |
| Action List | forward calendar, linked to the | impact on our solvency and liquidity, |
| ¼ Monitoring and reviewing the | Committee’s Terms of Reference and | before recommending and approving |
| effectiveness of our Internal Audit | covering key events in the financial | the Going Concern and Viability |
| function in the overall context of the | reporting cycle, is approved by the | Statement to the Board |
| our internal controls and risk- | Committee. The Company Secretary | ¼ Evaluating on behalf of the Board |
| management systems | and the CFO assist me in drafting the | whether the Annual Report and |
| ¼ Recommending the appointment | agenda for each Committee meeting. | Financial Statements, taken as |
| ofthe External Auditor and reviewing |  | awhole, are fair, balanced and |
| its effectiveness, fees, terms | Following each Committee meeting, | understandable, and provide |
| andindependence | aformal report is made to the Board | theinformation necessary for |
| ¼ Monitoring the availability of | inwhich the Chair of the Committee | shareholders to assess our position |
| distributable profits for the purpose | describes the discussions and | and performance, business model |
| of considering dividend payments | challenges from the Committee | and strategy |
| ¼ Reviewing and approving our | meeting, and has the opportunity | ¼ Receiving a paper summarising all |
| whistleblowing arrangements | toescalate any items and make | statements and assurances required |
|  | recommendations to the Board | of Directors in the Annual Report and |
| The Committee’s full Terms of | asappropriate. | Accounts together with evidence to |
| Reference are reviewed on an annual |  | support the Directors’ views and |
| basis and were last reviewed in May | Members of the Committee also meet | required statements |
| 2022. They are available on our website. | separately with the Global Head of | ¼ Overseeing our approach to tax |
|  | Internal Audit and the External Auditor | management and control |
| Membership and attendance | to focus on their respective areas | ¼ Reviewing the inherent risks in |
| All Committee members are | ofresponsibility, and to discuss any | thefinancial reporting process |
| independent Non-Executive Directors | potential requirements for support | andsystems |
| who between them draw on | fromthe Committee to address | ¼ Reviewing and considering both audit |
| broadbusiness and financial | anyissues arising. | and non-audit services required. |

servicesexperience.

|  | Main activities during the |  | To aid this review process, the |
| --- | --- | --- | --- |
| The Code requires that at least | financialyear |  | Committee has considered reports from |
| one member of the Committee, | Financial reporting |  | the CFO and his team and the Internal |
| determined by the Board, has recent | In relation to financial reporting, the |  | and External Auditors. |
| and relevant financial experience, and | primary role of the Committee is to |  |  |
| I as Committee Chair continue to fulfil | work with management and the External |  | The Committee considered and |
| those requirements. The Committee | Auditor in reviewing the appropriateness |  | discussed with management and the |
| as a whole has competence relevant | of the half-year and annual Financial |  | External Auditor the primary areas of |
| to the sector in which we operate. | Statements. The Committee |  | judgement and disclosure in relation to |
|  | discharged its responsibilities in |  | the Financial Statements for FY22, |
| The CFO, CEO, Global Head of | this area through focusing on the |  | details of which are set out on pages |
| Internal Audit, Company Secretary | following, among other matters: |  | 104 to 109. |
| and representatives from |  | ¼ Assessing the quality and |  |
| PricewaterhouseCoopers LLP (PwC), |  | acceptability of accounting policies |  |
| the External Auditor, attend Committee |  | and practices |  |
| meetings by standing invitation. |  | ¼ Ensuring disclosures are clear and |  |
| Members of senior management |  | compliant with financial reporting |  |
| from various areas of the business |  | standards, and relevant financial and |  |
| attend the Committee meetings |  | governance reporting requirements |  |
| by invitation when necessary. |  | ¼ Considering material areas in which |  |

significant judgements and estimates
The Committee has four scheduled have been applied or there has been
meetings a year and will additionally discussion with the External Auditor
meet if and when required. ¼ Reviewing announcements and
Financial Statements prior to
issuance, including preliminary and
half-year results announcements and
recommending these to the Board
for approval
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 103
GOVERNANCE REPORT
### Audit Committee Report continued
Role of the Committee Discharge of responsibilities Conclusion/action taken
Going concern and long-term viability
The Directors are required to make a The Committee evaluated various Taking into account the assessment
statement in the Annual Report as to the reports from management that set out bymanagement of stress-testing results
going concern and longer-term viability the view of the Group’s going concern and risk appetite, the Committee agreed
of the Group. and longer-term viability. These reports to recommend the Going Concern
detailed the impact of outcomes of andViability Statement to the Board
stress tests after applying multiple forapproval.
scenarios to determine how we were
able to cope with deterioration in
liquidity profile or capital position.
Carrying value of goodwill and other intangible assets
In accordance with accounting The Committee reviewed a report from Based on the assessment performed,
standards, we are required to review any management setting out the key theCommittee concluded that there
goodwill balances for impairment and assumptions used in the impairment should be no change to the recorded
toconsider the underlying assumptions review of the goodwill balance and an carrying value of the goodwill and other
used in determining the carrying value associated sensitivity analysis. The intangible assets.
ofthese assets. Committee also considered the work
ofthe External Auditor on goodwill and The Committee concluded that adequate
In addition, we are required to assess intangible assets. disclosure was included within the
whether there is any indication the other financial statements.
intangible assets may be impaired. An independent external valuation
agency has provided support in valuing
the US cash-generating unit as part of
the annual goodwill impairment testing.
104 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Role of the Committee Discharge of responsibilities Conclusion/action taken
Business combinations and discontinued operations

| During the period, we completed the | The Committee reviewed various reports | Based on the assessment performed, the |
| --- | --- | --- |
| acquisition of tastytrade and its | from management setting out the | Committee concluded that the fair value |
| subsidiaries. We also completed the sale | assumptions used to determine the fair | and useful lives of the assets acquired |
| of our 100% holding in Nadex. | value of assets and liabilities acquired | were appropriate. |

with tastytrade.
We are required to properly disclose The Committee concluded that adequate
matters relating to the acquisitions and The Committee reviewed a report disclosure was included within the
disposals in our financial statements. frommanagement relating to the financial statements.
identification of assets held for sale and
We are required to consider whether our the profits associated with the Nadex
accounting policies relating to business discontinued operation.
combinations are appropriate.
The Committee reviewed the disclosures
relating to the acquisitions and disposals
during the year.
The Committee received an update
fromPwC on recent accounting
developments including findings from
the FRC Annual Review relating to
business combinations.
Alternative performance measures
We are required to define any alternative The Committee discussed the alternative The Committee concluded that the
performance measures used and to performance measures included within alternative performance measures
explain why they are useful or more the Annual Report. provided a fair representation of business
meaningful to describe the performance performance and position, and that
during the period. The Committee received an update adequate disclosure was included to
fromPwC on recent accounting reconcile them to the closest UK-adopted
We are also required to reconcile them developments including findings from International Accounting Standards
to the closest UK-adopted International the FRC Annual Review relating to measures.
Accounting Standards measures. alternative performance measures.
Tax provisions
Calculating the Group’s corporation tax The Committee reviewed a report The Committee concluded that the
charge involves a degree of estimation frommanagement that detailed the corporation tax charge and provisions
and judgement, as the tax treatment assumptions made in calculating the recorded were appropriate and complete.
ofcertain items cannot be finally Group’s corporation tax charge and
determined until resolution has been provisions. Our External Auditor also The Committee recommended our Tax
reached with the relevant tax authority. provided commentary on this matter to Risk Management Policy and Tax Strategy
Where appropriate, we hold tax the Committee. The Committee has also to the Board for approval.
provisions in respect of the potential reviewed our Tax Risk Management
taxliability that may arise on these Policy and Tax Strategy.
unresolved items.
We have generated tax losses in certain
jurisdictions where we operate. We’ve
recognised deferred tax assets in
respect of these losses to the extent that
future profits have been forecast.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 105
GOVERNANCE REPORT
### Audit Committee Report continued
Role of the Committee Discharge of responsibilities Conclusion/action taken
Legal entity governance
To aid with its review of corporate The Committee noted the work that The Committee was satisfied with the
governance, the Committee has hadbeen undertaken during the year progress made and the proposal to create
received support from the Company toreview legal entity governance a new Subsidiary Governance Framework.
Secretary, whose Legal Entity globally, including the development of
Governance Committee has provided appropriate procedures and policies.
some oversight over the risk-based
system for the governance, operation The establishment of a North American
and maintenance of the Group’s Board has helped to strengthen our
legalentities. Corporate Governance Framework
following the acquisition of the
tastytrade business.
Work is underway to ensure appropriate
governance arrangements are in place
across our other Regulated Entities to
support our future growth and strategy
through the creation of a new Subsidiary
Governance Framework.
Control environment
Other matters addressed by the Committee included focus on the effectiveness of our control environment and
performance of our IT systems, and the Internal Audit function, including the objectivity and independence of Internal
Audit personnel. These are summarised below:
Role of the Committee Discharge of responsibilities Conclusion/action taken
Risk management and internal control
The Committee is required to assist the The Committee received a report from The Committee agreed to recommend to
Board in the annual review of the the Board Risk Committee including an the Board the Annual Report statements
effectiveness of our Risk Management assessment of those risks that might relating to the effectiveness of the Risk
Framework and internal control systems threaten our business model, future Management Framework and internal
performance, solvency or liquidity. control systems.
It considered and challenged The Committee has received regular
management on the overall updates from management regarding the
effectiveness of the Risk Management positive progress made in these areas to
Framework and internal control systems. address identified areas for improvement
against the agreed action plans.
Particular focus was given by the
Committee to the control environment
in respect of corporate actions, following
the significant growth in the number of
clients serviced by the Stock Trading and
Investments business, and privileged
access management.
The Committee reviewed the relevant
disclosures within the Accountability
section of the Governance Report within
the Annual Report.
106 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Role of the Committee Discharge of responsibilities Conclusion/action taken
Internal Audit
The Committee is required to oversee The Committee monitored and The Committee reviewed the resourcing
the performance, resourcing and reviewedthe effectiveness of our and effectiveness of the Internal Audit
effectiveness of the Internal Audit Internal Audit function in the overall function and approved the risk-based
function. context of our internal controls and audit plan.
riskmanagement systems.
The Internal Audit function supports
It reviewed and assessed the risk-based thework of the Committee.
Internal Audit plan.
The Internal Audit function remains
It reviewed and monitored effective and has implemented the
management’s responsiveness to the appropriate processes to ensure this.
findings of the Internal Audit function. Thefunction has sufficient resources
todeliver the proposed plan.
It monitored the consolidated Control
Action List, noting themes arising, The function continues to be efficient,
andreviewed the effectiveness of with robust processes.
thefunction.
The Committee received all Internal
Audit reports and, in addition, received
summary reports on the results of the
work of the Internal Audit function on
aperiodic basis.
The Committee reviewed additional
Internal Audit reports, not forming part
of the annual plan.
It reviewed the performance of the
Internal Audit function against the plan
and an assessment of the effectiveness
of the Internal Audit function.
The priorities for the Internal Audit
function were considered.
Whistleblowing
The Committee considers the adequacy The Committee reviewed our The Committee decided that the
of our arrangements by which Whistleblowing Policy to ensure that it Whistleblowing Policy remained fit
employees may in confidence raise remained fit for our needs. forpurpose.
concerns about improprieties in matters
of financial reporting or other matters. The Committee concluded that
whistleblowing processes were operating
effectively during the period under
review.All employees acknowledged their
understanding of the policy and additional
training is also being rolled out.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 107
GOVERNANCE REPORT
### Audit Committee Report continued
Role of the Committee Discharge of responsibilities Conclusion/action taken
Client money and assets
The Committee has a responsibility for The Committee monitored the The Committee reviewed the control
overseeing our systems and controls effectiveness of the control environment environment at both Group and
relating to the holding and management relating to client money and assets and entitylevel.
of client money and assets. received an annual report on the
operation of the Client Money and The Committee considered that the
Assets Committee. control environment remained effective.
The Committee also considered the
report from the External Auditor on
theclient money control environment
and operations.
The Committee further received regular
reports on the control environment of
corporate actions.
Role of the Committee Discharge of responsibilities Conclusion/action taken
Oversight of external audit

| The Committee is required to oversee | The Committee met with the key | The Committee approved the audit plan |
| --- | --- | --- |
| the work and performance of PwC | members of the PwC audit team to | and the main areas of focus, including the |
| asExternal Auditor, including the | discuss the FY22 audit plan and areas | potential risk of management override of |
| maintenance of audit quality during | offocus. This included the valuation | controls and the valuation of customer |
| theperiod. | oftastytrade. | relationships and assessment of the |

carrying value of the tastytrade cash-
It assessed regular reports from PwC on generating unit.
the progress of the FY22 audit and any
material issues identified. More information on the Committee’s
rolein assessing the performance,

| It debated the draft audit opinion ahead | effectiveness and independence of the |
| --- | --- |
| of the FY22 year-end. The Committee | External Auditor and the quality of the |
| was also briefed by PwC on critical | external audit can be found on page 109. |

accounting estimates, where significant
judgement was needed.
Audit and audit-related fees

| Audit-related fees include those related | During the year, the Committee | The Committee considers the FY22 audit |
| --- | --- | --- |
| to the statutory audit of the Group and | reviewed and approved a | and audit-related fees to be appropriate |
| its subsidiaries, as well as audits required | recommendation from management | given the change in complexity of the |
| due to the regulated nature of our | on the Company’s audit and audit- | Group structure. A breakdown of audit |
| business. Also included are fees | related fees. | and non-audit related fees is in note 5 to |
| associated with testing of controls |  | the Financial Statements on page 150. |

relating to our processes and controls
over client money and asset segregation.
108 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Role of the Committee Discharge of responsibilities Conclusion/action taken
Non-audit services and fees

| To prevent the objectivity and | The Committee reviewed and approved | During the year, non-audit fees of £0.3 |
| --- | --- | --- |
| independence of the External Auditor | all arrangements for non-audit fees. | million were paid to PwC, as discussed in |
| from becoming compromised, the | Fees in relation to permitted services | note 5 to the Financial Statements. |
| Committee has a formal policy | below £0.05 million are deemed pre- |  |
| governing the engagement of the | approved by the Committee and are |  |
| External Auditor to provide non-audit | subject to the approval of the CFO. |  |
| services. The policy is reviewed on an | Feesabove £0.05 million must be |  |
| annual basis. The Committee reviewed | approved by the Committee, through |  |
| our policy governing non-audit work | the Committee Chair. |  |

against details of regulations on the
statutory audit of public interest entities. The Committee also requested and
received an explanation from PwC of its
own in-house independence process.
The Committee ensured there were
noexceptions to fee limits and approval
processes, per the policy, during
theyear.
Effectiveness of the External Auditor
In assessing the effectiveness and independence of the External Auditor, the Committee considered relevant professional and
regulatory requirements and the relationship with the External Auditor as a whole. The Committee monitored the External
Auditor’s compliance with relevant regulatory, ethical and professional guidance on the rotation of partners, and assessed its
qualifications, expertise, resources, and quality of people and service provided, including a report from the External Auditor on
its own internal quality procedures and independence.
As part of the assessment, a questionnaire was completed by our key stakeholders. The questionnaire addressed matters
including the External Auditor’s independence, objectivity, the quality of planning and execution of the audit, insights and added
value and general support and communication to the Committee and management. The results were analysed, and a report
was presented to the Committee.
The Committee assessed the robustness of the audit process, specifically how the auditor challenged management’s key
assumptions and demonstrated professional scepticism, through discussion with the audit partner, by reviewing PwC’s findings
on areas which required management judgement and in considering the quality and depth of the auditor’s observations
andchallenge.
Following the review of the effectiveness of the External Auditor, the external audit process and an assessment of the External
Auditor’s independence and objectivity, the Committee recommends the reappointment of PwC to the Board for approval by
shareholders at the Company’s 2022 AGM.
There are no contractual obligations restricting choice of External Auditor.
Committee evaluation
During the year, an evaluation of the performance of the Committee was undertaken in line with the Committee’s Terms of
Reference. Further information of the evaluation of the Board and its Committees is given on page 70.
Andrew Didham
Chair of the Audit Committee
20 July 2022
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 109
GOVERNANCE REPORT
## ESG Committee Report
### Sally-Ann Hibberd, Chair of the
### ESG Committee, highlights
### some of the Committee’s key
### activities during the year.
### Sally-Ann Hibberd
### Chair of the Chair’s overview
The ESG Committee has an important
### ESGCommittee
role in providing oversight on behalf
of, and advice to, the Board in relation
to our ESG strategy and activities. The
Board established the Committee
in 2020 and, in the Spencer Stuart
2021 UK Board Index, was recognised
as one of six FTSE 150 companies
with such a Committee. During its
## Substantial progress has been made to second year of operation it has taken
significant steps to ensure principles of
## embed ESG considerations in everything
responsible and sustainable business
are formally embedded across the
## we do, in line with our purpose, culture
business. We are particularly proud
## andvalues.” to have started a review of the ESG
impacts of our entire suite of products,
and a project developing new tools
to identify and support vulnerable
### Members and attendance
clients. These link to what we recognise
as two of the most material ESG
Where Directors were unable to attend meetings, they gave the Chair their views risks posed by our business. We are
in advance on the matters to be discussed. also proud to have recommended
a new Financial Education Strategy,
Meeting attended Did not attend
an expression of our value to learn
fast together, and a significant step
2
Sally-Ann Hibberd Helen Stevenson
towards ensuring that we truly exist
Chair of the Committee Committee member
for every ambitious person.
The Committee has worked closely with
our COO, the executive accountable
1
Malcolm Le May Rakesh Bhasin for ESG, as well as our Group Head of
Committee member Committee member ESG. At each meeting, the Committee
reviews progress against agreed
metrics under each of the four pillars
of the ESG strategy – Products, People,
1 Unable to attend one Committee meeting due to illness.
2 Unable to attend one Committee meeting due to a prior commitment. Partnerships and Best Practice. The
Committee has continued to consider
the ability of our ESG strategy to
reflect our purpose and values.
### FY22 key focus areas

| ¼ Commissioned a review of our | ¼ Recommended to the Board our |
| --- | --- |
| products to better understand their | Equality, Diversity and Inclusion |
| ESG impacts. This project is ongoing | strategy |
| and will be progressed throughout | ¼ Oversaw ESG-related disclosures |
| FY23 | including those under the TCFD |
| ¼ Commissioned a project to develop | recommendations |
| a data science driven process for | ¼ Sought and received insights and |
| identifying and supporting | feedback from key stakeholders |
| vulnerable clients. This project is | including shareholders to better |
| ongoing and will be progressed | understand their ESG priorities |
| throughout FY23 | ¼ Recommended that we pledge 1% |
| ¼ Recommended to the Board our | of our prior-year post-tax profits to |
| Financial Education strategy | charitable causes through the |

Brighter Future Fund
110 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| Furthermore, the Committee has also |  | How the Committee operates | The first Internal Audit review of ESG |
| --- | --- | --- | --- |
| continued to focus on challenging |  | To ensure the Committee discharges | was undertaken during the year at the |
| andsupporting us in relation to our |  | itsresponsibilities appropriately, an | Committee’s request. The review |
| charitable outreach through Brighter |  | annual forward calendar, linked to the | concluded that the Committee was |
| Future initiatives (see page 32 for |  | Committee’s Terms of Reference is | operating effectively. Unsurprisingly, |
| moreinformation). In this area, we are |  | approved by the Committee. The | given the Committee’s recent formation, |
| particularly proud to have overseen a |  | Company Secretary, COO and ESG | there are a number of areas to work on. |
| significant increase in the number of |  | Manager assist the Chair of the | Continued focus will remain on ensuring |
| young people benefiting from our |  | Committee in drafting the agenda for | Committee members are kept up to |
| Brighter Future Fund initiatives, from |  | each Committee meeting. | date with best practice, acknowledging |
| 22,284 in FY21, to 94,751 in FY22 |  |  | the area of ESG is rapidly evolving across |
| (seepage 26 for more information). |  | Following each Committee meeting, | the world. All Directors have received |
|  |  | aformal report is made to the Board | TCFD training during the year. |
| Role of the ESG Committee |  | inwhich the Chair of the Committee |  |
| The principal roles and responsibilities of |  | describes the discussions and | As we embed principles of ESG across |
| the Committee include: |  | challenges from the Committee | all business activities, the Committee |
|  | ¼ Oversight of our ESG strategy | meeting, and has the opportunity | recognised the importance of ensuring |
|  | ¼ Monitoring and reviewing how the | toescalate any items and make | ESG risks are fully integrated into the |
|  | ESG strategy is received and | recommendations to the Board | Risk Management Frameworks. To fully |
|  | regarded by our stakeholders | asappropriate. | understand these risks, the Committee |
|  | ¼ Overseeing how all elements of the |  | sought input from third-party providers. |
|  | ESG strategy are reported externally | Work undertaken during the |  |
|  | ¼ Ensuring that there are appropriate | financial year | Committee evaluation |
|  | policies in place to effectively support | During the year, the Committee | During the year, an evaluation of the |
|  | the ESG framework | undertook a number of significant | performance of the Committee was |
|  | ¼ Assisting on other matters related | activities. | undertaken in line with the Committee’s |
|  | toESG as may be referred to it by |  | Terms of Reference. Further information |
|  | theBoard | It has reviewed and monitored the | of the evaluation of the Board and its |
|  |  | implementation of our ESG strategy, | Committees is given on page 70. |
| The Terms of Reference of the |  | aswell as targets, key performance |  |
| Committee, which were last reviewed in |  | indicators, its budget and third-party |  |
| May 2022, are available on our website. |  | partnerships. It has also considered |  |

whether the Group maintains
Membership and attendance appropriate policies in order to
The Committee consists entirely of Sally-Ann Hibberd
effectively support its ESG framework.
Chair of the ESG Committee
independent Non-Executive Directors
20 July 2022
and meets on a quarterly basis. The
Committee met four times during
theyear.
The Board Chair, CEO, COO, ESG
Manager, Chief People Officer and Chief
Risk Officer are standing attendees of
the Committee. Representatives from
other areas of the business attend the
Committee meetings by invitation,
asrequired.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 111
GOVERNANCE REPORT
## Board Risk Committee Report
### Jonathan Moulds, Chair of the
### Board Risk Committee, gives
### his review of the Committee’s
### activities during the
### Jonathan Moulds
### financialyear.
### Chair of the Board Risk
### Committee Chair’s overview
The Committee has continued to focus
on providing oversight and advice to
the Board in relation to our current
and potential future risk exposures,
including risks to the achievement
of our strategy. The Committee’s
agenda reflects the importance of
reviewing the key actual and emerging
## During the year, we have continued to risks faced by the business.
## demonstrate the robustness of our Risk
During the year, we have continued
## Management Framework.” to demonstrate the robustness of our
Risk Management Framework. Again,
we have faced significant turmoil and
### Members and attendance
heightened risks, including interest
rate rises, geopolitical instability and
Meeting attended Did not attend
the ongoing impact and after-effects
of the global Covid-19 pandemic. We
Jonathan Moulds Wu Gang continue to adapt to changes in the
Chair of the Committee Committee member
regulatory landscape, ranging from
the introduction of a Consumer Duty
in the UK, to monitoring developments
regarding Payment for Order Flow
in the US. Our focus on good client
Andrew Didham Sally-Ann Hibberd
Committee member Committee member outcomes, resilience and our control
infrastructure means we have seen
limited manifestation of risk, which
would be considered out of keeping
with the volume of business seen.
1
Susan Skerritt
Committee member
We have considered in detail the risks
around the integration of tastytrade.
This has included focusing on
1 Appointed to the Committee on 10 November 2021. implementation of a new operational risk
system to align and embed tastytrade
into our Risk Management Framework.
### FY22 key focus areas
The Risk function, headed by the Chief
¼ Undertook a detailed evaluation of ¼ Developed a strategy for the
Risk Officer, seeks to ensure a holistic
the risks and controls around the enhanced identification of clients
approach to risk management is
integration of tastytrade displaying traits of vulnerability,
embedded, including through clear
¼ Continued to embed the together with support and
linking of risk reporting to the key risks
operational risk framework, assisted intervention mechanisms
facing the business, through the Risk
by an ongoing upgrade in risk ¼ Oversaw the implementation of the
Taxonomy and Key Risk Indicators, in line
management tools. The operational new IFPR in Europe and the UK,
with our Risk Appetite Statement and
risk strategy aligns with the business including preparatory work for the
Risk Management Framework. The
in FY23 with more focus on associated new Internal Capital and
Committee reviews this framework on
localised ownership of risk Risk Assessment (ICARA)
an annual and continuous basis.
management across all entities ¼ Monitored closely the associated
¼ Reviewed our Financial Crime risks related to market volatility,
The operational risk management
Framework and associated controls people and business continuity
systems continue to be developed and
relating to the war in Ukraine
further embedded into the business,
112 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| with strong stakeholder engagement | financial and regulatory capital |  | Membership and attendance |
| --- | --- | --- | --- |
| that encourages a culture of event | forecasts; and privileged access |  | The Committee is composed of five |
| reporting. The Operational Risk team | management. All members of the Audit |  | independent Non-Executive Directors. |
| has adapted its approach to assist | Committee and Board Risk Committee |  |  |
| and coach first-line functions in root- | attended this meeting. It was agreed |  | The Terms of Reference require the |
| cause analysis relating to events, | that this would take place on an annual |  | Committee to meet at least four |
| enabling improvements to design and | basis going forward. |  | times a year and additionally as |
| implementation of controls. Operational |  |  | required. During the financial year the |
| risk reports are regularly provided to | Role of the Board Risk Committee |  | Committee met five times. As well as |
| related management committees, such | The Committee provides oversight |  | making decisions in its own right, the |
| as the Executive Risk Committee and the | andadvice to the Board in relation to |  | Committee makes recommendations |
| Client Money and Assets Committee. | ourcurrent and potential future risk |  | to the Board and, where relevant, |
|  | exposures and future risk strategy. |  | to other Board Committees. The |
| This year’s annual Non-Executive | Thisincludes the determination |  | business of the Committee is reported |
| Director Risk Workshop, as previously, | of riskappetite and tolerance, |  | at the following Board meeting. |
| provided active oversight of, and input | consideringthecurrent and prospective |  |  |
| into, our regulatory capital calculations, | macroeconomic and financial |  | The Executive Directors, the Company |
| as set out in our ICAAP and ILAA. It also | environment. Key responsibilities |  | Secretary, the Chief Risk Officer, Chief |
| covered the stress testing of our risks, | of the Committee, in addition to |  | Compliance Officer and the Global Head |
| and our capital and liquidity held against | those noted above, include: |  | of Internal Audit attend Committee |
| those, as well as our reverse stress-test |  | ¼ Reviewing the design and | meetings as standing attendees. |
| Recovery Plans. |  | implementation of our general | Representatives from other areas of the |
|  |  | RiskManagement Policy and | business attend the Committee |
| The Compliance function, headed by the |  | measurement strategies | meetings by invitation, as required. |
| Chief Compliance Officer, has provided |  | ¼ Considering and regularly reviewing |  |
| the Committee with regular reporting |  | our risk profile relative to current and | How the Committee operates |
| of second-line compliance assurance |  | future strategy and risk appetite, | To ensure the Committee discharges |
| activity, details of regulatory change and |  | identifying any risk trends, material | itsresponsibilities appropriately, an |
| the assessment of key financial crime |  | regulatory changes, concentrations | annual forward calendar, linked to the |
| controls, with a focus on the detection |  | or exposures and any requirement for | Committee’s Terms of Reference, is |
| and prevention of market abuse. |  | policy change | approved by the Committee. The |
|  |  | ¼ Carrying out a robust assessment | Company Secretary and the Chief |
| Cyber threats remain a significant |  | ofour emerging and principal risks | RiskOfficer assist the Chair of the |
| issue for the financial sector and the |  | ¼ Considering our ILAA, ICAAP (to be | Committee in drafting the agenda for |
| Committee continues to support the |  | replaced with ICARA going forwards), | each Committee meeting. |
| Chief Information Security Officer |  | and Recovery Plans |  |
| in ensuring we manage our risks |  | ¼ Considering the scope and nature | Following each Committee meeting, |
| appropriately. Ransomware attacks |  | ofthe work undertaken by the Risk | aformal report is made to the Board |
| have been a particular hot topic |  | Management and the control | inwhich the Chair of the Committee |
| across the industry, with trends |  | functions in analysing, monitoring | describes the discussions and |
| indicating attacks on the increase. |  | and reporting of risks forming part | challenges from the Committee |
| The Committee has sponsored |  | ofour Risk Taxonomy | meeting, and has the opportunity |
| focused work to be conducted |  | ¼ Providing advice to the Remuneration | toescalate any items and make |
| during 2022 to test our technical, |  | Committee on the alignment of the | recommendations to the Board |
| people and process cyber capabilities |  | Remuneration Policy to risk appetite | asappropriate. |
| to ensure they work in unison. |  | and annually reviewing remuneration- |  |

related risks
Reporting from Internal Audit has ¼ Recommending to the Board the
focused on the ongoing state of the Risk appointment and, when and if
Management Framework – particularly appropriate, replacement of the
the development of the operational risk Chief Risk Officer and Chief
framework, as well as our current and Compliance Officer.
potential risk exposures.
The Terms of Reference for the
During the year, we held a joint meeting Committee were last reviewed in May
with the Audit Committee to review and 2022 and are available on our website.
discuss matters common to both
Committees. This included review of the
Risk Acceptance Policy and Procedure;
our ICAAP, ILAA and Recovery Plans;
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 113
GOVERNANCE REPORT
### Board Risk Committee Report continued

| Main activities during the |  | Committee evaluation |
| --- | --- | --- |
| financialyear |  | During the year, an evaluation of the |
| During the year, the Committee’s key |  | performance of the Committee was |
| activities included: |  | undertaken in line with the Committee’s |
|  | ¼ Reviewing the Risk Appetite | Terms of Reference. Further information |
|  | Statement, Risk Taxonomy, Risk | of the evaluation of the Board and its |
|  | Management Framework and | Committees is given on page 70. |

Compliance Framework
¼ Considering current and emerging
risks facing the business,
includingregulatory change,
theCovid-19 pandemic and the
Russia/Ukraine conflict
¼ Undertaking an evaluation of

| tastytrade’s risk profile and | Jonathan Moulds |
| --- | --- |
| associated integration with the | Chair of the Board Risk Committee |
| Group’s Risk Management | 20 July 2022 |

