Letter to shareholders from  Roy Gori
President and Chief Executive Officer

We proudly served nearly 30 million customers globally in 2019 as we continued to provide compelling ways to meet their needs. A great example is the expansion of our behavioural insurance offerings, Manulife Vitality, John Hancock Vitality, and ManulifeMOVE. These products embody our focus on making lives better as they reward our customers for healthy habits, like exercising and eating well. In Asia, we introduced ManulifeMOVE in Vietnam and Cambodia, and doubled enrollment across the region. The introduction of Manulife Vitality to our Individual Health and Group Benefits customers in Canada was met with great enthusiasm. And in the U.S., we are changing the lives of people with diabetes with the launch of John Hancock Aspire, which combines financial protection with personalized diabetes support.

In our Global Wealth and Asset Management business, we entered into a joint venture agreement with Mahindra Finance in India, with the goal of becoming a leading provider of retail investment solutions in that country. And we launched an industry-first, voice-enabled retirement product using Alexa for customers in the U.S.

We also made steady progress in how we are supporting our customers. In Canada, we saw 3.9 million more claims submitted digitally, and with our Group Benefits business also moving to paperless claims, we are on track to eliminate 4.2 million cheques and benefits statements as well. In Asia, we launched Hong Kong’s first all-digital cashless service, which enables customers to obtain speedy pre-approval for most common claims, and we expanded our eClaims platform across the region. What’s most gratifying is our customers’ feedback, with the Net Promoter Scores in Asia increasing as a result of these changes.

We set an ambitious goal of improving our Net Promoter Scores (NPS) by 30 points across the company by 2022, knowing that passionate customers are more likely to recommend Manulife and stay with us. As we closed the year, we were pleased to see our NPS up 7 points from our 2017 levels. By leveraging human-centred design and technology, we’ll continue to enhance our customer experience.

I am exceptionally proud of the commitment and winning mindset of our colleagues, as it’s their enthusiasm for delivering for our customers that is fuelling our success. As I shared with you last year, we’ve been challenging ourselves to bring an insurgent mindset to all we do. Instead of asking, “Does this process, product, or policy work for our customers?” we are asking, “Does this work as well as it possibly can or is there a better way?” This future-focused approach is encouraging all of us to look for ways to continuously improve what we do and we’re investing in helping our colleagues build new skills and capabilities to do that. Our focus on making the future better is resonating with our team, as we saw increased engagement across the company last year.

Actively cultivating a diverse and inclusive workplace is also a key contributor to engagement. When all employees are inspired to bring their authentic and whole selves to work, they get the opportunity to thrive personally and professionally. Through our employee resource groups, we are sponsoring activities that enable us to build closer connections, to learn about each others’ perspectives, and to live our “Share your humanity” value every day. Our efforts earned us recognition on the 2019 Bloomberg Gender Equality Index and as one of Canada’s Best Diversity Employers for the past two years.

Tata, one of our colleagues in Indonesia, had limited education, no work experience, and was coping with a physical disability when she applied for a direct marketing position with Manulife. Her great attitude and desire to assert her independence in life made her a standout candidate and she was invited to join our team. Since she’s been with us, Tata has received numerous awards, including being nominated as a top colleague four times in a row. In her own words, “To be able to work in Manulife Indonesia is truly a dream come true for me.”

Her story shows what’s possible when passion meets opportunity to create a unique company culture, and I firmly believe our people and the teamwork we’re building will continue to be a competitive advantage for us globally.

There is no denying the impact of climate change is significant and has implications for every community and business globally. To bring about sustained change, it’s clear this will require all stakeholders to work together. We’re proud to be doing our part, with our colleagues taking steps to make progress on many fronts, and we know much still remains to be done.

We established a climate change working group that reports to our Executive Sustainability Council, whose mandate includes identifying climate change risks and opportunities across the organization. We are proud to have served as a leading arranger and provider of financing for the renewable power sector in North America, having invested over $13.6 billion in wind and solar energy and energy efficiency since 2002. We’re also sustainably managing our real estate, timber, and agriculture assets. For example, over 48 million square feet, or 80%, of our global real estate portfolio has been certified to a green building standard.

Manulife was the first global life insurer to issue a green bond, and with two issuances to date, our total outstanding green bond issuance amount is now over $1.0 billion. The environmental benefit of our second, $600 million green bond is 258,400 tons of carbon dioxide emissions avoided annually, or 430 tons per $1.0 million invested.

Our commitment to sustainability extends beyond environmental considerations. From helping underserved communities in Canada, to providing support for deserving students through our Martin Luther King scholarships in the U.S., to improving financial literacy in the Philippines, we are involved in a range of efforts designed to help people learn and grow to fulfill their aspirations. We’re also proud of the work we have done globally in support of important community needs, directly making or helping to raise over $46 million in community contributions, along with our employees and agents volunteering approximately 66,000 hours of service to make a difference. Identifying ways to help make the world a better place will continue to be a key focus for us. It’s also a personal passion for me, our leadership team, and our Board, so we are looking forward to continuing to build on our progress in the year to come.

Despite significant market volatility, global trade tensions, and other geopolitical events, we continued to sustainably grow net income and core earnings, free up capital so it can be put to best use, and grow our highest-potential businesses while maintaining discipline on costs.

We delivered top-quartile shareholder returns in 2019. We achieved core earnings of $6.0 billion and net income attributed to shareholders of $5.6 billion, increases of 5% and 14%, respectively, over 2018. Our strong results were driven by continued double-digit growth in core earnings in Asia. New business value, at $2.0 billion, was up 15% from 2018.

We released a total of $5.1 billion of capital from our legacy businesses by the end of 2019 and are pleased to have achieved our 2022 target three years ahead of schedule.

Thanks to the ongoing trust and confidence of our customers around the world, our assets continued to grow, finishing the year at $1.2 trillion of assets under management and administration. This is up 13% from last year and up almost 30% from five years ago.

Our results in 2019 were strong and we made great progress as measured by a one- and three-year Total Shareholder Return of 49.2% and 27.6%, respectively—a metric we have worked hard to improve as we strive to consistently deliver on our bold ambition and transform Manulife into the most digital, customer-centric global company in our industry.

Thank you

One of our values, “Get it done together,” is an apt description for how we have been able to accomplish so much in 2019. I am incredibly grateful for the leadership, positive mindset, and adaptability of our team. We are also so fortunate to have the counsel and support of our distinguished Board members, whose experience and guidance have helped us on many fronts.

I want to extend a special thank you to our Chairman of the Board, John Cassaday, for his continued dedication, candor, and sound advice. I’d also like to thank you, fellow shareholders, for your ongoing trust and confidence in Manulife and our team.

Looking ahead, we are excited to build on the momentum of our strong achievements. We know the key to continued success is consistency and executional excellence in all we do. It’s why we will remain steadfastly focused on the five strategic priorities we set out at the start of our transformation.

Our goal remains a bold one: to lead our industry. It will require us to continue to have an insurgent mindset, challenge ourselves to look for new ways to support our customers and our communities, all while adapting as needed to address new challenges and opportunities. We remain confident that we have the right plan, the right team, and the right mindset to achieve our ambition.

Sincerely,