Chartwell Retirement Residences (CSHUN) Earnings Call Transcript & Summary

Hello, and welcome to the Annual Meeting of Shareholders of Chartwell Retirement Residences Annual Meeting 2021. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to Mike Harris, Chairman of the Board, Mr. Harris, the floor is yours.

Good afternoon, and welcome to the Annual Meeting of the unitholders of Chartwell Retirement Residences. My name is Mike Harris, and I am the Chair of the Board. We're holding a virtual meeting this year, given the ongoing uncertainty surrounding the COVID-19 pandemic and in order to mitigate the risks to the health and safety of our communities, unitholders and employees and other stakeholders. This format allows all unitholders and proxy holders from any location to attend and to participate and vote at the meeting. Guests are also welcome to attend, listen to our meeting and ask questions. We are joining you from Chartwell's Head Office in Mississauga. Turning to Slide 3. I would like to begin by extending, on behalf of the Board, our sincere gratitude and heartfelt thanks to the employees of Chartwell, most especially in our residences. Their commitment and dedication are exemplary and their selfless efforts are heroic. We also appreciate the tremendous efforts of the regional and corporate teams that have worked tirelessly from the very beginning of this pandemic to provide a clear direction, communication and support to allow our residences staff to focus on the health and the safety of our residents. Despite these extraordinary efforts of our staff, the COVID-19 virus tragically claimed the lives of some of our residents and staff, and our thoughts are with those who lost loved ones to this disease. We understand how difficult this time has been for our residents and for their families, especially those in long-term care homes. This pandemic has tested our resilience and stretched our resources. I know that our unitholders will understand that our first priority has been the health and safety of our residents and our frontline employees. The Board also extends its full support and confidence to Chartwell's leadership team and its management through this pandemic. Their focus on the safety of our residents and staff and decisive response to this pandemic, utilizing the company's strong cross-functional expertise has been exceptional. As this meeting is held virtually via live webcast, I will set out a few rules for the orderly conduct of the meeting. Questions in respect of a motion can be submitted by any registered unitholder or a duly appointed proxy holder using the instant messaging service of the virtual interface. When sending a question, please indicate your name, which entity you represent and confirm that you are a registered unitholder or a duly appointed proxy holder. General questions will be addressed during the question period at the end of the meeting. And questions regarding procedural matters are directly related to the motions before the meeting will be addressed at the appropriate time. For the purposes of the meeting today, voting on all matters will be conducted by electronic ballot. Voting on all matters is now open and will remain open until I close voting shortly before the end of the formal part of the meeting. Please feel free to vote at any time during the meeting. All registered holders and proxy holders who have properly logged in with their control numbers or user name and wish to vote, will be able to see on the screen all motions being brought forth at this meeting. We will now proceed with the formal portion of today's meeting, and I will call the meeting to order. I will act as Chair of this meeting. Jonathan Boulakia, Chartwell's Chief Investment Officer and Chief Legal Officer, will act as secretary of the meeting. And Computershare Trust Company of Canada through its representative, Louise Waltenbury, act as scrutineer to compute the votes of any polls taken at this meeting and to report the results to me. The purposes of today's meeting are set out in the management information circular of Chartwell dated March 31, 2021. The notice, information circular and proxy form were provided on or around April 14, 2021, to each unitholder of record as of March 30, 2021. Our transfer agent, Computershare Trust Company of Canada has attested to the proper mailing of the notice calling this meeting, proof of which will be annexed to the minutes of this meeting as a schedule. With the consent of the meeting, we will dispense with the reading of the minutes of the last annual meeting of unitholders. The agenda for today's meeting will be as follows as set out on Slide 4. First, the presentation of the financial statements of Chartwell for the period ended December 31, 2020. Second, the election of the trustees of Chartwell, the nomination of trustees for CSH Trust and the nomination of directors for Chartwell Master Care Corporation. Third, the reappointment of auditors for Chartwell. Fourth, a resolution confirming and ratifying Chartwell's deferred unit plan adopted on July 1, 2008. Fifth, a resolution reconfirming and ratifying Chartwell's unitholder rights agreement. Sixth, an advisory resolution on Chartwell's approach to executive compensation. Seven, 2 unitholder proposals and eight, management's presentation to unitholders. I want to take this opportunity to introduce the other trustees and directors who are featured on Slide 5 and senior officers of Chartwell and of subsidiaries, who are in attendance today in the room or on the phone. Lise Bastarache, Director; Brent Binions, Director; Ann Davis, Director; André Kuzmicki, Director; Sharon Sallows, Director; James Scarlett, Director; Huw Thomas, Director; Vlad Volodarski, Director and Chief Executive Officer; Karen Sullivan, President and Chief Operating Officer; Sheri Harris, Chief Financial Officer; Jonathan Boulakia, Chief Investment and Legal Officer. Notice of this meeting and for those who requested it, the management information circular -- requested the circular were mailed to unitholders and the transfer agent has provided us with proof of mailing. And I direct that a copy of such proof be annexed to the minutes of this meeting. The scrutineer has reported on the number of units represented at this meeting and has computed and recorded the votes received to date on the matters submitted for consideration at this meeting. I'm advised that there is a quorum of unitholders present as required by Chartwell's Declaration of Trust. I declare the meeting to be duly called and properly constituted for the transaction of business. In order to allow the meeting to proceed efficiently, we have arranged for certain unitholders to make the motions required to put before the meeting, the various resolutions to be voted upon. The financial statements. Turning to Slide 6. I wish to present to the meeting the financial statements of Chartwell for the period ended December 31, 2020, and the report of the auditors on those statements. Copies of these financial statements were mailed to those unitholders of Chartwell who requested them and are available on our website at www.chartwell.com. I do not propose to read the financial statements to the meeting nor is approval of the financial statements by unitholders required. We'll now move to the election of trustees. This is -- for the trustees for Chartwell, sorry. The approval of directions regarding the election of trustees of CSH trust and directions regarding the election of directors of Chartwell Master Care Corporation. All of these can be seen on Slide 7. Chartwell has a policy that entitles unitholders to vote for each nominee on an individual basis. We will proceed first with the election of the trustees of Chartwell. The number of trustees of Chartwell has been fixed at 3, and I would ask Sheri Harris to nominate the 3 trustees.

