(a)
The Registrant has adopted a code of ethics that applies to its principal
executive officers and principal financial and accounting officer.
(f)
Pursuant to Item 13(a)(1), the Registrant is attaching as an exhibit a copy of
its code of ethics that applies to its principal executive officers and
principal financial and accounting officer.
Item
3. Audit Committee Financial Expert.
(a)(1)
The Registrant has an audit committee financial expert serving on its audit
committee.
(2)
The audit committee financial expert are Ann Torre Bates and David W. Niemiec
and they are “independent" as defined under the relevant Securities and
Exchange Commission Rules and Releases.
Principal Accountant Fees and Services. N/A
Members
of the Audit Committee are: Ann Torre Bates, David W. Niemiec, J. Michael
Luttig, Terrence J. Checki and Constantine D. Tseretopoulos
Item
6. Schedule of Investments. N/A
Item
7
. Disclosure
of Proxy Voting Policies and Procedures for Closed-End Management Investment
Companies.
The board of directors of the Fund has
delegated the authority to vote proxies related to the portfolio securities
held by the Fund to the Fund’s investment manager, Templeton Asset Management
Ltd.(TAML), in accordance with the Proxy Voting Policies and Procedures
(Policies) adopted by the investment manager.
Franklin Templeton
Emerging Markets Equity Group, a separate investment group within Franklin
Templeton, comprised of investment personnel from the SEC-registered investment
advisers listed on Appendix A (hereinafter individually an “Investment Manager”
and collectively the "Investment Managers") have delegated the
administrative duties with respect to voting proxies for securities to the
Franklin Templeton Proxy Group within Franklin Templeton Companies, LLC (the
"Proxy Group"), a wholly-owned subsidiary of Franklin Resources, Inc.
Franklin Templeton Companies, LLC provides a variety of general corporate
services to its affiliates, including, but not limited to, legal and compliance
activities. Proxy duties consist of disseminating proxy materials and analyses
of issuers whose stock is owned by any client (including both investment
companies and any separate accounts managed by the Investment Managers) that
has either delegated proxy voting administrative responsibility to the
Investment Managers or has asked for information and/or recommendations on the
issues to be voted. The Investment Managers will inform Advisory Clients that
have not delegated the voting responsibility but that have requested voting
advice about the Investment Managers’ views on such proxy votes. The Proxy
Group also provides these services to other advisory affiliates of the Investment
Managers.
The Proxy Group will
process proxy votes on behalf of, and the Investment Managers vote proxies
solely in the best interests of, separate account clients, the Investment
Managers’-managed investment company shareholders, or shareholders of funds
that have appointed Franklin Templeton International Services S.à.r.l. (“FTIS
S.à.r.l.”) as the Management Company, provided such funds or clients have
properly delegated such responsibility in writing, or, where employee benefit
plan assets subject to the Employee Retirement Income Security Act of 1974, as
amended, are involved (“ERISA accounts”), in the best interests of the plan
participants and beneficiaries (collectively, "Advisory Clients"),
unless (i) the power to vote has been specifically retained by the named
fiduciary in the documents in which the named fiduciary appointed the
Investment Managers or (ii) the documents otherwise expressly prohibit the
Investment Managers from voting proxies. The Investment Managers recognize that
the exercise of voting rights on securities held by ERISA plans for which the
Investment Managers have voting responsibility is a fiduciary duty that must be
exercised with care, skill, prudence and diligence.
In certain circumstances,
Advisory Clients are permitted to direct their votes in a solicitation pursuant
to the Investment Management Agreement. An Advisory Client that wishes to
direct its vote shall give reasonable prior written notice to the Investment
Managers indicating such intention and provide written instructions directing
the Investment Managers or the Proxy Group to vote regarding the solicitation.
Where such prior written notice is received, the Proxy Group will vote proxies
in accordance with such written notification received from the Advisory Client.
The Investment Managers
have adopted and implemented Proxy Voting Policies and Procedures (“Proxy
Policies”) that they believe are reasonably designed to ensure that proxies are
voted in the best interest of Advisory Clients in accordance with their fiduciary
duties and rule 206(4)-6 under the Investment Advisers Act of 1940. To the
extent that the Investment Managers have a subadvisory agreement with an affiliated
investment manager (the “Affiliated Subadviser”) with respect to a particular
Advisory Client, the Investment Managers may delegate proxy voting
responsibility to the Affiliated Subadviser. The Investment Managers may also
delegate proxy voting responsibility to a subadviser that is not an Affiliated
Subadviser in certain limited situations as disclosed to fund shareholders
(e.g., where an Investment Manager to a pooled investment vehicle has engaged a
subadviser that is not an Affiliated Subadviser to manage all or a portion of
the assets).
