Sun Life Financial Inc. (SLF) Earnings Call Transcript & Summary

Okay. Before we get started, I'd like to reflect on the many heartbreaking discoveries of unmarked graves found on the grounds of former residential schools in Canada starting last year. It's a stark reminder of the systemic oppression, inequalities and discrimination that indigenous people have endured over the past years, decades and even centuries, and the injustices and challenges they continue to face today. As a Canadian and a global citizen, I'm compelled to learn more about this part of our history, face it and understand the long-lasting and multigenerational impact. I make a conscious effort to not only look back at Canada's history of genocide and colonialism, but also to reflect on the way these forces are still at play today and the critical work of reconciliation that remains to be done. With that, I would like to acknowledge the land and consider the indigenous nations of whom we share territories and responsibilities. I'm speaking from Toronto, which is on the traditional territory of [indiscernible] Huron-Wendat, Anishnaabeg, Haudenosaunee Confederacy and the Mississaugas of the Credit First Nations. Today, Toronto is still the home of many indigenous First Nations, Inuit and Métis people from all across [ Toronto Islands ]. We are grateful to have the opportunity to work and present in this territory. We also offer this acknowledgment as a stepping stone towards honoring the original occupants, a testimony to the oppression faced by indigenous people and our commitment to the indigenous communities and employees of Sun Life.

Thank you for that, Kevin, and good afternoon, everyone. My name is Bill Anderson. I'm the Chair of your Board of Directors, and I'm pleased to extend a warm welcome to all of you. As the notices of the meeting have been duly given and a quorum is present, I call to order the Annual Meetings of Sun Life Financial Inc. and its wholly owned subsidiary, Sun Life Assurance Company of Canada. We are indeed living in extraordinary times. And to get through times like these, you need an extraordinary team on your side. But Sun Life is the determination, commitment, resilience and actions of our employees and advisers who have been there for our clients, helping them create the best of times and helping them through the worst of times. In 2021, Sun Life achieved strong financial performance and delivered long-term value for our shareholders once again, against the backdrop of a pandemic. Our diversified business model, combined with robust risk management and a disciplined approach to capital allocation, has remained tried and true throughout Sun Life's history and once again proved to be a competitive advantage and a strength in 2021. Some of our highlights from last year include strong performance, with reported net income and underlying net income up 64% and 10%, respectively, over the previous year. Both insurance and wealth sales were up, with our assets under management increasing to over $1.44 trillion, an increase of 15% over 2020. We continue to trend well on our medium-term financial objectives against our targets, resulting in 14.2% underlying return on equity, 10% underlying earnings per share growth and a 40% underlying dividend payout ratio on a 5-year basis. In addition to this strong financial performance, Sun Life managed more than 10 strategic capital transactions in 2021. Details of these transactions are included in our annual report. And last month, we added another strategic capital transaction when we deepened and extended our partnership with CIMB Niaga in Indonesia. We also reinforced our commitment to delivering shareholder value by immediately increasing our common share dividend by 20% when OSFI lifted pandemic restrictions on dividend increases for regulated financial institutions. Our strong results have always allowed us to effectively deploy capital in line with our capital management philosophy, enabling significant investments in our digital capabilities, including offering virtual health care and new online products. We've also been able to accelerate our sustainability journey, making commitments like our goal to achieve net zero greenhouse gas emissions by 2050 or sooner. As both an asset manager and an owner, we set a target to invest an additional $20 billion in sustainable investments and achieve carbon neutrality across our global business operations. These investments and actions contribute to our client impact strategy. Diversity, equity and inclusion remain integral to our sustainability plan, and we are making meaningful progress towards achieving our 2025 diversity targets. This also extends to our Board of Directors. I'm proud of the broad range of business and strategic expertise we have added to our Board the past year with the addition of Deepak Chopra, David Ho, Helen Mallovy-Hicks and Marie-Lucie Morin. This past year, we've been included on several prestigious lists, including the Global 100 Most Sustainable Corporations in the World for the 13th consecutive year, which is quite an accomplishment. Earlier this year, we became Great Place to Work Certified in Canada and the U.S. for the first time and renewed our certification for the second and fourth year in our Asian service center in the Philippines and India, respectively. We're especially proud of this recognition as it is based on what employees have to say about their workplace and their experience in Sun Life's inclusive culture. The Board and I continue to be inspired by how Sun Lifers have shined during these extraordinary times, taking care of our clients while balancing their own well-being. On behalf of the Board, thank you to Kevin Strain and the Sun Life executive team for their leadership as they continue to navigate our company through these extraordinary times. Our focus on meaningful client impact and the key areas that will help us get there, including digital leadership and sustainability-driven