Thanks, Mike. I nominate Lise Bastarache, Ann Davis and Huw Thomas to serve as trustees of Chartwell Retirement Residences. Thank you, Mike.

Sheri, now I'll turn your mic on and do it again.

Be on mute 2020. I nominate Lise Bastarache, Ann Davis and Huw Thomas to serve as trustees of Chartwell Retirement Residences.

As no other nominations were submitted within the required time frame set out in Chartwell's Declaration of Trust, I declare the nominations closed. Unitholders of Chartwell are also entitled to direct the trustees of Chartwell to elect nominees who will serve as the 3 trustees of CSH Trust. And I would ask Sheri Harris to move a motion in favor of the election of nominees as the 3 trustees of CSH Trust.

I move that the trustees of Chartwell be directed to both the units of CSH Trust held by Chartwell in favor of the election of Mike Harris, André Kuzmicki and Sharon Sallows as trustees of CSH Trust.

I will ask someone to second the motion.

I second the motion.

As no other nominations were submitted within the required time frame set out in Chartwell's Declaration of Trust, I declare the nominations closed. Unitholders of Chartwell are also entitled to direct the trustees of Chartwell to elect nominees who will serve as the 9 directors of Chartwell Master Care Corporation. I would now ask Karen Sullivan to move a motion in favor of the election of nominees as the 9 directors of Chartwell Master Care Corporation.

I move that the trustees of chart will be directed to vote the common shares of Chartwell Master Care Corporation held by Chartwell in favor of the election of Lise Bastarache, Brent Binions, Ann Davis, Mike Harris, André Kuzmicki, Sharon Sallows, James Scarlett, Huw Thomas and Vlad Volodarski as Directors of Chartwell Master Care Corporation.

I second the motion.

As no other nominations were submitted within the required time frame set out in Chartwell's declaration of trust, I declare the nominations closed. Turning to Slide 8. The next item of business is the reappointment of auditors for Chartwell. Sheri, please move a motion in this regard.

I move that KPMG LLP be reappointed auditors of Chartwell until the next Annual Meeting or until a successor is appointed, and that their remuneration be such -- as such be fixed by the trustees of Chartwell.

I second the motion.

The next item of business is to consider, and if thought advisable, to pass the resolution reconfirming and ratifying Chartwell's deferred unit plan adopted on July 1, 2008, set out in Appendix A of the management information circular. In order to be effective, this resolution must be passed by a majority of votes cast by the unitholders who vote on this resolution. I would ask Karen to move a motion in favor of the resolution.

I move that the resolution as set out on Appendix A of the management information circular be approved.

I second the motion.

Are there any questions on this motion? I do not see any. The next item of business is to consider and, if thought advisable, to pass the resolution reconfirming and ratifying Chartwell's Unitholder Rights Management -- Rights Agreement set out in Appendix B of the management information circular. In order to be effective, this resolution must be passed by a majority of votes cast by the unitholders who vote on this resolution. I would now ask Sheri to move a motion in favor of the resolution.

I move that the resolution as set out on Appendix B of the management information circular be approved.

I second the motion.

Are there any questions on the motion? The next item of business is to consider and if thought advisable to approve the advisory resolution on approach to executive compensation set out on Page 26 of the management information circular. I would now ask Huw Thomas, Chair of the compensation governance and nominating committee to move a motion in favor of the resolution.

I move that the resolution as set out on Page 26 of the management information circular be approved.

I second the motion.