Framework
¼ Reviewing the adequacy of our global
insurance cover
¼ Reviewing Product Governance
¼ Reviewing our Financial Crime
Framework
¼ Reviewing and challenging
operational risk development
¼ Reviewing IT and cyber security in
relation to the annual technology
riskreview
¼ Undertaking a formal annual
compliance assessment of material
breaches
¼ Reviewing a culture risk dashboard
and report covering client outcomes,
IT, regulatory outcomes, people
outcomes and conduct more broadly
¼ Reviewing our capital and liquidity
position including through the ICAAP,
ILAA and the Recovery Plans
¼ Overseeing the implementation of
the new IFPR in Europe and the UK,
including preparatory work for ICARA
¼ Receiving reports from Internal Audit
on the Risk Management Framework
¼ Developing a strategy for the
enhanced identification of clients
displaying traits of vulnerability,
together with support and
intervention mechanisms.
114 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Directors’ Report

| Directors’ Report | In line with the IFPR and the Capital | £178.3million). Dividends are recognised |
| --- | --- | --- |
| The Directors present their report, | Requirements (Country-by-Country | in the Financial Statements for the year |
| together with the Group Financial | Reporting) Regulations 2013, requiring | in which they are paid or, in the case of |
| Statements, for FY22. The Directors’ | credit institutions and investment firms | afinal dividend, when approved by the |
| Report comprises pages 115 to 117 of | to publish annually certain tax and | shareholders. The amount recognised in |
| this report, together with the sections of | financial data for each country where | the Financial Statements, as described |
| the Annual Report incorporated by | they operate, the Group’s UK-regulated | in note 11, includes this financial year’s |
| reference as set out below: | subsidiaries will make available their | interim dividend and the final dividend |
|  | country-by-country reporting on | from the previous year, both of which |
| Contents Page | ourwebsite. | were paid. |

56-

|  |  | Disclosures required pursuant to | The final ordinary dividend, if approved, |
| --- | --- | --- | --- |
| Governance Report | 118 |  |  |
|  |  | Listing Rule 9.8.4R | will be paid on 20 October 2022 to |
| Statement of Directors’ |  | In compliance with the UK FCA’s Listing | those shareholders on the register as at |
| Responsibilities 118 |  | Rules, the information in Listing Rule | 23 September 2022. |

9.8.4R to be included in the Annual
167-

|  |  | Report and Accounts, where applicable, | Certain nominee companies |
| --- | --- | --- | --- |
| Financial instruments | 169 |  |  |
|  |  | can be found on the following pages: | representing our Employee Benefit |
| Greenhouse gas emissions 33 |  |  | Trusts hold shares in the Company, in |
|  |  | Detail Page | connection with the operation of the |

Workforce engagement,
Company’s share plans. Evergreen
communication and equal 30– Waiver of dividends 115
dividend waivers remain in place on
opportunities 31
shares held by them that have not been
Modern slavery
Employees, Customers, Suppliers
allocated to employees.
In compliance with Section 4 (I) of the
and Others Reporting
Modern Slavery Act 2015, the Group
Requirements Under the
Articles of Association
haspublished its slavery and human
Companies (Miscellaneous 22–
The Company’s Articles of Association
trafficking statement on our website.
Reporting) Regulations 2018 23
are available on our website, or by
writing to the Company Secretary at the
Policy concerning the 30- Branch offices
Group’s registered office. The Articles of
employment of disabled persons 31 We have the following overseas
Association were last amended by
branches within the meaning of the
Going Concern and Viability 54-
shareholders by means of a special
CA2006: offices in Australia, China
Statement 55
resolution on 22 September 2021.
(Representative Office), France,
Directors’ Remuneration Report Germany, Hong Kong, Ireland, Italy,
and Policy, service contracts and Board of Directors and their
NewZealand, the Netherlands, Norway,
details of Directors’ interest in 79- interests
Poland, South Africa, Spain and Sweden.
shares 101 The Directors who held office during
FY22 are set out below:
Corporate Governance Statement
12-
In compliance with the UK FCA’s
Likely future developments 13
Chair
Disclosure Guidance and Transparency
Risk management and internal 46- Mike McTighe
Rules (DTR) 7.2.1, the disclosures
control 53 required by the DTR are set out in
Independent Non-Executive
thisDirectors’ Report and in the
Anti-bribery and corruption 35
Directors
Governance Report.
Jonathan Moulds
Section 414A of the CA2006 requires
Rakesh Bhasin
Profit and dividends
the Directors to present a Strategic
Andrew Didham
The Group’s statutory profit for the year
Report in the Annual Report and
Wu Gang
after taxation amounted to £503.9
Financial Statements. Theinformation
Sally-Ann Hibberd
million (2021: £371.9 million), all of which
can be found on pages10 to 55.
Malcolm Le May
is attributable to the equity members of
Lisa Pollina – stepped down from the
the Company.
The Company has chosen, in
Board on 9 July 2021
accordance with Section 414C (11)
Susan Skerritt – appointed on 9 July2021
The Directors recommend a final
ofthe CA2006 and as noted in this
Helen Stevenson
ordinary dividend of 31.24 pence per
Directors’ Report, to include certain
share, amounting to £134.8 million,
matters in its Strategic Report that
making a total of 44.2 pence per share
would otherwise be disclosed in this
and £190.7 million for the year
Directors’ Report, including the Non-
(2021:43.2 pence per share and
Financial Information Statement
required by Section 414C of the
CA2006, which can be found on
page28.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 115
GOVERNANCE REPORT
### Directors’ Report continued

| Executive Directors | Political donations | Exercise of rights of shares in |
| --- | --- | --- |
| June Felix | The Company made no political | employee share schemes |
| Bridget Messer – stepped down from | donations to political organisations or | The trustees of the IG Group Employee |
| the Board on 22 September 2021 | independent election candidates and | Benefit Trusts do not seek to exercise |
| Jon Noble | incurred no political expenditure in the | voting rights on shares held in the |
| Charlie Rozes | year (2021: £nil). | employee trusts, other than on the |

direction of the underlying beneficiaries.

| Appointment and retirement | Share capital | No voting rights are exercised in relation |
| --- | --- | --- |
| ofDirectors | The Company has three classes of | to shares unallocated to individual |
| The rules concerning the appointment | shares: ordinary shares, deferred | beneficiaries. The trustees have a |
| and replacement of Directors are set out | redeemable shares and preference | dividend waiver in place in respect of |
| in the Articles of Association. The Board | shares. As at 31 May 2022, our issued | unallocated shares held in the trust. |
| has the power to appoint any person | shares comprised 431,299,455 ordinary |  |
| as a Director to fill a casual vacancy | shares of 0.005 pence each | Powers of the Directors to issue or |
| or as an additional Director, provided | (representing 99.98% of the total issued | purchase the Company’s shares |
| the total number of Directors does | share capital), 65,000 deferred | The Articles of Association permit the |
| not exceed the maximum prescribed | redeemable shares of 0.001 pence each | Directors to issue or repurchase the |
| in the Articles of Association. Any | (representing 0.01% of the total issued | Company’s own shares, subject to |
| such Director holds office only until | share capital) and 40,000 preference | obtaining shareholders’ prior approval. |
| the next AGM and is then eligible | shares of £1.00 each (representing | The shareholders gave this approval at |
| to offer themselves for election. | 0.01% of the total issued share capital). | the 2021 AGM. The authority to issue or |
|  | Details of movement in our share capital | buy back shares will expire at the 2022 |
| The Articles of Association also require | and rights attached to the issued shares | AGM, and it will be proposed at the |
| that all those Directors who have been | are given in note 23 to the Financial | meeting that the Directors be granted |
| inoffice at the time of the two previous | Statements. Information about the rights | new authorities to issue or buyback |
| AGMs, and who did not retire at either | attached to our shares can also be found | shares. The Directors currently have |
| ofthem, must retire as Directors by | in the Articles of Association. Details of | authority to purchase up to 43,157,445 of |
| rotation. Such Directors are eligible to | the Group’s required regulatory capital | the Company’s ordinary shares. No |
| stand for re-election. However, in line | are disclosed in the Business | ordinary shares were purchased during |
| with the Code’s recommendation, all | Performance Review on page 45. | the year. |

Directors will stand for re-election at the

| 2022 AGM. | Variation of rights | During the year, 61,000,000 ordinary |
| --- | --- | --- |
|  | Subject to the provisions of applicable | shares with an aggregate nominal value |
| Directors’ conflicts of interest | statutes, the rights attached to any class | of £3,050.00 were issued as part of |
| In accordance with the CA2006, all | of shares may be varied, either with the | the consideration for the acquisition of |
| Directors must disclose both the nature | consent in writing of the holders of at | tastytrade. Furthermore, the Company |
| and extent of any potential, actual or | least three-quarters in nominal value of | instructed the trustees of the Employee |
| perceived conflicts with the interests of | the issued shares of that class, or with | Benefit Trusts to purchase shares |
| the Company. We explain the procedure | the sanction of a special resolution | in order to satisfy awards under our |
| for this on page 69. | passed at a separate meeting of the | share-incentive plan schemes and |
|  | holders of the shares of that class. | also issued shares in respect of the |
| Insurance and indemnities |  | sustained performance plan. Details |
| The Group has Directors’ and Officers’ | Restrictions on transfer of | of the shares held by our Employee |
| liability insurance in place, providing | securities | Benefit Trusts, and the amounts paid |
| appropriate cover for any legal action | There are no specific restrictions on the | during the year, are disclosed in note |
| brought against its Directors. Qualifying | transfer of securities in the Company, | 24 to the Financial Statements. |
| third-party indemnity provisions (as | other than as contained in the Articles of |  |
| defined by Section 234 of the CA2006) | Association, this paragraph and certain | At the AGM held on 22 September 2021, |
| were in force during FY22 and a Deed of | laws or regulations, such as those related | the Company was granted authority to |
| Indemnity with the Directors was put in | to insider trading, which may be imposed | allot ordinary shares in the Company up |
| place. These provisions remain in force | from time to time. The Directors and | to an aggregate nominal amount of |
| for the benefit of the Directors, in | certain employees are required to obtain | £7,000, being 33% of the total issued |
| relation to certain losses and liabilities | approval prior to dealing in the | share capital at that date, amounting to |
| which they may incur (or have incurred) | Company’s securities. Certain parties | 142,419,570 ordinary shares. In addition, |
| to third parties in the course of acting as | who were previously shareholders in | the Company was granted authority to |
| Directors of the Company. | tastytrade are subject to contractual | allot further ordinary shares in the |
|  | restrictions on transfer in accordance | Company up to an aggregate nominal |
| Research and development | with the terms of the sale arrangements. | amount of £7,000 pursuant to a rights |
| In the ordinary course of business, | We are not aware of any agreements | issue, being 33% of the total issued share |
| weregularly develop new products | between holders of securities that may | capital at that date, amounting to |
| andservices. | result in restrictions on the transfer of | 142,419,570 ordinary shares. No ordinary |
|  | securities or on voting rights. | shares were issued under these |

authorities during the year.
116 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

### Major interest in shares

Information provided to the Company by major shareholders pursuant to the FCA and DTRs is published via a Regulatory Information Service and is available on our website. The information in the table below has been received in accordance with information made available to the Company and in accordance with DTRS, from holders of notifiable interests in the Company's issued share capital as at 31 May 2022. The lowest threshold is 3% of the Company's voting rights, and holders are not required to notify us of any change until this, or the next applicable threshold, is reached or crossed.

|  Major interest in shares | 31 May 2022  |   |
| --- | --- | --- |
|   |  No. of shares | Percentage  |
|  Artemis Investment Management LLP | 25,617,216 | 5.94%  |
|  BlackRock (Index) | 24,677,604 | 5.72%  |
|  MFS Investment Management | 24,966,339 | 5.78%  |
|  Massachusetts Financial Services Company | 21,530,650 | 4.98%  |
|  The Vanguard Group, Inc. | 17,100,088 | 3.96%  |
|  Tom Sosnoff | 15,996,740 | 3.71%  |
|  M&G | 11,983,351 | 2.78%  |
|  Schroder | 12,321,485 | 2.86%  |
|  Royal London Asset Management | 10,718,335 | 2.48%  |

Subsequent to the year end, on 1 July 2022, the Company was notified that Massachusetts Financial Services Company now holds 21,612,131 shares representing 5.00% of the Company's voting rights. The Company has not been informed of any other changes to the notifiable interests between 31 May 2022 and the date of this Annual Report.

### Change of control

Following any future change of control of the Company, participating lenders in the Group's bank facility agreements have the option to cancel their commitment. Upon such cancellation, any outstanding loans, including accrued interest and other amounts due to lenders, will become immediately due and payable. Further details may be found in note 18 to the Financial Statements.

There are no agreements between the Company and its Directors or employees providing for compensation on any loss of office or employment that occurs because of a takeover bid. However, options and awards granted to employees under our share schemes and plans may vest on a takeover, under the schemes' provisions.

### AGM

The Company's AGM will be held on 21 September 2022. Details of the resolutions to be proposed will be provided in the Notice of AGM.

### Independent Auditors

Resolutions to reappoint PwC as the Company's External Auditor, and to authorise the Directors to determine PwC's remuneration, will be put to shareholders at the AGM on 21 September 2022.

### Subsequent events

Please refer to note 34 to the Financial Statements.

On behalf of the Board.

Charles A Rozes
Chief Financial Officer
20 July 2022

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

117
GOVERNANCE REPORT
## Statement of Directors’ Responsibilities
## in respect of the Financial Statements

| The Directors are responsible for | The Directors are also responsible for | In the case of each Director in office at |  |
| --- | --- | --- | --- |
| preparing the FY22 Annual Report and | keeping adequate accounting records | the date the Directors’ Report is |  |
| Financial Statements in accordance with | that are sufficient to show and explain | approved: |  |
| applicable law and regulation. | the Group’s and Company’s transactions |  | ¼ So far as the Director is aware, there |
|  | and disclose with reasonable accuracy |  | is no relevant audit information of |
| Company law requires the Directors to | at any time the financial position of the |  | which the Group’s and Company’s |
| prepare Financial Statements for each | Group and Company and enable them |  | Auditor are unaware |
| financial year. Under that law the | to ensure that the Financial Statements |  | ¼ They have taken all the steps that |
| Directors have prepared the Group and | and the Directors’ Remuneration Report |  | they ought to have taken as a Director |
| the Company Financial Statements in | comply with the CA2006. |  | in order to make themselves aware |
| accordance with UK-adopted |  |  | ofany relevant audit information |
| International Accounting Standards. | The Directors are responsible for |  | andto establish that the Group’s |
|  | the maintenance and integrity of |  | andCompany’s Auditor are aware |
| Under company law, Directors must not | the Company’s website. Legislation |  | ofthat information |
| approve the Financial Statements unless | in the UK governing the preparation |  |  |
| they are satisfied that they give a true | and dissemination of Financial | On behalf of the Board. |  |
| and fair view of the state of affairs of the | Statements may differ from |  |  |
| Group and Company and of the profit or | legislation in other jurisdictions. |  |  |

loss of the Group for that period. In

| preparing the Financial Statements, the |  | Directors’ confirmations |
| --- | --- | --- |
| Directors are required to: |  | The Directors consider that the FY22 |
|  | ¼ Select suitable accounting policies | Annual Report and Financial Statements, |
|  | and then apply them consistently | taken as a whole, is fair, balanced and |
|  | ¼ State whether applicable UK-adopted | understandable and provides the |

June Felix
International Accounting Standards information necessary for shareholders
Chief Executive Officer
have been followed, subject to any to assess the Group’s and Company’s
20 July 2022
material departures disclosed and position and performance, business
explained in the Financial Statements model and strategy.
¼ Make judgements and accounting

| estimates that are reasonable | Each of the Directors, whose names |  |
| --- | --- | --- |
| andprudent | and functions are listed on pages 115 |  |
| ¼ Prepare the Financial Statements on | to116 confirm that, to the best of |  |
| the going concern basis unless it is | theirknowledge: |  |
| inappropriate to presume that the |  | ¼ The Group and Company Financial |
| Group and Company will continue |  | Statements, which have been |
| inbusiness |  | prepared in accordance with |

UK-adopted International Accounting
The Directors are responsible for Standards, give a true and fair view of
safeguarding the assets of the Group the assets, liabilities and financial
and Company and hence for taking position of the Group and Company,
reasonable steps for the prevention and and of the profit of the Group
detection of fraud and other ¼ The Strategic Report includes a fair
irregularities. review of the development and
performance of the business and the
position of the Group and Company,
together with a description of the
principal risks and uncertainties that
it faces
118 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and

Company Information

# Independent Auditors' Report to the Members of IG Group Holdings plc

## Report on the audit of the Financial Statements

### Opinion

In our opinion, IG Group Holdings plc's Group Financial Statements and Company Financial Statements (the "Financial Statements"):

- give a true and fair view of the state of the Group's and of the Company's affairs as at 31 May 2022 and of the Group's profit and the Group's and Company's cash flows for the year then ended;
- have been properly prepared in accordance with UK-adopted international accounting standards; and
- have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the Financial Statements, included within the Annual Report, which comprise: the Consolidated and Company Statements of Financial Position as at 31 May 2022; the Consolidated Income Statement, the Consolidated Statement of Comprehensive Income, the Consolidated and Company Statements of Changes in Equity and Consolidated and Company Statements of Cash Flows for the year then ended; and the notes to the Financial Statements, which include a description of the significant accounting policies.

Our opinion is consistent with our reporting to the Audit Committee.

### Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors' responsibilities for the audit of the Financial Statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

### Independence

We remained independent of the Group in accordance with the ethical requirements that are relevant to our audit of the Financial Statements in the UK, which includes the FRC's Ethical Standard, as applicable to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

To the best of our knowledge and belief, we declare that non-audit services prohibited by the FRC's Ethical Standard were not provided.

Other than those disclosed in note 5, we have provided no non-audit services to the Company or its controlled undertakings in the period under audit.

### Our audit approach

This was the second year that it has been my responsibility to form this opinion on behalf of PricewaterhouseCoopers LLP ("PwC"), who you first appointed on 8 December 2010 in relation to that year's audit. In addition to forming this opinion, in this report we have also provided information on how we approached the audit, how it changed from the previous year and details of the significant discussions that we had with the Audit Committee.

### Key audit matters

- Fair value of customer relationships recognised on the acquisition of tastytrade, Inc. (Group)
- Estimation of the recoverable amount of the cash generating unit – tastytrade, Inc. (Group)
- OTC derivative revenue (Group)
- Carrying value of the investments in subsidiaries (Company)

### Materiality

- Overall Group materiality: £23,800,000 (2021: £22,500,000) based on 5% of adjusted profit before tax.
- Overall Company materiality: £17,600,000 (2021: £7,600,000) based on 1% of total assets
- Performance materiality: £17,800,000 (2021: £16,900,000) (Group) and £13,200,000 (2021: £5,700,000) (Company).

### The scope of our audit

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the Financial Statements.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

119
GOVERNANCE REPORT
### Independent Auditors’ Report continued
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the audit of the
Financial Statements of the current period and include the most significant assessed risks of material misstatement (whether or
not due to fraud) identified by the auditors, including those which had the greatest effect on: the overall audit strategy; the
allocation of resources in the audit; and directing the efforts of the engagement team. These matters, and any comments we
make on the results of our procedures thereon, were addressed in the context of our audit of the Financial Statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
This is not a complete list of all risks identified by our audit.
Fair value of customer relationships recognised on the acquisition of tastytrade, Inc., Estimation of the recoverable amount of
the cash generating unit – tastytrade, Inc. and Carrying value of the investments in subsidiaries are new key audit matters this
year. Impact of Covid-19 (Group and Company), which was a key audit matter last year, is no longer included because the impact
of Covid-19 on the operations of the Group and the Company have lessened in the current year. Otherwise, the key audit
matters below are consistent with last year.
Key audit matter How our audit addressed the key audit matter
Fair value of customer relationships recognised on the
acquisition of tastytrade, Inc. (Group)
The Group acquired tastytrade, Inc. on 28 June 2021 for total We understood and evaluated the design and implementation
consideration of £723mn. On acquisition customer of controls relating to the Group’s purchase price allocation
relationships and other intangible assets totalling £260mn assessment.
were recorded.
We obtained management’s purchase price allocation results.
The valuation of the intangible assets requires management We utilised our in-house valuation experts to evaluate the
estimation as they are dependent on estimates of future cash appropriateness of the valuation methodology used by
flows, tax and discount rates and other asset specific management’s experts against the requirements of the
assumptions such as the customer attrition rate for the financial reporting framework and we tested the
customer relationship intangible. Management engaged their mathematical accuracy of the calculations. We also assessed
own external valuation experts to assist with the determination the competency and objectivity of our in-house and
of the fair values of the acquired intangible assets. management experts so that we were able to use their work.
We have focused on this area as the valuation of intangible In respect of the significant assumptions utilised in the
assets on acquisition involves a significant degree of valuation of the customer relationship intangible asset we
judgement and the estimation uncertainty is high. Based on performed the following procedures:
our risk assessment, we focused our testing on the customer ¼ For customer attrition we compared the forecast rates to
relationship intangible asset given its size and the estimation historical tastytrade and Group data;
uncertainty associated with the key assumptions. ¼ For the other remaining assumptions these were validated
to underlying support provided by management, for
As part of our risk assessment procedures we assessed the example, future cash flows were agreed to approved
sensitivity of the customer relationship intangible asset to acquisition business cases; and
reasonable variations in assumptions and identified customer ¼ For certain assumptions we used the work of our in-house
attrition rates as the significant assumption. valuation experts which included an independent
assessment of the inputs used to determine the discount
Refer to notes 1 – General information and basis of rate.
preparation and 30 – Business acquisition for further details.
We evaluated the appropriateness of the critical accounting
estimates and key sources of estimation uncertainty in note 1
to the Group Financial Statements and the disclosures on the
business acquisition in note 30 and considered these to be
reasonable. We performed independent sensitivity
calculations for the relevant assumptions included in note 30.
Based on the procedures performed, we considered the
directors’ conclusion that the customer relationship intangible
asset should be recognised at £163.5mn on acquisition of
tastytrade, Inc. to be reasonable.
120 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Key audit matter How our audit addressed the key audit matter
Estimation of the recoverable amount of the cash
generating unit – tastytrade, Inc. (Group)
The Group recorded £462mn of goodwill on the acquisition of We understood and evaluated the design and implementation
tastytrade, Inc. on 28 June 2021. As required by IAS 36 – of controls relating to the Group’s impairment assessment.
Impairment of assets, management has performed its first
annual goodwill impairment assessment. We obtained management’s value-in-use impairment model.
We assessed the methodology used by management and
The goodwill impairment assessment is dependent on an their experts against the requirements of the financial
estimate of the recoverable amount of the tastytrade cash reporting framework and we tested the mathematical
generating unit (“CGU”). Management used a value-in-use accuracy of the calculations. We validated the carrying
model to determine the recoverable amount of the tastytrade amount of the CGU to underlying accounting records and
CGU in their impairment assessment. compared the cash flows used in the impairment models to
the Board approved plan.
We have focused on this area as the calculation of value-in-
use of the tastytrade CGU involves a significant degree of We utilised our in-house valuation experts to evaluate the
judgement and the estimation uncertainty is high. appropriateness of the methodology used in the impairment
model. We also assessed the competency and objectivity of
As part of our risk assessment procedures we also assessed our in-house and management experts so that we were able
the sensitivity of the value-in-use to reasonable variations in to use their work.
certain significant assumptions.
In respect of management’s assumptions, our in-house
A number of assumptions principally relating to short and long valuation experts assessed the reasonableness of the discount
term revenue growth, earnings before interest, tax, rate and long-term growth rate used in the impairment model.
depreciation and amortisation, and discount rates are
required to be assessed by management. To assist with the We performed the following procedures over significant
determination of the value-in-use, management engaged assumptions:
their own external valuation experts. ¼ Challenged the appropriateness of management’s
assumptions and, where relevant, their interrelationships;
No impairment charge has been recorded for the year ended ¼ We identified the key drivers in management’s forecasts
31 May 2022. and obtained evidence to support the reasonableness of
these assumptions including historic experience, third-
Refer to notes 1 – General information and basis of party sources including market reports and information
preparation, and 15 – Goodwill for further details. available from tastytrade management; and
¼ Assessed whether judgements made in deriving the
assumptions gave rise to indicators of possible
management bias.
Representations were obtained from management that
assumptions used were their best estimate and were
consistent with information currently available to them.
We evaluated the appropriateness of the critical accounting
estimates and key sources of estimation uncertainty in note 1
to the Group Financial Statements and the disclosures on
goodwill in note 15 and considered these to be reasonable.
We performed independent sensitivity calculations for the
relevant assumptions included in note 15.
Based on the procedures performed, we considered the
directors’ conclusion that the goodwill within the tastytrade
CGU is not impaired to be reasonable.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 121
GOVERNANCE REPORT
### Independent Auditors’ Report continued
Key audit matter How our audit addressed the key audit matter
OTC derivative revenue (Group)
The Group’s trading revenue is predominantly generated from We focused firstly on understanding the control environment
over the counter (“OTC”) derivatives placed by clients, offset in which revenue is recorded. We understood and evaluated
by net gains or losses from the hedging trades that the Group the design of key controls in place and tested their operating
places with external market counterparties to manage its effectiveness.
market risk. The Group’s revenue on these activities arises
principally from spreads, overnight funding charges and These controls included:
commissions. ¼ IT general controls over key revenue systems in scope;
¼ Automated business controls such as interfaces between
The audit of revenue from OTC derivatives is a focus of our in-scope systems, key reports and automated calculations;
audit given the magnitude of the balance, the large volume of ¼ Validation of system calculated revenue numbers including
transactions and the automated nature of the revenue manual client ledger postings by the Group’s revenue
calculations. control team;
¼ Cash and settlement reconciliations; and
Refer to notes 2 – Significant accounting policies and 3 – ¼ Market counterparty and other third party reconciliations.
Segment analysis for further details.
We concluded that we could place reliance on these controls
for the purpose of our audit.
Our substantive testing included, but was not limited to, the
following:
¼ Using data enabled audit techniques, we recalculated the
revenue recorded in relation to a sample of trades and
agreed these to the underlying accounting records;
¼ Testing commission, overnight funding, guaranteed stop
premium and cash currency transfer rates on a sample
basis;
¼ We tested the valuation of selected client and broker
positions to third party pricing sources;
¼ We agreed all cash account balances to external third-
party evidence at year-end through a combination of
independent confirmations and examination of bank
statements;
¼ We agreed all amounts and balances held with market
counterparties to independent confirmations or other
external third party evidence; and
¼ We tested manual client ledger postings on a sample basis.
Based on the procedures performed, no material issues arose
from this work.
122 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Key audit matter How our audit addressed the key audit matter
Carrying value of the investments in subsidiaries
(Company)
The Company has total investments in subsidiaries of We have evaluated management’s impairment assessment
£1,076mn, of which the full amount is an investment in IG that identified an indicator for impairment and found this to be
Group Limited (“IGGL”). reasonable.
IGGL is the Group holding Company which, via a series of We obtained management’s value-in-use calculation that was
other holding companies, owns all the operating entities of the used to estimate the recoverable amount of the investment in
Group. subsidiaries and performed the following substantive
procedures:
This investment is held at cost less any provision for ¼ Assessed the reliability of management’s data used as
impairment. inputs to management’s value-in-use calculation;
¼ Assessed the discount rate used for reasonableness;
IAS 36 ‘Impairment of Assets’ requires that investments are ¼ Assessed the long – term growth rate for reasonableness;
subject to an impairment review when there is an indication and
that an asset may be impaired. Management identified an ¼ Tested the mathematical accuracy of management’s
indicator of impairment and performed an impairment value-in-use model.
assessment and estimated the recoverable amount using a
value-in-use model. We concluded that the carrying value of the investment is
supported by the recoverable amount of the underlying
We have focused on this area as the calculation of value-in- operating companies and consider the directors’ conclusion
use involves a significant degree of judgement. that the investments in subsidiaries balance is not impaired to
be reasonable.
Management’s impairment assessment showed significant
headroom at year-end, and consequently no impairment We evaluated the appropriateness of the disclosures on the
provision is held against this investment. investment in subsidiaries in the Company Financial
Statements and found these to be reasonable.
Refer to notes 2 – Accounting policies and 6 – Investment in
subsidiaries of the Company Financial Statements for further
details.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 123
GOVERNANCE REPORT
### Independent Auditors’ Report continued
How we tailored the audit scope
We performed a risk assessment, giving consideration to relevant external and internal factors including industry dynamics,
litigation, climate change, impact of Covid-19, relevant accounting and regulatory developments, the Group’s strategy and the
changes taking place across the Group including the acquisition of tastytrade, Inc. and the disposal of Nadex. We also
considered our knowledge and experience obtained in prior year audits.
As part of considering the impact of climate change in our risk assessment, we evaluated management’s assessment of the
impact of climate risk, the detail of which is set out on page 34, including their conclusion that there are no material risks.
Management’s assessment gave consideration to a number of matters, including the results of their climate related risks and
opportunities exercise that was performed during the year. We have also understood the impact of the Group’s carbon
reduction targets, which are outlined on page 34 and these are not considered to have a material impact on the Financial
Statements.
Using our risk assessment, we tailored the scope of our audit to ensure that we performed enough work to be able to give an
opinion on the Financial Statements as a whole, taking into account the structure of the Group and the Company and the
accounting processes and controls, and the industry in which they operate. We continually assessed risks and changed the
scope of our audit where necessary.
The Group consists of a UK holding Company with a number of subsidiary entities and branches containing the operating
businesses of both the UK, United States and overseas territories. Our risk assessment and scoping identified tastyworks, Inc. as
a new significant component of the Group due to the acquisition of tastytrade, Inc. on 28 June 2021. We obtained a full scope
audit opinion for the financial position as at 31 May 2022 and results of tastyworks, Inc. for the period from 28 June 2021 to
31 May 2022. The audit of tastyworks, Inc. was performed by a PwC member firm in the United States.
The other significant financial reporting component was determined to be the OTC derivatives and stock trading and
investment businesses. As the accounting records and related controls for both the UK, United States and overseas businesses
are primarily maintained and operated by the Group’s finance teams in London and Krakow this was considered one financial
reporting component. The technology and business process controls that are relevant to our financial statement audits are
operated by the Group in London and Krakow. As a result, the audit work over this component was performed by the Group
engagement team in London, supported by the PwC member firm in Poland, reflecting the centralised nature of the Group’s
financial reporting activities. Some of this work was also relied upon by the PwC engagement team auditing tastyworks, Inc.
All remaining components, which are Exchange Traded Derivative businesses, were subject to procedures which mitigated the
risk of material misstatement including Group level analytical review procedures.
The Company audit was performed by the Group engagement team.
tastyworks, Inc. audit approach
We asked the partner and engagement team reporting to us on tastyworks, Inc. to work to an assigned materiality reflecting
thesize of the tastyworks, Inc. component. We were in active dialogue throughout the year with the partner and engagement
team responsible for the audit, including consideration of how they planned and performed their work. We obtained direct
access to their working papers to oversee and review their work. We also attended meetings with tastyworks, Inc. management
at year-end. The majority of our interactions were undertaken virtually.
Using the work of others
We continued to make use of evidence provided by others. We used the work of PwC experts, for example, valuation experts for
our work over the carrying value of goodwill and acquired intangible assets at 31 May 2022 and the fair value of those intangible
assets recognised on acquisition.
124 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality.
These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent
of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of
misstatements, both individually and in aggregate on the Financial Statements as a whole.
Based on our professional judgement, we determined materiality for the Financial Statements as a whole as follows:
Financial Statements – Group Financial Statements – Company
Overall materiality £23,800,000 (2021: £22,500,000). £17,600,000 (2021: £7,600,000).
How we determined it 5% of adjusted profit before tax 1% of total assets
(2021: 5% of profit before tax)