HOW THE INVESTMENT
MANAGERs VOTE PROXIES
All proxies received by
the Proxy Group will be voted based upon the Investment Managers’ instructions
and/or policies. To assist it in analyzing proxies of equity securities, the
Investment Managers subscribe to Institutional Shareholder Services Inc.
("ISS"), an unaffiliated third-party corporate governance research
service that provides in-depth analyses of shareholder meeting agendas and vote
recommendations. In addition, the Investment Managers subscribe to ISS’s Proxy
Voting Service and Vote Disclosure Service. These services include receipt of
proxy ballots, custodian bank relations, account maintenance, vote execution,
ballot reconciliation, vote record maintenance, comprehensive reporting
capabilities, and vote disclosure services. Also, the Investment Managers
subscribe to Glass, Lewis & Co., LLC ("Glass Lewis"), an
unaffiliated third-party analytical research firm, to receive analyses and vote
recommendations on the shareholder meetings of publicly held U.S. companies, as
well as a limited subscription to its international research.
For accounts managed by
the Templeton Global Equity Group (“TGEG”), in making voting decisions, the
Investment Managers may consider Glass Lewis’s Proxy Voting Guidelines, ISS’s
Benchmark Policies, ISS’s Sustainability Policy, and TGEG’s custom
sustainability guidelines, which reflect what TGEG believes to be good
environmental, social, and governance practices. Although analyses provided by
ISS, Glass Lewis, and/or another independent third-party proxy service provider
(each a “Proxy Service”) are thoroughly reviewed and considered in making a
final voting decision, the Investment Managers do not consider recommendations
from a Proxy Service or any third-party to be determinative of the Investment
Managers’ ultimate decision. Rather, the Investment Managers exercise their
independent judgment in making voting decisions. As a matter of policy, the
officers, directors and employees of the Investment Managers and the Proxy
Group will not be influenced by outside sources whose interests conflict with
the interests of Advisory Clients.
For ease of reference,
the Proxy Policies often refer to all Advisory Clients. However, our processes
and practices seek to ensure that proxy voting decisions are suitable for
individual Advisory Clients. In some cases, the Investment Managers’ evaluation
may result in an individual Advisory Client or Investment Manager voting
differently, depending upon the nature and objective of the fund or account,
the composition of its portfolio, whether the Investment Manager has adopted a
specialty or custom voting policy, and other factors.
Certain of the Investment
Managers’ separate accounts or funds (or a portion thereof) are included under
Franklin Templeton Investment Solutions (“FTIS”), a separate investment group
within Franklin Templeton, and employ a quantitative strategy.
For such accounts, FTIS’s
proprietary methodologies rely on a combination of quantitative, qualitative,
and behavioral analysis rather than fundamental security research and analyst
coverage that an actively-managed portfolio would ordinarily employ.
Accordingly, absent client direction, in light of the high number of positions
held by such accounts and the considerable time and effort that would be
required to review proxy statements and ISS or Glass Lewis recommendations, the
Investment Manager may review ISS’s non-US Benchmark guidelines, ISS’s
specialty guidelines (in particular, ISS’s Sustainability guidelines), or Glass
Lewis’s US guidelines (the “the ISS and Glass Lewis Proxy Voting Guidelines”)
and determine, consistent with the best interest of its clients, to provide
standing instructions to the Proxy Group to vote proxies according to the
recommendations of ISS or Glass Lewis.
The Investment Manager,
however, retains the ability to vote a proxy differently than ISS or Glass
Lewis recommends if the Investment Manager determines that it would be in the
best interests of Advisory Clients (for example, where an issuer files
additional solicitation materials after a Proxy Service has issued its voting
recommendations but sufficiently before the vote submission deadline and these
materials would reasonably be expected to affect the Investment Manager’s
voting determination).
All conflicts of interest
will be resolved in the best interests of the Advisory Clients. The Investment
Managers are affiliates of a large, diverse financial services firm with many
affiliates and makes its best efforts to mitigate conflicts of interest.
However, as a general matter, the Investment Managers take the position that
relationships between certain affiliates that do not use the “Franklin
Templeton” name (“Independent Affiliates”) and an issuer (e.g., an investment
management relationship between an issuer and an Independent Affiliate) do not
present a conflict of interest for an Investment Manager in voting proxies with
respect to such issuer because: (i) the Investment Managers operate as an
independent business unit from the Independent Affiliate business units, and
(ii) informational barriers exist between the Investment Managers and the
Independent Affiliate business units.