Are there any questions on this motion? Then turning to Slide 12. The next item of business to consider is unitholder Proposal #1, set out in Schedule B, the management information circular. Given the format of this meeting, the unitholder that put forward this proposal has agreed to have their introductory remarks and proposal read out by our Chief Legal Officer, Jonathan Boulakia. Jonathan, I would now ask that you read the Proposer's introductory remarks and Proposal #1 as well read Chartwell's response.

Thank you, Mike. Unitholder Proposal #1 is described in Schedule B of the management information circular. I'll now read the introductory remarks provided by IBVM Foundation of Canada Inc. as well as their proposal. I'll also provide Chartwell's response to this proposal. Here's the proposal. Good afternoon. My name is Anthony Schein, Director of Shareholder Advocacy Share. I represent my client, the IBVM Foundation of Canada and our network of institutional investors with more than $70 billion in assets under management. This proposal asks Chartwell to provide shareholders with a greater level of transparency regarding its workforce. Specifically, we request the Board clarifies its oversight responsibilities on human capital management and disclose key workforce metrics that would allow shareholders to assess the merits of workforce programs and related investments. As a long-term care and retirement home operator, Chartwell is in the business of caring for people, particularly our elders. And like most care based businesses, the primary input of the business is people, the nurses, personal support workers, occupational and physical therapists, cooks, nutritionists, dietitians and cleaners, who care for our parents, grandparents and loved ones. At least 51 homes operated or owned by Chartwell have reported outbreaks of COVID, resulting in at least 393 resident deaths. The Canadian Armed Forces Ontario's long-term care COVID-19 commission report and the Ontario Auditor General have extensively documented that deficiencies in management of the workforce are substantially responsible for the devastating death and suffering during the pandemic. Insufficient staffing levels, inadequate training, unsafe working conditions, the high proportion of part-time and contingent workers and low wages all have adverse impacts on standards of care. Chartwell and the entire sector are at a pivotal turning point. The business is under unprecedented scrutiny. Chartwell and its investors are left exposed to significant legal, operational and reputational risks. The scrutiny has intensified in the last year but the issuers -- the issues are not new. As such, it is particularly surprising and disappointing that the Board has failed to address these concerns. It is critical for Chartwell to provide greater transparency vis-à-vis its workforce to allow investors to assess the risks and challenges it faces in its human capital management and the merits of its programs and related investments. The harrowing impact of the pandemic is, in part, a result of the prior decisions that boards and management have made about employment, workforce structure, risk management, training and priorities for capital expenditures. As the Board chair for 18 years, Michael D. Harris must be accountable for this state of affairs. Fellow shareholders, I urge you to vote yes on Proposal #1. Respectfully submitted, Anthony Schein, Director of Shareholder Advocacy, May 14, 2021, East York, Toronto, Canada. And now I will provide Chartwell's response to that proposal. Our response is as follows. Our ability to attract, engage, train, develop and retain employees is critical to the success of our business. Only highly engaged employees can deliver on our unique value proposition to our customers, which is an exceptional customer experience that is personalized and feels like home. We recognize the ability of our unitholders to understand the initiatives and actions we undertake to manage our human capital is important in their evaluation of our performance, and their investment in Chartwell's future. That is why we significantly enhanced our human capital management disclosures in this year's management information circular. The desire to deepen our understanding of our workforce and improve our ability to make data-informed decisions drove us to embark on a multiyear implementation of a sophisticated human capital management system. The first and most complex phase of the implementation being a payroll transition for our 16,000 employees was completed in 2020. This additional data allowed us to enhance our disclosures. Examples of our enhanced disclosure include specific reference to the Board oversight of risk management and how human capital management risk is integrated in our enterprise risk management program. Our commitment to a fully inclusive culture and equity and hiring decisions, an integrated approach to talent management and development and succession planning and statistics where applicable and where applicable trends on things like length of service, gender diversity, employee engagement, health and safety, unionization rates, participation in training and development programs and internal promotion rates for key positions. We believe that this enhanced disclosure addresses this unitholder proposal. Chartwell is committed to continued transparency with respect to our human capital management.

Thank you. Are there any questions on the proposal?

No.

Then the last item of business to consider is unitholder Proposal #2, set out in Schedule B, the management information circular. Similarly, the unitholder that put forward this proposal has agreed to have their introductory remarks and their proposal read by Jonathan. Jonathan, I would now ask you that you read the proposer's introductory remarks, and Proposal #2 as well as Chartwell's response to this proposal.