| Rationale for benchmark applied | We believe a standard benchmark of 5% | We have used a benchmark of total |
| --- | --- | --- |
|  | of adjusted profit before tax is an | assets as the Company’s primary |
|  | appropriate quantitative indicator or | purpose is to act as a holding Company |
|  | materiality, although certain items could | with investments in the Group’s |
|  | also be material for quantitative reasons. | subsidiaries, not to generate operating |
|  | This benchmark is standard for listed | profits and therefore a profit based |
|  | entities like IG. We selected an adjusted | measure is not relevant. The benchmark |
|  | profit measure this year in order to exclude | used is consistent with last year. |

the performance and gain on sale of
Nadex and Small Exchange during the
period, as in our opinion they are non
recurring items that do not form part of
ongoing business performance.
For each component in the scope of our Group audit, we allocated a materiality that is less than our overall Group materiality.
The range of materiality allocated across components was between £5,000,000 to £22,600,000.
We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and
undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope of
our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example in
determining sample sizes. Our performance materiality was 75% (2021: 75%) of overall materiality, amounting to £17,800,000
(2021: £16,900,000) for the Group Financial Statements and £13,200,000 (2021: £5,700,000) for the Company Financial
Statements.
In determining the performance materiality, we considered a number of factors – the history of misstatements, risk assessment
and aggregation risk and the effectiveness of controls – and concluded that an amount at the upper end of our normal range
was appropriate.
We agreed with the Audit Committee that we would report to them misstatements identified during our audit above £1,100,000
(Group audit) (2021: 1,100,000) and £880,000 (Company audit) (2021: £300,000) as well as misstatements below those amounts
that, in our view, warranted reporting for qualitative reasons.
Conclusions relating to going concern
Our evaluation of the directors’ assessment of the Group’s and the Company’s ability to continue to adopt the going concern
basis of accounting included:
¼ Performing a risk assessment to identify factors that could impact the going concern basis of accounting.
¼ Obtaining and evaluating management’s going concern assessment.
¼ Understanding and evaluating the Group’s financial forecasts and the Group’s stress testing of liquidity and capital, including
the severity of the stress scenarios that were used.
¼ Validation of year end financial resources such as cash and debt securities in issue.
¼ Evaluating the adequacy of the disclosures made in the Financial Statements in relation to going concern.
¼ Consideration of the regulatory capital and liquidity requirements applicable to the Group.
¼ Obtaining and reviewing the Group’s most recent internal capital adequacy assessment process and individual liquidity
adequacy assessment documents.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 125
GOVERNANCE REPORT
### Independent Auditors’ Report continued
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the Group’s and the Company’s ability to continue as a going concern
for a period of at least twelve months from when the Financial Statements are authorised for issue.
In auditing the Financial Statements, we have concluded that the directors’ use of the going concern basis of accounting in the
preparation of the Financial Statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the Group’s and
the Company’s ability to continue as a going concern.
In relation to the directors’ reporting on how they have applied the UK Corporate Governance Code, we have nothing material
to add or draw attention to in relation to the directors’ statement in the Financial Statements about whether the directors
considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections
of this report.
Reporting on other information
The other information comprises all of the information in the Annual Report other than the Financial Statements and our
auditors’ report thereon. The directors are responsible for the other information, which includes reporting based on the Task
Force on Climate-related Financial Disclosures (“TCFD”) recommendations. Our opinion on the Financial Statements does not
cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly
stated in this report, any form of assurance thereon.
In connection with our audit of the Financial Statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the Financial Statements or our knowledge obtained in
the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material
misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the Financial
Statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that
there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based
on these responsibilities.
With respect to the Strategic Report and Directors’ Report, we also considered whether the disclosures required by the UK
Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions
and matters as described below.
Strategic Report and Directors’ Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic Report and
Directors’ Report for the year ended 31 May 2022 is consistent with the Financial Statements and has been prepared in
accordance with applicable legal requirements.
In light of the knowledge and understanding of the Group and Company and their environment obtained in the course of the
audit, we did not identify any material misstatements in the Strategic Report and Directors’ Report.
Directors’ Remuneration
In our opinion, the part of the Directors’ Remuneration Report and Policy to be audited has been properly prepared in
accordance with the Companies Act 2006.
126 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Corporate governance statement
The Listing Rules require us to review the directors’ statements in relation to going concern, longer-term viability and that part
of the corporate governance statement relating to the Company’s compliance with the provisions of the UK Corporate
Governance Code specified for our review. Our additional responsibilities with respect to the corporate governance statement
as other information are described in the Reporting on other information section of this report.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate
governance statement is materially consistent with the Financial Statements and our knowledge obtained during the audit, and
we have nothing material to add or draw attention to in relation to:
¼ The directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks;
¼ The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify emerging
risks and an explanation of how these are being managed or mitigated;
¼ The directors’ statement in the Financial Statements about whether they considered it appropriate to adopt the going
concern basis of accounting in preparing them, and their identification of any material uncertainties to the Group’s and
Company’s ability to continue to do so over a period of at least twelve months from the date of approval of the Financial
Statements;
¼ The directors’ explanation as to their assessment of the Group’s and Company’s prospects, the period this assessment
covers and why the period is appropriate; and
¼ The directors’ statement as to whether they have a reasonable expectation that the Company will be able to continue in
operation and meet its liabilities as they fall due over the period of its assessment, including any related disclosures drawing
attention to any necessary qualifications or assumptions.
Our review of the directors’ statement regarding the longer-term viability of the Group was substantially less in scope than an
audit and only consisted of making inquiries and considering the directors’ process supporting their statement; checking that
the statement is in alignment with the relevant provisions of the UK Corporate Governance Code; and considering whether the
statement is consistent with the Financial Statements and our knowledge and understanding of the Group and Company and
their environment obtained in the course of the audit.
In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements of the
corporate governance statement is materially consistent with the Financial Statements and our knowledge obtained during the
audit:
¼ The directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced and understandable, and
provides the information necessary for the members to assess the Group’s and Company’s position, performance, business
model and strategy;
¼ The section of the Annual Report that describes the review of effectiveness of risk management and internal control
systems; and
¼ The section of the Annual Report describing the work of the Audit Committee.
We have nothing to report in respect of our responsibility to report when the directors’ statement relating to the Company’s
compliance with the Code does not properly disclose a departure from a relevant provision of the Code specified under the
Listing Rules for review by the auditors.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 127
GOVERNANCE REPORT
### Independent Auditors’ Report continued
Responsibilities for the Financial Statements and the audit
Responsibilities of the directors for the Financial Statements
As explained more fully in the Statement of Directors’ Responsibilities, the directors are responsible for the preparation of the
Financial Statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The
directors are also responsible for such internal control as they determine is necessary to enable the preparation of Financial
Statements that are free from material misstatement, whether due to fraud or error.
In preparing the Financial Statements, the directors are responsible for assessing the Group’s and the Company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Group or the Company or to cease operations, or have no realistic
alternative but to do so.
Auditors’ responsibilities for the audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is
a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or
in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these
Financial Statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to
which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the Group and industry, we identified that the principal risks of non-compliance with laws and
regulations related to the Financial Conduct Authority (FCA) Listing Rules and rulebook requirements and UK tax legislation, and
we considered the extent to which non-compliance might have a material effect on the Financial Statements. We also
considered those laws and regulations that have a direct impact on the Financial Statements such as the Companies Act 2006.
We evaluated management’s incentives and opportunities for fraudulent manipulation of the Financial Statements (including
the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to
increase revenue or reduce costs and management bias in accounting estimates. The Group engagement team shared this risk
assessment with the component auditors so that they could include appropriate audit procedures in response to such risks in
their work. Audit procedures performed by the Group engagement team and/or component auditors included:
¼ Enquiries of management, internal audit, and those charged with governance in relation to known or suspected instances of
non-compliance with laws and regulation and fraud;
¼ Review of correspondence with regulators, and internal audit reports in so far as they are related to the Financial Statements;
¼ Specific written enquiries of external legal counsel to assist with our evaluation of known instances of non-compliance with
laws and regulations, including their potential impact;
¼ Challenging assumptions and judgements made by management in its significant accounting estimates, in particular in
relation to the carrying value of the goodwill and acquired intangible assets, fair value of the intangible assets recognised on
acquisition and the investment in subsidiaries (see related key audit matters);
¼ Identifying and testing journal entries, including those posted to certain account combinations, posted with certain
descriptions, backdated journals or posted by unexpected users;
¼ Incorporating unpredictability into the nature, timing and/or extent of our testing; and
¼ Review of reporting to the Audit Committee and minutes of Board of Directors’ meetings and made enquiries of
management to understand the business rationale for unusual and significant transactions.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of
non-compliance with laws and regulations that are not closely related to events and transactions reflected in the Financial
Statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one
resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or
through collusion.
Our audit testing might include testing complete populations of certain transactions and balances, possibly using data auditing
techniques. However, it typically involves selecting a limited number of items for testing, rather than testing complete
populations. We will often seek to target particular items for testing based on their size or risk characteristics. In other cases,
wewill use audit sampling to enable us to draw a conclusion about the population from which the sample is selected.
A further description of our responsibilities for the audit of the Financial Statements is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
128 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Use of this report
This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with
Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or
assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may
come save where expressly agreed by our prior consent in writing.
### Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
¼ we have not obtained all the information and explanations we require for our audit; or
¼ adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received
from branches not visited by us; or
¼ certain disclosures of directors’ remuneration specified by law are not made; or
¼ the Company Financial Statements and the part of the Directors’ Remuneration Report and Policy to be audited are not in
agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Appointment
We were appointed by the directors on 8 December 2010 to audit the Financial Statements for the year ended 31 May 2011 and
subsequent financial periods. The period of total uninterrupted engagement is 12 years, covering the years ended 31 May 2011
to 31 May 2022.
### Other matter
As required by the Financial Conduct Authority Disclosure Guidance and Transparency Rule 4.1.14R, these Financial Statements
form part of the ESEF-prepared annual financial report filed on the National Storage Mechanism of the Financial Conduct
Authority in accordance with the ESEF Regulatory Technical Standard (‘ESEF RTS’). This auditors’ report provides no assurance
over whether the annual financial report has been prepared using the single electronic format specified in the ESEF RTS.
Carl Sizer (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
20 July 2022
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 129
FINANCIAL STATEMENTS

# Financial Statements

# A year of change; accelerating growth

PG. 131-181

Primary Statements

|  Consolidated Income Statement | 131  |
| --- | --- |
|  Consolidated Statement of Comprehensive Income | 132  |
|  Consolidated Statement of Financial Position | 133  |
|  Consolidated Statement of Changes in Equity | 134  |
|  Consolidated Statement of Cash Flows | 135  |

Notes to the Financial Statements

|  1. General information and basis of preparation | 136 | 21. Other payables | 160  |
| --- | --- | --- | --- |
|  2. Significant accounting policies | 138 | 22. Contingent liabilities and provisions | 161  |
|  3. Segmental analysis | 148 | 23. Share capital and share premium | 161  |
|  4. Operating costs | 149 | 24. Other reserves | 162  |
|  5. Auditors' remuneration | 150 | 25. Employee share plans | 163  |
|  6. Staff costs | 150 | 26. Related party transactions | 166  |
|  7. Finance income | 151 | 27. Financial instruments | 167  |
|  8. Finance costs | 151 | 28. Financial risk management | 169  |
|  9. Taxation | 151 | 29. Cash flow information | 174  |
|  10. Earnings per ordinary share | 154 | 30. Business acquisition | 174  |
|  11. Dividends paid and proposed | 154 | 31. Discontinued operations | 177  |
|  12. Property, plant and equipment | 155 | 32. Investment in associates | 178  |
|  13. Intangible assets | 156 | 33. Investments in subsidiaries | 179  |
|  14. Financial investments and financial assets pledged as collateral | 156 | 34. Subsequent events | 181  |
|  15. Goodwill | 157 |  |   |
|  16. Trade receivables | 159 |  |   |
|  17. Other assets | 159 |  |   |
|  18. Borrowings and debt securities in issue | 159 |  |   |
|  19. Lease liabilities | 160 |  |   |
|  20. Trade payables | 160 |  |   |

130

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Consolidated Income Statement
for the year ended 31 May 2022
Year ended

|  | Year ended |  | 31 May 2021 |  |
| --- | --- | --- | --- | --- |
|  | 31 May 2022 |  | (Restated) |  |
| Note |  | £m |  | £m |

Continuing operations
Trading revenue 982 . 0 84 6.9
Introducing partner commissions (9.7) (9.6)
Net trading revenue 3 972 . 3 8 3 7. 3
Betting duty and financial transaction taxes (2 . 5) (0. 9)
Interest income on client funds 3.5 2 .1
Interest expense on client funds (2 .7) (1. 8)
Other operating income 8.6 7. 0
Net operating income 979. 2 8 4 3 .7
Operating costs 4 (499. 2) (390.5)
Net credit losses on financial assets 28 (2 .7) (3 .0)
Operating profit 47 7. 3 450.2
Gain on disposal of associates 4 .1 –
Loss on disposal of subsidiaries – (0. 4)
Fair value gain on convertible loan note 9.3 –
Share of loss after tax from associates 32 (2 . 3) –
Finance income 7 3. 4 2 .1
Finance costs 8 (14 . 8) (5 . 9)
Profit before tax 4 7 7. 0 446.0
Tax expense 9 (8 0 . 9) (77 .4)
Profit for the year from continuing operations 3 9 6 .1 368.6
Profit for the year from discontinued operations 31 1 0 7. 8 3.3
Profit for the year and attributable to owners of the parent 503.9 3 71. 9
Earnings per ordinary share for profit from continuing operations:
Basic 10 92 . 9p 9 9.8p
Diluted 10 9 2 .1p 9 9. 0p
Earnings per ordinary share for profit attributable to owners:
Basic 10 11 8 . 2 p 10 0 .7p
Diluted 10 117. 2p 9 9. 9p
1 The FY21 comparatives have been restated to present separately the results of discontinued operations. Refer to note 31 for further details.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 131
FINANCIAL STATEMENTS

## Consolidated Statement of Comprehensive Income

for the year ended 31 May 2022

|   | Year ended 31 May 2022 |   | Year ended 31 May 2021  |   |
| --- | --- | --- | --- | --- |
|   | £m | 4m | £m | 4m  |
|  **Profit for the year attributable to owners of the parent** |  | **503.9** |  | 371.9  |
|  **Other comprehensive income:** |  |  |  |   |
|  Items that may be subsequently reclassified to the income statement: |  |  |  |   |
|  Changes in the fair value of financial assets held at fair value through other comprehensive income, net of tax | (4.0) |  | (1.3) |   |
|  Foreign currency translation gain/(loss) attributable to continuing operations | 67.4 |  | (17.7) |   |
|  Foreign currency translation (loss) attributable to discontinued operations | (3.0) |  | (3.2) |   |
|  Other comprehensive income/(loss) for the year, net of tax |  | **60.4** |  | (22.2)  |
|  **Total comprehensive income attributable to owners of the parent** |  | **564.3** |  | 349.7  |
|  **Total comprehensive income attributable to owners of the parent arising from:** |  |  |  |   |
|  Continuing operations |  | **459.5** |  | 349.6  |
|  Discontinued operations |  | **104.8** |  | 0.1  |
|   |  | **564.3** |  | 349.7  |

132

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

## Consolidated Statement of Financial Position

at 31 May 2022

|   | Note | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- | --- |
|  **Assets** |  |  |   |
|  **Non-current assets** |  |  |   |
|  Goodwill | 15 | 604.7 | 107.3  |
|  Intangible assets | 13 | 292.1 | 32.7  |
|  Property, plant and equipment | 12 | 36.6 | 38.6  |
|  Financial investments | 14 | 134.8 | 127.6  |
|  Financial assets pledged as collateral | 14 | 25.3 | 61.1  |
|  Investment in associates | 32 | 14.8 | –  |
|  Deferred income tax assets | 9 | 17.5 | 12.9  |
|   |  | **1,125.8** | **380.2**  |
|  **Current assets** |  |  |   |
|  Cash and cash equivalents |  | 1,246.4 | 655.2  |
|  Trade receivables | 16 | 469.5 | 490.9  |
|  Financial investments | 14 | 200.9 | 127.4  |
|  Financial assets pledged as collateral | 14 | 35.1 | 26.0  |
|  Other assets | 17 | 14.2 | 30.3  |
|  Prepayments |  | 23.2 | 12.6  |
|  Other receivables |  | 9.8 | 5.5  |
|   |  | **1,999.1** | **1,347.9**  |
|  Assets classified as held for sale |  | 1.2 | –  |
|  **TOTAL ASSETS** |  | **3,126.1** | **1,728.1**  |
|  **Liabilities** |  |  |   |
|  **Non-current liabilities** |  |  |   |
|  Borrowings | 18 | – | 98.8  |
|  Debt securities in issue | 18 | 297.2 | –  |
|  Lease liabilities | 19 | 13.0 | 16.4  |
|  Deferred income tax liabilities | 9 | 67.2 | 0.8  |
|   |  | **377.4** | **116.0**  |
|  **Current liabilities** |  |  |   |
|  Trade payables | 20 | 571.2 | 357.5  |
|  Other payables | 21 | 119.5 | 108.2  |
|  Lease liabilities | 19 | 8.9 | 6.7  |
|  Income tax payable | 9 | 20.5 | 6.4  |
|   |  | **720.1** | **478.8**  |
|  Liabilities directly associated with assets classified as held for sale |  | 0.8 | –  |
|  **TOTAL LIABILITIES** |  | **1,098.3** | **594.8**  |
|  **Equity** |  |  |   |
|  Share capital and share premium | 23 | 125.8 | 125.8  |
|  Translation reserve |  | 117.6 | 53.2  |
|  Merger reserve |  | 590.0 | 81.0  |
|  Other reserves | 24 | 8.4 | 12.8  |
|  Retained earnings |  | 1,186.0 | 860.5  |
|  **TOTAL EQUITY** |  | **2,027.8** | **1,133.3**  |
|  **TOTAL EQUITY AND LIABILITIES** |  | **3,126.1** | **1,728.1**  |

The consolidated financial statements on pages 131 to 181 were approved by the Board of Directors on 20 July 2022 and signed on its behalf by:

Registered Company number: 04677092

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

133
FINANCIAL STATEMENTS

## Consolidated Statement of Changes in Equity

for the year ended 31 May 2022

|   | Note | Share capital £m | Share premium £m | Translation reserve £m | Margin Reserve £m | Other reserves £m | Retained earnings £m | Total £m  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  **At 1 June 2020** |  | - | 125.8 | 74.1 | 81.0 | 13.3 | 641.7 | 935.9  |
|  Profit for the year and attributable to owners of the parent |  | - | - | - | - | - | 371.9 | 371.9  |
|  Other comprehensive loss for the year |  | - | - | (20.9) | - | (1.3) | - | (22.2)  |
|  Total comprehensive (loss)/income for the year |  | - | - | (20.9) | - | (1.3) | 371.9 | 349.7  |
|  Tax recognised directly in equity on share-based payments | 9 | - | - | - | - | - | 0.2 | 0.2  |
|  Equity dividends paid | 11 | - | - | - | - | - | (159.7) | (159.7)  |
|  Employee Benefit Trust purchase of own shares | 24 | - | - | - | - | (0.2) | - | (0.2)  |
|  Transfer of vested awards from the share-based payment reserve |  | - | - | - | - | (6.4) | 6.4 | -  |
|  Equity-settled employee share-based payments | 25 | - | - | - | - | 7.4 | - | 7.4  |
|  **At 31 May 2021** |  | - | 125.8 | 53.2 | 81.0 | 12.8 | 860.5 | 1,133.3  |
|  **At 1 June 2021** |  | - | **125.8** | **53.2** | **81.0** | **12.8** | **860.5** | **1,133.3**  |
|  Profit for the year and attributable to owners of the parent |  | - | - | - | - | - | **503.9** | **503.9**  |
|  Other comprehensive income/(loss) for the year |  | - | - | **64.4** | - | (4.0) | - | **60.4**  |
|  Total comprehensive income/(loss) for the year |  | - | - | **64.4** | - | (4.0) | **503.9** | **564.3**  |
|  Tax recognised directly in equity on share-based payments | 9 | - | - | - | - | - | **0.5** | **0.5**  |
|  Equity dividends paid | 11 | - | - | - | - | - | **(186.2)** | **(186.2)**  |
|  Employee Benefit Trust purchase of own shares | 24 | - | - | - | - | (6.7) | - | (6.7)  |
|  Transfer of vested awards from the share-based payment reserve |  | - | - | - | - | (7.3) | 7.3 | -  |
|  Equity-settled employee share-based payments | 25 | - | - | - | - | 13.6 | - | 13.6  |
|  Issue of ordinary share capital for the acquisition of tastytrade | 30 | - | - | - | **509.0** | - | - | **509.0**  |
|  **At 31 May 2022** |  | - | **125.8** | **117.6** | **590.0** | **8.4** | **1,186.0** | **2,027.8**  |

134

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Consolidated Statement of Cash Flows
for the year ended 31 May 2022

|  | Year ended |  | Year ended |  |
| --- | --- | --- | --- | --- |
|  | 31 May 2022 |  | 31 May 2021 |  |
| Note |  | £m |  | £m |

Operating activities
Cash generated from operations 29 811 . 4 573 . 5
Income taxes paid (99. 2) (8 3. 0)
Net cash flows generated from operating activities 712 . 2 490.5
Investing activities
Interest received 3.2 1. 5
Net cash flow to investment in associates (1 . 9) –
Purchase of property, plant and equipment (8 .5) (9 .1)
Payments to acquire and develop intangible assets (9.0) (6 . 9)
Net proceeds from disposal of subsidiaries 14 3 . 3 –
Net proceeds from disposal of investments in associates 24 .5 –
Net cash flow from financial investments (5 7. 1) (11 8 . 2)
Net cash flow to acquire subsidiaries (19 3 . 5) –
Net cash flows used in investing activities (99. 0) (13 2 . 7)
Financing activities
Interest paid (11 . 0) (5. 0)
Financing fees paid (5 . 4) (1. 3)
Interest paid on lease liabilities (0 .6) (0.6)
Repayment of principal element of lease liabilities (7. 5) (5 . 2)
Drawdown on term loan 15 0 . 0 –
Repayment of term loans (250 . 0) –
Net proceeds from issue of debt securities 29 9. 2 –
Equity dividends paid to owners of the parent (186 . 2) (15 9 . 7)
Employee Benefit Trust purchase of own shares (6.7) (0 . 2)
Net cash flows used in financing activities (18 . 2) (172 . 0)
Net increase in cash and cash equivalents 595. 0 18 5 . 8
Cash and cash equivalents at the beginning of the year 655. 2 486.2
Impact of movement in foreign exchange rates (3 .8) (16 . 8)
Cash and cash equivalents at the end of the year 1 ,246.4 655 . 2
1 Cash generated from operations include cash generated from both continuing and discontinued operations. Refer to note 31 for cash flows of discontinued operations.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 135
FINANCIAL STATEMENTS

# Notes to the Financial Statements

## 1. General information and basis of preparation

### General information

The Financial Statements of IG Group Holdings plc and its subsidiaries (together 'the Group') for the year ended 31 May 2022 were authorised for issue by the Board of Directors on 20 July 2022 and the Consolidated Statement of Financial Position was signed on the Board's behalf by Charles Rozes. IG Group Holdings plc is a public company limited by shares, which is listed on the London Stock Exchange and incorporated and domiciled in England and Wales. The address of the registered office is Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA.

### Basis of preparation

#### (a) Compliance with International Financial Reporting Standards (IFRS)

On 31 December 2020, IFRS as adopted by the European Union was brought into UK law and became UK-adopted International Accounting Standards, with future changes being subject to endorsement by the UK Endorsement Board. The Group transitioned to UK-adopted International Accounting Standards in the Group Financial Statements on 1 June 2021. This change constitutes a change in accounting framework. However, there is no impact on recognition, measurement or disclosure in the period reported as a result of the change in framework.

The Group's Financial Statements have been prepared in accordance with UK-adopted International Accounting Standards and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards. There were no unendorsed standards effective for the year ended 31 May 2022 affecting these Consolidated Financial Statements.

These Financial Statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets and financial liabilities (including derivative instruments) at fair value through other comprehensive income and fair value through profit and loss.

The accounting policies which have been applied in preparing the Group Financial Statements for the year ended 31 May 2022 are disclosed in note 2.

#### (b) Critical accounting estimates and judgements

The preparation of these Financial Statements in conformity with UK-adopted International Accounting Standards requires the Group to make use of certain critical accounting estimates that affect the amounts reported for assets and liabilities as at the reporting date, and the amounts reported for revenue and expenses during the period. It also requires management to exercise its judgement in the process of applying the Group's accounting policies.

The nature of estimates and judgements means that actual outcomes could differ from those estimates. In the Directors' opinion, the accounting estimates or judgements that have the most significant impact on the presentation or measurement of items recorded in the Financial Statements are the following:

Fair value and useful economic lives of intangible assets acquired (estimate) – the Group has recognised intangible assets of £263.5 million upon acquisition of tastytrade, inc. (tastytrade) based on estimates of fair values at the acquisition date of 28 June 2021. The fair values of intangible assets are based upon a number of factors including management's best estimates of future performance and estimates of an appropriate discount rate. The identified intangible assets are amortised over their remaining useful economic lives, which are also based on management's best estimates of the periods over which value from the intangible asset is generated. Further information outlining the valuation methodologies and the significant assumptions, together with sensitivities, is provided in note 30.

Recoverable amount of US (tastytrade) cash-generating unit (CGU) (estimate) – the Group has estimated the recoverable amount of its US (tastytrade) CGU, which includes goodwill of £502.8 million and other acquisition-related intangibles resulting from the tastytrade acquisition. Key assumptions used in the value-in-use calculations include management cash flow forecasts, the discount rate and the long-term growth rate. The recoverable amount of the US (tastytrade) CGU is sensitive to a reasonably possible change in some of these assumptions. Further information regarding the assumptions and their associated sensitivities is provided in note 15.

#### (c) New accounting standards and interpretations

There were no new standards, amendments or interpretations issued during the period which have had a material impact on the Group. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.

The IASB has published a number of minor amendments to IFRSs that are effective from 1 January 2022 and 1 January 2023. These include amendments published to IAS 12 – Income Taxes, IAS 37 – Provisions and Contingent Liabilities and Contingent Assets. The Group is in process of assessing the impact of these amendments. There have also been amendments published to IAS 1 – Presentation of Financial Statements. However, the Group expects they will have an insignificant effect, when adopted, on the Consolidated Financial Statements of the Group.