Material conflicts of
interest could arise in a variety of situations, including as a result of the
Investment Managers’ or an affiliate’s (other than an Independent Affiliate as
described above): (i) material business relationship with an issuer or
proponent, (ii) direct or indirect pecuniary interest in an issuer or
proponent; or (iii) significant personal or family relationship with an issuer
or proponent. Material conflicts of interest are identified by the Proxy Group
based upon analyses of client, distributor, broker dealer, and vendor lists,
information periodically gathered from directors and officers, and information
derived from other sources, including public filings. The Proxy Group gathers
and analyzes this information on a best-efforts basis, as much of this
information is provided directly by individuals and groups other than the Proxy
Group, and the Proxy Group relies on the accuracy of the information it
receives from such parties.
Nonetheless, even though
a potential conflict of interest between the Investment Managers or an
affiliate (other than an Independent Affiliate as described above) and an
issuer may exist: (1) the Investment Managers may vote in opposition to the
recommendations of an issuer’s management even if contrary to the
recommendations of a third-party proxy voting research provider; (2) if
management has made no recommendations, the Proxy Group may defer to the voting
instructions of the Investment Managers; and (3) with respect to shares held by
Franklin Resources, Inc. or its affiliates for their own corporate accounts,
such shares may be voted without regard to these conflict procedures.
Otherwise, in situations
where a material conflict of interest is identified between the Investment
Managers or one of its affiliates (other than Independent Affiliates) and an
issuer, the Proxy Group may vote consistent with the voting recommendation of a
Proxy Service or send the proxy directly to the relevant Advisory Clients with
the Investment Managers’ recommendation regarding the vote for approval. To
address certain affiliate conflict situations, the Investment Managers will
employ pass-through voting or mirror voting when required pursuant to a fund’s
governing documents or applicable law.
Where the Proxy Group
refers a matter to an Advisory Client, it may rely upon the instructions of a
representative of the Advisory Client, such as the board of directors or
trustees, a committee of the board, or an appointed delegate in the case of a
U.S. registered investment company, a conducting officer in the case of a fund
that has appointed FTIS S.à.r.l as its Management Company, the Independent
Review Committee for Canadian investment funds, or a plan administrator in the
case of an employee benefit plan. A quorum of the board of directors or
trustees or of a committee of the board can be reached by a majority of
members, or a majority of non-recused members. The Proxy Group may determine to
vote all shares held by Advisory Clients of the Investment Managers and
affiliated Investment Managers (other than Independent Affiliates) in
accordance with the instructions of one or more of the Advisory Clients.
The Investment Managers
may also decide whether to vote proxies for securities deemed to present
conflicts of interest that are sold following a record date, but before a
shareholder meeting date. The Investment Managers may consider various factors
in deciding whether to vote such proxies, including the Investment Managers’
long-term view of the issuer’s securities for investment, or it may defer the
decision to vote to the applicable Advisory Client. The Investment Managers
also may be unable to vote, or choose not to vote, a proxy for securities
deemed to present a conflict of interest for any of the reasons outlined in the
first paragraph of the section of these policies entitled “Proxy Procedures.”
Weight Given
Management Recommendations
One of the primary
factors the Investment Managers consider when determining the desirability of
investing in a particular company is the quality and depth of that company's
management. Accordingly, the recommendation of management on any issue is a
factor that the Investment Managers consider in determining how proxies should
be voted. However, the Investment Managers do not consider recommendations from
management to be determinative of the Investment Managers’ ultimate decision.
Each issue is considered on its own merits, and the Investment Managers will
not support the position of a company's management in any situation where it
determines that the ratification of management's position would adversely
affect the investment merits of owning that company's shares.
The Investment Managers
believe that engagement with issuers is important to good corporate governance
and to assist in making proxy voting decisions. The Investment Managers may
engage with issuers to discuss specific ballot items to be voted on in advance
of an annual or special meeting to obtain further information or clarification
on the proposals. The Investment Managers may also engage with management on a range
of environmental, social or corporate governance issues throughout the year.
The Proxy Group is part of
the Franklin Templeton Companies, LLC Legal Department and is overseen by legal
counsel. Full-time staff members and support staff (which includes individuals
that are employees of affiliates of Franklin Templeton Companies, LLC) are devoted
to proxy voting administration and oversight and providing support and
assistance where needed. On a daily basis, the Proxy Group will review each
proxy upon receipt as well as any agendas, materials and recommendations that
they receive from a Proxy Service or other sources. The Proxy Group maintains a
record of all shareholder meetings that are scheduled for companies whose
securities are held by the Investment Managers’ managed funds and accounts. For
each shareholder meeting, a member of the Proxy Group will consult with the
research analyst that follows the security and provide the analyst with the
agenda, analyses of one or more Proxy Services, recommendations and any other
information provided to the Proxy Group. Except in situations identified as
presenting material conflicts of interest, the Investment Managers’ research
analyst and relevant portfolio manager(s) are responsible for making the final
voting decision based on their review of the agenda, analyses of one or more
Proxy Services, proxy statements, their knowledge of the company and any other
information publicly available.