Thank you. Unitholder Proposal #2 is described in Schedule B of the management information circular. I will now read the introductory remarks provided by Vancity Investment Management Limited on behalf of IA Clarington Monthly Income SRI Class fund and their proposal. I will also provide Chartwell's response to this proposal. The following is Vancity Investment Management statement. The COVID-19 pandemic has disproportionately impacted the long-term care sector with staff carrying the substantial burden of providing care to vulnerable residents, while facing hazardous exposure to the deadly virus and financial vulnerabilities. In LTC, the majority of care for residents is provided by health care aids. Aids represent up to 90% of the direct care workforce tend to be women and speak English as their second language. They also tend to be some of the lowest compensated workers at LTC sites. Prior to COVID-19 and the implementation of single-site work orders, it was not uncommon for care aids to work in multiple LTC facilities to make financial ends meet. In the first year of the pandemic, the Canadian LTC sector experienced 80,000 infections, which included 23,000 staff members and over 14,000 deaths, including 28 staff members. This mortality figure represents more than 2/3 of Canada's overall COVID-19 death rate. While these devastating outcomes of the virus may be attributed to the unprecedented nature of the pandemic and insufficient government oversight, we believe there is a direct link between staff working conditions and resident care. While many provinces have taken steps to temporarily increase compensation and benefits to stabilize the LTC workforce during the pandemic, companies must explore long-term sustainable strategies by raising employment standards to protect its employees and residents. We believe socially responsible companies contribute to the economic well-being of communities by providing employment at rates that reflect the true cost of living by paying out living wage. Unlike the minimum wage, the living wage is a voluntary pay rate commitment. Over the past decade, public campaigns have evolved to ensure the lowest paid workers and contracted service employees receive sufficient wages to meet basic needs and support families. These wages are defined as living wage and are set at an hourly rate calculated on a metropolitan regional or provincial basis. The rate is calculated annually and is based on the market basket of expenses, including clothing, shelter, transportation, food, childcare and other basic household expenses. The living wage does not provide allowances for savings, vacations or retirement planning. It is simply the wage required to make basic ends meet. The direct benefits of paying a living wage include healthier employees working reasonable hours without juggling multiple jobs, reduced risk of disease spread to vulnerable residents, staff retention, positive corporate reputation, increased productivity and improved staff morale. The indirect benefits include increased social capital and sustainable economic growth. In an era where excessive executive compensation and bonuses are readily challenged by concerned investors, paying a living wage would demonstrate Chartwell's investment in its workforce, its residents and its community. We believe readily available preexisting company compensation data would provide a factual basis to evaluate how fair the company's compensation policies are and is an efficient use of company resources as it would assure shareholders the company is a responsible employer. Therefore, we propose the Board of Directors undertake a review and report to shareholders by December 31, 2021, on the feasibility, costs and benefits of Chartwell Retirement Residences, implementing a living wage policy, covering employees, suppliers and contractors. I will now provide Chartwell's response, which is as follows. Our job is to balance interest of all our stakeholders, residents, families, employees, lenders, unitholders, suppliers, communities in which -- and communities in which we operate. At times, these interests diverge. All stakeholders' interests are aligned around Chartwell's success so that we can continue to provide much-needed care and services to our residents, peace of mind to families, safe and rewarding employment to employees and benefits to the communities in which we operate and reasonable returns on invested capital to lenders and unitholders. Our compensation process is complex and comprehensive. It is and must remain flexible enough to ensure employees are fairly compensated and that we are able to maintain our competitive position and adapt to changes in our sector, such as government funding or other market conditions so that our services remain affordable to our customers. Adopting a living wage policy would remove such flexibility. 80% of our employees are represented by unions. The collective bargaining framework ensures that employees are compensated fairly based on their regional comparators. In circumstances where certain jobs are determined to fall below such regional comparators, we routinely implement larger percentage increases to ensure improved alignment with such comparators. We work with 20 unions across the country and maintain strong working relationships with them. In 2020, we achieved over 50 voluntary settlements with our union partners. Our employees choose to work for Chartwell because we provide fair compensation, safe and rewarding work environment with opportunities for career progression. This is evidenced by our average length of service being 5.4 years for all employees including casual and part-time and retirement residences and 7.5 years in our long-term care residences. Further, full-time care positions have an average length of stay of over 12 years. Finally, our employee engagement scores have been increasing over the years and, on average, exceed those of our peers.

Thank you, Jonathan. Are there any questions on this proposal?

No.

Then please turn to Slide 13. As we mentioned, voting today will be conducted by electronic ballot, which has been opened since the start of the meeting for registered holders and appointed proxy holders. The polls are still open. Please register your votes by accessing the voting page and selecting the for or withhold buttons next to the name of each proposed trustee and Director and next to the resolution with respect to the appointment of KPMG as Chartwell's auditor. Turning to Slide 14. Please register your votes by selecting for or against next to each of the following resolutions. To confirm and ratify Chartwell's deferred unit plan, to confirm and ratify Chartwell's unitholder rights plan, the advisory resolution on executive compensation, unitholder Proposal #1 and unitholder Proposal #2. We will provide registered shareholders and duly appointed proxy holders approximately 1 more minute to complete the electronic ballot. [Voting]

