The executives of Canada’s three largest life insurers received seven-figure payouts in 2021 after successfully navigating the persistent COVID-19 pandemic while increasing profits.
According to Globe and Mail, Manulife Financial Corp (Manulife) chief executive officer (CEO) Roy Gori’s total compensation jumped by nearly 15% to $16.86 million in 2021, up from $14.69 million in 2020 and $14.67 million in 2019 based on Manulife’s annual proxy circular. The latest compensation included an $8.62 million share award, up from $8.41 million in stock and option awards in 2020, as well as a $5.84 million cash bonus, up from $3.58 million in 2020.
Gori has been with Manulife for seven years, entering the insurer in May 2015 as the president and CEO of Manulife Asia and then becoming the president and CEO of Manulife in Canada in June 2017. According to Globe and Mail, Gori earned the biggest paycheck in 2021 among the three executives.
Manulife boasted solid performance for the fourth quarter (Q4) and 12 months of 2021 (FY21). In Q4 2021, its net income attributed to shareholders totalled CA$2.1 billion, up from CA$304 million in Q4 2020. For the whole year, it saw a record net income of CA$7.1 billion, up from CA$1.2 billion in 2020.
Another executive who saw an increase in compensation last year was Sun Life Financial Inc (Sun Life) CEO Kevin Strain, who received total compensation of $11.33 million. The figure included $4.2 million in share and option awards (which Sun Life said reflected Strain’s promotion to CEO), $2.19 million in cash bonus, and $3.94 million in pension compensation (reflecting an estimated increase in his retirement payments because his pay increased when he became the CEO), according to Globe and Mail.
Strain has been with Sun Life for 19 years, joining the insurer in August 2002 as the vice president for investor relations and taking on various leadership roles until becoming the president and CEO in August 2021.
In February 2022, Sun Life unveiled its financial performance for the fourth quarter of 2021 (Q4), with net income soaring 45% to $1.08 billion, mainly driven by the IPO of its India asset management joint venture.
Great-West Lifeco Inc (Great-West) CEO Paul Mahon also saw a boost in compensation in 2021, totalling $9.09 million, up from $7.87 million a year earlier. His compensation included a $3.1 million bonus, up from his prior-year bonus of $2.46 million, as well as $5.63 million stock and option awards, up from $4.87 million in the previous year, according to Globe and Mail.
Mahon joined Great-West in 1986 as an employee benefits specialist and worked his way up until becoming the president and CEO in 2013.
Globe and Mail reported that all three insurers increased their executives’ bonus pay in 2021 after exceeding their financial goals for the year despite the persistence of the pandemic.
Particularly, Manulife said its “company performance score,” used in its bonus formula, totalled 142 in 2021, up from 84 in 2020. It also exceeded all its targets for profitability and other goals for the year.
Sun Life said its “company performance factor,” used in its bonus calculations and mainly used for the CEO and chief financial officer (CFO), hit 143% in 2021, up from only 93% in 2020. The boost in performance reflected “strong reported and underlying net income and value-of-new-business performance and solid client results.”
Meanwhile, Great-West said the $1.89 million of Mahon’s bonus was given because the company’s operating earnings doubled its target in 2021.