136

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
1. General information and basis of preparation continued
(d) Segmental information
The Group’s segmental information is disclosed in a manner consistent with the basis of internal reporting provided to the Chief
Operating Decision Maker (CODM) regarding components of the Group. The Group has identified the CODM as the Executive
Directors of IG Group Holdings plc, who regularly review this management information to assess the performance and allocate
resources to the reportable segments. The CODM uses net trading revenue as the primary measure of performance of the
various segments of the Group. Reportable segments that do not meet the quantitative thresholds required by IFRS 8
areaggregated.
(e) Foreign currencies
The functional currency of each entity in the Group is consistent with the primary economic environment in which the entity
operates. Transactions in other currencies are initially recorded in the functional currency by applying spot exchange rates
prevailing on the date of the transactions. Monetary assets and liabilities denominated in foreign currencies are revalued at the
entity’s functional currency exchange rate prevailing at the balance sheet date. Gains and losses arising on revaluation are taken
to trading revenue in the Income Statement. Non-monetary assets and liabilities carried at fair value and denominated in foreign
currencies are translated at the rates prevailing at the date when the fair value was determined.
The Group’s presentational currency is sterling. In the Group Financial Statements, the assets and liabilities of Group’s overseas
operations are translated into sterling at exchange rates prevailing on the balance sheet date. Income and expense items are
translated at the average exchange rates for the year. Goodwill and fair value adjustments arising on the acquisition of a foreign
operation are treated as assets and liabilities of the foreign operation and translated at closing rate. Exchange differences
arising from the translation of overseas operations are recognised in other comprehensive income and translation reserve. On
disposal of an overseas operation, exchange differences previously recognised in other comprehensive income are recycled to
the Income Statement as income or expense.
(f) Going concern
The Directors have prepared the Group Financial Statements on a going concern basis which requires the Directors to have a
reasonable expectation that the Group has adequate resources to continue in operational existence for a period of at least 12
months from the date of approval of the Financial Statements.
In assessing whether it is appropriate to adopt the going concern basis in preparing the Financial Statements, the Directors have
considered the resilience of the Group, taking account of its liquidity position and cash generation, the adequacy of capital
resources, the availability of external credit facilities and the associated financial covenants, and stress-testing of liquidity and
capital adequacy that takes into account the principal risks faced by the business.
The Directors’ assessment has considered future performance, solvency and liquidity over a period of at least 12 months from
the date of approval of the Group Financial Statements. The Board, following the review by the Audit Committee, has a
reasonable expectation that the Group has adequate resources for that period, and confirm that they consider it appropriate to
adopt the going-concern basis in preparing the Financial Statements.
(g) Business acquisitions
The Group acquired tastytrade, Inc. and its subsidiaries (tastytrade) on 28 June 2021. The results of tastytrade have been
consolidated within the Group since the date of acquisition. Where necessary, comparative information is presented in US dollar
alongside sterling. Further details are disclosed in note 30.
As part of the acquisition of tastytrade, the Group acquired an investment in Small Exchange, Inc. (Small Exchange). In addition,
at acquisition date, the Group recognised a convertible loan note with Zero Hash Holdings Limited (Zero Hash) at a fair value of
$12.0 million. This was subsequently remeasured to $24.2 million prior to conversion to an equity shareholding in September
2021 and recognised as an investment in associate on the Statement of Financial Position.
(h) Disposals
On 1 March 2022, the Group completed the disposal of its North American Derivatives Exchange, Inc operations (Nadex) and its
investment in Small Exchange.
The profits of Nadex have been separated from the profits of the Group’s continuing operations for the year and shown as
discontinued operations, with the comparative period restated accordingly. The Nadex operations were not classified as a
disposal group as at 31 May 2021 and the Consolidated Statement of Financial Position has not been restated from that
published in the FY21 Group Annual Report. Further details relating to the sale are disclosed in note 31.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 137
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
1. General information and basis of preparation continued
Small Exchange does not meet the criteria for discontinued operations. The Group’s share of losses prior to disposal and the
Group’s gain from the disposal are recognised within continuing operations.
(i) Reclassification of comparatives
To ensure consistency with the current period, comparative figures have been reclassified where the presentation of Financial
Statements has been changed. The adjustments are:
(i) Goodwill of £604.7 million (31 May 2021: £107.3 million) has been separated out from intangible assets and presented as a
separate line item in the Consolidated Statement of Financial Position.
(ii) Merger reserve of £590.0 million (31 May 2021: £81.0 million) has been separated out from other reserves and presented as a
separate line item in the Consolidated Statement of Financial Position.
2. Significant accounting policies
The accounting policies and interpretations adopted in the preparation of the Group Financial Statements are consistent with
those followed in the preparation of the Group Financial Statements for the year ended 31 May 2021, with the exception of
changes in policy on presentation as outlined in note 1, and the following accounting policies adopted due to new transactions
in the year:
¼ Investment in associates and joint ventures
¼ Debt securities in issue
¼ Non-current assets (or disposal groups) and discontinued operations
¼ Money market funds
Basis of consolidation
Subsidiaries
The Group Financial Statements consolidate the financial results of IG Group Holdings plc and the entities it controls
(itssubsidiaries) as listed in note 33.
Subsidiaries are consolidated from the date on which the Group obtains control, up until the date on which control ceases.
Control is achieved where the Group has existing rights that give it the ability to direct the activities that affect the Group’s
returns and exposure, or rights to variable returns from the entity. The results, cash flows and final positions of the subsidiaries
used in the preparation of the Group Financial Statements are prepared for the same reporting year as the parent company
andare based on consistent accounting policies. Where necessary, adjustments are made to the Financial Statements
ofsubsidiaries to align the accounting policies used with those used by other members of the Group. All inter-company
transactions, balances, income and expenses between the Group entities, including unrealised profits arising from them,
areeliminated on consolidation.
Business combinations
Business combinations are accounted for using the acquisition method. On acquisition, the identifiable assets, liabilities and
contingent liabilities of a subsidiary are measured at their fair values at the date of acquisition. The cost of an acquisition is
measured at the fair value of consideration transferred, including an estimate of any contingent or deferred consideration.
Contingent or deferred consideration is remeasured at each balance sheet date with periodic changes to the estimated liability
recognised in the Income Statement. Acquisition-related costs are expensed as they are incurred.
Goodwill is initially measured as the excess of the consideration transferred over the fair values of identifiable net assets. If this
consideration is lower than the fair values of identifiable net assets acquired, the difference is credited to the Income Statement
in the year of acquisition.
The results of subsidiaries acquired or disposed of during the year are included in the Income Statement from the effective date
of acquisition or up to the effective date of disposal, as appropriate.
Investments in associates and joint ventures
Associates are entities for which the Group has significant influence, but not control or joint control. Investments in associates
are accounted for under the equity method of accounting after initially being recognised at cost. The investment is adjusted for
the Group’s share of the profit or loss after tax and other comprehensive income net of tax of the associate which is recognised
from the date that significant influence begins, up until the date that significant influence ceases.
Joint ventures are entities for which the Group has joint control. Investments in joint ventures are accounted for under the equity
method of accounting after initially being recognised at cost. The investment is adjusted for the Group’s share of the profit or
loss and other comprehensive income of the joint venture which is recognised from the date that joint control begins, up until
the date that joint control ceases.
138 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
2. Significant accounting policies continued
Investments in associates and joint ventures are assessed for impairment indicators at the end of each reporting date. If such
indicators exist, the recoverable amount is estimated to determine the extent of the impairment loss (if any). If the recoverable
amount of an asset is estimated to be less than its carrying amount, the carrying value of the investment is reduced to its
recoverable amount. Impairment losses are immediately expensed in the Income Statement.
Revenue recognition
Trading revenue includes revenue arising from each of the Group’s four revenue generation models: OTC derivatives, exchange
traded derivatives, stock trading and investments.
OTC derivatives
Revenue from the OTC derivatives business represents:
(i) fees paid by clients for spread, commission and funding charges in respect of the opening, holding and closing of financial
spread bets, contracts for difference or options contracts, together with gains and losses for the Group arising on client
trading activity; less
(ii) fees paid by the Group in spread, commissions and funding charges arising in respect of hedging the risk associated with the
client trading activity and the Group’s currency exposures, together with gains and losses incurred by the Group arising on
hedging activity.
Open client and hedging positions are fair valued daily with gains and losses arising on this valuation recognised in revenue.
Thepolicies and methodologies associated with the determination of fair value are disclosed in note 27.
Exchange traded derivatives
Revenue from exchange traded derivatives represents:
(i) fee and commission income earned through facilitation of client trades
(ii) payment for order flow generated from execution partners who accept trades from client securities transactions.
In addition to transaction fees, revenue from exchange traded derivatives also includes gains or losses arising from the change
in fair value of the Group’s market-making activity on its multilateral trading facility.
Revenue from exchange traded derivatives is recognised on a trade-date basis.
Stock trading
Revenue from stock trading represents fees and commission earned from transactions in the stock. Revenue is recognised in
full on the date of the trade being placed or the fee being charged.
Investments
Revenue from investments represents management fees, which are earned as a percentage of assets under management.
These are recognised over the period in which the service is provided.
Revenue is shown net of sales taxes. Trading revenue is reported before introducing partner commission, betting duties and
financial transaction taxes, which are disclosed as an expense in arriving at net operating income. Net trading revenue
represents trading revenue after adjusting for introducing partner commission.
Finance income and expense on client funds
Interest income and expense on client funds held with banks and execution partners is accrued on a time basis, by reference to
the principal amount outstanding and at the applicable interest rate are included in operating income. This is consistent with the
nature of the Group’s operations.
Interest income and interest expense on firm cash and client funds that are not held in segregated client money accounts are
disclosed within finance income and finance costs, respectively.
Dividends
Dividends declared but not yet distributed to the Company’s shareholders are recognised as a liability in the Group’s Financial
Statements in the period in which the dividends are approved by the Company’s shareholders.
Employee benefits
Pension obligations
The Group operates defined contribution schemes. Contributions are charged to the Income Statement when they become
payable according to the rules of the schemes. Once the contributions have been paid, the Group has no legal or constructive
obligations to pay further contributions.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 139
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
2. Significant accounting policies continued
Bonus schemes
The Group recognises an accrual and an expense for bonuses based on formulae that take into consideration specific financial
and non-financial measures. Liabilities for the Group’s cash-settled portion of the Sustained Performance Plan are recognised
as an employee benefit expense over the relevant service period and remeasured at each balance sheet date until settlement.
Termination benefits
Termination benefits are payable when an employment contract is terminated by the Group. The Group recognises termination
benefits when the Group can no longer withdraw the offer of those benefits.
Leases
The Group’s leases are recognised as a right-of-use asset with a corresponding lease liability from the date at which the asset is
available for use.
Leasing arrangements can contain both lease and non-lease components. The Group has elected to separate out the non-lease
component and to account for these separately from the right-of-use asset.
The lease liability is initially measured as the net present value of the following payments:
¼ Fixed payments less any lease incentives,
¼ Variable lease payments dependent on an index or rate initially measured as at the commencement date,
¼ Amounts payable by the Group under residual guarantees,
¼ Payments of penalties for terminating the lease.
Lease payments are discounted at the Group’s estimated secured incremental borrowing rate. This represents the cost
toborrow funds in order to obtain a similar valued right-of-use asset in a similar economic environment with similar terms
andconditions.
Right-of-use assets are measured at cost comprising:
¼ Lease liability at initial recognition,
¼ Any lease payments made at or before the commencement date less any lease incentives received,
¼ Any initial direct costs,
¼ Restoration costs.
Right-of-use assets are depreciated over the duration of the lease term.
Lease payments for low-value assets or with a period of 12 months or less are recognised on a straight-line basis as an expense.
Taxation
The income tax expense represents the sum of tax currently payable and movements in deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from accounting profit as reported in the
Income Statement because taxable profit excludes items of income or expense that are taxable or deductible in other years and
items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates in the respective
jurisdictions that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is accounted for on all temporary differences between the carrying amount of assets and liabilities in the Financial
Statements and the corresponding tax bases used in the computation of taxable profit. In principle, deferred tax liabilities are
recognised for all temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable
profits will be available, against which deductible temporary differences may be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from the initial recognition of other assets and liabilities (other than in a business
combination) in a transaction that affects neither the taxable profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries, except where the
Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
140 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
2. Significant accounting policies continued
Deferred tax assets and liabilities are measured on an undiscounted basis at the tax rates that are expected to apply when
therelated asset is realised or liability is settled, based on tax rates and laws enacted or substantively enacted at the balance
sheet date. Deferred tax is charged or credited in the Income Statement, except when it relates to items credited or charged
directly to equity or other comprehensive income, in which case the deferred tax is also dealt with in equity or other
comprehensive income.
Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the
Group intends to settle its current tax assets and liabilities on a net basis.
Non-current assets (or disposal groups) held for sale and discontinued operations
Non-current assets (or disposal groups) are classified as held for sale if the carrying amount is expected to be recovered
through a sale transaction rather than through continuing use, and provided that the sale is highly probable. The assets are
measured at the lower of their carrying amount and fair value less costs to sell, except for financial assets which are measured
at fair value. Where the fair value less costs to sell is lower than the carrying amount, an impairment is recognised. Any
subsequent increases in fair value less costs to sell which are not in excess of previously recognised impairment losses are
recognised in the Income Statement.
Non-current assets are not depreciated or amortised while they are classified as held for sale and the assets held for sale are
separately presented from other assets on the Statement of Financial Position. Liabilities associated with assets held for sale are
presented separately from other liabilities on the Statement of Financial Position.
A discontinued operation is a component that has been disposed or classified as held for sale, and represents a separate major
line of business or geographical area of operations. The results of discontinued operations are presented separately in the
Income Statement with comparatives restated.
Property, plant and equipment
Property, plant and equipment are carried at cost less accumulated depreciation and accumulated impairment losses. Cost
comprises the aggregate amount paid and the fair value of any other consideration given to acquire the asset, including costs
directly attributable to making the asset capable of operating as intended.
Depreciation is provided on all property, plant and equipment at rates calculated to write off the cost less estimated residual
value based upon estimated useful lives. Estimated residual value and useful lives are reviewed annually and residual values are
based on prices prevailing at the balance sheet date. Depreciation is charged on a straight-line basis over the expected useful
lives as follows:
Leasehold improvements ¼ over the lease term of up to 15 years
Office equipment, fixtures and fittings ¼ over 5 years
Computer and other equipment ¼ over 2, 3 or 5 years
Right-of-use asset ¼ over the lease term of up to 15 years
The carrying values of property, plant and equipment are reviewed for impairment when events or changes in circumstances
indicate the carrying value may not be recoverable, at which point they are written down immediately to their recoverable
amount.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to
arise from the continued use of the asset. The gain or loss arising on derecognition is determined as the difference between the
sale proceeds and carrying amount of the asset, and is immediately recognised in the Income Statement.
Goodwill
Goodwill is stated at cost less any accumulated impairment losses, with the carrying value being reviewed for impairment at
least annually, and whenever events or changes in circumstances indicate that the carrying value may be impaired.
Goodwill is recognised as an asset and is allocated to CGUs by management for purposes of impairment testing. A CGU
represent the smallest identifiable group of assets that generate cash inflows that are largely independent of the cash inflows
from other assets or groups of assets. Where the recoverable amount of a CGU is less than its carrying amount, including
goodwill, an impairment loss is recognised in the Income Statement.
The carrying amount of goodwill allocated to a CGU is taken into account when determining the gain or loss on disposal of a
business unit, or of an operation within it.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 141
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
2. Significant accounting policies continued
Intangible assets
Intangible assets are carried at cost less accumulated amortisation and impairment losses.
Intangible assets acquired separately from a business are carried initially at cost. An intangible asset acquired as part of a
business combination, such as a trade name or customer relationship, is recognised at fair value and identified separately from
goodwill if the asset is separable or arises from contractual or other legal rights and its fair value can be measured reliably.
Development expenditure is recognised as an intangible asset only after all the following criteria are met:
¼ The project’s technical feasibility and commercial viability can be demonstrated,
¼ The availability of adequate technical and financial resources and an intention to complete the project have been
confirmed,and
¼ Probable future economic benefit has been established.
Development expenditure on internally developed intangible assets, excluding internal software development costs, which do
not meet these criteria is taken to the Income Statement in the year in which it is incurred.
Intangible assets with a finite life are amortised over their expected useful lives, as follows:
Internally developed software ¼ straight-line basis over 3 to 5 years
Software and licences ¼ straight-line basis over the contract term of up to 5 years
Trade names ¼ straight-line basis over 2 to 15 years
Customer relationships ¼ straight-line basis over 9 years
Non-compete arrangements ¼ straight-line basis over 5 years
Domain names ¼ straight-line basis over 10 years
The carrying value of intangible assets is reviewed for impairment whenever events or changes in circumstances indicate the
carrying value may not be recoverable. In addition, the carrying value of capitalised development expenditure is reviewed before
being brought into use.
Impairment of non-financial assets
When impairment testing is required, the carrying amounts of the Group’s non-financial assets are reviewed to determine
whether there is any indication of impairment. If any such indication exists (or at least annually for goodwill), the recoverable
amount of the asset is estimated to determine the extent of the impairment loss (if any). Where the asset does not generate
cash flows that are independent from other assets, the Group estimates the recoverable amount of the CGU to which the asset
belongs.
The recoverable amount is the higher of fair value less selling costs and value-in-use. In assessing value-in-use, the estimated
future cash flows are discounted to their present values using a pre-tax discount rate. This rate reflects current market
assessments of the time value of money, as well as the risks specific to the asset to the extent the estimates of future cash flows
have not been adjusted.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is
reduced to its recoverable amount. Impairment losses are recognised as an expense immediately.
An assessment is made at each balance sheet date as to whether there is any indication that previously recognised impairment
losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated and previously
recognised impairment losses are reversed only if there has been a change in the estimates used to determine the asset’s
recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of the asset is
increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been
determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised
as income immediately, although impairment losses relating to goodwill may not be reversed.
Financial instruments
Classification, recognition and measurement
The Group determines the classification of its financial instruments at initial recognition in accordance with the following
categories outlined and re-evaluates this designation annually. When financial instruments are recognised initially, they are
measured at fair value. In the case of financial assets and financial liabilities not at fair value through profit or loss, the fair value
of these assets and/or liabilities is measured net of directly attributable transaction costs. Financial instruments are disclosed in
note 27 of the Financial Statements.
142 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
2. Significant accounting policies continued
(a) Financial assets and liabilities measured at fair value through profit or loss
Financial assets and liabilities measured at fair value through profit or loss are financial assets and liabilities that are not
classified and measured at amortised cost or as fair value through other comprehensive income. The financial assets and
liabilities included in this category are the financial derivative open positions included in trade receivables (due from brokers).
The Group uses derivative financial instruments in order to hedge derivative exposures arising from open client positions, which
are also classified as fair value through profit or loss.
All financial instruments at fair value through profit or loss are carried at fair value with gains or losses recognised in trading
revenue in the Income Statement.
(b) Financial assets measured at amortised cost
Financial assets measured at amortised cost are non-derivative financial assets which are held to collect the contractual cash
flows. The contractual terms of the financial assets give rise to payments on specified dates that are solely payments of principal
amount and interest on the principal amount outstanding. They are included in current assets, except for maturities greater
than 12 months after the end of the reporting period, which are classified as non-current assets. The Group’s financial assets
measured at amortised cost comprise trade receivables, other receivables, cash and cash equivalents and fixed term deposits
that are categorised under financial investments.
Fixed term deposits do not meet the criteria of cash and cash equivalents under IAS 7 as they have a maturity of longer than
three months. Furthermore, the Group is unable to withdraw these deposits before their respective maturity date. Therefore,
these are categorised as financial investments as stated above.
Interest on term deposits is included in finance income using the effective interest rate method. The effective interest rate is
either the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial
instrument. When calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the
financial instrument but does not consider expected credit losses unless the asset is credit impaired. The calculation includes all
fees and spreads paid or received between parties to the contract that are an integral part of the effective interest rate,
transaction costs, and all other premiums or discounts.
(c) Financial assets measured at fair value through other comprehensive income
Financial assets measured at fair value through other comprehensive income are assets that are held to collect the contractual
cash flows or to be sold. The contractual terms of these assets give rise to payments on specified dates that are solely payments
of principal and interest on the principal amount outstanding. They are included in non-current assets unless the investment
matures or management intend to dispose of them within 12 months of the end of the reporting period. The Group’s fair value
through other comprehensive income financial assets are financial investments (other than fixed term deposits) and financial
assets pledged as collateral.
Unrealised gains or losses, other than loss allowances for expected credit losses, arising from financial investments measured at
fair value through other comprehensive income are reported in equity (in the fair value through other comprehensive income
reserve) and in other comprehensive income, until such investments are sold, collected or otherwise disposed of.
On disposal of an investment, the accumulated unrealised gain or loss included in equity is recycled to the Income Statement
for the period and reported in other income. Gains and losses on disposal are determined using the fair value of the investment
at the date of derecognition.
Interest on financial investments is included in finance income using the effective interest rate method. The effective interest
rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial
instrument. When calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the
financial instrument but does not consider expected credit losses unless the asset is credit impaired. The calculation includes all
fees and spreads paid or received between parties to the contract that are an integral part of the effective interest rate,
transaction costs, and all other premiums or discounts.
(d) Financial liabilities
The Group’s financial liabilities include trade payables, lease liabilities, borrowings and other payables. These are initially
recognised at fair value less transaction fees. They are subsequently measured at amortised cost using the effective interest
method, excluding the derivative element of trade payables – amounts due from brokers, which is measured at fair value
through profit or loss and recognised as part of trade receivables as detailed in (a) above. The interest expense is calculated
ateach reporting period by applying the effective interest rate, and the resulting charge is reflected in finance costs in the
Income Statement.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 143
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
2. Significant accounting policies continued
(e) Determination of fair value
Financial instruments arising from open client positions, financial derivative open positions included in trade receivables (due
from brokers), financial investments (other than fixed term deposits) and financial assets pledged as collateral are stated at fair
value. They are disclosed according to the valuation hierarchy required by IFRS 13 Fair Value Measurement. Fair values are
predominantly determined by reference to third-party market values (bid prices for long positions and offer prices for short
positions) as detailed below:
¼ Level 1: valued using unadjusted quoted prices in active markets for identical financial instruments.
¼ Level 2: valued using techniques where a price is derived based significantly on observable market data. For example, where
an active market for an identical financial instrument to the product offered by the Group to its clients or used by the Group
to hedge its market risk does not exist.
¼ Level 3: valued using techniques that incorporate information other than observable market data that is significant to the
overall valuation
Impairment of financial assets
The impairment charge in the Income Statement includes a loss allowance reflecting the change in expected credit losses.
Expected credit losses are recognised for trade receivables, cash and cash equivalents, other receivables, financial investments
and financial assets pledged as collateral. Expected credit losses are calculated as the difference between the contractual cash
flows that are due to the Group and the cash flows that the Group expects to receive given the probability of default and loss
given default, discounted at the original effective interest rate.
At initial recognition of financial assets, an allowance is made for expected credit losses resulting from default events that are
possible within the next 12 months, except for where the simplified approach is used where an allowance is made for the
lifetime expected credit loss. In the event of a significant increase in credit risk, an allowance is made for expected credit losses
resulting from possible default events over the expected life of the financial asset. The Group applies the simplified approach for
trade receivables and other receivables where the revenue associated with these receivables is recognised in accordance with
IFRS 15 Revenue from Contract with Customers. The Group applies the general approach for all other financial assets.
Financial assets that have not experienced a significant increase in credit risk are categorised as Stage 1 and 12 month
expected credit losses are recognised; financial assets which are considered to have experienced a significant increase in credit
risk since initial recognition are considered to be Stage 2; and financial assets which have defaulted or are otherwise considered
to be credit impaired are allocated to Stage 3.
An assessment of whether credit risk has increased significantly considers changes in the credit rating associated with the
asset, whether contractual payments are more than 30 days past due and other reasonable information demonstrating a
significant increase in credit risk. In accordance with the Group’s internal credit risk management definition, financial
instruments have a low credit risk when they have an external credit rating of investment grade. If no external credit rating is
available, reference is made to the Group’s internal credit risk policy.
Assets are transferred to Stage 3 when an event of default, as defined in the Group’s credit risk management policy, occurs or
where the assets are credit impaired. The Group determines that a default occurs when a payment is 90 days past due for all
assets, except for receivables from clients where it uses 120 days. This is aligned with the Group’s risk management practices.
All changes in expected credit losses subsequent to the assets’ initial recognition are recognised as an impairment loss or gain.
Financial assets are written off, either partially or in full, against the related allowance when the Group has no reasonable
expectations of recovery of the asset. Subsequent recoveries of amounts previously written off decrease the amount of
impairment losses recorded in the Income Statement.
Derecognition of financial assets and liabilities
A financial asset or liability is generally derecognised when the contract that gives rise to it is settled, sold, cancelled or expired.
(a) Financial assets
A financial asset is derecognised when the right to receive cash flows from the asset has expired; or the Group retains the right
to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party
under a pass-through arrangement; or the Group has transferred its right to receive cash flows from the asset and either has
transferred substantially all the risks and rewards of the asset, or has neither transferred nor retained substantially all the risks
and rewards of the asset, but has transferred control of the asset.
144 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
2. Significant accounting policies continued
When the Group has transferred its right to receive cash flows from an asset and has neither transferred nor retained
substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of
the Group’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred
asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the
Group could be required to repay.
(b) Financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. Where an existing
financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability
are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the
recognition of a new liability, whereby the difference in the respective carrying amounts together with any costs or fees
incurred are recognised in profit or loss.
(c) Offsetting financial instruments
Assets or liabilities resulting from gains or losses on open positions are carried at fair value. Amounts due from or to clients and
amounts due from and to brokers are offset, with the net amount reported in the Statement of Financial Position. Amounts are
offset where there is a legally enforceable right to offset the recognised amounts, and there is an intention to settle on a net
basis or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future
events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the
Group or the counterparty.
Trade payables and receivables
Trade receivables represent balances with counterparties and clients where the combination of cash held on account and the
valuation of financial derivative open positions results in an amount due to the Group. Trade receivables balances also include
commissions and required deposits due from the Group’s broker-dealer counterparties.
Trade payables represent balances with counterparties and clients where the combination of cash held on account and the
valuation of financial derivative open positions result in an amount payable by the Group.
For trade receivables under IFRS 15 Revenue from Contracts with Customers that do not contain a significant financing
element, the Group has applied the simplified approach for measuring impairment. For all other trade receivables, the general
approach has been applied for measuring impairment. The expected lifetime credit loss is recognised at initial recognition of
the financial asset, with the loss allowance calculated by reference to an ageing debt profile, adjusted for forward-looking
information. Trade receivables are written off when there is objective evidence of non-collectability or when an event of
defaultoccurs.
Other assets
Other assets represent rights to cryptocurrency assets controlled by the Group. The Group offers various cryptocurrency-
related products that can be traded on its platform. The Group purchases and sells cryptocurrency assets as part of its
hedgingactivity.
The Group holds cryptocurrency assets for trading in the ordinary course of its business, effectively acting as a commodity
broker-dealer in respect of the underlying cryptocurrency asset because the salient features of these assets are, in economic
terms, consistent with certain commodities under IAS 2 Inventories, 3(b). The assets are recognised on trade date and
measured at fair value less costs to sell, with changes in valuation being recorded in the Income Statement in the period in
which they arise. Cryptocurrency assets are not financial instruments and they are categorised as non-financial assets.
Other receivables
Other receivables are financial assets which give rise to payments on specified dates that are solely payments of principal
amount and interest on the principal amount outstanding. They are assets that have not been designated as fair value through
profit or loss. Such assets are carried at amortised cost using the effective interest method if the time value of money
issignificant.
For other receivables under IFRS 15 Revenue from Contracts with Customers that do not contain a significant financing
element, the Group applies a simplified approach for measuring impairment, similar to that as trade receivables.
Prepayments
Prepayments are assets with fixed or determinable payments made in advance for services or goods. They do not qualify as
financial assets and are amortised over the period in which the economic benefit is expected to be consumed.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 145
FINANCIAL STATEMENTS

# Notes to the Financial Statements continued

# 2. Significant accounting policies continued

# Cash and cash equivalents

Cash comprises of cash on hand and demand deposits which may be accessed within 90 days without penalty. Cash equivalents comprise of short-term highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. This includes money market funds.

The Group holds money on behalf of clients in accordance with the client money rules of the UK Financial Conduct Authority (FCA) and other regulatory bodies. Such monies are classified as either cash and cash equivalents or segregated client funds in accordance with the relevant regulatory requirements or legal protections attached to the monies.

The majority of the Group's cash balances are held with investment-grade banks. The Group considers the risk of default, and how adverse changes in economic and business conditions might impact the ability of the banks to meet their obligations. The Group assesses the expected credit losses on cash and cash equivalents on a forward-looking basis and if there has been a significant increase in credit risk since initial recognition. At 31 May 2022, the Group held £236.7 million (31 May 2021: £161.3 million) of segregated client funds for customers of the Group's Japanese subsidiary, IG Securities Limited. Under local Japanese law, the Group is liable for any credit losses suffered by clients on the segregated client money balance.

Money market funds are mutual funds that invest in a diversified range of money market instruments, such as government owned instruments and short-term debt from highly credit rated counterparties. Money market funds are presented within cash and cash equivalents as they are short-term highly liquid investments that are readily convertible into known amounts of cash, they are subject to an insignificant risk of changes in value and they can be withdrawn without penalty. At 31 May 2022, the Group's cash and cash equivalents balance included £437.5 million (31 May 2021: £nil) of money market funds.

The Group's Swiss banking subsidiary, IG Bank S.A., is required to protect customer deposits under the FINMA Privileged Deposit Scheme. At 31 May 2022, IG Bank S.A. was required to hold £36.1 million (31 May 2021: £36.6 million) in satisfaction of this requirement. This amount, which represents restricted cash, is included in cash and cash equivalents.

Segregated client funds are held in segregated client money accounts which restrict the Group's ability to control the monies and accordingly are held off-balance sheet. The amount of segregated client funds held at 31 May 2022 was £2,577.9 million (31 May 2021: £2,710.3 million). The return received on managing segregated client funds is included within net operating income.

Title transfer funds are held by the Group under a Title Transfer Collateral Arrangement (TTCA) by which a client agrees that full ownership of such monies is unconditionally transferred to the Group. Title transfer funds are accordingly held on the Statement of Financial Position with a corresponding liability to clients within trade payables.

# Other payables

Non-derivative financial liabilities are recognised initially at fair value and carried at amortised cost using the effective interest rate method if the time value of money is significant.

# Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated.

# Contingent liabilities

Contingent liabilities, which include certain guarantees and letters of credit pledged as collateral security, and contingent liabilities related to legal proceedings or regulatory matters, are not recognised in the Financial Statements but are disclosed unless the probability of settlement is remote.