I will now direct that voting be closed. As the electronic balloting closes, the voting page will disappear and your votes will be automatically submitted. I would ask that the scrutineer tabulate the results of voting on all business matters. We will disclose the official voting results shortly after this meeting. However, based on the proxies we have received to date, I have a preliminary report from the scrutineer with respect to each of the motions voted upon at the meeting, and I could now confirm the results of your votes today. On the first motion, the election of trustees of Chartwell, the scrutineer reports that each of the 3 nominees has been elected. Therefore, I declare Lise Bastarache, Ann Davis and Huw Thomas were duly elected as trustees of Chartwell Retirement Residences to hold office until the next Annual Meeting or until their successors are elected or appointed subject to the provisions of Chartwell's declaration of Trust. On the second motion, the nomination of trustees of CSH Trust, the Scrutineer reports that each of the 3 nominees has been elected. Therefore, I declare the trustees of Chartwell are hereby directed to vote the units of CSH Trust held by Chartwell in favor of the election of Mike Harris, André Kuzmicki and Sharon Sallows as trustees of CSH Trust. On the third motion, the nomination of Directors of Chartwell Master Care Corporation, the scrutineer reports that each of the 9 nominees has been elected. Therefore, I declare the trustees of Chartwell are directed to vote the common shares of Chartwell Master Care Corporation held by Chartwell in favor of the election of Lise Bastarache, Brent Binions, Ann Davis, Mike Harris, André Kuzmicki, Sharon Sallows, James Scarlett, Huw Thomas and Vlad Volodarski as Directors of Chartwell Master Care Corporation. On the motion to appoint auditors, I declare KPMG LLP have been appointed auditors of Chartwell in accordance with the motion and that the trustees of Chartwell are authorized to fix their remuneration. On the motion to reconfirm and ratify the deferred unit plan, the scrutineer reports that the resolution has been approved by a majority of votes cast by the unitholders represented at this meeting. Accordingly, I declare the resolution carried in accordance with the motion. On the motion to reconfirm and ratify the unitholder rights agreement, the scrutineer reports that the resolution has been approved by a majority of votes cast by the unitholders represented at this meeting. Accordingly, I declare the resolution carried in accordance with the motion. On the advisory resolution on executive compensation, the scrutineer reports that the resolution has been approved by a majority of votes cast by the unitholders represented at this meeting. Accordingly, I declare the resolution carried. On unitholder Proposal #1, the scrutineer reports that the resolution has been voted against by a majority of votes cast by the unitholders represented at this meeting. Accordingly, I declare the resolution not carried. On unitholder Proposal #2, the scrutineer reports that the resolution has been voted against by a majority of votes cast by the unitholders represented at this meeting. Accordingly, I declare the resolution not carried. The official voting results will be available on sedar.com following today's meeting. The formal business of the meeting is now concluded. As there is no further business with the consent of the meeting, I now terminate the meeting, and I hand it over to Vlad to make some remarks about Chartwell's operations. On behalf of the Chartwell, I want to thank you all for attending today's meeting.