In situations where the
Investment Managers have not responded with vote recommendations to the Proxy
Group by the deadline date, the Proxy Group may vote consistent with the vote
recommendations of a Proxy Service. Except in cases where the Proxy Group is
voting consistent with the voting recommendation of a Proxy Service, the Proxy
Group must obtain voting instructions from the Investment Managers’ research
analysts, relevant portfolio manager(s), legal counsel and/or the Advisory
Client prior to submitting the vote. In the event that an account holds a
security that an Investment Manager did not purchase on its behalf, and the
Investment Manager does not normally consider the security as a potential
investment for other accounts, the Proxy Group may vote consistent with the
voting recommendations of a Proxy Service or take no action on the meeting.
The Proxy Group is fully
cognizant of its responsibility to process proxies and maintain proxy records
as may be required by relevant rules and regulations. In addition, the
Investment Managers understand their fiduciary duty to vote proxies and that
proxy voting decisions may affect the value of shareholdings. Therefore, the
Investment Managers will generally attempt to process every proxy it receives
for all domestic and foreign securities. However, there may be situations in
which the Investment Managers may be unable to successfully vote a proxy, or may
choose not to vote a proxy, such as where: (i) a proxy ballot was not received
from the custodian bank; (ii) a meeting notice was received too late; (iii)
there are fees imposed upon the exercise of a vote and it is determined that
such fees outweigh the benefit of voting; (iv) there are legal encumbrances to
voting, including blocking restrictions in certain markets that preclude the
ability to dispose of a security if an Investment Manager votes a proxy or
where the Investment Manager is prohibited from voting by applicable law,
economic or other sanctions, or other regulatory or market requirements,
including but not limited to, effective Powers of Attorney; (v) additional
documentation or the disclosure of beneficial owner details is required; (vi)
the Investment Managers held shares on the record date but has sold them prior
to the meeting date; (vii) the Advisory Client held shares on the record date,
but the Advisory Client closed the account prior to the meeting date; (viii) a
proxy voting service is not offered by the custodian in the market; (ix) due to
either system error or human error, the Investment Managers’ intended vote is
not correctly submitted; (x) the Investment Managers believe it is not in the
best interest of the Advisory Client to vote the proxy for any other reason not
enumerated herein; or (xi) a security is subject to a securities lending or
similar program that has transferred legal title to the security to another
person.
Even if the Investment
Managers use reasonable efforts to vote a proxy on behalf of its Advisory
Clients, such vote or proxy may be rejected because of (a) operational or
procedural issues experienced by one or more third parties involved in voting
proxies in such jurisdictions; (b) changes in the process or agenda for the
meeting by the issuer for which the Investment Managers do not have sufficient
notice; or (c) the exercise by the issuer of its discretion to reject the vote
of the Investment Managers. In addition, despite the best efforts of the Proxy
Group and its agents, there may be situations where the Investment Managers’
votes are not received, or properly tabulated, by an issuer or the issuer’s
agent.
The Investment Managers
or their affiliates may, on behalf of one or more of the proprietary registered
investment companies advised by the Investment Managers or their affiliates,
make efforts to recall any security on loan where the Investment Manager or its
affiliates (a) learn of a vote on an event that may materially affect a
security on loan and (b) determine that it is in the best interests of such
proprietary registered investment companies to recall the security for voting
purposes. The ability to timely recall shares is not entirely within the
control of the Investment Managers. Under certain circumstances, the recall of
shares in time for such shares to be voted may not be possible due to
applicable proxy voting record dates or other administrative considerations.
There may be instances in
certain non-U.S. markets where split voting is not allowed. Split voting occurs
when a position held within an account is voted in accordance with two
differing instructions. Some markets and/or issuers only allow voting on an
entire position and do not accept split voting. In certain cases, when more
than one Franklin Templeton investment manager has accounts holding shares of
an issuer that are held in an omnibus structure, the Proxy Group will seek
direction from an appropriate representative of the Advisory Client with
multiple Investment Managers (such as a conducting officer of the Management
Company in the case of a SICAV), or the Proxy Group will submit the vote based
on the voting instructions provided by the Investment Manager with accounts
holding the greatest number of shares of the security within the omnibus
structure.