146

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
2. Significant accounting policies continued
Borrowings
Borrowings are initially recognised at fair value and subsequently at amortised cost using the effective interest rate method with
any difference between net proceeds and the redemption value being recognised in the Income Statement over the period of
borrowings.
Debt securities in issue
Debt securities in issue are recognised initially at fair value. Subsequently, debt securities are measured at amortised cost, with
any difference between net proceeds and the redemption value being recognised in the Income Statement over the lifetime of
the security using the effective interest rate method. Transaction fees are recognised on the Statement of Financial Position,
and amortised over the expected life of the security.
Share capital
(a) Classification of shares as debt or equity
When shares are issued, any component that creates a financial liability of the Group is presented as a liability on the balance
sheet; measured initially at fair value net of transaction costs and subsequently at amortised cost until extinguished on
conversion or redemption. Dividends paid are charged as an interest expense in the Income Statement.
Equity instruments issued by the Company are recorded as the proceeds received, net of direct issue costs. Equity instruments
are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract
that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
(b) Own shares held in Employee Benefit Trusts
Shares held in Employee Benefit Trusts for the purposes of employee share schemes are classified as a deduction from
shareholders’ equity and are recognised at cost. Consideration received for the sale of such shares is recognised in equity,
withany difference between the proceeds from the sale and the cost being taken to reserves. No gain or loss is recognised
inthe Income Statement on the purchase, sale, issue or cancellation of equity shares.
(c) Share-based payments
The Company operates four employee share plans: a share-incentive plan, a sustained performance plan, a medium-term
incentive plan and a long-term incentive plan. For market-based vesting conditions, the cost of these awards is measured at fair
value calculated using option pricing models and are recognised as an expense in the Income Statement on a straight-line basis
over the vesting period based on the Company’s estimate of the number of shares that will vest.
For non-market-based vesting conditions, the cumulative expense is calculated representing the extent to which the vesting
period has expired and management’s best estimate of the achievement or otherwise of non-market conditions determining
the number of equity instruments that will ultimately vest. The movement in cumulative expense since the previous balance
sheet date is recognised in the Income Statement as part of operating expenses, with a corresponding credit to equity.
The grant by the Company of options over its equity instruments to employees of the subsidiary undertakings in the Group is
treated as a capital contribution. The fair value of the employee services received is recognised over the vesting period as an
increase in the investment in subsidiary undertakings, with a corresponding credit to equity. Upon awards vesting, the cost of
awards is transferred from the share-based payments reserve into retained earnings.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 147
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
3. Segmental analysis
The Executive Directors are the Group’s Chief Operating Decision Maker (CODM). Management has determined
thereportablesegments based on the information reviewed by the CODM for the purposes of allocating resources
andassessingperformance.
The Group manages market risk and a number of other activities on a Group-wide portfolio basis and accordingly a large
proportion of costs are incurred centrally. These central costs are not allocated to individual segments for decision-making
purposes for the CODM, and, accordingly, these costs have not been allocated to segments. Additionally, the Group’s assets
and liabilities are not allocated to individual segments and not reported as such for decision making purposes to the CODM.
Therefore, the segmental analysis shown below does not include a measure of profitability, nor a complete segmented balance
sheet, as this would not reflect the information which is received by the CODM on a regular basis.
Net trading revenue by reportable segment
Net trading revenue represents trading revenue that the Group generates from client trading activity after deducting
introducing partner commissions. The CODM uses net trading revenue as the primary measure of performance of the various
segments of the Group. The CODM considers business performance from a product perspective, split into OTC derivatives,
exchange traded derivatives and stock trading and investments. The segmental analysis shown below by product aggregates
the different geographical locations given the products are economically similar in nature. Revenue from OTC derivatives
isderived from the UK, EU, EMEA – Non-EU, Australia, Singapore, Japan, Emerging Markets and the US. Exchange traded
derivatives revenue derives from tastytrade and the Spectrum business located in the US and the EU, whereas stock trading
andinvestments revenue derives from the UK and Australia. The segmental analysis does not include a measure of profitability,
nor a segmented Statement of Financial Position, as this would not reflect the information which is received by the CODM.
The segmental breakdown of net trading revenue is as follows:
Year ended

| Year ended |  | 31 May 2021 |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | (Restated) | 1 |
|  | £m |  | £m |

Net trading revenue by product:
OTC derivatives 817.3 790.3
Exchange traded derivatives 121.2 8.3
Stock trading and investments 33.8 38.7
Total net trading revenue from continuing operations 972.3 837.3
Net trading revenue from discontinued operations 9.4 16.1
1 The FY21 comparatives have been restated to present separately the results of discontinued operations. Refer to note 31 for further details.
The CODM also considers business performance based on geographical location. This geographical split reflects the location of
the office that manages the underlying client relationship. Net trading revenue represents an allocation of the total net trading
revenue that the Group generates from client trading activity.
148 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
3. Segmental analysis continued
Year ended

| Year ended |  | 31 May 2021 |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | (Restated) |  |
|  | £m |  | £m |

Net trading revenue by geography:
UK 365.3 346.8
US 128.6 15.1
EU 112 .9 108.0
Japan 98.5 68.7
Australia 96.2 128.0
Singapore 74.1 75.3
EMEA – Non-EU 53.5 60.6
Emerging markets 43.2 34.8
Total net trading revenue 972.3 8 37.3
1 The FY21 comparatives have been restated to present separately the results of discontinued operations. Refer to note 31 for further details.
The Group does not derive more than 10% of revenue from any one single client. The UK geographic segment, and the OTC
derivatives segment, includes a £5.8 million gain (31 May 2021: £7.9 million loss) arising from financing of the tastytrade
acquisition, as set out in note 30.
The segmental breakdown of non-current assets excluding financial investments, financial assets pledged as collateral and
deferred income tax assets, based on geographical location, is as follows:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

UK 133.8 129.1
US 795.1 30.0
EU 5.5 6.6
EMEA – Non-EU 7.3 5.5
Australia 0.8 1.3
Japan 0.8 4.9
Emerging Markets 3.4 1.2
Total non-current assets 946.7 178.6
4. Operating costs
Year ended

|  | Year ended |  | 31 May 2021 |  |  |
| --- | --- | --- | --- | --- | --- |
|  | 31 May 2022 |  | (Restated) |  | 1 |
| Note |  | £m |  | £m |  |

Employee-related expenses:
Fixed remuneration 151.5 126.9
Variable remuneration 62.7 50.6
214.2 177.5
Advertising and marketing 87.2 67. 4
Premises-related costs 9.1 6.3
IT, market data and communications 45.1 30.7
Legal and professional costs 19.6 31.8
Regulatory fees 12.9 9.2
Depreciation and amortisation 12,13 56.5 24.8
Other costs 54.6 42.8
Total operating costs 499.2 390.5
1 The FY21 comparatives have been restated to present separately the results of discontinued operations. Refer to note 31 for further details.
Included in premises-related costs is £0.5 million relating to short-term operating leases which do not meet the criteria to be
capitalised as right-of-use assets (year ended 31 May 2021: £0.1 million).
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 149
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
5. Auditors’ remuneration

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Audit fees
Parent 1.2 0.7
Subsidiaries 1.1 0.7
Total audit fees 2.3 1.4
Audit related fees
Services supplied pursuant to legislation 0.6 0.6
Other audit related assurance services – 0.1
Total audit related fees 0.6 0.7
Non-audit fees
Other services 0.3 0.1
Total non-audit fees 0.3 0.1
Audit related fees include services that are specifically required of the Group’s Auditors through legislative or regulatory
requirements, controls assurance engagements required of the Auditors by the regulatory authorities in whose jurisdiction the
Group operates and other audit related assurance services.
6. Staff costs
Staff costs for the year, including Directors, were as follows:
Year ended

| Year ended |  | 31 May 2021 |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | (Restated) | 1 |
|  | £m |  | £m |

Wages and salaries, performance-related bonus and equity-settled share-based payment awards 185.1 152.4
Social security costs 20.2 17.4
Other pension costs 8.9 7.7
214.2 177.5
1 The FY21 comparatives have been restated to present separately the results of discontinued operations. Refer to note 31 for further details.
The Group does not operate any defined benefit pension schemes. Other pension costs includes employee-nominated
payments to defined contribution schemes and Company contributions.
The Directors’ remuneration for the years ended 31 May 2022 and 31 May 2021 is set out in the Directors’ Remuneration Report
on page 83.
The average monthly number of employees, including Directors, split into the key activity areas was as follows:
Year ended Year ended
31 May 2022 31 May 2021
Prospect acquisition 356 311
Sales and client management 257 277
Technology 895 759
Operations 545 386
Business administration 371 293
2,424 2,026
150 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
7. Finance income

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Bank interest receivable 1.5 0.6
Interest receivable on cash held at brokers 0.8 0.6
Interest accretion on financial investments 0.4 0.9
Interest receivable on money market funds 0.3 –
Other interest 0.4 –
3.4 2.1
8. Finance costs

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Interest and fees on issued debt securities 5.3 –
Term loan interest and fees 3.5 2.6
Revolving credit facility interest and fees 1.6 0.5
Interest payable to brokers 2.7 1.6
Interest payable on lease liabilities 0.6 0.6
Bank interest payable 1.1 0.6
14.8 5.9
9. Taxation
Tax on profit on ordinary activities
Tax charged in the income statement:
Year ended

| Year ended |  | 31 May 2021 |  |  |
| --- | --- | --- | --- | --- |
| 31 May 2022 |  | (Restated) |  | 1 |
|  | £m |  | £m |  |

Current income tax:
UK corporation tax 79.1 80.9
Non-UK corporation tax 39.3 6.4
Adjustment in respect of prior years (6.1) (6.0)
Total current income tax 112 .3 81.3
Deferred income tax:
Origination and reversal of temporary differences (1.6) (2.0)
Adjustment in respect of prior years (1.0) (0.4)
Impact of change in tax rates on deferred tax balances 0.3 (0.5)
Total deferred income tax (2.3) (2.9)
Tax expense in the Income Statement attributable to continuing operations 80.9 77.4
Tax expense attributable to discontinued operations 29.1 1.0
Tax not charged to income statement:
Tax recognised in other comprehensive income 0.5 –
Tax recognised directly in equity (0.5) (0.2)
1 The FY21 comparatives have been restated to present separately the results of discontinued operations. Refer to note 31 for further details.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 151
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
9. Taxation continued
Reconciliation of the total tax charge
The standard rate of corporation tax in the UK for the year ended 31 May 2022 is 19.0% (31 May 2021: 19.0%). Taxation outside
the UK is calculated at the rates prevailing in the relevant jurisdictions. The tax expense in the income statement for the year can
be reconciled as set out below:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Profit before taxation
From continuing operations 477.0 446.0
From discontinued operations 136.9 4.3
Total profit before tax 613.9 450.3
Profit multiplied by the UK standard rate of corporation tax of 19.0%
(year ended 31 May 2021: 19.0%) 116 .7 85.6
Higher taxes on overseas earnings 7.9 1.4
Adjustment in respect of prior years (8.2) (6.4)
Expenses not deductible for tax purposes 0.8 4.6
Patent Box deduction (7.0) (4.7)
Impact of change in tax rates on deferred tax balances 0.3 (0.5)
Recognition and utilisation of losses previously not recognised (1.2) (2.7)
Current year losses not recognised as deferred tax assets 0.7 1.1
Total tax expense attributable to: 110.0 78.4
Continuing operations 80.9 77.4
Discontinued operations 29.1 1.0
The effective tax rate for the year is 17.9% (year ended 31 May 2021: 17.4%).
The Finance Act 2021 passed into legislation in May 2021 and increased the main rate of UK corporation tax from 19% to 25%
effective from 1 April 2023. The impact of these changes on deferred tax has been assessed and deferred tax assets and
liabilities have been measured at the tax rates that are expected to apply when the related asset is realised or liability settled.
Deferred income tax assets
31 May 2022 31 May 2021
£m £m
Tax losses available for offset against future profits 3.7 4.0
Temporary differences arising on share-based payments 3.7 3.1
Temporary differences arising on fixed assets 2.1 2.0
Other temporary differences 8.0 3.8
17.5 12.9
Deferred income tax liabilities
31 May 2022 31 May 2021
£m £m
Temporary differences arising on business combinations (62.9) -
Temporary differences arising on fixed assets (0.2) (0.3)
Other temporary differences (4.1) (0.5)
(67.2) (0.8)
Deferred income tax recovery
31 May 2022 31 May 2021
£m £m
Deferred tax assets to be recovered within 12 months 5.4 3.7
Deferred tax assets to be recovered after 12 months 12.1 9.2
17.5 12.9
152 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
9. Taxation continued
Deferred income tax settlement
31 May 2022 31 May 2021
£m £m
Deferred tax liabilities to be settled within 12 months (7.7) (0.3)
Deferred tax liabilities to be settled after 12 months (59.5) (0.5)
(67.2) (0.8)
The recognised deferred tax asset reflects the extent to which it is considered probable that future taxable profits can be offset
against the tax losses carried forward and sufficient capital gains arising in the future.
Share-based payment awards have been charged to the income statement but are not allowable as a tax deduction until the
awards vest. The excess of the expected tax relief in future years over the amount charged to the income statement is
recognised as a credit directly to equity.
Unrecognised deferred tax assets
31 May 2022 31 May 2021
Gross Gross
unrecognised unrecognised
losses for tax Tax value losses for tax Tax value
purposes of loss purposes of loss
£m £m Expiry date £m £m Expiry date
Overseas trading losses 14.6 3.9 N/A 14.4 4.2 N/A
UK capital losses 23.5 5.9 N/A 23.5 5.9 N/A
38.1 9.8 37. 9 10.1
The recoverability of unrecognised deferred tax assets is dependent on sufficient taxable profits of the entities.
The movement in the deferred income tax assets is as follows:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

At the beginning of the year 12.9 11. 5
Amounts arising on acquisitions in the year 7. 4 –
Tax (charged)/credited to the Income Statement (2.2) 3.0
Tax charged directly to equity (0.3) (0.6)
Impact of movement in foreign exchange rates – (1.0)
Reallocations between deferred tax assets and liabilities (0.3) –
At the end of the year 17.5 12.9
The movement in the deferred income tax liability is as follows:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

At the beginning of the year (0.8) (0.7)
Amounts arising on acquisitions in the year (66.1) –
Tax credited/(charged) to the Income Statement 4.5 (0.1)
Tax charged to other comprehensive income (0.5) –
Impact of movement in foreign exchange rates (4.6) –
Reallocations between deferred tax assets and liabilities 0.3 –
At the end of the year (67.2) (0.8)
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 153
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
9. Taxation continued
Factors affecting the tax charge in future years
Factors that may affect the Group’s future tax charge include the geographic location of the Group’s earnings, the tax rates in
those locations, changes in tax legislation, the recognition of previously unrecognised tax losses and the resolution of open tax
issues. The Group’s future tax charge may also be impacted by changes in the Group’s business activities, client composition
and regulatory status, which could impact the Group’s exemption from the UK Bank Corporation Tax Surcharge.
The calculation of the Group’s total tax charge involves a degree of estimation and judgement with respect to the recognition of
deferred tax assets, which are dependent on the Group’s estimation of future profitable income, transfer pricing and of certain
items whose tax treatment cannot be finally determined until resolution has been reached with the relevant tax authority. The
Group operates in a number of jurisdictions worldwide, and tax laws in those jurisdictions are themselves subject to change.
The Group determines its tax liability by taking into account its tax risks and it makes provision for those matters where it is
probable that a tax liability will arise. Tax payable may ultimately be materially more or less than the amount already accounted
for.
10. Earnings per ordinary share
Basic earnings per share is calculated by dividing the profit for the year attributable to ordinary equity holders of the parent by
the weighted average number of ordinary shares in issue during the year, excluding shares held as own shares in the Group’s
Employee Benefit Trusts. Diluted earnings per share is calculated using the same profit figure as that used in basic earnings per
share and by adjusting the weighted average number of ordinary shares assuming the vesting of all outstanding share scheme
awards and that vesting is satisfied by the issue of new ordinary shares.

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Earnings attributable to owners of the parent 503.9 371.9
Weighted average number of shares:
Basic 426,289,898 369,181,516
Dilutive effect of share-based payments 3,614,236 3,222,900
Diluted 429,904,134 372,404,416
Year ended
Year ended 31 May 2021
31 May 2022 (Restated)
Basic earnings per ordinary share 118 . 2p 110.7p
– Attributable to continuing operations 92.9p 99.8p
– Attributable to discontinued operations 25.3p 0.9p
Diluted earnings per ordinary share 117. 2p 99.9p
– Attributable to continuing operations 92.1p 99.0p
– Attributable to discontinued operations 25.1p 0.9p
11. Dividends paid and proposed

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Final dividend for 31 May 2021 at 30.24p per share (FY20: 30.24p) 130.3 111. 8
Interim dividend for 31 May 2022 at 12.96p per share (FY21: 12.96p) 55.9 47. 9
186.2 159.7
The final dividend for the year ended 31 May 2022 of 31.24 pence per share was proposed by the Board on 20 July 2022 and
has not been included as a liability at 31 May 2022. This dividend will be paid on 20 October 2022, following approval at the
Company’s AGM, to those members on the register at the close of business on 23 September 2022.
154 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

# 12. Property, plant and equipment

|   | Leasehold Improvements £m | Office equipment, fixtures and filings £m | Computer and other equipment £m | Right-of-use assets £m | Total £m  |
| --- | --- | --- | --- | --- | --- |
|  **Cost:** |  |  |  |  |   |
|  At 1 June 2020 | 23.0 | 6.9 | 41.8 | 36.2 | 107.9  |
|  Additions | 1.0 | 0.1 | 8.0 | 0.3 | 9.4  |
|  Impact of movement in foreign exchange rates | (0.4) | (0.3) | (0.7) | (2.0) | (3.4)  |
|  At 31 May 2021 | 23.6 | 6.7 | 49.1 | 34.5 | 113.9  |
|  Additions | **0.1** | **0.1** | **8.3** | **8.4** | **16.9**  |
|  Additions – business acquisition | **0.8** | **0.1** | **1.3** | **0.7** | **2.9**  |
|  Disposals – discontinued operations | – | – | (3.4) | (0.8) | (4.2)  |
|  Other disposals | – | (0.1) | (0.6) | (5.6) | (6.3)  |
|  Classified as assets held for sale | (0.7) | – | – | (1.5) | (2.2)  |
|  Impact of movement in foreign exchange rates | **0.3** | **0.3** | **0.6** | **0.9** | **2.1**  |
|  **At 31 May 2022** | **24.1** | **7.1** | **55.3** | **36.6** | **123.1**  |
|  **Accumulated depreciation:** |  |  |  |  |   |
|  At 1 June 2020 | 17.2 | 4.8 | 32.6 | 6.9 | 61.5  |
|  Charge for the year | 1.4 | 0.6 | 6.1 | 6.9 | 15.0  |
|  Impact of movement in foreign exchange rates | (0.1) | (0.1) | (0.4) | (0.6) | (1.2)  |
|  At 31 May 2021 | 18.5 | 5.3 | 38.3 | 13.2 | 75.3  |
|  Charge for the year | **1.9** | **1.0** | **7.8** | **7.6** | **18.3**  |
|  Disposal – discontinued operations | – | – | (2.5) | (0.2) | (2.7)  |
|  Other disposals | – | (0.1) | (0.5) | (3.3) | (3.9)  |
|  Classified as assets held for sale | (0.3) | – | – | (0.7) | (1.0)  |
|  Impact of movement in foreign exchange rates | **0.3** | – | **0.1** | **0.1** | **0.5**  |
|  **At 31 May 2022** | **20.4** | **6.2** | **43.2** | **16.7** | **86.5**  |
|  Net book value – 31 May 2021 | 5.1 | 1.4 | 10.8 | 21.3 | 38.6  |
|  **Net book value – 31 May 2022** | **3.7** | **0.9** | **12.1** | **19.9** | **36.6**  |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

155
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
13. Intangible assets
Internally
Customer Trade Non-compete developed Domain Software and
relationships Names agreements software names licences Total
£m £m £m £m £m £m £m
Cost:
At 1 June 2020 – – – 40.9 37.7 28.1 106.7
Additions – – – 3.3 – 3.6 6.9
Disposals – – – – – (0.2) (0.2)
Impact of movement in
foreign exchange rates – – – 0.1 (4.3) (0.3) (4.5)
At 31 May 2021 – – – 44.3 33.4 31.2 108.9
Additions – – – 6.1 – 2.9 9.0
Additions – business
acquisition 163.5 56.9 28.8 14.3 – – 263.5
Disposals – discontinued
operations – – – (0.6) – (0.7) (1.3)
Other disposals – – – (1.5) – – (1.5)
Impact of movement in
foreign exchange rates 15.9 5.5 2.8 1.5 3.6 0.2 29.5
At 31 May 2022 179.4 62.4 31.6 64.1 37.0 33.6 408.1
Accumulated amortisation:
At 1 June 2020 – – – 27.7 15.4 24.5 6 7. 6
Charge during the year – – – 4.7 3.5 2.5 10.7
Disposals – discontinued
operations – – – – – (0.2) (0.2)
Impact of movement in
foreign exchange rates – – – (0.1) (1.7) (0.1) (1.9)
At 31 May 2021 – – – 32.3 17. 2 26.7 76.2
Charge during the year 16.8 3.6 5.5 6.8 3.5 3.0 39.2
Disposal – discontinued
operations – – – (0.4) – (0.5) (0.9)
Other disposals – – – (1.5) – – (1.5)
Impact of movement in
foreign exchange rates 0.7 0.1 0.3 0.2 1.6 0.1 3.0
At 31 May 2022 17.5 3.7 5.8 37. 4 22.3 29.3 116.0
Net book value –
31 May 2021 – – – 12.0 16.2 4.5 32.7
Net book value –
31 May 2022 161.9 58.7 25.8 26.7 14.7 4.3 292.1
14. Financial investments and financial assets pledged as collateral

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

UK Government securities 351.1 3 42.1
Term deposits 45.0 –
396.1 342.1
Split as:
Non-current portion 160.1 188.7
Current portion 236.0 153.4
396.1 342.1
Of the UK Government securities, £289.9 million (31 May 2021: £256.0 million) is held at brokers to satisfy margin requirements.
The remaining balance is held to meet regulatory liquidity requirements.
156 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
15. Goodwill
The movement in the goodwill for the year is as follows:
31 May 2022 31 May 2021
Cost or valuation £m £m
At the beginning of the year 107. 3 10 8.1
Additions – business acquisition 462.4 –
Disposals (13.4) –
Impact of foreign exchange movement 48.4 (0.8)
At the end of the year 604.7 107. 3
Goodwill has been allocated for impairment testing purposes to cash-generating units (CGUs) as follows:
31 May 2022 31 May 2021
£m £m
US (tastytrade) 502.8 –
UK 100.9 100.9
US (Nadex) – 5.3
South Africa 0.9 1.0
Australia 0.1 0.1
604.7 107. 3
Goodwill arose as follows:
¼ US (tastytrade) – from the acquisition of tastytrade on 28 June 2021. As part of the transaction, the Group acquired an
investment in Small Exchange, which was considered an operation within the US (tastytrade) CGU. The Group sold its interest
in Small Exchange during the year and a portion of the US (tastytrade) goodwill was allocated to it and disposed of.
¼ UK – from the reorganisation of the UK business on 5 September 2003.
¼ US (Nadex) – from the acquisition of Nadex previously recognised was disposed of during the year. Refer to note 31 for
further details.
¼ South Africa – from the acquisition of Ideal CFDs on 1 September 2010.
¼ Australia – from the acquisition of the non-controlling interest in IG Australia Pty Limited in the year ended 31 May 2006
.
Impairment testing
The Group’s goodwill balance has been subject to a full impairment assessment and there has not been any impairment
recognised for the year ended 31 May 2022 (31 May 2021: £nil). For the purposes of the Group’s impairment testing of goodwill,
the carrying amount of each CGU is compared to the estimated recoverable amount of the relevant CGU and any deficits are
considered impairments requiring recognition in the year.
The carrying amount of a CGU includes only those assets that can be attributed directly to it, or allocated on a reasonable and
consistent basis.
The US (tastytrade) CGU carrying value includes the investment in associate held in relation to Zero Hash Holdings Limited.
There are no cash flows included within the future cash flow projections relating to this investment. As Zero Hash forms part of
the US (tastytrade) CGU, the Group disposed of £2.2 million goodwill following partial sale of its holding in Zero Hash. Refer to
note 32 for further details relating to the disposal.
The estimated recoverable amount for each CGU is based upon the value-in-use (VIU) of each CGU. For all CGUs, the estimate
of the recoverable amount was higher than the carrying value.
Key assumptions used in the calculation of the recoverable amount of the CGUs
The key assumptions for the VIU calculations are those regarding regional long-term growth rates, future cash flow projections,
and discount rates.
Regional long-term growth:
Regional long-term growth is used to extrapolate the cash flows to perpetuity for each CGU. After a management forecast
period of four years, a terminal growth rate of 2.0% (31 May 2021: 2.0%) has been applied to the cash flows to derive
aterminalvalue.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 157
FINANCIAL STATEMENTS

# Notes to the Financial Statements continued

# 15. Goodwill continued

# Future cash flow projections:

The future cash flow projections are based on the most recent financial forecasts considered for each CGU which cover a four year period. These cash flow projections comprise of revenue, structural costs base and capital expenditure. Projected revenue is based on assumptions relating to client acquisition and trading activity, and assumptions on interest earned on client funds. The projected costs are based on assumptions relating to revenue-related costs, including trading and client transaction fees, and structural costs. The projected profitability takes into account historical performance and the Group's knowledge of the current market, together with the Group's views on the future achievable growth.

# Discount rates:

The discount rates used to calculate the recoverable amount of each CGU are based on a post tax weighted average cost of capital (WACC) which is specific to each geographical region. The discount rate depends on a number of inputs reflecting the current market assessment of the time value of money, determined by external market information, and inputs relating to the risks associated with the cash flow of each individual CGU which are subject to management's judgement.

The post-tax WACC is grossed up to a pre-tax discount rate. The pre-tax discount rate applied to calculate the recoverable amount of each CGU is as follows:

|   | 31 May 2022 | 31 May 2021  |
| --- | --- | --- |
|  US (tastytrade) | 17.5% | -  |
|  UK | 12.0% | 10.0%  |
|  US (Nades) | - | 12.0%  |
|  Australia | 13.0% | 12.0%  |
|  South Africa | 18.0% | 15.0%  |

# Sensitivity to changes in key assumptions

The VIU calculations have been subject to a sensitivity analysis reflecting reasonable changes in individual key assumptions. The most significant goodwill balance recognised by the Group relates to the US (tastytrade) CGU. The table below shows the reduction in the recoverable amount and where relevant the associated potential impairment arising from reasonable changes in key assumptions used in the US (tastytrade) impairment testing:

|  Assumption | Sensitivity applied | US (tastytrade)  |   |
| --- | --- | --- | --- |
|   |   |  Reduction in recoverable amount £m | Impairment £m  |
|  Long-term growth rate | 0.5% decrease | 27.7 | Nil  |
|  EBITDA | 20% decrease | 185.4 | 70.4  |
|  Discount rates | 1% increase (post-tax) | 72.6 | Nil  |

The assumptions that would result in the recoverable amount equalling the carrying value of the US (tastytrade) CGU are:

|  Long-term growth rate | 0.5%  |
| --- | --- |
|  EBITDA margin | 13% underperformance  |
|  Discount rates | 19.8%  |

For all other goodwill balances, there is sufficient headroom in the recoverable amount of the CGU based on the assumptions made, and there is not considered to be any reasonably likely scenario under which material impairment could be expected to occur based on the testing performed.

158

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

# **16. Trade receivables**

|   | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  Amounts due from brokers | 381.0 | 424.3  |
|  Own funds in client money | 85.5 | 63.3  |
|  Amounts due from clients | 3.0 | 3.3  |
|   | **469.5** | **490.9**  |

Amounts due from brokers represent balances with brokers and execution partners where the combination of cash held on account and the valuation of financial derivative open positions, or unsettled trade receivables, results in an amount due to Group.

Own funds in client money represent the Group's own cash held in segregated client funds, in accordance with the UK's Financial Conduct Authority (FCA) CASS rules and similar rules of other regulators in whose jurisdiction the Group operates and includes £7.6 million (31 May 2021: £9.2 million) to be transferred to the Group on the following business day.

Amounts due from clients arise when a client's total funds held with the Group are insufficient to cover any trading losses incurred by the client or when a client utilises a trading credit limit. Amounts due from clients are stated net of an allowance for impairment.

# **17. Other assets**

Other assets are cryptocurrency assets and rights to cryptocurrency assets, which are owned and controlled by the Group for the purpose of hedging the Group's exposure to clients' cryptocurrency trading positions. The Group holds rights to cryptocurrency assets on exchange and in vaults as follows:

|   | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  Exchange | 1.8 | 13.8  |
|  Vaults | 12.4 | 16.5  |
|   | **14.2** | **30.3**  |

Other assets are measured at fair value less costs to sell. Other assets are level 2 assets in accordance with the fair value hierarchy (note 27).

# **18. Borrowings and debt securities in issue**

In June 2021, the Group drew down on a £150.0 million term loan to finance the tastytrade acquisition, taking the total committed term loan facilities to £250.0 million.

The Group subsequently performed a debt refinancing exercise and implementation of a long term funding structure, which was completed in November 2021. The refinancing involved the following:

- → A new £300.0 million committed revolving credit facility, with an initial maturity of three years

The issued debt has been recognised at fair value less transaction fees. As at 31 May 2022, £2.0 million unamortised arrangement fees are recognised on the Statement of Financial Position, with £1.0 million unamortised fees relating to the repaid term loans expensed to the Income Statement in the year. Unamortised arrangements fees of £1.6 million in relation to the new revolving credit facility have been recognised on the Statement of Financial Position.

The Group has the option to request an increase in the revolving credit facility size to £400.0 million and to request two maturity extensions of one year each, all subject to bank approval. Following this refinancing exercise, total available credit facilities have risen from £375.0 million as at 31 May 2021 to £600.0 million as at 31 May 2022, with the potential to increase to £700.0 million if the new revolving credit facility is increased in size.

Under the terms of the new revolving credit facility agreement, the Group is required to comply with financial covenants covering maximum levels of leverage and debt to equity. The Group has complied with all covenants throughout the reporting period.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

159
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
19. Lease liabilities
The liability represents the obligation to make payments relating to leasing of premises. The table below shows the maturity
analysis of these lease liabilities as at the balance sheet date.
31 May 2022 31 May 2021
£m £m
Future minimum payments due:
Within one year 8.9 6.7
After one year but not more than five years 13.2 15.5
After more than five years 0.6 0.9
22.7 23.1
In addition to the £22.7 million lease liability (31 May 2021: £23.1 million), the Group has £0.3 million lease commitments under
non-cancellable operating leases which are not capitalised as right-of-use assets (31 May 2021: £0.1 million). Included within this
balance is a £0.8 million lease liability relating to lease assets classified as held for sale.
Please refer to note 28 below for the maturity analysis of the undiscounted cash flows for non-cancellable leases.
20. Trade payables
31 May 2022 31 May 2021
£m £m
Client funds:
UK and Ireland 359.0 222.0
US 34.1 21.6
EU 71.6 46.6
EMEA Non-EU 48.8 58.7
Singapore 1.5 2.6
Japan 4.4 1.7
519.4 353.2
Issued turbo warrants 1.5 1.1
Amounts due to brokers 28.0 –
Amounts due to clients 22.3 3.2
571.2 3 57.5
Client funds reflects the Group’s liability for client monies which are recognised on balance sheet in cash and cash equivalents.
Amounts due to brokers represents balances where the value of unsettled positions, or the value of open derivatives positions
held in accounts which are not covered by an enforceable netting agreement, results in an amount payable by the Group.
Amounts due to clients represent balances that will be transferred from cash and cash equivalents into segregated client funds
on the following business day in accordance with the UK’s Financial Conduct Authority CASS rules and similar rules of other
regulators in whose jurisdiction the Group operates.
21. Other payables
31 May 2022 31 May 2021
£m £m
Accruals 112 .6 97. 2
Payroll taxes, social security and other taxes 6.9 11. 0
119.5 108.2
160 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

## 22. Contingent liabilities and provisions

In the ordinary course of business, the Group is subject to legal and regulatory risks in a number of jurisdictions which may result in legal claims or regulatory action against the Group. Through the Group's ordinary course of business there are ongoing legal proceedings and engagements with regulatory authorities. Where possible, an estimate of the potential financial impact of these legal proceedings is made using management's best estimate, but where the most likely outcome cannot be determined no provision is recognised.

The largest group of related claims that the Group is subject to could have a financial impact of approximately £20.6 million as at 31 May 2022. This is in its early stages and it is not possible to determine whether any amounts will be payable to the clients. As a result, no provision has been recognised. The Group was not subject to any significant claims at 31 May 2021.

Under the terms of the agreement with the Group's clearing broker for its operations in the US, Apex Clearing Corporation, the Group guarantees the performance of its customers in meeting contracted obligations. In conjunction with the clearing broker, the Group seeks to control the risks associated with its customer activities by requiring customers to maintain collateral in compliance with various regulatory and internal guidelines. Compliance with the various guidelines is monitored daily and, pursuant to such guidelines, the customers may be required to deposit additional collateral, or reduce positions where necessary.

The Group does not expect there to be other contingent liabilities that would have a material adverse impact on the Group Financial Statements. The Group had no material provisions as at 31 May 2022 (31 May 2021: £nil).

## 23. Share capital and share premium

|   | Number of shares | Share capital £m | Share premium account £m  |
| --- | --- | --- | --- |
|  **Allotted and fully paid:**  |   |   |   |
|  **(i) Ordinary shares (0.005p)**  |   |   |   |
|  At 31 May 2020 | 369,439,455 | - | 125.8  |
|  Issued during the year | 860,000 | - | -  |
|  At 31 May 2021 | 370,299,455 | - | 125.8  |
|  Issued during the year | 61,275,000 | - | -  |
|  **At 31 May 2022** | **431,574,455** | **-** | **125.8**  |
|  **(ii) Deferred redeemable shares (0.001p)**  |   |   |   |
|  At 31 May 2021 | 65,000 | - | -  |
|  **At 31 May 2022** | **65,000** | **-** | **-**  |
|  **(iii) Redeemable preference shares (£1.00)**  |   |   |   |
|  At 31 May 2021 | 40,000 | - | -  |
|  **At 31 May 2022** | **40,000** | **-** | **-**  |

During the year ended 31 May 2022, 61,000,000 ordinary shares with an aggregate nominal value of £3,050.00 were issued as part of the consideration for the acquisition of tastytrade. The issue of shares qualifies for merger relief under Section 612 of the Companies Act 2006, and the amount in excess of the nominal value of ordinary shares, totalling £509.0 million, has been recognised in the merger reserve instead of the share premium account.