Thank you, Mike. I will now make some remarks about the operations of Chartwell, which will be followed by a general question period. [Operator Instructions] I would like to remind you that questions, which were already answered or that are redundant, repetitive or inappropriate will not be published nor answered. Let me remind everyone that during this call, we may make statements containing forward-looking information and non-GAAP measures as featured on Slide 16. I direct you to our MD&A and other securities filings for information about the assumptions, risks and uncertainties inherent in such forward-looking information and details of such non-GAAP measures. More specifically, I direct you to the added disclosure in our 2020 MD&A under the heading COVID-19 business impact and related risks for discussion of risks and uncertainties related to the COVID-19 pandemic. These documents can be found on our website or at sedar.com. Turning to Slide 17. I'd like to begin with thank you. These words have been said thousands of times over the past year, yet they cannot be said enough. Chartwell's people from our frontline staff to residents management teams to our regional and corporate support teams have and continue to demonstrate personal courage, dedication and commitment to what our company stands for, making people's lives better. Nothing speaks better to this than their individual stories. From Sarah, who quit her job at the hospital to come back to her long-term care home to help them out through an outbreak. To Lisa and 17 corporate team members who volunteered to support our homes through their most challenging outbreaks, staying in hotels for weeks and months to keep their loved ones at home safe. To Brenda, and many others in our people team who worked around the clock, 7 days a week to stabilize staffing in our homes hardest hit by the outbreaks. To Lucy and our care teams who worked day and night with various public health authorities and our on-site care teams to interpret the ever-changing directives and ensure timely implementation to save lives. There are thousands of these stores, each 1 deserving to be told many times over. 18 of our corporate team members volunteered to provide leadership and on-site support in our long-term care homes that suffered the most severe COVID-19 outbreaks. These people took personal risks to help our homes in their fight against this most highly transmissible and deadly virus to provide services, care, support and compassion, to the residents at a time where they needed it the most. In recognition of their extraordinary efforts, as shown on Slide 18, we are preparing an e-book featuring these heroic individuals as well as 20 of our frontline employees who went way above and beyond in serving our residents. Individual stories of these extraordinary people are being shared over the course of 2021 in our social media channels, and I strongly encourage you to follow these. Moving to Slide 19. We note that throughout the pandemic, our employees' focus has always been on the safety and well-being of our residents and their families. They have been doing all they could to fight this pandemic and save lives. Despite their best efforts, some of our residents have succumbed to this terrible virus. Every one of these deaths is 1 too many, and our thoughts are with the families of those who lost their loved ones. The toll the crisis exerted on our people is enormous. I know many are tired physically, mentally and emotionally. Now that most of our residents and staff are vaccinated and case counts in our homes have been declining, we must take time to reflect and heal together. We have put in place several mental health initiatives for our residences and corporate teams, making resources available to overcome the impact of this crisis. We know that only highly engaged employees can deliver exceptional personalized experiences to our residents and their loved ones. Our employees choose Chartwell because they know here, they do meaningful rewarding work that makes a tremendous difference in people's lives. They do this work in a safe, positive and supporting environment with opportunities for training, professional and personal development and career growth. We pay competitive fair wages, offer good benefit packages or pay in lieu of benefits for part-time employees, vacation and paid sick days entitlements. We believe our approach to employee engagement, which encompasses all these factors allows us to attract and retain people who are dedicated to their customers, to their teams and to Chartwell. This is supported, among other things, by our employee average length of service. As can be seen on Slide 20. The average length of service for all employees is 5.4 years in our retirement residence, 7.5 years in our long-term care residences. The longest average length of service is in full time, long-term care positions, which is over 12 years. Turning to Slide 21. We measure employee engagement annually through a survey conducted by a third party, the U.S.-based Sensight surveys. Sensight has been conducting resident and employee satisfaction surveys, exclusively for the senior living industry for 20 years. Sensight clients currently operate 723 communities in the U.S. and Canada. In monitoring our employee engagement, we have always focused exclusively on top box, 5 out of 5 score, representing strongly agreed employees. We know that these highly engaged employees are more likely to be our ambassadors and recommend Chartwell as a place to work to others. Our strongly agreed score in 2020 was 44%, a 2 percentage points increase from 2019. Many other organizations track combined strongly agree and agree scores. Our combined strongly agree and agree score was 80% in 2020. Sensight reported that since 2017, Chartwell combined scores have been consistently higher than their senior living industry averages. According to Sensight, there was only 1 other senior living organization amongst their client group who conducted an employee engagement survey in 2020. Gallup, a large U.S.-based management consulting company regularly surveys our over 100,000 business units in the country measuring their employee engagement. In their 2020 survey, they reported a 40% employee engagement score compared to 35% in 2019. While these results are not directly comparable to Sensight's, they are indicative of the level of engagement of employees in the U.S. We are committed to continue to build engagement of our employees through fair compensation practices, safe and supportive work environment, training, development and career growth opportunities. Moving to Slide 22. We established a robust system of learning, development and succession planning. In addition to the mandatory training for our residents employees, our learning and development team delivered over 12,000 person hours of education and leadership development to our employees with almost 3,000 of our employees participating in our proprietary Chartwell experience training, 44 employees participating in Gateways, a training program for our new general managers and administrators and 18 employees completing our Aspiring Leaders Program for high potential residence managers, who aspire to become general managers or administrators. Our L&D team converted the majority of its training materials for online delivery, including virtual classes and self-learning modules. As a result of