If several issues are
bundled together in a single voting item, the Investment Managers will assess
the total benefit to shareholders and the extent that such issues should be subject
to separate voting proposals.
PROCEDURES FOR
MEETINGS INVOLVING FIXED INCOME SECURITIES & PRIVATELY HELD ISSUERS
From time to time,
certain custodians may process events for fixed income securities through their
proxy voting channels rather than corporate action channels for administrative
convenience. In such cases, the Proxy Group will receive ballots for such
events on the ISS voting platform. The Proxy Group will solicit voting
instructions from the Investment Managers for each account or fund involved. If
the Proxy Group does not receive voting instructions from the Investment
Managers, the Proxy Group will take no action on the event. The Investment
Managers may be unable to vote a proxy for a fixed income security, or may
choose not to vote a proxy, for the reasons described under the section
entitled “Proxy Procedures.”
In the rare instance
where there is a vote for a privately held issuer, the decision will generally
be made by the relevant portfolio managers or research analysts.
The Proxy Group will
monitor such meetings involving fixed income securities or privately held
issuers for conflicts of interest in accordance with these procedures. If a
fixed income or privately held issuer is flagged as a potential conflict of
interest, the Investment Managers may nonetheless vote as it deems in the best
interests of its Advisory Clients. The Investment Managers will report such
decisions on an annual basis to Advisory Clients as may be required.
These Proxy Policies
apply to accounts managed by personnel within Franklin Templeton Emerging
Markets Equity Group, which includes the following investment managers:
Franklin Templeton
Investment Management Limited
Templeton Asset
Management Ltd.
Item
8. Portfolio Managers of Closed-End Management Investment Companies
. N/A
Item
9. Purchases of Equity Securities by Closed-End Management Investment Company
and Affiliated Purchasers
. N/A
Item
10
. Submission
of Matters to a Vote of Security Holders.
There have been no changes to the procedures by which
shareholders may recommend nominees to the Registrant's Board of Directors that
would require disclosure herein.
Item
11. Controls and Procedures.
(a) Evaluation
of Disclosure Controls and Procedures.
The Registrant maintains disclosure controls
and procedures that are designed to provide reasonable assurance that
information required to be disclosed in the Registrant’s filings under the
Securities Exchange Act of 1934, as amended, and the Investment Company Act of
1940 is recorded, processed, summarized and reported within the periods specified
in the rules and forms of the Securities and Exchange Commission. Such
information is accumulated and communicated to the Registrant’s management,
including its principal executive officer and principal financial officer, as
appropriate, to allow timely decisions regarding required disclosure. The Registrant’s
management, including the principal executive officer and the principal
financial officer, recognizes that any set of controls and procedures, no matter
how well designed and operated, can provide only reasonable assurance of
achieving the desired control objectives.
Within
90 days prior to the filing date of this Shareholder Report on Form N-CSRS, the
Registrant had carried out an evaluation, under the supervision and with the participation
of the Registrant’s management, including the Registrant’s principal executive
officer and the Registrant’s principal financial officer, of the effectiveness
of the design and operation of the Registrant’s disclosure controls and
procedures. Based on such evaluation, the Registrant’s principal executive officer
and principal financial officer concluded that the Registrant’s disclosure
controls and procedures are effective.
(b) Changes
in Internal Controls
.
There
have been no changes in the Registrant’s internal control over financial
reporting that occurred during the period covered by this report that has
materially affected, or is reasonably likely to materially affect the internal
control over financial reporting.
Item 12. Disclosure of Securities Lending
Activities for Closed-End Management Investment Company.
Securities lending agent.
The board of trustees has
approved the Fund’s participation in a securities lending program. Under the
securities lending program, JP Morgan Chase Bank serves as the Fund’s
securities lending agent.
The securities lending agent is responsible for the
implementation and administration of the Funds’ securities lending program.