IG Group Holdings plc also issued 275,000 ordinary shares (31 May 2021: 860,000 ordinary shares) with an aggregate nominal value of £13.75. The 275,000 ordinary shares (31 May 2021: 860,000) were issued to the Employee Benefit Trust in order to satisfy the exercise of sustained performance plan and long-term incentive plan awards, for consideration of £13.75 (31 May 2021: £43.00). Except as the ordinary shareholders have agreed or may otherwise agree, on a winding up of the Company, the balance of assets available for distribution, after the payment of all of the Company's creditors and subject to any special rights attaching to other classes of shares, are distributed among the shareholders according to the amounts paid up on shares by them.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

161
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
23. Share capital and share premium continued
Deferred redeemable shares
These shares carry no entitlement to dividends and no voting rights.
Redeemable preference shares
The preference shares are entitled to a fixed non-cumulative dividend of 8.0% paid in preference to any other dividend.
Redemption is only permissible in accordance with capital distribution rules or on the winding up of the Company where the
holders are entitled to £1 per share plus, if the Company has sufficient distributable reserves, any accrued or unpaid dividends.
The preference shares have no voting rights, except that they are entitled to vote should the Company fail to pay any amount
due on redemption of the shares. The effective interest rate on these shares is 8.0% (31 May 2021: 8.0%).
24. Other reserves
Own shares held
Share-based in Employee Total other
payments reserve Benefit Trusts FVOCI reserve reserves
£m £m £m £m
At 1 June 2020 16.7 (4.6) 1.2 13.3
Equity-settled employee share-based payments 7.4 – – 7.4
Exercise of employee share awards (3.2) 3.2 – –
Employee Benefit Trust purchase of shares – (0.2) – (0.2)
Transfer of vested awards from share-based payment reserve (6.4) – – (6.4)
Change in value of financial assets held at fair value through other
comprehensive income – – (1.3) (1.3)
At 31 May 2021 14.5 (1.6) (0.1) 12.8
At 1 June 2021 14.5 (1.6) (0.1) 12.8
Equity-settled employee share-based payments 13.6 – – 13.6
Exercise of employee share awards (2.3) 2.3 – –
Employee Benefit Trust purchase of shares – (6.7) – (6.7)
Transfer of vested awards from share-based payment reserve (7.3) – – (7.3)
Change in value of financial assets held at fair value through other
comprehensive income – – (4.0) (4.0)
At 31 May 2022 18.5 (6.0) (4.1) 8.4
The share-based payments reserve relates to the estimated cost of equity-settled employee share plans based on a straight-
line basis over the vesting period. The fair value through other comprehensive income reserve includes unrealised gains or
losses in respect of financial investments, net of tax.
Own shares held in Employee Benefit Trusts
The movements in own shares held in Employee Benefit Trusts in respect of employee share plans during the year were as follows:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | Number |  | Number |

At the beginning of the year 872,272 1,279,338
Subscribed for and purchased during the year 1,012 ,13 0 898,139
Exercise and sale of own shares held in trust (1,224,473) (1,305,205)
At the end of the year 659,929 872,272
The Group has a UK-resident Employee Benefit Trust which holds shares in the Company to satisfy awards under the Group’s
HMRC-approved share-incentive plan (SIP). At 31 May 2022, 161,918 ordinary shares (31 May 2021: 205,623) were held in the
trust. The market value of the shares at 31 May 2022 was £1.2 million (31 May 2021: £1.8 million).
The Group has a Jersey-resident Employee Benefit Trust which holds shares in the Company to satisfy awards under the
long-term incentive plan and sustained performance plan. At 31 May 2022 the Trust held 488,094 ordinary shares (31 May
2021: 651,444). The market value of the shares at 31 May 2022 was £3.5 million (31 May 2021: £5.6 million).
The Group has an Australian-resident Employee Equity Plan Trust which holds shares in the Company to satisfy awards under a
SIP. At 31 May 2022, 9,917 ordinary shares (31 May 2021: 15,205) were held in the Trust. The market value of the shares at
31 May 2022 was £0.1 million (31 May 2021: £0.1 million).
162 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

## 25. Employee share plans

The Company operates four employee share plans: a sustained performance plan (SPP), a long-term incentive plan (LTIP), a share-incentive plan (SIP) and a medium-term incentive plan (MTIP). The LTIP, MTIP and SIP are equity-settled. The SPP awarded prior to 31 May 2021 was fully equity-settled. The SPP awarded after 31 May 2021 has changed such that 30% of the award for the Executive Directors is settled in cash, and does not meet the criteria to be recognised as either a cash-settled share-based payment or an equity-settled share-based payment.

### Sustained performance plan (SPP)

The SPP award was introduced in the year ended 31 May 2014 for the Group's Executive Directors and other selected senior employees. The Remuneration Committee approves any awards made under the plan and is responsible for setting the policy for the operation of the SPP, agreeing performance targets and participation.

The legal grant of awards under the SPP occurs post the relevant performance period. At the outset of the financial year the Remuneration Committee approves, and communicates to the participants, performance conditions and a pre-defined maximum monetary award in terms of multiple of salary. The grant of awards, in the form of equity-settled par value options, is based upon three performance conditions: relative Total Shareholder Return (TSR), earnings per share (EPS) and operational non-financial performance (NFP). Awards subsequently vest periodically in tranches until three years after the expiry of the SPP scheme in August 2023, unless a decision is made by the Remuneration Committee to extend the life of the SPP scheme. As at 31 May 2022, no decision had been made to extend the life of the SPP scheme.

The following table shows the movement of options in the SPP, and the additional awards issued for the year ended 31 May 2022:

|  Award date | Performance period (year ended) | Share price at award | Expected full vesting date | At the beginning of the year Number | Awarded during the year Number | Lapsed during the year Number | Exercised during the year Number | Dividend equivalent awarded during the year Number | At the end of the year Number  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  04-Aug-14 | 31 May 2014 | 609.90p | 1 Aug 2025 | 24,776 | - | - | (13,547) | 622 | 11,851  |
|  06-Aug-15 | 31 May 2015 | 742.55p | 1 Aug 2025 | 26,849 | - | - | (14,355) | 693 | 13,187  |
|  02-Aug-16 | 31 May 2016 | 868.65p | 1 Aug 2025 | 111,044 | - | - | (60,627) | 2,798 | 53,215  |
|  01-Aug-17 | 31 May 2017 | 626.50p | 1 Aug 2025 | 98,688 | - | - | (49,795) | 2,713 | 51,606  |
|  07-Aug-18 | 31 May 2018 | 893.00p | 1 Aug 2025 | 336,128 | - | - | (162,502) | 9,634 | 183,260  |
|  06-Aug-19 | 31 May 2019 | 559.20p | 1 Aug 2025 | 245,860 | - | - | (106,144) | 7,753 | 147,469  |
|  06-Aug-20 | 31 May 2020 | 734.00p | 1 Aug 2025 | 1,334,825 | - | - | (444,940) | 49,368 | 939,253  |
|  06-Aug-20 | - | 734.00p | 1 May 2022 | 17,814 | - | - | (19,855) | 2,041 | -  |
|  06-Aug-20 | 31 May 2021 | 734.00p | 30 Jun 2022 | 35,616 | - | - | - | - | 35,616  |
|  06-Aug-20 | - | 734.00p | 1 May 2023 | 4,357 | - | - | (2,426) | 248 | 2,179  |
|  05-Aug-21 | 31 May 2022 | 911.50p | 1 Aug 2025 | - | 1,322,774 | (34,678) | - | 38,684 | 1,326,780  |
|  10-Jan-22 | - | 829.50p | 30 Jun 2023 | - | 15,390 | - | - | - | 15,390  |
|  10-Jan-22 | - | 829.50p | 30 Jun 2024 | - | 12,990 | - | - | - | 12,990  |
|  Total |   |   |   | 2,235,957 | 1,351,154 | (34,678) | (874,191) | 114,554 | 2,792,796  |

The average share price at exercise of options during the year was 905.87 pence. The exercise price of all SPP awards is 0.005 pence and the weighted average remaining contractual life of share options as at 31 May 2022 was 3.11 years (30 May 2021: 4.17 years).

The SPP awards for the year ended 31 May 2022 will be granted in August 2022 following the approval of actual performance against targets set by the Remuneration Committee. A ten-day share price averaging period, that commences after the Company's closed period, is utilised to convert the notional value awarded into a number of options.

The table below details the number of options expected to be awarded for the year ended 31 May 2022, based on the year-end share price:

|  Expected award date | Closing share price at 31 May 2022 | Expected full vesting date | Awards expected for the year ending 31 May 2022 Number  |
| --- | --- | --- | --- |
|  4 Aug 2022 | 715.5p | 1 Aug 2025 | 2,002,411  |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

163
FINANCIAL STATEMENTS

# Notes to the Financial Statements continued

# **25. Employee share plans continued**

# **Long-term incentive plan (LTIP)**

The LTIP is made available to senior management who are not invited to participate in the SPP. Awards under the LTIP are nominal cost options, which vest after three years, conditional upon continued employment at the vesting date. There are no other performance targets.

The maximum number of LTIP awards that can vest under the awards made are:

|  Award date | Share price at award | Expected vesting date | At the beginning of the year Number | Awarded during the year Number | Lapsed during the year Number | Dividend equivalent awarded during the year Number | Exercised during the year Number | At the end of the year Number  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  7 Aug 2018 | 893.00p | 7 Aug 2021 | 218,371 | - | (3,636) | 47,510 | (259,810) | 2,435  |
|  6 Aug 2019 | 559.20p | 6 Aug 2022 | 438,844 | - | (61,125) | - | - | 377,719  |
|  6 Aug 2020 | 734.00p | 6 Aug 2023 | 386,697 | 2,210 | (64,803) | - | - | 324,104  |
|  5 Aug 2021 | 911.50p | 5 Aug 2024 | - | 397,257 | (41,962) | - | - | 355,295  |
|  Total |  |  | 1,043,912 | 399,467 | (171,526) | 47,510 | (259,810) | 1,059,553  |

The exercise price of all options awarded under the LTIP is 0.005 pence and the weighted average remaining contractual life of share options as at 31 May 2022 was 1.16 years (31 May 2021: 1.34 years).

# **Medium-term incentive plan (MTIP)**

The MTIP is made available to certain employees within the Group. Awards under the MTIP are nominal cost options, which vest after 15 months, conditional upon continued employment at the vesting date. There are no other performance targets.

The maximum number of MTIP awards that can vest under the awards made are:

|  Award date | Share price at award | Expected vesting date | At the beginning of the year Number | Awarded during the year Number | Lapsed during the year Number | Dividend equivalent awarded during the year Number | Exercised during the year Number | At the end of the year Number  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  5 Aug 2021 | 911.50p | 5 Nov 2022 | - | 205,487 | (9,968) | - | - | 195,519  |
|  Total |  |  | - | 205,487 | (9,968) | - | - | 195,519  |

The exercise price of all options awarded under the MTIP is 0.005 pence and the weighted average remaining contractual life of share options as at 31 May 2022 was 0.43 years (31 May 2021: nil).

# **Share-incentive plan (SIP)**

SIP awards are made available to all UK, Australian and US employees. The terms of the award are approved by the Remuneration Committee.

The UK and Australian awards invite all employees to purchase up to £1,800/AS3,000 (31 May 2021: £1,800/AS3,000) of partnership shares, with the Company matching on a one-for-one (31 May 2021: one-for-one) basis. All matching shares vest after three years as long as the employee remains employed with the Group for the term of the award. Shares awarded under the scheme are held in trust in accordance with local tax authority rules. Employees are entitled to receive dividends on the partnership and matching shares held in trust for as long as they remain employees.

The US award invites employees to invest a maximum of 5% of their salary to the award. Employees are invited to purchase shares in IG Group Holdings plc at a discount of 15% to the scheme price, being the lower of the opening share price and the closing share price for the period.

164

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

# **25. Employee share plans continued**

The maximum number of matching shares that can vest based on the SIP awards made are:

|  Country of award | Award date | Share price at award | Expected vesting date | At the beginning of the year Number | Awarded during the year Number | Lapsed during the year Number | Exercised during the year Number | At the end of the year Number  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  UK | 7 Aug 2018 | 893.00p | 7 Aug 2021 | 85,158 | – | (2,634) | (82,524) | –  |
|  Australia | 15 Jul 2018 | 935.84p | 15 Jul 2021 | 7,178 | – | – | (7,178) | –  |
|  UK | 6 Aug 2019 | 559.20p | 6 Aug 2022 | 61,239 | – | (8,027) | (88) | 53,124  |
|  Australia | 15 Jul 2019 | 597.00p | 15 Jul 2022 | 2,075 | – | (283) | – | 1,792  |
|  UK | 6 Aug 2020 | 734.00p | 6 Aug 2023 | 55,003 | – | (5,400) | (484) | 49,119  |
|  Australia | 15 Jul 2020 | 740.79p | 15 Jul 2023 | 3,663 | – | (666) | – | 2,997  |
|  UK | 5 Aug 2021 | 911.50p | 5 Aug 2024 | – | 50,302 | (2,335) | (198) | 47,769  |
|  Australia | 15 Jul 2021 | 851.50p | 15 Jul 2024 | – | 4,179 | (190) | – | 3,989  |
|  Total |   |   |   | 214,316 | 54,481 | (19,535) | (90,472) | 158,790  |

Of the above SIP awards exercised during the year ended 31 May 2022, the average weighted share price at exercise was:

|  Country of award | Award date | Weighted average share price at exercise  |
| --- | --- | --- |
|  UK | 7 Aug 2018 | 871.26p  |
|  Australia | 15 Jul 2018 | 859.50p  |
|  UK | 6 Aug 2019 | 556.00p  |
|  Australia | 15 Jul 2019 | 614.12p  |
|  UK | 6 Aug 2020 | 751.60p  |
|  Australia | 15 Jul 2020 | 825.70p  |
|  UK | 5 Aug 2021 | 910.50p  |
|  Australia | 15 Jul 2021 | 827.89p  |

The weighted average exercise price of the SIP awards exercised during the year ended 31 May 2021 is 903.89 pence.

# **Accounting for share schemes**

The expense recognised in the Income Statement in respect of share-based payments was £13.7 million (31 May 2021: £7.4 million).

The fair value of the equity-settled share-based payments to employees is determined at the date at which a shared understanding of the terms and conditions of the arrangement is reached between the Company and the participants. The weighted average fair value of the equity-settled awards granted or deemed as such under IFRS 2 during the year was £15.3 million (31 May 2021: £12.7 million). For SIP awards the fair value is determined to be the share price at the grant date without making an adjustment for expected future dividends, as award recipients are entitled to dividends over the vesting period. For LTIP and MTIP awards the fair value is determined to be the share price at grant date without making an adjustment for the expected future dividends as dividend equivalents are awarded on options granted under the LTIP.

For potential SPP awards made under the TSR criteria, fair value is calculated using an option pricing model prepared by advisers. For the SPP awards made under the EPS and NFP operational measures, the fair value is determined by taking the share price at deemed grant date less the present value of expected future dividends for the duration of the performance period. Dividend equivalents accrue under the SPP on awarded but not yet vested options post the performance period. Dividend equivalents cease to accrue on unexercised options after the vesting date.

The inputs below were used to determine the fair value of the TSR element of the SPP award:

|  Date of grant | 16 August 2021  |
| --- | --- |
|  Share price at grant date (pence) | £9.13  |
|  Expected life of awards (years) | 0.79  |
|  Risk-free sterling interest rate (%) | 0.05%  |
|  IG Group Holdings plc expected volatility (%) | 24.09%  |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

165
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
25. Employee share plans continued
IG Group Holdings plc’s expected volatility is based on historical TSR volatility of IG Group Holdings plc measured daily over a
period prior to the date of grant and commensurate with the remaining performance period. The weighted average fair values
for outstanding awards across all schemes are as follows:
At the beginning Awarded during Lapsed during Exercised during At the end of the
of the year the year the year the year year
Year ended 31 May 2022 618.63p 760.27p 807.52p 641.61p 683.09p
Year ended 31 May 2021 577.48p 695.98p 6 6 7. 22p 689.06p 618.63p
26. Related party transactions
The Directors and other members of management classified as persons discharging management responsibility in accordance
with the Market Abuse Regulation are considered to be the key management personnel of the Group in accordance with IAS 24
Related Party Disclosures. The Directors’ Remuneration Report discloses all benefits and share-based payments earned during
the year and the preceding year by the Executive Directors. The total compensation for key management personnel was as
follows:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Short-term employee benefits 6.8 6.4
Share-based payments 10.6 6.5
17. 4 12.9
The average number of key management personnel during the year was twelve (year ended 31 May 2021: nine). Included within
short-term employee benefits are pension charges of £nil million (year ended 31 May 2021: £0.1 million).
The Group incurred short-term office rental costs in relation to office space leased from key management personnel totalling
£0.3 million in 31 May 2022 (31 May 2021: £nil). During the year ended 31 May 2022, the Group incurred £0.4 million of
arrangement fees for the issue of debt securities with a financial advisory firm that a member of key management personnel
holds a directorship in.
In November 2021, the Group took part in a funding round of Small Exchange and invested an additional £1.9 million. Prior to the
disposal of the Group’s shareholding in Small Exchange, the Group recognised its share of losses in the year from Small
Exchange of £2.3 million. In addition, the Group paid various operating expenses on behalf of Small Exchange and is reimbursed
for these expenses. The total value of these expenses in the year ended 31 May 2022 was £2.0 million (31 May 2021: £nil).
On acquisition of tastytrade, the Group initially recognised a convertible loan note with Zero Hash at a fair value of £9.3 million
($12.0 million). This was subsequently converted into an equity shareholding of 17.4% at fair value of £17.9 ($24.2 million)
inSeptember 2021. On 22 December 2021, the Group sold shares in Zero Hash and reduced its shareholding to 9.86%.
Thegain on revaluation on conversion of loan note and the gain on disposal have been shown as a separate line item
intheIncome Statement.
Zero Hash facilitates cryptocurrency trading for clients of tastyworks. tastyworks recognised £0.6 million revenue, net of
integration fees, from Zero Hash (year ended 31 May 2021: £nil).
There were no other related party transactions which had a material impact on the Financial Statements. The Group had no
transactions with its Directors other than those disclosed in the Directors’ Remuneration Report.
166 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

# **27. Financial instruments**

# **Accounting classifications and fair values**

The table below sets out the classification of each class of financial assets and liabilities and their fair values.

|  As at 31 May 2022 | Note | FVTPL £m | Amortised cost £m | FVOCI £m | Total carrying amount £m | Fair value £m  |
| --- | --- | --- | --- | --- | --- | --- |
|  **Financial assets:**  |   |   |   |   |   |   |
|  Cash and cash equivalents |  | - | 1,246.4 | - | 1,246.4 | 1,246.4  |
|  Financial assets pledged as collateral |  | - | - | 60.4 | 60.4 | 60.4  |
|  Financial investments | 14 | - | 45.0 | 290.7 | 335.7 | 335.7  |
|  Trade receivables – amounts due from brokers | 16 | (159.3) | 540.3 | - | 381.0 | 381.0  |
|  Trade receivables – own funds in client money | 16 | - | 85.5 | - | 85.5 | 85.5  |
|  Trade receivables – amounts due from clients | 16 | - | 3.0 | - | 3.0 | 3.0  |
|  Other receivables |  | - | 9.8 | - | 9.8 | 9.8  |
|   |  | **(159.3)** | **1,930.0** | **351.1** | **2,121.8** | **2,121.8**  |
|  **Financial liabilities:**  |   |   |   |   |   |   |
|  Trade payables – client funds | 20 | 117.4 | (636.8) | - | (519.4) | (519.4)  |
|  Trade payables – issued turbo warrants | 20 | (1.5) | - | - | (1.5) | (1.5)  |
|  Trade payables – amounts due to brokers | 20 | (1.0) | (27.0) | - | (28.0) | (28.0)  |
|  Trade payables – amounts due to clients | 20 | - | (22.3) | - | (22.3) | (22.3)  |
|  Debt securities in issue | 18 | - | (297.2) | - | (297.2) | (269.6)  |
|  Lease liabilities | 19 | - | (22.7) | - | (22.7) | (22.7)  |
|  Other payables – accruals | 21 | - | (112.6) | - | (112.6) | (112.6)  |
|   |  | **114.9** | **(1,118.6)** | **-** | **(1,003.7)** | **(976.1)**  |

|  As at 31 May 2021 | Note | FVTPL £m | Amortised cost £m | FVOCI £m | Total carrying amount £m | Fair value £m  |
| --- | --- | --- | --- | --- | --- | --- |
|  **Financial assets:**  |   |   |   |   |   |   |
|  Cash and cash equivalents |  | - | 655.2 | - | 655.2 | 655.2  |
|  Financial assets pledged as collateral |  | - | - | 87.1 | 87.1 | 87.1  |
|  Financial investments | 14 | - | - | 255.0 | 255.0 | 255.0  |
|  Trade receivables – amounts due from brokers | 16 | 17.1 | 407.2 | - | 424.3 | 424.3  |
|  Trade receivables – own funds in client money | 16 | - | 63.3 | - | 63.3 | 63.3  |
|  Trade receivables – amounts due from clients | 16 | - | 3.3 | - | 3.3 | 3.3  |
|  Other receivables |  | - | 5.5 | - | 5.5 | 5.5  |
|   |  | **17.1** | **1,134.5** | **342.1** | **1,493.7** | **1,493.7**  |
|  **Financial liabilities:**  |   |   |   |   |   |   |
|  Trade payables – client funds | 20 | 38.4 | (392.7) | - | (354.3) | (354.3)  |
|  Trade payables – issued turbo warrants | 20 | - | - | - | - | -  |
|  Trade payables – amounts due to brokers | 20 | - | - | - | - | -  |
|  Trade payables – amounts due to clients | 20 | - | (3.2) | - | (3.2) | (3.2)  |
|  Borrowings | 18 | - | (98.8) | - | (98.8) | (98.8)  |
|  Lease liabilities | 19 | - | (23.1) | - | (23.1) | (23.1)  |
|  Other payables – accruals | 21 | - | (97.2) | - | (97.2) | (97.2)  |
|   |  | **38.4** | **(615.0)** | **-** | **(576.6)** | **(576.6)**  |

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

167
FINANCIAL STATEMENTS

# Notes to the Financial Statements continued

# 27. Financial instruments continued

# Financial instrument valuation hierarchy

The hierarchy of the Group's financial instruments carried at fair value is as follows:

|   | Level 1 £m | Level 2 £m | Level 3 £m | Total fair value £m  |
| --- | --- | --- | --- | --- |
|  As at 31 May 2022 |  |  |  |   |
|  Financial assets: |  |  |  |   |
|  Trade receivables – amounts due from brokers | 9.2 | (168.5) | – | (159.3)  |
|  Financial assets pledged as collateral | 60.4 | – | – | 60.4  |
|  Financial investments | 290.7 | – | – | 290.7  |
|  Financial liabilities: |  |  |  |   |
|  Trade payables – amounts due to brokers | – | (1.0) | – | (1.0)  |
|  Trade payables – client funds | 14.1 | 103.3 | – | 117.4  |
|  Trade payables – issued turbo warrants | – | (1.5) | – | (1.5)  |
|  As at 31 May 2021 |  |  |  |   |
|   | Level 1 £m | Level 2 £m | Level 3 £m | Total fair value £m  |
|  Financial assets: |  |  |  |   |
|  Trade receivables – due (to)/from brokers | 0.6 | 16.5 | – | 17.1  |
|  Financial assets pledged as collateral | 87.1 | – | – | 87.1  |
|  Financial investments | 255.0 | – | – | 255.0  |
|  Financial liabilities: |  |  |  |   |
|  Trade payables – amounts due to brokers | – | – | – | –  |
|  Trade payables – client funds | – | 38.4 | – | 38.4  |

Fair value hierarchy levels 1 to 3 are based on the degree to which the fair value is observable:

- → Level 1 assets are valued using unadjusted quoted prices in active markets for identical financial instruments. This category includes the Group's open-exchange traded hedging positions. The quoted market price used for financial assets held by the Group is the period end bid price.
- → Level 2 assets are valued using techniques where a price is derived based significantly on observable market data. For example, where an active market for an identical financial instrument to the product used by the Group to hedge its market risk does not exist. This category includes the Group's open non-exchange traded hedging positions. This comprises shares, foreign currency and foreign currency options. The fair values used in the valuation of these products are sometimes brokered values and may occur after the close of a market but before the measurement date. The effects of discounting are generally insignificant for these Level 2 financial instruments.
- → Level 3 assets are valued using techniques that incorporate information other than observable market data that is significant to the overall valuation.

There have been no changes to the fair value hierarchy or the valuation techniques for any of the Group's financial instruments held at fair value in the year (31 May 2021: none). There were no transfers between Level 1 and Level 2 fair value measurements, and no transfers into or out of Level 3 fair value measurements for years ended 31 May 2022 and 31 May 2021.

# Fair value of financial assets and liabilities measured at amortised cost

The fair value of the Group's financial assets and liabilities measured at amortised cost approximates their carrying amount, with the exception of debt securities in issue.

# Items of income, expense, gains or losses

All of the Group's gains and losses arising from financial assets and liabilities classified as fair value through the profit and loss are included in net trading revenue for the years ended 31 May 2022 and 31 May 2021.

168

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
27. Financial instruments continued
Offsetting financial assets and liabilities
The following financial assets and liabilities have been offset and are subject to enforceable netting agreements.
Gross amounts

|  | Gross amounts |  |  | of recognised |  |  | Net amounts of |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  | of recognised |  | financial liabilities |  |  |  | financial assets |  |
|  | financial assets |  |  |  | set off |  | and liabilities |  |
| As at 31 May 2022 Note |  | £m |  |  |  | £m |  | £m |

Financial assets:
Trade receivables – amount due from/(to) brokers 16 1,119.3 (738.3) 381.0
Financial liabilities:
Trade payables – amount due from/(to) brokers 20 68.0 (96.0) (28.0)
Trade payables – client funds 20 121.3 (640.7) (519.4)
1,308.6 (1,475.0) (166.4)
Gross amounts

|  | Gross amounts |  |  | of recognised |  | Net amounts of |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  | of recognised |  | financial liabilities |  |  | financial assets |  |
|  | financial assets |  |  |  | set off | and liabilities |  |
| As at 31 May 2021 Note |  | £m |  |  | £m |  | £m |

Financial assets:
Trade receivables – amount due from/(to) brokers 16 954.6 (530.3) 424.3
Financial liabilities:
Trade payables – client funds 20 42.1 (396.4) (354.3)
996.7 (926.7) 70.0
Amounts due from brokers and client funds have been presented net to reflect the impact of offsetting. The Group is entitled to
offset amounts due from brokers on a broker account level by currency. Collateral at brokers represent UK Government
securities listed with brokers to meet the broker’s requirements. Client funds represents balances with clients where the cash
held on balance sheet and the valuation of open derivative positions result in an amount due to clients.
28. Financial risk management
Financial risks arising from financial instruments are analysed into market, credit, concentration and liquidity risks. Details of
how risks are managed are discussed in the risk management section on page 46.
Market risk
Market risk disclosures are analysed into the following categories:
¼ Non-trading interest rate risk.
¼ Price and foreign currency risk, which is further analysed between the impact on financial investments held at fair value
through other comprehensive income and the impact on the Group’s year-end net trading book position. The Group’s
foreign currency exposure on its financial assets and liabilities denominated in currencies other than the reporting currency
is included in the trading book.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 169
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
28. Financial risk management continued
Non-trading interest rate risk
The interest rate risk profile of the Group’s financial assets and liabilities at each year end was as follows:
Within 1 year Between 2 and 5 years More than 5 years Total
31 May 2022 31 May 2021 31 May 2022 31 May 2021 31 May 2022 31 May 2021 31 May 2022 31 May 2021
£m £m £m £m £m £m £m £m
Fixed rate:
Financial assets pledged as collateral 35.1 26.0 25.3 61.1 – – 60.4 87.1
Financial investments 200.9 127. 4 134.8 127.6 – – 335.7 255.0
Debt securities in issue – – – – (297. 2) – (297. 2) –
Floating rate:
Cash and cash equivalents 1246.4 655.2 – – – – 1246.4 655.2
Trade receivables – due from brokers 381.0 424.3 – – – – 381.0 424.3
Trade receivables – own funds in
client money 85.5 63.3 – – – – 85.5 63.3
Trade payables – due to brokers (28.0) – – – – – (28.0) –
Borrowings – – – (98.8) – – – (98.8)
1,920.9 1,296.2 160.1 89.9 (297.2) – 1,783.8 1,386.1
Non-trading interest rate risk sensitivity analysis – fixed rate
Interest on financial instruments classified as fixed rate is fixed until the maturity of the instrument. The level of future fixed
interest receivable would be similar to that received in the year and is considered immaterial to the Group’s profit for the year.
Non-trading interest rate risk sensitivity analysis – floating rate
Interest on financial instruments classified as floating rate is re-priced at intervals of less than one year. Trade receivables and
payables include client and broker balances upon which interest is paid or received based upon market rates.
Interest rate sensitivity has been performed on floating rate financial instruments by considering the impact of a 1% decrease in
interest rates on financial assets and financial liabilities. The impact of such a movement on the Group’s profit before tax for the
year is shown below.