this tremendous work, we now will be able to reach even more of our employees with our innovative training programs. As set out on Slide 23, the focus on employee development resulted in a strong record of promoting from within. I'm especially proud to see that over 50% of our general managers and administrators as well as nearly 70% of our Directors of Regional Operations and Director of Regional Sales came up the ranks working at Chartwell Homes. We believe this ongoing focus on growing our own leaders is extremely important in establishing our competitiveness as an employer of choice in our industry. Turning to Slide 24. Various mandated restrictions on visitation, dining services and other activities implemented for our residents' safety impacted the quality of their lives and cost significant hardship to them and their families. Our staff demonstrated immense ingenuity, coming up with new ways to keep residents engaged and even entertained during these restrictions from parking lot concerts to hallway bingo and happy hours. There are countless examples of such engagement. Even when our residents could not be with their loved ones, they were always surrounded by our caring and compassionate staff and they were never alone. As set out on Slide 25, in the summer of 2020, I conducted 12 virtual sessions with our residents and family members across the country. Their feedback received from these virtual calls, combined with the feedback we received through our resident and family surveys as part of our Listening to Serve You Better program was used to better prepare for the next waves of the pandemic and for the future. In addition, throughout the last year and into this year, I have numerous conversations and correspondence directly with individual residents and family members. Amazingly, even when the calls were about things people wanted us to correct or improve, our residents and family members have always made a point of thanking our employees and praising the services and care they received. It was no surprise that 96% of residents and 95% of family members who responded to our survey stated that Chartwell took important measures to ensure their safety and 94% of family members felt their loved ones were safe at Chartwell. Turning to Slide 26. From the early days of the pandemic, we mobilized our critical incident commands, cross-departmental groups of people working together to support our residences. The corporate CIC team supported our office employees in their transition to work from home. Operation CIC has been meeting twice daily, 7 days a week in the first 3 months of the pandemic, and they worked to interpret ever-evolving and often conflicting public health and government directors and guidelines. They oversaw tremendous recruitment effort, which resulted in over 7,000 new hires since the beginning of the pandemic in 2020. At high point, we had over 60 corporate employees involved in our recruitment efforts. We sourced and delivered to our homes over 15 million pieces of personal protective equipment, overcoming the disruption of worldwide supply chains and heightened demand for this product across the world. We provided 24/7 nursing hotline support, implemented technology solutions, including those for keeping our residents engaged with their families and their doctors during the times of isolation. We established high-frequency communications with our residents, families and employees and responded to media requests and concerns and worked with governments and industry associations to influence important policy decisions for the benefit of our residents and employees. This rapid, decisive and well-organized response, save lives. It also demonstrated the strength of our corporate culture, our experienced team and the critical importance of a strong national management platform. I want to especially comment our Ontario long-term care team. This team has been caring for residents who are most vulnerable to this virus. They certainly have been on the front lines of this fight. It is because of their tremendous efforts, exceptional commitment to their residents, their deep expertise in the sector, and their open and transparent collaboration with their health system partners that at no time, the Chartwell require government intervention in our long-term care operations through voluntary or mandatory management contracts or assistance of the Red Cross or of the Canadian Armed Forces. While dedicating all required resources to the pandemic management, we continued building a foundation for future success at Chartwell, as shown on Slide 27. One of the highlights of 2020 was the completion of the Phase I implementation of our new human capital management system. This multiyear, extremely complex project resulted in the successful conversion of all of our 16,000 employees to our internal payroll system. This system enables us to improve consistency and efficiency in our payroll processes and provides us much better information about our employees. This information will enable us to make better decisions in recruitment, on-boarding, compensation and development and has already allowed us to enhance our human capital management disclosures in our management information circular. The second phase of the implementation, the recruitment and on-boarding module of this system is underway in 2021 with the learning and performance management modules implementations planned for future years. Moving to Slide 28. I am proud that Chartwell has taken further steps strengthen its diversity and inclusion practices. We have been recognized as 1 of the leaders in gender diversity. At Chartwell, almost 56% of our senior leaders, people in the positions of Senior Director and hire are women. In 2020, we developed our diversity and inclusion framework and established our first ever diversity and inclusion leadership council with a diverse representation from our residences and various corporate departments. This newly-formed council chaired by Jonathan Boulakia, our Chief Legal Officer and Chief Investment Officer, will have an oversight responsibility for the implementation of this framework. They have been hard at work and several initiatives to further our DI practices have already been put in motion. Since 2015, we've raised more than $850,000 for Wish of a Lifetime Canada, resulting in over 135 wishes being granted to deserving Canadian seniors, as you can see on Slide 29. In 2020, we became a founding partner of the Senior Living CaRES Fund inspired by the heroic efforts of long-term care and retirement residence employees, most especially during the COVID-19 pandemic. The CaRES Fund offers onetime grants for up to $10,000 for urgent financial needs of the sector's employees. Chartwell donated $775,000 to the fund including a $225,000 contribution by our directors in 2020. In 2021, we donated another $100,000. To date, the fund has raised and distributed nearly $2.5 million to over 750 deserving sector employees and their families. As shown on Slide 30, we continue to be one of the country's leaders in board governance, placing 6 in the 2020 Globe and Mail Board game program. We have been active in our outreach to our institutional investors, conducting over 100 meetings over the course of 2020, covering topics like our pandemic response, financial and operating results and ESG matters. Our Board continues to be focused on its renewal with 3 