Pursuant to the respective Securities Lending Agreements with the Fund, the
securities lending agent performs a variety of services, including (but not limited
to) the following:
o Trade finding, execution and settlement
o Settlement
monitoring and controls, reconciliations, corporate actions and recall
management
o Collateral management and valuation information
o Invoice management and billing from counterparties
For the period ended June 30, 2023, the income
earned by the Fund as well as the fees and/or compensation paid by the Fund in
dollars pursuant to a securities lending agreement between the Trust with
respect to the Fund and the Securities Lending Agent were as follows (figures
may differ from those shown in shareholder reports due to time of availability
and use of estimates):
Gross income earned by the Fund
from securities lending activities |
|
Fees and/or compensation paid by the Fund for
securities lending activities and related services |
|
Fees paid to Securities Lending Agent from revenue
split |
|
Fees paid for any cash collateral management service
(including fees deducted from a pooled cash collateral reinvestment vehicle)
not included in a revenue split |
|
Administrative fees not included in a revenue
split |
|
Indemnification fees not included in a revenue
split |
|
Rebate (paid to borrower) |
|
Other fees not included above |
|
Aggregate fees/compensation paid by the
Fund for securities lending activities |
|
Net income from securities lending
activities |
|
(a)(2)
Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of
Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and
Christopher Kings, Chief Financial Officer, Chief Accounting Officer and
Treasurer
(a)(2)(1)
There were no written solicitations to purchase securities under Rule 23c-1 under
the Act sent or given during the period covered by the report by or on behalf
of the Registrant to 10 or more persons.
(a)(2)(2)
There was no change in the Registrant’s independent public accountant during
the period covered by the report.
(b)
Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of
Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and
Christopher Kings, Chief Financial Officer, Chief Accounting Officer and Treasurer
Pursuant
to the requirements of the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Templeton
Dragon Fund, Inc.
By SMATTHEW
T. HINKLE______________________
Chief
Executive Officer - Finance and Administration
Pursuant
to the requirements of the Securities Exchange Act of 1934 and the Investment
Company Act of 1940, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates indicated.
By SMATTHEW
T. HINKLE______________________
Chief
Executive Officer - Finance and Administration
By SCHRISTOPHER
KINGS______________________
Chief
Financial Officer, Chief Accounting Officer and Treasurer
II.
Other Policies and
Procedures
This Code shall be the sole code of ethics adopted by the Funds for
purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms
applicable to registered investment companies thereunder.
Franklin Resources, Inc. has separately adopted the
Code of Ethics and
Business Conduct (“Business Conduct”), which is applicable to all
officers, directors and employees of Franklin Resources, Inc., including
Covered Officers. It summarizes the values, principles and business practices
that guide the employee’s business conduct and also provides a set of basic
principles to guide officers, directors and employees regarding the minimum
ethical requirements expected of them. It supplements the values, principles
and business conduct identified in the Code and other existing employee
policies.
Additionally, the Franklin Templeton Funds have separately adopted the FTI
Personal Investments and Insider Trading Policy governing personal
securities trading and other related matters. The Code for Insider Trading
provides for separate requirements that apply to the Covered Officers and
others, and therefore is not part of this Code.
Insofar as other policies or procedures of Franklin Resources, Inc., the
Funds, the Funds’ adviser, principal underwriter, or other service providers
govern or purport to govern the behavior or activities of the Covered Officers
who are subject to this Code, they are superceded by this Code to the extent
that they overlap or conflict with the provisions of this Code. Please review
these other documents or consult with the Legal Department if have questions
regarding the applicability of these policies to
you.
III.
Covered Officers Should Handle Ethically Actual and Apparent Conflicts
of Interest
Overview. A "conflict of interest" occurs when a Covered
Officer's private interest interferes with the interests of, or his or her
service to, the FT Funds. For example, a conflict of interest would arise if a
Covered Officer, or a member of his family, receives improper personal benefits
as a result of apposition with the FT Funds.
Certain conflicts of interest arise out of the relationships between
Covered Officers and the FT Funds and already are subject to conflict of
interest provisions in the Investment Company Act of 1940 ("Investment
Company Act") and the Investment Advisers Act of 1940 ("Investment
Advisers Act"). For example, Covered Officers may not individually engage
in certain transactions (such as the purchase or sale of securities or other
property) with the FT Funds because of their status as "affiliated
persons" of the FT Funds. The FT Funds’ and the investment advisers’ compliance
programs and procedures are designed to prevent, or identify and correct,
violations of these provisions. This Code does not, and is not intended to,
repeat or replace these programs and procedures, and such conflicts fall
outside of the parameters of this Code.
Although
typically not presenting an opportunity for improper personal benefit,
conflicts arise from, or as a result of, the contractual relationship between
the FT Funds, the investment advisers and the fund administrator of which the Covered
Officers are also officers or employees. As a result, this Code recognizes that
the Covered Officers will, in the normal course of their duties (whether
formally for the FT Funds, for the adviser, the administrator, or
2
for all three), be involved in
establishing policies and implementing decisions that will have different
effects on the adviser, administrator and the FT Funds. The participation of
the Covered Officers in such activities is inherent in the contractual
relationship between the FT Funds, the adviser, and the administrator and is
consistent with the performance by the Covered Officers of their duties as
officers of the FT Funds. Thus, if performed in conformity with the provisions
of the Investment Company Act and the Investment Advisers Act, such activities
will be deemed to have been handled ethically. In addition, it is recognized by
the FT Funds' Boards of Directors ("Boards") that the Covered
Officers may also be officers or employees of one or more other investment
companies covered by this or other codes.