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

(Decrease)/increase in profit before tax:
Cash and cash equivalents (12.5) (6.6)
Trade receivables – amounts due from brokers (0.9) (1.2)
Trade receivables – own funds in client money 0.9 0.6
Trade payables – amounts due to brokers (0.3) –
Borrowings – 0.1
Price risk
The Group is exposed to investment securities price risk because financial investments and financial assets pledged as collateral
held by the Group are priced based on closing market prices published by the UK Debt Management Office.
The table below summarises the impact of decreases in the value of financial investments on the Group’s other comprehensive
income. The analysis is based on the assumption that the yield curve of financial investments moved upwards by 1% with all
other variables held constant:

|  | Year ended |  | Year ended |  |
| --- | --- | --- | --- | --- |
|  | 31 May 2022 |  | 31 May 2021 |  |
| Impact: |  | £m |  | £m |

Decrease in FVOCI reserve (equity) (2.9) (3.1)
The Group is also exposed to price and foreign currency risk in relation to its net trading book position. The Group accepts
some residual market risk to facilitate instant execution of client trades but does not take proprietary positions for the purposes
of speculative gain. The Group manages the market risk it faces in providing its services to clients by internalising client flow
(allowing individual client trades to offset one another) and hedging when the residual exposures reach pre-defined limits. The
Group’s Risk Management Framework is set out on page 46 of the Annual Report.
170 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
28. Financial risk management continued
The Group’s market risk policy includes Board-approved notional market risk limits (KRIs) which set out the Group’s appetite and
the extent to which the Group is willing to be exposed to this residual market risk. Product market risk limits control the
maximum (long or short) residual exposure the Group can hold before hedging externally. Predefined limits are set and regularly
reviewed in accordance with a limits framework which references client trading volumes, market liquidity, volatility and
expected shortfall results for each underlying market.
Alongside these notional limits the Group employs a range of risk measurement techniques including Value at Risk (VaR),
Expected Shortfall and Stress-Testing models which are used to quantify potential market risk and client credit risk losses
against all products. These measures cover all products offered to clients and are monitored on an hourly basis, with breaches
investigated and reported to the Chief Risk Officer and senior stakeholders in each line of defence on a daily basis.
These measures quantify the potential uncertainty in relation to the Group’s current exposure by estimating the potential
impact of a negative change in the value of each underlying financial market the Group is exposed to. The VaR model uses a
99% confidence interval over one day and one year’s historical price data for all markets as inputs to determine the risk factors
to apply to the portfolio exposures. VaR has limitations as it is reliant on historical data only and estimates potential future losses
on this basis. Additionally, VaR does not quantify the potential losses outside of the 99% confidence level – the tail risk. To
overcome these limitations the Group also measures and monitors Expected Shortfall and Stress Testing results alongside VaR
results as part of its overall risk management strategy. Expected Shortfall measures the Group’s expected losses outside of the
99% confidence level (average losses in the 1% tail), while Stress Testing models potential losses in extreme but plausible events.
Stress Testing covers a range of scenarios including future known economic and political events, market or region-specific
scenarios and potential macro systemic shocks, which references the 20-year price returns for all markets at the 99.9th
percentile confidence interval. The Group’s end of day market risk VaR for the year is shown in the table below:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Market risk as at 31 May 5.0 5.3
Average market risk (daily) 3.6 9.6
Maximum market risk (daily) 13.1 25.5
Minimum market risk (daily) 1.3 2.8
Foreign currency risk
The Group faces foreign currency exposures on financial assets and liabilities denominated in currencies other than the
functional currency of its subsidiaries. In the normal course of business, the Group hedges these exposures along with its
trading book positions.
Associated with the tastytrade, acquisition, the Group entered into a foreign exchange contract to hedge the $300 million
exposure arising from the cash consideration due upon completion of the transaction. In the year ended 31 May 2022, the
Group recognised a £5.8 million realised foreign exchange gain (31 May 2021: £7.9 million unrealised foreign exchange loss) in
net trading revenue as a result of this hedge.
Credit risk
The principal sources of credit risk to the Group’s business are from financial institutions and individual clients.
Amounts due from financial institutions, which are stated net of an expected credit loss of £nil (31 May 2021: £nil), are all less
than 30 days past due. Amounts due from clients, which are stated net of an expected credit loss of £18.0 million at 31 May
2022 (31 May 2021: expected credit loss of £17.0 million), include both amounts less than and greater than 30 days past due.
The analysis in the following table shows credit exposures by credit rating.

|  |  |  |  | Trade receivables – amounts |  |  |  |  | Trade receivables – amounts |  |  |  | Trade receivables – own funds |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Cash and cash equivalents |  |  |  |  | due from brokers |  |  |  |  | due from clients |  |  |  | in client money |  |  |
| 31 May 2022 |  | 31 May 2021 |  | 31 May 2022 |  |  | 31 May 2021 |  | 31 May 2022 |  | 31 May 2021 |  | 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |  |  | £m |  | £m |  | £m |  | £m |  | £m |  | £m |

Credit rating:
AA+ and above 24.1 27.3 – – – – – –
AA to AA- 437.8 158.1 – 8.2 – – 5.3 0.6
A+ to A- 730.9 426.2 320.0 402.1 – – 80.0 61.8
BBB+ to BBB- 25.5 30.0 32.8 – – – 0.2 0.8
BB+ to B 17.6 13.6 1.5 1.1 – – – –
Unrated 10.5 – 26.7 12.9 3.0 3.3 – 0.1
Total carrying amount 1,246.4 655.2 381.0 424.3 3.0 3.3 85.5 63.3
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 171
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
28. Financial risk management continued
Loss allowance
Below is a reconciliation of the total loss allowance:

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

At the beginning of the year 17.0 15.8
Loss allowance for the year:
– gross charge for the year 6.5 8.0
– recoveries (3.6) (5.1)
– debts written off (1.7) (1.3)
Foreign exchange 0.4 (0.4)
At the end of the year 18.6 17.0
The loss allowance has been calculated in accordance with the Group’s expected credit loss model. The following table provides
an overview of the Group’s credit risk and the associated loss allowance for assets held at amortised cost and fair value through
other comprehensive income.
31 May 2022

| Stage 1 |  | Stage 2 |  | Stage 3 |  |  |
| --- | --- | --- | --- | --- | --- | --- |
| 12-month |  | Lifetime |  | Lifetime |  | Total |
|  | £m |  | £m |  | £m | £m |

Credit grade:
Investment grade 2,213.9 – – 2,213.9
Non-investment grade 70.2 1.0 17.6 88.8
Gross carrying amount 2,284 .1 1.0 17.6 2,302.7
Loss allowance – (1.0) (17.6) (18.6)
Total carrying amount 2,284 .1 – – 2,284.1
31 May 2021

| Stage 1 |  | Stage 2 |  | Stage 3 |  |  |
| --- | --- | --- | --- | --- | --- | --- |
| 12-month |  | Lifetime |  | Lifetime |  | Total |
|  | £m |  | £m |  | £m | £m |

Credit grade:
Investment grade 1,439.6 – – 1,439.6
Non-investment grade 37.0 – 17. 0 54.0
Gross carrying amount 1,476.6 – 17. 0 1,493.6
Loss allowance – – (17.0) (17. 0 )
Total carrying amount 1,476.6 – – 1,476.6
The Group’s trade receivables in stage 3 include amounts arising from IFRS 15 Revenue from Contracts with Customers which
are assessed in accordance with the simplified approach. The comparatives for 31 May 2021 have been re-presented to split
out amount previously presented as being classified within the simplified approach column into the relevant staging.
Concentration risk
The Group’s largest credit exposure to any one individual broker at 31 May 2022 was £55.7 million (A+ rated) (31 May 2021:
£69.9 million (A+ rated)). Included in cash and cash equivalents, the Group’s largest credit exposure to any bank at 31 May 2022
was £320.9 million (AA- rated) (31 May 2021: £117.3 million (A+ rated)). The Group has no significant credit exposure to any one
particular client or group of connected clients.
172 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
28. Financial risk management continued
Liquidity risk
Maturities of financial liabilities
The table below outlines the Group’s financial liabilities into relevant maturity categories based on their contractual maturities.
The amounts disclosed below are the contractual undiscounted cash flows.
31 May 2022

| Within |  |  | Between |  | Over |  | Carrying amount |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 1 year |  | 2 and 5 years |  |  | 5 years | Total |  | of liability |  |
|  | £m |  |  | £m | £m | £m |  |  | £m |

Debt securities in issue 9.4 37.6 304.7 351.7 299.2
Lease liabilities 8.9 14.6 0.6 24 .1 22.7
Trade payables – client funds 519.4 – – 519.4 519.4
Trade payables – amounts due to clients 22.3 – – 22.3 22.3
Trade payables – amounts due to brokers 28.0 – – 28.0 28.0
Trade payables – issued turbo warrants 1.5 – – 1.5 1.5
Other payables – accruals 112 .6 – – 112 .6 112 .6
Total 702.1 52.2 305.3 1,059.6 1,005.7
31 May 2021

| Within |  |  | Between |  | Over |  | Carrying amount |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 1 year |  | 2 and 5 years |  |  | 5 years | Total |  | of liability |  |
|  | £m |  |  | £m | £m | £m |  |  | £m |

Borrowings 2.0 102.4 – 104.4 98.8
Lease liabilities 6.7 16.5 0.9 24.1 23.1
Trade payables – client funds 353.2 – – 353.2 353.2
Trade payables – amounts due to clients 3.2 – – 3.2 3.2
Trade payables – issued turbo warrants 1.1 – – 1.1 1.1
Other payables – accruals 97. 2 – – 97. 2 97. 2
Total 463.4 118 . 9 0.9 583.2 576.6
Capital management
The Group manages its capital resources in line with its capital allocation framework.
The regulatory capital resources of the Group is a measure of equity, adjusted for goodwill and intangible assets, deferred tax
assets, declared dividends and prudent valuation, which at 31 May 2022 totalled £1,025.6 million (31 May 2021: £860.7 million).
The Group operates a monitoring framework over the capital resources and minimum capital requirements daily, calculating the
market and credit risk requirements arising from exposure at the end of each day and this includes internal warning indicators
as part of the Group’s Board Risk Dashboard.
Until 31 December 2021, the Group was subject to CRD IV regulations. The Group was required to undertake a Pillar 2 Internal
Capital Adequacy Assessment Process (ICAAP) at least annually, which involved an assessment of capital requirements through
a series of stress-testing scenarios against the financial projections. From 1 January 2022, the Group is subject to the
Investment Firm Prudential Regime (IFPR), which changes the basis of calculation of the Group’s regulatory capital, and replaces
the ICAAP with an Internal Capital and Risk Assessment (ICARA) prepared under the requirements of the MiFIDPRU.
The Group met all externally imposed capital requirements throughout the years ended 31 May 2022 and 31 May 2021. In
addition to regulatory capital requirements, the Group is required to comply with financial covenants covering a maximum
leverage ratio and net debt to equity. Further details can be found in note 18.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 173
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
29. Cash flow information
Cash generated from operations

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Operating activities
Operating profit 477. 3 454.5
From continuing operations 477.3 450.2
From discontinued operations – 4.3
Depreciation and amortisation 57.5 25.7
Profit on disposal of assets (0.3) –
Equity-settled share-based payments charge 13.6 7. 4
Decrease/(increase) in trade receivables, other receivables and other assets 53.9 (161.9)
Increase in trade and other payables 209.4 247. 8
Cash generated from operations 811. 4 573.5
Liabilities arising from financing activities
Debt Securities
in Issue Borrowings Leases Total
£m £m £m £m
Liabilities as at 1 June 2020 – 99.7 29.3 129.0
Changes to existing lease agreements – – 0.4 0.4
Lease payments made in the year – – (5.8) (5.8)
Unwinding of discount – – 0.6 0.6
Financing arrangement fees – (1.3) – (1.3)
Amortisation of fees – 0.4 – 0.4
Impact of movement in foreign exchange rates – – (1.4) (1.4)
Liabilities as at 31 May 2021 – 98.8 23 .1 121.9
Liabilities as at 1 June 2021 – 98.8 23.1 121.9
Changes to existing lease agreements – – 5.6 5.6
Lease agreements through acquisition – – 0.9 0.9
Unwinding of discount – – 0.6 0.6
Lease payments made in the year – – (8.1) (8.1)
Issuance of debt securities 299.2 – – 299.2
Draw down of term loan – 150.0 – 150.0
Repayment of term loan – (250.0) – (250.0)
Financing arrangement fees (2 .1) – – (2.1)
Amortisation of fees 0.1 1.2 – 1.3
Impact of movement in foreign exchange rates – – 0.6 0.6
Liabilities as at 31 May 2022 297. 2 – 22.7 319.9
30. Business acquisition
On 28 June 2021, the Group completed the acquisition of tastytrade, Inc. (tastytrade), a company incorporated in the US and
headquartered in Chicago. tastytrade is a US online brokerage and trading education platform operating within the US listed
options and futures market.
The acquisition of tastytrade has strategic benefits for the Group and provides immediate scale in the US listed options and
futures market. It transforms the scale and breadth of the Group’s existing US presence through IG US LLC and DailyFX and its
relevance to US retail clients. The acquisition also extends the Group’s global product capabilities into exchange traded options
and futures, diversifying IG’s regulatory risk profile beyond its historical focus on OTC derivatives, and increases the contribution
from capital efficient agency-only activities.
A fair value exercise has been prepared in accordance with IFRS 3 Business Combinations. The results of this exercise are set
out below, along with the fair value of the purchase consideration.
174 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

# **30. Business acquisition continued**

# **Purchase consideration**

Under the terms of the purchase agreement, IG Group Holdings plc (directly and through certain wholly owned subsidiaries) acquired the entire voting share capital of tastytrade and in exchange, \$296.9 million cash consideration was paid and IG Group Holdings plc issued 61,000,000 ordinary shares. The shares were issued on 28 June 2021 and upon issue the total value of the shares was £509.4 million, based upon the closing share price on 28 June 2021 of £8.35. The issue of shares is determined to qualify for merger relief under Section 612 of the Companies Act 2006, and the amount in excess of the nominal value of ordinary shares has been recognised in the merger reserve, along with issue costs of £0.4 million which were directly attributable to the issue of the shares. The Group part-financed the transaction by drawing down on a £150.0 million term loan which was arranged during the year ended 31 May 2021.

The fair value of the purchase consideration is as follows:

|   | 3m | 1m  |
| --- | --- | --- |
|  Cash consideration | 296.9 | 213.8  |
|  Issued ordinary shares | 707.2 | 509.4  |
|  **Total consideration** | **1,004.1** | **723.2**  |

# **Identified assets and liabilities**

The Group has a 12 month measurement period from date of acquisition to estimate the fair value of acquired assets and liabilities. The fair value exercise is complete as at the reporting date. The fair values recognised at acquisition is set out below:

|   | 3m | 1m  |
| --- | --- | --- |
|  Cash and cash equivalents | 31.2 | 22.6  |
|  Trade receivables | 21.6 | 15.6  |
|  Prepayments and other receivables | 4.6 | 3.3  |
|  Convertible loan notes | 4.0 | 2.9  |
|  **Total current assets** | **61.4** | **44.4**  |
|  Investments in associates | 12.5 | 9.0  |
|  Property, plant and equipment | 4.0 | 2.9  |
|  Internally developed software | 19.8 | 14.3  |
|  Trade name | 78.7 | 56.9  |
|  Customer relationships | 226.1 | 163.5  |
|  Non-compete agreements | 39.8 | 28.8  |
|  Convertible loan notes | 8.0 | 5.8  |
|  Deferred tax asset | 10.3 | 7.4  |
|  **Total non-current assets** | **399.2** | **288.6**  |
|  Accruals and other payables | (7.8) | (5.6)  |
|  **Total current liabilities** | **(7.8)** | **(5.6)**  |
|  Deferred tax liability | (91.4) | (66.1)  |
|  Lease liabilities | (0.7) | (0.5)  |
|  **Total non-current liabilities** | **(92.1)** | **(66.6)**  |
|  **Total identifiable net assets acquired** | **360.7** | **260.8**  |

The gross contractual amount of trade receivables is £15.6 million (\$21.6 million) and it is expected that the full contractual amounts, less the amounts already provided for, is recoverable.

The fair value of assets and liabilities acquired was determined based on the assumptions that reasonable market participants would use in the principal or most advantageous market. The assumptions used included a discount rate of 17.3% and unobservable inputs within the valuation methodologies, which are outlined in the section below alongside sensitivity analysis for certain key inputs.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

175
FINANCIAL STATEMENTS

# Notes to the Financial Statements continued

# 30. Business acquisition continued

# Customer relationships: Income approach (excess earnings method)

This approach estimates the projected cash flows of the asset, adjusted for capital charges from other contributory assets. In addition to the assumptions applied in the cash flow forecasts, key inputs include the customer attrition rate, the discount rate and the long-term growth rate.

→ A 5 percentage point increase in the attrition rate would reduce the fair value of the asset by £34.9 million.
→ A 2 percentage point increase in the discount rate would reduce the fair value of the asset by £12.2 million.
→ A 0.5 percentage point decrease in the long-term growth rate would reduce the fair value of the asset by £4.2 million.

The value of customer relationships has increased from £156.3 million ($216.2 million) to £163.5 million ($226.1 million) since the values reported at 30 November 2021 as a result of a change in assumptions related to attrition rates.

# Trade names: Income approach (relief from royalty method)

This approach estimates the future cost savings that arise as a result of not having to pay a royalty or licence fee on the future revenues earned through using the asset. In addition to the assumptions applied in the revenue forecasts, key inputs include the royalty rate and the discount rate.

→ A 0.5 percentage point decrease in the royalty rate would reduce the fair value of the asset by £5.7 million.
→ A 2 percentage point increase in the discount rate would reduce the fair value of the asset by £5.4 million.
→ A 5-year reduction in the useful life of the asset would reduce the fair value by £10.3 million.

# Non-compete agreement: Income approach (with or without method)

This approach estimates the fair value of the cash flows both with the non-compete agreement and without the non-compete agreement. The non-compete arrangements in place apply for a period of five years for the founders. The key inputs are the assumptions relating to likelihood and value of lost revenue over the five year period. There are no inputs where a reasonable change in the assumptions results in a significant change in the fair value.

# Internally developed software: Cost approach

This approach applies the concept of replacement cost as an indicator of fair value, where an investor would pay no more for an asset than the amount the asset could be replaced for. In addition to the estimate of cost, the key inputs are the estimated mark-up generated by a developer and obsolescence factors. There are no inputs where a reasonable change in the assumptions results in a significant change in the fair value.

Goodwill arising from the acquisition has been recognised as follows:

|   | $m | £m  |
| --- | --- | --- |
|  Purchase consideration | 1,004.1 | 723.2  |
|  Less: fair value of identified net assets | (360.7) | (260.8)  |
|  **Goodwill** | **643.4** | **462.4**  |

Goodwill is attributable to the workforce, future technology and future growth of tastytrade. Goodwill is not deductible for tax purposes.

From the date of acquisition, tastytrade contributed £110.1 million of net trading revenue in the year ended 31 May 2022 and operating profit of £17.8 million, which includes the amortisation of acquisition related intangible assets. If the acquisition had occurred on 1 June 2021, the contribution to trading revenue is estimated to be £118.7 million and operating profit of £19.3 million. Operating profit includes the additional amortisation that would have been charged assuming that the fair value of intangible assets had been applied from 1 June 2021.

# Purchase consideration outflow

|   | $m | £m  |
| --- | --- | --- |
|  Outflow of cash to acquire subsidiary, net of cash acquired |  |   |
|  Cash consideration | 296.9 | 213.8  |
|  Less: cash balance acquired | (31.2) | (22.6)  |
|  Net outflow of cash | 265.7 | 191.2  |

The Group incurred acquisition costs not directly attributable to the issuance of shares of £20.7 million for legal, insurance, bank and broker services. Of this, £11 million was recognised in the year ended 31 May 2022 and the remaining £19.6 million was recognised in the year ended 31 May 2021. These costs have been recognised as part of operating expenses and operating cash flows.

Included within the cash consideration above is a working capital adjustment of £2.3 million ($3.1 million), due back to the Group.

176

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
31. Discontinued operations
On 1 March 2022, the Group completed the sale of its operations in Nadex to Foris DAX Markets, Inc for cash consideration of
$213.7 million (£162.7 million). The financial performance and cash flow information of Nadex for the nine month period up until
the date of disposal are reported in discontinued operations as set out below.
Financial performance and cash flow information

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Net trading revenue 9.4 16.1
Other operating income 0.6 0.8
Operating income 10.0 16.9
Operating costs (9.9) (12.5)
Net credit losses (0.1) (0.1)
Operating profit – 4.3
Profit before tax – 4.3
Tax expense – (1.0)
Profit after tax – 3.3
Gain on sale of subsidiary after tax expense 107.8 –
Profit from discontinued operations 107. 8 3.3

| Year ended |  | Year ended |  |
| --- | --- | --- | --- |
| 31 May 2022 |  | 31 May 2021 |  |
|  | £m |  | £m |

Net cash inflow from ordinary activities 1.0 7. 2
Net cash inflow/(outflow) from investing activities 121.6 (1.4)
Net cash (outflow) from financing activities (0.1) (4.5)
Impact of movement in foreign exchange rates 1.0 (2.3)
Net cash increase/(decrease) generated by the subsidiary 123.5 (1.0)
1 Includes sales proceeds net of cash retained of £143.3 million.
Details of disposal of operations in Nadex
£m
Consideration received 162.7
Carrying amount of net assets sold (24.7)
Costs associated with disposal (4.1)
Reclassification of foreign currency translation reserve 3.0
Tax expense on gain on sale (29.1)
Gain on sale after income tax 107.8
The carrying amounts of assets and liabilities as at the date of disposal were: £m
Property, plant and equipment 1.5
Intangible assets (including goodwill) 6.2
Net current assets 0.2
Non-current lease liabilities (0.6)
Cash and cash equivalents 17. 4
Net assets 24.7
Year ended Year ended
31 May 2022 31 May 2021
Basic earnings per ordinary share from discontinued operations 25.3p 0.9p
Diluted earnings per ordinary share from discontinued operations 25.1p 0.9p
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 177
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
32. Investment in associates
31 May 2022 31 May 2021
£m £m
At the beginning of the period: – –
Additions – business acquisition 26.9 –
Additions – increase in investment in associate 1.9 –
Disposals (13.1) –
Share of loss after tax (2.3) –
Foreign exchange movement 1.4 –
At the end of the year 14.8 –
As a part of the acquisition of tastytrade, the Group acquired a 37.18% investment in Small Exchange. During the year, the Group
increased its investment in Small Exchange by £1.9 million and subsequently sold its entire shareholding in Small Exchange for
consideration of £18.9 million recognising a gain of £4.0 million.
As part of the acquisition of tastytrade, the Group acquired a convertible loan instrument with a fair value of £9.3 million. On
24 September 2021, the convertible loan instrument was wholly converted into equity providing the Group with a 17.4% equity
shareholding in Zero Hash with a fair value of £17.9 million. The Group also held 25% voting rights in Zero Hash and it was
therefore recognised as an associate. Zero Hash has a reporting date of 31 December. The Group disposed of 7.54% of its
equity interest in Zero Hash on 22 December 2021 for consideration of £5.6 million.
% equity

|  |  | Registered office and |  | owned by |
| --- | --- | --- | --- | --- |
| Name of entity Principal place of business |  | country of incorporation Class of shares |  | the Group Nature of business |
| Zero Hash Holdings | Chicago, Illinois 1013 Centre Rd. |  | Series C-preferred | 9.86% Digital asset trading |
| Limited |  | Suite 403-A, City of | shares |  |

Wilmington, County
of New Castle,
19805.US
Interactive Broker Group (IBG) LLC holds 33.3% interest in Zero Hash. The Group has an account with IBG for hedging purposes.
However, IBG is not the Group’s primary or secondary broker and no trades have been placed with IBG during the year ended
31 May 2022.
178 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
33. Investments in subsidiaries
The following companies are all owned directly or indirectly by IG Group Holdings plc:
Registered office and
Name of Company country of incorporation Holding Voting rights Nature of business
Subsidiary undertakings held directly:
IG Group Limited Cannon Bridge House, Ordinary shares 100% Holding company
25 Dowgate Hill,
London EC4R 2YA
United Kingdom
Subsidiary undertakings held indirectly:
IG Index Limited Cannon Bridge House, Ordinary shares 100% Spread betting
25 Dowgate Hill,
London EC4R 2YA
United Kingdom
IG Markets Limited Ordinary shares 100% CFD trading, foreign
exchange and
market risk
management
IG Markets South Africa Limited Ordinary shares 100% CFD trading
Market Data Limited Ordinary shares 100% Data distribution
1
IG Nominees Limited Ordinary shares – Nominee company
IG Knowhow Limited Ordinary shares 100% Software
development
1
Extrabet Limited Ordinary shares – Non-Trading
1
IG Finance Ordinary shares – Financing
1
IG Finance Two Ordinary shares – Financing
1
IG Finance Three Ordinary shares – Financing
1
IG Finance Four Ordinary shares – Financing
1
IG Finance 5 Limited Ordinary shares – Financing
1
IG Forex Limited Ordinary shares – Financing
1
IG Spread Betting Limited Ordinary shares – Financing
1
IG Finance 8 Limited Ordinary shares – Financing
IG Finance 9 Limited Ordinary shares 100% Financing
1
Financial Domaigns Limited Ordinary shares – Holding company
Financial Domaigns Registry Ordinary shares 100% Holding company
HoldingsLimited
1
Financial Domaigns Registrar Limited Ordinary shares – Domains registrar
1
Financial Domaigns (Services) Limited Ordinary shares – Domains registry
Deal City Limited Ordinary shares 100% ETF trading
1
InvestYourWay Limited Ordinary shares – Non-trading
IG Trading and Investments Limited Ordinary shares 100% Non-trading
IG Australia Pty Limited Level 15, 55 Collins Street, Ordinary shares 100% Sales and marketing
Melbourne VIC 3000 office
Australia
IG Share Trading Australia Pty Limited Ordinary shares 100% Non-trading
IG Asia Pte Limited 9 Battery Road, Ordinary shares 100% CFD trading and
01-02 MYP Centre, foreign exchange
049910 Singapore
Kunxin Translation (Shenzhen) 19-B16, Shenzhen Dinghe Tower, Ordinary shares 100% Translation services
Co.Limited No.100 of Fuhua 3rd Road,
Fuan Community,
Futian District,
Shenzhen
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 179
FINANCIAL STATEMENTS
### Notes to the Financial Statements continued
33. Investments in subsidiaries continued
Registered office and

| Name of Company | country of incorporation Holding Voting rights Nature of business |  |  |
| --- | --- | --- | --- |
| IG Securities Limited Izumi Garden Tower 26F, |  | Ordinary shares 100% CFD trading and |  |
|  | 1-6-1 Roppongi, |  | foreign exchange |

Minato-ku,
106- 6026 Tokyo
IG Europe GmbH Westhafenplatz 1, Ordinary shares 100% CFD trading and
Frankfurt am Main, foreign exchange
60327 Germany
IG Bank S.A. 42 Rue du Rhone, Ordinary shares 100% CFD trading and
Geneva, foreign exchange
1204 Switzerland

| IG Infotech (India) Private Limited Infinity, 2nd Floor, Katha No 436, |  | Ordinary shares 100% Software |  |
| --- | --- | --- | --- |
|  | Survey No 13/1B, 12/2B, |  | development and |
|  | Challagatta Village, |  | support services |

Bangalore,
560071 India
IG US Holdings Inc. 251 Little Falls Drive, Ordinary shares 100% Holding company
Wilmington,
Delaware,
19808 US
Market Risk Management Inc. Ordinary shares 100% Market maker
FX Publications Inc Ordinary shares 100% Publications
IG US LLC Ordinary shares 100% Foreign exchange
trading
1
Fox Sub Limited 57/63 Line Wall Road, Ordinary shares 100% Financing
Gibraltar
Fox Sub 2 Limited Ordinary shares 100% Financing
Fox Japan Holdings Ordinary shares 100% Holding company
IG Limited Office 2&3, Level 27, Ordinary shares 100% CFD trading and
Currency House – Tower 2, foreign exchange
Dubai International
FinancialCentre,
P O Box – 506968 Dubai,
United Arab Emirates
Brightpool Limited Christodoulou Chatzipavlou, Ordinary shares 100% Market maker
221 Helios Court,
3rd floor 3036,
Limassol
Cyprus
IG Markets Kenya Limited William House, Ordinary shares 100% Non-trading
4th Ngong Avenue,
Nairobi,
Nairobi West District,
P O B ox 4 0111,
00100 Kenya

| Spectrum MTF Operator GmbH | Westhafenplatz 1, | Ordinary shares 100% Multilateral Trading |  |
| --- | --- | --- | --- |
| Raydius GmbH | Frankfurt am Main, |  | Facility |
|  | 60327 |  | Issuer of turbo |
|  | Germany |  | warrants |
| IG International Limited Canon’s Court, |  | Ordinary shares 100% CFD trading and |  |
|  | 22 Victoria Street, |  | foreign exchange |

Hamilton,
HM 12 Bermuda
IG Securities Hong Kong Limited 19/F, Lee Garden One, Ordinary shares 100% Financial services
33 Hysan Avenue Causeway Bay
Hong Kong
3
tastytrade, Inc. 1000 W Fulton Market St, Ordinary shares 100% Holding company
Suite 220
180 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and Company Information

# 33. Investments in subsidiaries continued

|  Name of Company | Registered office and country of incorporation | Holding | Voting rights | Nature of business  |
| --- | --- | --- | --- | --- |
|  tastyworks, Inc.^{2} | 327 N Aberdeen, Chicago, IL 60607 | Ordinary shares | 100% | Brokerage firm  |
|  tastyworks Australia, Pty Ltd.^{3} | Unit 13, 5 Gladstone Rd, Castle Hill NSW 2154 | Ordinary shares | 100% | Australian brokerage firm  |
|  tastyworks Canada, Inc.^{2} | 800 – 885 West Georgia Street, Vancouver BC, V6C 3H1 Canada | Ordinary shares | 100% | Canadian brokerage firm  |
|  Quiet Foundation, Inc.^{2} | 327 N Aberdeen, Chicago, IL 60607 | Ordinary shares | 100% | Investment advisory  |
|  Dough LLC^{2} | 19 N Sangamon St, Chicago, IL 60607 | Ordinary shares | 100% | Inactive  |
|  Tastyworks Singapore Pte | #28-00, One Marina Boulevard, Singapore (018989) | Ordinary shares | 100% | Singaporean brokerage firm  |

1 The subsidiary entered into Members' voluntary liquidation (solvent liquidation) and was handed over to liquidation on 28 May 2021.

2 The subsidiary was acquired on 28 June 2021.

3 As part of the acquisition of tastyroads, Inc., a series of merger transactions took place between Spring Merger Sub I, Inc., Spring Merger Sub II, Inc. and the acquired tastyroads, Inc. The surviving entity resulting from the series of merger was Spring Merger Sub II, Inc. which was subsequently renamed at tastyroads, Inc.

The following UK entities, all of which are 100% owned by the Group, are not subject to an audit by virtue of s479A of the Companies Act 2006 relating to subsidiary companies: IG Finance 9 Limited (07306407) and Deal City Limited (09635230).

Financial Domains Registry Holdings Limited (09235699) is a UK entity, which is 100% owned by the Group and is exempt from the requirement to prepare individual financial statements by virtue of s394A of the Companies Act 2006 relating to the individual financial statements of dormant subsidiaries.

# Employee Benefit Trusts:

IG Group Holdings plc Inland Revenue Approved Share Incentive Plan (UK Trust)

IG Group Limited Employee Benefit Trust (Jersey Trust)

IG Group Employee Equity Plan Trust (Australian Trust)

# 34. Subsequent events

On 1 July 2022, the Group signed an Accordion Increase Request increasing the revolving credit facility by £25.0 million. This increase is effective from 1 August 2022.

On 20 July 2022, the Board approved a share buyback programme of up to £150.0 million, commencing 21 July 2022. The share buyback programme is expected to be substantially completed during the FY23 period.