longest tenure directors announcing their intent not to stand for reelection in 2022 and 2023. Our 2020 financial results found on Slide 31, have been significantly impacted by the pandemic. Our occupancies declined significantly, resulting in a $35.7 million loss of revenue compared to 2019. In addition, investments in additional staffing, PPE and supplies to ensure residents and employee safety during the pandemic exceeded government support by $7.3 million in 2020. This resulted in an 8.8% decline in same-property adjusted operating income and a 17% decline in our funds from operations. Increased government-imposed restrictions during the second and third waves of the pandemic continued to impact our occupancies in early 2021. With vaccination rates increasing amongst our residents and staff and in the general population, these restrictions have begun to ease in some provinces and the pace of occupancy decline slowed down in May, as you can see on Slide 32. Over the years, we built Chartwell into a strong and resilient company with prudent debt levels, low distribution payout ratios, long-term debt maturities and strong relationships with our investors, lenders and joint venture partners. We did so that Chartwell could sustain and persevere in crisis. Throughout this 14 month-long pandemic, this solid foundation allowed us to maintain strong liquidity and our distributions to unitholders, while meeting our obligations to our employees, suppliers, lenders and communities where we operate. We will continue to exercise this prudence in our capital allocation and investment decisions going forward as we rebuild our occupancies and profitability. The current negative sentiment towards congregate living is a reality. Turning to Slide 33. Most people when asked would say that they prefer to age in their own homes. This sentiment, while not new, has been exacerbated by the pandemic and the negative media surrounding congregate living. I believe it will be short-lived. It is also clear that more people now understand the difference between long-term care and retirement living. People who do live with us tell us things like these are best 5 years of my life. I wish I had moved here 5 years earlier or I'm not going anywhere, this is my home. This last quote is, by the way, from our resident who won $4.5 million in the lottery. Our challenge continues to be to make these voices heard widely in the society. We serve only 18% of people over the age of 75 in Québec and 5% in Ontario with Alberta, and BC capture rates being 6% and 8%, respectively. There are tremendous opportunities to make more lives better by bringing more of these people to our residences. Most of the people come to us because they need assistance with activities of daily living, either now or foresee that need shortly. That need did not go away. On the contrary, I believe it has been exacerbated during the pandemic, and retirement residences will continue to play an important role in fulfilling that need going forward. The population of the people over the age of 75 is growing fast. In 2022, it is projected to grow by 5.3%. That means that in the 4 provinces in which we operate, 12,000 new suites will need to be built annually to keep up with the demand. This is a 50% increase from the 2019 levels. I know we have been talking about this expected growth and demand for a long time. The difference this time is that it is a year away. This robust growth in the seniors population is projected to continue for the next 20-plus years. At the same time, as you can see on Slide 34, new construction starts have declined significantly during the pandemic, which will result in fewer new home openings in 2022 and 2023. Construction starts as a percentage of inventory declined to 1.3% in 2020 from 3% in 2019, which has already been lower than 2016 and 2018 levels of 4.4% and 4.9%. This, combined with the growing demand, should support our occupancy recovery and growth in the future. Despite the impact the pandemic has on our business, I remain optimistic and excited about Chartwell's future. The growth in the seniors population and the decline in new construction starts are certainly important positive trends for our business. What gives me the most optimism, though, is the knowledge that Chartwell's people and Chartwell's culture have not only persevered through the most challenging crisis we've faced in our lifetime, but they also become stronger because of it. Moving to Slide 35. I'd like to say to our residents. Thank you for choosing Chartwell for the next chapter of your personal life story. We are honored to serve you and are committed to delivering exceptional personalized experiences to you in our residence. To my partners on the senior executive committee, every day, I feel privileged to be working alongside such dedicated and talented leaders. Thank you for your support, challenge and inspiration. To my fellow directors, thank you for your unwavering support and vice counsel, always and especially during this -- my first year as the CEO. To our lenders and unitholders. In over 100 meetings I had with you over the course of the last year, not 1 went without you asking and acknowledging the tremendous work of our people and asking me to pass your appreciation to them. I did this every time. We know that we can only deliver on our promise of making people's lives better if we have access to capital in good times and especially in challenging times. You've been there for us through this enormous crisis, and we are grateful to you for that. We will continue to treat your investments with utmost care and respect they deserve. Most importantly, to Chartwell people, from our residences team to our regional and corporate office staff. Words cannot describe my gratitude to you for what you have done and continue doing for your residents, their families, for each other and for your communities. Thank you for everything. We'll now be pleased to answer any questions you may have.So the first question is from a unitholder, John Sharp. The question is you stated that you have 16,000 employees and hired 7,000 in the last year. How do you get your high retention numbers with that type of turnover? Thank you for the question. Last year was challenging on many different levels, and particularly when it comes to employment. With the single-site orders, the employees who worked at different communities had to choose where they have to go because they were limited to working in 1 community. In addition, we had a number of instances where people either were sick with the COVID or were afraid to come to work for a period of time because of the pandemic. And through the tremendous effort of our recruitment team and our operations teams, we were able to replace and stabilize staffing situations in our homes quickly, and that certainly helped us to manage through these outbreaks. Many of them were very challenging. So that plays into the number of hires that we had to do last year. I would expect that, that number will be coming down over time as we stabilize situation in our homes as this pandemic gets to its end. Are there any other questions? I'm not seeing any other questions. Just give another minute. We do not have any other questions. So I'd like to thank everybody for your participation and your attention this afternoon. Have a great evening.

This concludes the meeting. Thank you. You may now disconnect.