Other conflicts
of interest are covered by the Code, even if such conflicts of interest are not
subject to provisions in the Investment Company Act and the Investment Advisers
Act. The following list provides examples of conflicts of interest under the
Code, but Covered Officers should keep in mind that these examples are not
exhaustive. The overarching principle is that the personal interest of a
Covered Officer should not be placed improperly before the interest of the FT
Funds.
Each Covered Officer must:
Not use his or her personal influence or personal relationships
improperly to influence investment decisions or financial reporting by the FT
Funds whereby the Covered
Officer
would benefit personally to the detriment of the FT
Funds;
Not cause the FT Funds to take action, or fail to take action,
for the individual personal benefit of the Covered Officer rather than the
benefit the FT
Funds;
Not retaliate against any other Covered Officer or any employee
of the FT Funds or their affiliated persons for reports of potential violations
that are made in good
faith;
Report at least annually the following affiliations or other
relationships:
1
all directorships for public companies and all companies that are
required to file reports with the
SEC;
any direct or indirect business relationship with any independent
directors of
the FT
Funds;
any direct or indirect business relationship with any independent
public accounting firm (which are not related to the routine issues related to
the
firm’s service as the Covered
Persons accountant);
and
any direct or indirect interest in any transaction with any FT
Fund that will benefit the officer (not including benefits derived from the
advisory, sub-advisory, distribution or service agreements with affiliates of
Franklin
Resources).
These reports will be reviewed
by the Legal Department for compliance with the Code.
There are some
conflict of interest situations that should always be approved in writing by
Franklin Resources General Counsel or Deputy General Counsel, if material.
Examples of these include
2
:
Service as a director on the board of any public or private
Company.
Reporting
of
these
affiliations
or
other
relationships
shall
be
made
by
completing
the
annual
Directors
and
Officers
Questionnaire and returning the
questionnaire to Franklin Resources Inc, General Counsel or Deputy General
Counsel.
Any
activity
or
relationship
that
would
present
a
conflict
for
a
Covered Officer
may
also
present
a
conflict
for
the
Covered Officer
if a member of the Covered Officer's
immediate family engages in such an activity or has such a relationship. The
Cover Person should also obtain written approval by FT’s General Counsel in
such situations.
3
The receipt of any gifts in excess of $100 from any person, from
any corporation
or association.
The receipt of any entertainment from any Company with which the
FT Funds has current or prospective business dealings unless such entertainment
is business related, reasonable in cost, appropriate as to time and place, and
not so frequent as to raise
any
question of impropriety. Notwithstanding the foregoing, the Covered Officers
must obtain prior approval from the Franklin Resources General Counsel for any
entertainment with a value in excess of
$1000.
Any ownership interest in, or any consulting or employment
relationship with, any of
the FT
Fund’s service providers, other than an investment adviser, principal
underwriter, administrator or any affiliated person
thereof.
A direct or indirect financial interest in commissions,
transaction charges or spreads paid by the FT Funds for effecting portfolio
transactions or for selling or redeeming shares other than an interest arising
from the Covered Officer's employment, such as compensation or equity
ownership.
Franklin Resources General Counsel or Deputy General Counsel will
provide a report
to the FT Funds
Audit Committee of any approvals granted at the next regularly scheduled
meeting.
IV.
Disclosure and
Compliance
Each Covered Officer should familiarize himself with the
disclosure
requirements generally
applicable to the FT
Funds;
Each Covered Officer should not knowingly misrepresent, or cause
others to misrepresent, facts about the FT Funds to others, whether within or
outside the FT Funds, including to the FT Funds’ directors and auditors, and to
governmental
regulators and
self-regulatory
organizations;
Each Covered Officer should, to the extent appropriate within his
or her area of responsibility, consult with other officers and employees of the
FT Funds, the FT Fund’s adviser and the administrator with the goal of
promoting full, fair, accurate, timely and understandable disclosure in the
reports and documents the FT Funds file with, or submit to, the SEC and in
other public communications made by the FT Funds;
and
It is the responsibility of each Covered Officer to promote
compliance with the standards and restrictions imposed by applicable laws,
rules and
regulations.
V.