There have been no other subsequent events that have material impact on the Group's Financials Statements.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

181
FINANCIAL STATEMENTS

# Company Financial Statements

# A year of change; accelerating growth

## ➤ PG. 182–191

### Primary Statements

|  Company Statement of Financial Position | 183  |
| --- | --- |
|  Company Statement of Changes in Equity | 184  |
|  Company Statement of Cash Flows | 185  |

### Notes to the Company Financial Statements

|  1. Authorisation of Financial Statements and statement of compliance | 186  |
| --- | --- |
|  2. Accounting policies | 186  |
|  3. Auditors' remuneration | 186  |
|  4. Directors' remuneration | 186  |
|  5. Staff costs | 186  |
|  6. Investment in subsidiaries | 187  |
|  7. Leases liabilities | 187  |
|  8. Cash flow information | 188  |
|  9. Other receivables | 189  |
|  10. Debt securities in issue | 189  |
|  11. Other payables | 189  |
|  12. Share capital and share premium | 189  |
|  13. Related party transactions | 190  |
|  14. Other reserves | 190  |
|  15. Directors' shareholdings | 190  |
|  16. Contingent liabilities and provisions | 190  |
|  17. Financial risk management | 191  |
|  18. Subsequent events | 191  |
|  19. Dividends paid and proposed | 191  |

182

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

## Company Statement of Financial Position

as at 31 May 2022

|   | Note | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- | --- |
|  **Assets** |  |  |   |
|  **Non-current assets** |  |  |   |
|  Investment in subsidiaries | 6 | 1,076.3 | 553.3  |
|  Right-of-use asset | 7 | 5.0 | 6.1  |
|  Other receivables | 9 | 298.3 | -  |
|   |  | **1,379.6** | **559.4**  |
|  **Current assets** |  |  |   |
|  Prepayments |  | 2.2 | 0.5  |
|  Other receivables | 9 | 383.1 | 209.2  |
|  Cash and cash equivalents |  | 1.8 | 0.4  |
|   |  | **387.1** | **210.1**  |
|  **TOTAL ASSETS** |  | **1,766.7** | **769.5**  |
|  **Liabilities** |  |  |   |
|  **Non-current liabilities** |  |  |   |
|  Debt securities in issue | 10 | 297.2 | -  |
|  Lease liabilities | 7 | 4.3 | 6.0  |
|   |  | **301.5** | **6.0**  |
|  **Current liabilities** |  |  |   |
|  Other payables | 11 | 13.9 | 18.1  |
|  Lease liabilities | 7 | 2.1 | 1.8  |
|   |  | **16.0** | **19.9**  |
|  **TOTAL LIABILITIES** |  | **317.5** | **25.9**  |
|  **Equity** |  |  |   |
|  Share capital and share premium | 12 | 125.8 | 125.8  |
|  Merger reserve |  | 590.0 | 81.0  |
|  Other reserves | 14 | 7.5 | 7.9  |
|  Retained earnings |  | 725.9 | 528.9  |
|  **Total equity** |  | **1,449.2** | **743.6**  |
|  **TOTAL EQUITY AND LIABILITIES** |  | **1,766.7** | **769.5**  |

The Company's profit for the year was £375.9 million (2021: profit of £223.8 million).

The Financial Statements of IG Group Holdings plc (registered number 04677092) were approved by the Board of Directors on 20 July 2022 and signed on its behalf by:

Chief Financial Officer

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

183
FINANCIAL STATEMENTS

## Company Statement of Changes in Equity

for the year ended 31 May 2022

|   | Share capital €m | Share premium €m | Margin reserve €m | Other reserves €m | Retained earnings €m | Total equity €m  |
| --- | --- | --- | --- | --- | --- | --- |
|  At 1 June 2020 | - | 125.8 | 81.0 | 7.1 | 458.4 | 672.3  |
|  Profit and total comprehensive income for the year | - | - | - | - | 223.8 | 223.8  |
|  Equity-settled employee share-based payments | - | - | - | 7.4 | - | 7.4  |
|  Employee Benefit Trust purchase of own shares | - | - | - | (0.2) | - | (0.2)  |
|  Equity dividends paid | - | - | - | - | (159.7) | (159.7)  |
|  Transfer of vested awards from the share-based payment reserve | - | - | - | (6.4) | 6.4 | -  |
|  At 31 May 2021 | - | 125.8 | 81.0 | 7.9 | 528.9 | 743.6  |
|  **At 1 June 2021** | - | **125.8** | **81.0** | **7.9** | **528.9** | **743.6**  |
|  Profit and total comprehensive income for the year | - | - | - | - | 375.9 | 375.9  |
|  Equity-settled employee share-based payments | - | - | - | 13.6 | - | 13.6  |
|  Employee Benefit Trust purchase of own shares | - | - | - | (6.7) | - | (6.7)  |
|  Transfer of vested awards from the share-based payment reserve | - | - | - | (7.3) | 7.3 | -  |
|  Equity dividends paid | - | - | - | - | (186.2) | (186.2)  |
|  Issue of ordinary share capital for the acquisition of tastytrade | - | - | 509.0 | - | - | 509.0  |
|  **At 31 May 2022** | - | **125.8** | **590.0** | **7.5** | **725.9** | **1,449.2**  |

184

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
## Company Statement of Cash Flows
for the year ended 31 May 2022

|  | Year ended |  | Year ended |  |
| --- | --- | --- | --- | --- |
|  | 31 May 2022 |  | 31 May 2021 |  |
| Note |  | £m |  | £m |

Operating activities
Cash generated from operations 8 203.9 164.7
Net cash flow generated from operating activities 203.9 164.7
Investing activities
Investment in subsidiary – (4.0)
Loan issued to Group companies (298.3) –
Net cash flow used in investing activities (298.3) (4.0)
Financing activities
Interest paid on lease liabilities (0.2) (0.2)
Interest and other financing costs paid (8.4) –
Repayment of principal element of lease liabilities (1.9) (0.3)
Net proceeds from issue of debt securities 299.2 –
Equity dividends paid to owners of the parent (186.2) (159.7)
Employee Benefit Trust purchase of own shares (6.7) (0.3)
Net cash flow from/(used in) financing activities 95.8 (160.5)
Net increase in cash and cash equivalents 1.4 0.2
Cash and cash equivalents at the beginning of the year 0.4 0.2
Cash and cash equivalents at the end of the year 1.8 0.4
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 185
FINANCIAL STATEMENTS

# Notes to the Company Financial Statements

## 1. Authorisation of Financial Statements and statement of compliance

The Financial Statements of IG Group Holdings plc (the Company) for the year ended 31 May 2022 were authorised for issue by the Board of Directors on 20 July 2022 and Statement of Financial Position was signed on the Board's behalf by Charles Rozes. IG Group Holdings plc is a public company limited by shares, which is listed on the London Stock Exchange and incorporated in the United Kingdom and domiciled in England and Wales. The address of the registered office is Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA.

On 31 December 2020, IFRS as adopted by the European Union was brought into UK law and became UK-adopted International Accounting Standards, with future changes being subject to endorsement by the UK Endorsement Board. The Company transitioned to UK-adopted International Accounting Standards in the Company Financial Statements on 1 June 2021. This change constitutes a change in accounting framework. However, there is no impact on recognition, measurement or disclosure in the period reported as a result of the change in framework.

The Financial Statements of the Company have been prepared in accordance with UK-adopted International Accounting Standards and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards. There were no unendorsed standards effective for the year ended 31 May 2022 affecting these consolidated and separate Financial Statements.

The Financial Statements have been prepared under the historical cost convention and in conformity with UK-adopted International Accounting Standards requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company's accounting policies. There are no significant areas of judgement or complexity, or areas where assumptions and estimates are significant to the Company's Financial Statements.

As permitted by Section 408(1)(b), (4) of the Companies Act 2006, the individual Income Statement of IG Group Holdings plc (the Company) has not been presented in these Financial Statements. The amount of profit for the year included within the Financial Statements of IG Group Holdings plc is £375.9 million (year ended 31 May 2021: £223.8 million). A Statement of Comprehensive Income for IG Group Holdings plc has also not been presented in these Financial Statements. No items of other comprehensive income arose in the year (31 May 2021: £nil).

## 2. Accounting policies

The accounting policies applied are the same as those set out in note 2 of the Group Financial Statements except for the following:

### Investment in subsidiaries

Subsidiaries are entities on which the Company has control. Control is achieved where the Company has existing rights that give it the ability to direct the activities that affect the Company's returns and exposure or rights to variable returns from the entity. Investments in subsidiaries are stated at cost less accumulated impairment losses.

### Impairment of investment in subsidiaries

The Directors of the Company carry out an annual assessment to determine if any indication of impairment exits. If such indicators are identified, then the amount of impairment is ascertained by comparing the carrying amount of the investment in each subsidiary to its recoverable amount. The recoverable amount of a subsidiary is determined based on value-in-use calculations (VIU) which requires the use of assumptions. The calculation of VIU incorporates cash flow projections based on financial budgets approved by management.

### Dividends

Dividends receivable are recognised when the shareholders' right to receive the payment is established.

## 3. Auditors' remuneration

Auditors' remuneration is disclosed within note 5 of the Group Financial Statements.

## 4. Directors' remuneration

Directors' remuneration is disclosed within the Director's Remuneration Report section of the Annual Report.

## 5. Staff costs

The Company has no employees (31 May 2021: nil).

186

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

## 6. Investment in subsidiaries

### At cost

|   | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  At the beginning of the year | 553.3 | 541.9  |
|  Additions | 1,027.1 | 11.4  |
|  Disposals | (504.1) | -  |
|  At the end of the year | 1,076.3 | 553.3  |

Additions during the year include the acquisition of tastytrade, Inc. As part of the acquisition of tastytrade, a series of merger transactions took place between Spring Merger Sub I, Inc., Spring Merger Sub II, Inc. and the acquired tastytrade, Inc. The surviving entity resulting from the series of mergers was Spring Merger Sub II, Inc. which was subsequently renamed as tastytrade, Inc. Refer to note 30 and note 33 for further information. Immediately following the acquisition of tastytrade, Inc., the Company contributed its investment in tastytrade, Inc. to its wholly owned subsidiary, IG Group Limited and in return received 100 ordinary shares in IG Group Limited.

The Company's direct and indirectly owned subsidiaries are disclosed in note 33 of the Group Financial Statements.

The investments in subsidiaries are assessed annually by the Directors of the Company, to determine if there is any indication that any of the investments might be impaired. Based on an assessment carried out, the carrying amount of the Company's investments in subsidiary is supported by the net present value of future cash flows. Therefore, no impairment was recognised during the current year.

Additions in the year include also equity-settled share-based awards for employees of subsidiaries of £13.6 million (year ended 31 May 2021: £7.4 million).

## 7. Leases

### (i) Right-of-use asset

|   | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  **Cost:** |  |   |
|  At the beginning of the year | 9.2 | 9.0  |
|  Additions | 0.5 | -  |
|  Displidation adjustment | - | 0.2  |
|  At the end of the year | 9.7 | 9.2  |
|  **Accumulated depreciation:** |  |   |
|  At the beginning of the year | 3.1 | 1.5  |
|  Provided during the year | 1.6 | 1.6  |
|  At the end of the year | 4.7 | 3.1  |
|  **Net book value** | **5.0** | **6.1**  |

The Company's right-of-use asset represents the commercial lease for office space. The table below shows the discounted rental commitments under non-cancellable operating leases.

|  Future minimum payments due | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  Not later than one year | 2.1 | 1.8  |
|  After one year but not more than five years | 4.3 | 6.0  |
|   | 6.4 | 7.8  |

The following table shows the maturity analysis of the undiscounted cash flows for non-cancellable leases. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

187
FINANCIAL STATEMENTS
### Notes to the Company Financial Statements continued
7. Leases continued
(ii) Lease liability

|  | Year ended |  | Year ended |  |
| --- | --- | --- | --- | --- |
|  | 31 May 2022 |  | 31 May 2021 |  |
| Future minimum payments due: |  | £m |  | £m |

Within one year 2.1 1.8
After one year but not more than five years 4.5 6.2
6.6 8.0
8. Cash flow information
31 May 2022 31 May 2021
£m £m
Operating activities
Operating loss (9.0) (24.2)
Dividends received 385.0 248.2
Lease asset depreciation 1.6 1.6
Increase in trade and other receivables (169.0) (75.2)
Increase/(decrease) in trade and other payables (4.7) 14.3
Cash generated from operations 203.9 164.7
Included within operating loss are legal and professional fees incurred in relation to the acquisition of tastytrade. For further
details refer to note 30 of the Group Financial Statements.
Liabilities arising from financing activities
Debt securities
in issue Leases Total
£m £m £m
Liabilities as at 1 June 2020 – 7.7 7.7
Lease payments made in the period – (0.5) (0.5)
Unwinding of discount – 0.2 0.2
Changes to existing lease agreements – 0.4 0.4
Liabilities as at 31 May 2021 – 7. 8 7. 8
Liabilities as at 1 June 2021 – 7.8 7.8
Issued Debt 299.2 – 299.2
Financing arrangement fees (2 .1) – (2.1)
Unwind of capitalised financing fees 0.1 – 0.1
Lease payments made in the period – (2.1) (2.1)
Unwinding of discount – 0.2 0.2
Changes to existing lease agreements – 0.5 0.5
Liabilities as at 31 May 2022 297. 2 6.4 303.6
188 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Introduction

Strategic Report

Governance Report

Financial Statements

Shareholder and^{}[] Company Information

# **9. Other receivables**

|   | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  Amounts due from Group companies: |  |   |
|  – IG Markets Limited | 370.3 | 205.5  |
|  – IG Index Limited | 11.1 | 3.3  |
|  – Other Group companies | 0.8 | 0.3  |
|  Other debtors | 0.9 | 0.1  |
|   | **383.1** | **209.2**  |

All amounts above are repayable on demand and are non-interest bearing.

Under the Group's cash management framework, entities holding cash that is surplus to short term requirements generally lend the money to IG Markets Limited. In addition to the £370.3 million due from IG Markets Limited outlined above, the Company has entered into an agreement with IG Markets Limited to provide a £298.3 million loan with an interest rate of 3.125% per annum to be repaid as one final payment in November 2028. This is classified within non-current other receivables in the Statement of Financial Position.

# **10. Debt securities in issue**

The Company undertook a debt financing exercise and implementation of a long-term funding structure, which was completed in November 2021. The financing involved the following:

- → A £300.0 million committed revolving credit facility, with an initial maturity of three years.

The issued debt has been recognised at fair value less transaction fees. As at 31 May 2022, £2.0 million unamortised arrangement fees are recognised on the Statement of Financial Position. Unamortised arrangements fees of £1.6 million in relation to the revolving credit facility have been recognised on the Statement of Financial Position.

The Company has the option to request an increase in the revolving credit facility size to £400.0 million and to request two maturity extensions of one year each, all subject to bank approval. Total available credit facilities as at 31 May 2022 were £600.0 million (31 May 2021: £nil), with the potential to rise to £700.0 million if the revolving credit facility is increased in size.

Under the terms of the revolving credit facility agreement, the Company is required to comply with financial covenants covering maximum levels of leverage and debt to equity for Group at a consolidated level. The Company has complied with all covenants throughout the reporting period.

# **11. Other payables**

|   | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  Accruals | 13.9 | 17.3  |
|  Amounts due to Group companies | – | 0.8  |
|   | **13.9** | **18.1**  |

# **12. Share capital and share premium**

Share capital and share premium is disclosed within note 23 of the Group Financial Statements.

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022

189
FINANCIAL STATEMENTS

# Notes to the Company Financial Statements continued

# **13. Related party transactions**

Transactions with related parties are as follows:

|   | 31 May 2022 £m | 31 May 2021 £m  |
| --- | --- | --- |
|  **Revenue:** |  |   |
|  Subsidiary – dividends | 385.0 | 248.2  |
|   | 385.0 | 248.2  |
|  **Finance income:** |  |   |
|  Subsidiary | 5.1 | –  |
|   | 5.1 | –  |

Refer to note 9 for balances outstanding in respect of related parties.

# **14. Other reserves**

|   | Share-based payments £m | Own share/hold in Employee Benefit Trusts £m | Total other reserves £m  |
| --- | --- | --- | --- |
|  At 1 June 2020 | 11.7 | (4.6) | 7.1  |
|  Equity-settled employee share-based payments | 7.4 | – | 7.4  |
|  Exercise of employee share awards | (3.2) | 3.2 | –  |
|  Employee Benefit Trust purchase of shares | – | (0.2) | (0.2)  |
|  Transfer of vested awards from the share-based payments reserve | (6.4) | – | (6.4)  |
|  At 31 May 2021 | 9.5 | (1.6) | 7.9  |
|  **As at June 2021** | **9.5** | **(1.6)** | **7.9**  |
|  Equity-settled employee share-based payments | 13.6 | – | 13.6  |
|  Exercise of employee share awards | (2.3) | 2.3 | –  |
|  Employee Benefit Trust purchase of shares | – | (6.7) | (6.7)  |
|  Transfer of vested awards from the share-based payments reserve | (7.3) | – | (7.3)  |
|  At 31 May 2022 | 13.5 | (6.0) | 7.5  |

# **15. Directors' shareholdings**

The Directors of the Company hold shares as disclosed in the Remuneration Report in the Group Annual Report.

# **16. Contingent liabilities and provisions**

In the ordinary course of business, the Company is required to issue guarantees on behalf of its subsidiaries. These primarily relate to guarantees provided to third-party banks and hedging counterparties. Under the terms of the agreements the Company acts as guarantor for unsettled liabilities that may arise under other agreements between Group companies and financial institutions. The amounts guaranteed by the Company as at 31 May 2022 was £0.2 million (31 May 2021: £0.4 million).

190

IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
17. Financial risk management
Financial risks arising from financial instruments are managed at a Group-wide level and details are in the Risk Management
section of the Group Annual Report.
Credit risk
Held within other receivables are amounts receivable by the Company from related parties that are unrated. The Directors
consider the Company’s receivables to be recoverable as they are with Group companies and the companies have adequate
resource to ensure repayment in full. Therefore, credit risk is minimal.
Liquidity risk
The tables below analyse the Company’s financial liabilities into relevant maturity categories based on their contractual
maturities. The amounts disclosed in the table are the contractual undiscounted cash flows. The Company is able to obtain
financial support from other Group companies if this is needed. Therefore, liquidity risk is minimal.
31 May 2022

| Within |  |  | Between |  | Over |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 1 year |  | 2 and 5 years |  |  | 5 years | Total | Carrying amount |  |
|  | £m |  |  | £m | £m | £m |  | £m |

Issued debt securities 9.4 37.6 304.7 351.7 299.2
Lease liabilities 2.1 4.5 – 6.6 6.6
Total 11. 5 42.1 304.7 358.3 305.8
31 May 2021

| Within |  |  | Between |  | Over |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| 1 year |  | 2 and 5 years |  |  | 5 years | Total | Carrying amount |  |
|  | £m |  |  | £m | £m | £m |  | £m |

Lease liabilities 1.8 6.2 – 8.0 8.0
Total 1.8 6.2 – 8.0 8.0
Capital management
The capital of the Company is managed as part of the capital of the Group. Full details, including details of dividends paid during
the year, are contained in the Group Financial Statements in note 28.
18. Subsequent events
The subsequent events of the entity are the same as those disclosed in the notes to the Group Financial Statements in note 34.
19. Dividends paid and proposed
The dividends paid and proposed by the entity are the same as those disclosed in the notes to the Group Financial Statements
in note 11.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 191
SHAREHOLDER AND COMPANY INFORMATION
## Shareholder and Company Information

| Shareholder information | Company information |
| --- | --- |
| Shareholder communications | Directors (as at 20 July 2022) |
| You can opt to receive communications from us by email | Executive Directors |
| rather than by post and we will email you whenever we add | J Y Felix (Chief Executive Officer) |
| shareholder communications to the Company website. To set | C A Rozes (Chief Financial Officer) |
| this up, please visit www.investorcentre.co.uk/ecomms and | J M Noble (Chief Operating Officer) |

register for electronic communications.
Non-Executive Directors
If you wish to change this instruction you can do so by R M McTighe (Chair)
contacting our Registrar at the address shown overleaf. J P Moulds
Youcan also make this request online via your Investor R Bhasin
Centreaccount. A Didham
Wu Gang
The Registrar can also be contacted by telephone on +44 S-A Hibberd
(0)371 495 2032. Calls to this number cost no more than a M Le May
national rate call from any type of phone or provider. These S Skerritt
prices are for indication purposes only; if in doubt, please H C Stevenson
check the cost of calling this number with your phone line

| provider. Lines are open 8.30am to 5.30pm, Monday to Friday | Company Secretary |
| --- | --- |
| excluding bank holidays. | J S Nayler |
| Shareholder enquiries | Registered number |
| If you have any queries relating to your shareholding, dividend | 04677092 |

payments, lost share certificates, or change of personal

| details, please contact Computershare by visiting | Registered office |
| --- | --- |
| www.investorcentre.co.uk or by using the contact | Cannon Bridge House |
| detailsabove. | 25 Dowgate Hill |

London
American Depositary Receipts (ADRs) EC4R 2YA
IG’s ADR programme trades in the US OTC market, under the
symbol IGGHY. Each ADR currently represents one ordinary Bankers
share. Barclays Bank plc
1 Churchill Place
Dividend dates London
Ex-dividend date 22 September 2022 E14 5HP
Record date 23 September 2022

| Last day to elect for dividend | HSBC Holdings plc |
| --- | --- |
| reinvestment plan 29 September 2022 | 8 Canada Square |
| Final dividend payment date 20 October 2022 | London |

E14 5HQ
Annual shareholder calendar

| Company reporting | Lloyds Banking Group plc |
| --- | --- |
| Final results announced 21 July 2022 | 25 Gresham Street |
| Annual Report published 15 August 2022 | London |
| Annual General Meeting 21 September 2022 | EC2V 7HN |
| Interim report | Royal Bank of Scotland plc |
| As part of our e-comms programme, we have decided not to | 36 St Andrew Square |
| produce a printed copy of our Interim Report. We will instead | Edinburgh |
| publish the report on our website, where it will be available | EH2 2YB |

around mid-January each year.
192 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information

| Brokers | Cautionary statement |
| --- | --- |
| Barclays Bank plc | Certain statements included in our 2022 Annual Report, |
| 5 The North Colonnade | orincorporated by reference to it, may constitute ‘forward- |
| Canary Wharf | looking statements’ in respect of the Group’s operations, |
| London | performance, prospects and/or financial condition. |

E14 4BB
Forward-looking statements involve known and unknown

| Numis Securities Limited | risksand uncertainties because they are beyond the Group’s |
| --- | --- |
| 45 Gresham Street | control and are based on current beliefs and expectations |
| London | about future events about the Group and the industry in which |
| EC2V 7BF | the Group operates. |
| Independent Auditors | No assurance can be given that such future results will be |
| PricewaterhouseCoopers LLP | achieved; actual events or results may differ materially as a |
| Chartered Accountants and Statutory Auditors | result of risks and uncertainties facing the Group. If the |
| 7 More London Riverside | assumptions on which the Group bases its forward-looking |
| London | statements change, actual results may differ from those |
| SE1 2RT | expressed in such statements. The forward-looking |

statements contained herein reflect knowledge and

| Solicitors | information available at the date of this Annual Report and the |
| --- | --- |
| Linklaters LLP | Group undertakes no obligation to update these forward- |
| 1 Silk Street | looking statements except as required by law. |

London
EC2Y 8HQ This report does not constitute or form part of any offer or
invitation to sell, or any solicitation of any offer to purchase,
Registrar any shares or other securities in the Company, and nothing in
Computershare Investor Services PLC this report should be construed as a profit forecast.
The Pavilions

| Bridgewater Road | Market share |
| --- | --- |
| Bristol | Market share data has been provided by Investment Trends |
| BS99 6ZZ | PtyLimited (website: www.investmenttrends.com/). |

Contact:Brian Chong (email: b.chong@investmenttrends.com).
Unless stated, market share data is sourced from the following
current reports:
¼ Investment Trends France Leverage Trading Report,
released August 2021
¼ Investment Trends US Leverage Trading Report,
releasedSeptember 2021
¼ Investment Trends Singapore Leverage Trading Report,
released October 2021
¼ Investment Trends Australia Leveraged Trading Report,
released December 2021
¼ Investment Trends Hong Kong Warrants & FX Report,
released February 2022
¼ Investment Trends Germany Leverage Trading Report,
released March 2022
¼ Investment Trends Spain Leverage Trading Report,
releasedApril 2022
¼ Investment Trends UK Leverage Trading Report,
releasedJune 2022
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 193
SHAREHOLDER AND COMPANY INFORMATION
## Appendices

| Adjusted net trading revenue | Adjusted profit before tax and earnings per share |
| --- | --- |
| £ million FY22 FY21 Change % | £m (unless stated) FY22 FY21 |
| Net trading revenue 972.3 837. 3 16% | Earnings per share (pence) 92.9 99.8 |
| Hedging (gain)/loss on | Weighted average number of |
| tastytrade acquisition (5.8) 7. 9 nm | sharesfor the calculation of EPS |

(millions) 426.3 369.2
Adjusted net trading

| revenue 966.5 845.2 14% | Profit after tax 396.1 368.6 |
| --- | --- |
| Core Markets+ 828.7 825.2 – | Tax expense 80.9 77.4 |
| High Potential Markets 137. 8 20.0 589% | Profit before tax 477. 0 446.0 |

¼ Hedging (gain)/loss on tastytrade
acquisition (5.8) 7. 9
Adjusted operating costs
¼ Operating income relating to
Nadex sale (1.5) –
£ million FY22 FY21
¼ Operating costs relating to the
Operating costs 499.2 390.5
tastytrade acquisition and

| ¼ Net credit losses on financial assets 2.7 2.9 | integration 2.0 19.6 |
| --- | --- |
| Adjusted operating costs inc. | ¼ Amortisation on tastytrade |
| netcredit losses 501.9 393.4 | acquisition intangibles and |
| ¼ Operating costs relating to the | recurring non-cash costs 31.7 – |
| tastytrade acquisition and | ¼ Operating costs relating to the |
| integration (2.0) (19.6) | Nadex sale 3.3 – |
| ¼ Amortisation on tastytrade | ¼ Financing costs relating to the |
| acquisition intangibles and recurring | debt issuance 1.0 – |

non-cash costs (31.7) –
¼ Gains on sale of Small Exchange
¼ Operating costs relating to the and disposal of Zero Hash (4.1) –
Nadex sale (3.3) –
¼ Movement in the FV of
convertible debt associated with
Adjusted operating costs 464.9 373.8
Zero Hash (9.3) –
Adjusted profit before tax (A) 494.3 473.6
Adjusted tax expense (83.8) (77.4)
Adjusted profit after tax 410.5 396.2
Adjusted earnings per share
(pence) 96.3 107.3
Adjusted total revenue (B) 967. 3 845.5
Adjusted profit before tax margin
(A/B) % 51% 56%
High Potential Markets total revenue – pro forma
£ million FY22 FY21 Change %
US options and futures
(tastytrade) 112 . 0 96.1 16%
US FX 16.6 11. 6 43%
European ETDs 9.3 4.9 90%
US market making 1.8 3.5 (49%)
Pro forma High Potential
Markets¹ 139.7 116 .1 20%
1 Pro forma basis reflects revenue from tastytrade in the period post-acquisition, from
28 June 2021 to 31 May 2022, and for the equivalent prior period in FY21
194 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
Shareholder and
Introduction Strategic Report Governance Report Financial Statements Company Information
Own cash Net own funds movement from acquisitions and
disposals of investments in subsidiaries and associates
£ million Note 31 May 2022 31 May 2021
£ million FY22
Cash and Cash equivalents 1,246.4 655.2

| Financial investments – | Net cash flow to investment in associates (1.9) |
| --- | --- |
| termed cash 14 45.0 – | Net proceeds from disposal of subsidiaries 143.3 |
| Less: Cash held to meet | Proceeds from disposal of investments in |
| regulatory liquidity | associates, net of cash disposed 24.5 |
| requirements (45.5) – | Net cash flow to acquire subsidiaries (193.5) |

Net own funds derecognised upon disposal of
Own cash 1,245.9 655.2
subsidiary (2.7)
Net own funds recognised upon acquisition of
subsidiary 15.6
Amounts due from brokers
Net own funds movement from acquisitions
£ million Note 31 May 2022 31 May 2021
and disposals of investments in subsidiaries
Financial investments – UK andassociates (14.7)
Government securities held
at brokers 14 289.9 256.0
Trade receivables – Net own funds generated from operations
amounts due from broker 16 381.0 424.3
£ million FY22 FY21
Trade payables – amounts
due to broker 20 (28.0) – Cash generated from operations 811. 4 573.5
Other assets 17 14.2 30.3 ¼ decrease in other assets (19.7) (0.4)
¼ Increase in trade payables (209.4) (222.2)
Amounts due from broker 657.1 710.6
¼ (decrease)/increase in trade
receivables (37.7 ) 160.7
¼ Repayment of lease liabilities ( 7. 5 ) (5.2)
Liquid assets threshold requirement
¼ Interest paid on lease liabilities (0.6) (0.6)
£ million Note 31 May 2022 31 May 2021
Own funds generated
Financial investments – from operations (A) 536.5 505.8
regulatory liquidity
Profit before taxation (B) 477.0 446.0
requirements 14 61.2 86.1
Conversion rate from profit
Cash held to meet
to cash (A/B) % 112% 113%
regulatory liquidity
requirements 45.5 –
Liquid assets threshold
requirement 106.7 86.1
Own funds in client money
£ million Note 31 May 2022 31 May 2021
Trade receivables – own
funds in client money 16 85.5 63.3
Trade payables – amounts
1
due to clients 20 (21.3) (2.4)
Own funds in client money 64.2 60.9
1 Amounts considered part of ‘own funds’.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022 195
SHAREHOLDER AND COMPANY INFORMATION
## Group-wide Key Performance Indicator (KPI) Definitions
Adjusted total revenue (£m)
Adjusted total revenue represents revenue from products and
services and interest on client money less cost of hedging,
excluding certain costs relating to the tastytrade acquisition.
Adjusted net trading revenue (£m)
Represents the transaction fees paid by clients (client income),
net of introducing partner commissions, our external hedging
costs, client trading profit and losses, and corresponding
hedging profits and losses, on an adjusted basis.
Adjusted net trading revenue generated from non-
OTC products (%)
Represents net trading revenue generated from exchange
traded derivatives and stock trading and investments, on an
adjusted basis.
Adjusted profit before tax margin (%)
Measures the profit that we generate as a percentage of total
revenue, prior to tax charges, on an adjusted basis.
Net own funds generated from operations (£m)
Measures the level of net own funds (cash) that we generate
from our operations after deductions for taxes.
Total number of active OTC derivative clients (000)
The total number of clients who have generated
revenue in the relevant financial year by trading
ourOTCderivative products.
Platform uptime (%)
This measures the percentage of time that IG’s online trading
platforms were online during the financial year. Partial outages
or degradation of service are included as uptime.
ESG KPI: scope 1–3 greenhouse gas emissions per
employee (TCO 2 e)
Total scope 1–3 greenhouse gas emissions in the financial
year, divided by average headcount during the year ended
31 May 2022.
ESG KPI: young people benefiting from our Brighter
Future initiatives globally
Total benefiting from collaboration between IG Group and
charity partners such as Teach First. This includes both direct
and indirect impact.
196 IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
This book has been printed on paper from well-managed
forests, approved by the Forest Stewardship Council ® ,
using vegetable inks. Our printer holds ISO 14001 and
FSC ® environmental certifications.
IG GROUP HOLDINGS PLC ANNUAL REPORT 2022
IG Group Holdings plc
Cannon Bridge House
25 Dowgate Hill
London EC4R 2YA
T: +44 (0)20 7896 0011
F: +44 (0)20 7896 0010
W: iggroup.com