Reporting and Accountability
Each Covered Officer must:
Upon becoming a covered officer affirm in writing to the Board
that he or she has received, read, and understands the Code (see Exhibit
B);
Annually thereafter affirm to the Board that he has complied with
the requirements of
the Code;
and
Notify Franklin Resources’ General Counsel or Deputy General
Counsel promptly if he or she knows of any violation of this Code. Failure to
do so is itself is a violation of
this
4
VII.
Amendments
Any amendments
to this Code, other than amendments to Exhibit A, must be approved or ratified
by a majority vote of the FT Funds’ Board including a majority of independent
directors.
VIII.
Confidentiality
All reports and records prepared or maintained pursuant to this Code will
be considered confidential and shall be maintained and protected accordingly.
Except as otherwise required by law or this Code, such matters shall not be
disclosed to anyone other than the FT Funds’ Board and their counsel.
IX.
Internal
Use
The Code is intended solely for the internal use by the FT Funds and does
not constitute an admission, by or on behalf of any FT Funds, as to any fact,
circumstance, or legal conclusion.
X.
Disclosure on Form
N-CSR
Item 2 of Form
N-CSR requires a registered management investment company to disclose annually
whether, as of the end of the period covered by the report, it has adopted a
code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions, regardless of whether these officers are
employed by the registrant or a third party. If the registrant has not adopted
such a code of ethics, it must explain why it has not done so.
The
registrant must also: (1) file with the SEC a copy of the code as an exhibit to
its annual report; (2) post the text of the code on its Internet website and
disclose, in its most recent report on Form N-CSR, its Internet address and the
fact that it has posted the code on its Internet website; or (3) undertake in
its most recent report on Form N-CSR to provide to any person without charge,
upon request, a copy of the code and explain the manner in which such request
may be made. Disclosure is also required of amendments to, or waivers
(including implicit waivers) from, a provision of the code in the registrant's
annual report on Form N-CSR or on its website. If the registrant intends to
satisfy the requirement to disclose amendments and waivers by posting such
information on its website, it will be required to disclose its Internet
address and this
intention.
The Legal Department shall be
responsible for ensuring that:
a copy of the Code is filed with the SEC as an exhibit to each
Fund’s annual report;
and
any amendments to, or waivers (including implicit waivers) from,
a provision of the
Code is
disclosed in the registrant's annual report on Form
N-CSR.
In the event that the foregoing disclosure is omitted or is determined to
be incorrect, the Legal Department shall promptly file such information with
the SEC as an amendment to Form N-CSR.
In such an event, the Fund Chief Compliance Officer shall review the Code
and propose such changes to the Code as are necessary or appropriate to prevent
reoccurrences.
I, Matthew T. Hinkle, certify that:
1.
I have reviewed this report on Form N-CSR of
Templeton Dragon Fund,
Inc.;
2.
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
Based on my knowledge, the
financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of
operations, changes in net assets, and cash flows (if the financial statements
are required to include a statement of cash flows) of the registrant as of, and
for, the periods presented in this report;
4.
The
registrant's other certifying officer(s) and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c)
under the Investment Company Act of 1940) and internal control over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act of
1940) for the registrant and have:
(a) Designed such disclosure controls and procedures,
or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this report is being
prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90
days prior to the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal
control over financial reporting that occurred during the period covered by
this report that has materially affected, or is reasonably likely to materially
affect, the registrant’s internal control over financial reporting; and
5.
The
registrant's other certifying officer(s) and I have disclosed to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material
weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves
management or other employees who have a significant role in the registrant's
internal control over financial reporting.
8/28/2023
SMATTHEW T. HINKLE
Matthew T. Hinkle
Chief Executive Officer - Finance and Administration
I, Christopher Kings, certify that:
1.
I have reviewed this report on Form N-CSR of
Templeton Dragon Fund,
Inc.;
2.
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
Based on my knowledge, the
financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of
operations, changes in net assets, and cash flows (if the financial statements
are required to include a statement of cash flows) of the registrant as of, and
for, the periods presented in this report;
4.
The
registrant's other certifying officer(s) and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c)
under the Investment Company Act of 1940) and internal control over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act of
1940) for the registrant and have:
(a) Designed such disclosure controls and procedures,
or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this report is being
prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90
days prior to the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal
control over financial reporting that occurred during the period covered by
this report that has materially affected, or is reasonably likely to materially
affect, the registrant’s internal control over financial reporting; and
5.
The
registrant's other certifying officer(s) and I have disclosed to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material
weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves
management or other employees who have a significant role in the registrant's
internal control over financial reporting.
8/28/2023
SCHRISTOPHER KINGS
Christopher Kings
Chief Financial Officer, Chief Accounting Officer and
Treasurer