actions, will keep Sun Life in a position of strength and give the company a competitive advantage. Just before we move on to the business of the meeting, I would like to note that I will retire after the Board following this annual meeting after 12 years as a Director, 5 of which I have had the honor to serve as Chair. I'm very proud of Sun Life. It has been a pleasure and a privilege to serve on the Board. And I would like to thank my fellow directors and the executive team and all of Sun Life's employees and advisers for their partnership, their support and dedication. We put clients at the center of everything we do, from strategy to day-to-day decision-making. Our purpose, to help our clients achieve lifetime financial security and live healthier lives, has allowed Sun Life to consistently deliver for all of our stakeholders. It's a powerful purpose that connects every Sun Life employee, whether they work in Jakarta, Indonesia, Waterford Island or in Waterloo, Ontario. Now with that, I will move to deal with some procedural issues and have a drink first. Similar to last year, our meeting is being held in a virtual-only format and is being recorded. I invite you, our registered shareholders, voting policyholders and duly appointed proxy holders to submit questions and vote on each of the matters of business as if you were attending our meeting in person. Our continued goal is to provide an experience similar to our usual meeting format. In accordance with Sun Life's bylaws, I will chair the 2 meetings. Also with me are Kevin Strain, President and Chief Executive Officer; and Troy Krushel, Vice President, Associate General Counsel and Corporate Secretary. Troy will act as Secretary of the meeting. We are broadcasting from Sun Life headquarters in Toronto, and are following appropriate health and safety protocols as we are all physically distanced from each other. Although Kevin, Troy and I are the only people you will see and hear from, also joining us remotely are our other directors and members of our executive team and senior management. I will now outline today's proceedings and go through some procedural matters for the virtual platform. We are holding 2 annual meetings today: the Annual Meeting of Common Shareholders of Sun Life Financial; and the Annual Meeting of Voting Policyholders and the Sole Shareholder of Sun Life Assurance. There will be 2 sets of formal business, one for each company. After all of the votes are taken, Kevin will provide an update on Sun Life's business progress and the company's future and its priorities. A joint question-and-answer period will be held after the formal portion of the meeting has been completed. We will conduct the business of Sun Life Financial first and then Sun Life Assurance. As for the physical meeting, only registered shareholders, voting policyholders and duly appointed proxy holders who have standing at the meeting will be able to address the meeting and submit questions during the formal conduct of business. You can submit a question anytime during the meeting by clicking on the messaging icon on the platform and following the instructions. To allow us to address your question at the appropriate time of the meeting, please submit your question and comments as early as possible. And when submitting a question, please identify whether it relates to a motion being considered as part of the formal business or whether it is more general in nature. As with our in-person meeting, please keep your questions and comments brief. Troy, our Corporate Secretary, will receive the questions and read them out at the appropriate time, and Kevin or I will address them. Each item of business will be open to submit questions or comments before a vote is taken. If your questions do not relate to items of business on the agenda, they will not be addressed until the joint question-and-answer period at the end. We will also observe the same protocol of appropriateness and relevance to the meeting. Rest assured, we will not be attempting to limit or filter legitimate questions, and we will do our best to address all of the issues raised. In an online format, we may receive questions of a similar nature or theme. And your specific question may be paraphrased in the interest of efficiency and addressing as many questions as possible. Now similar to last year, registered shareholders, voting policyholders and proxy holders who wish to vote at the meeting will be able to vote on each motion by online poll instead of in-person ballot. As in past years, the vast majority of all votes were cast in advance of the meeting by proxy through the various available channels, with only a small number opting to vote their shares at this meeting. On a poll, every shareholder entitled to vote on the matter has 1 vote in respect of each share entitled to be voted and held by that shareholder, and every voting policyholder has 1 vote. The poll will be open for all resolutions at the same time. This will allow you to choose to vote on each resolution immediately or wait until the conclusion of the questions or comments submitted on each resolution prior to casting your vote. You may vote at any time until the last item of business has been put to a vote and I declare that the voting is closed. Most importantly, if you have voted in advance of the meeting and do not wish to revoke your previously submitted proxies, then you do not need to do anything. Once the poll is closed, the preliminary results of votes cast and proxies received prior to the meeting will be provided to Troy, and he will read them out at the meeting, and the final results will also be posted on our website. To facilitate proceedings, since the meeting is conducted in a virtual-only format, I've asked Troy, who is also a shareholder and duly-appointed proxy holder, to move all of the motions, and I will call on him at the appropriate time. I now appoint TSX Trust Company by its representatives, Pat Lee and Jennifer Andersen, who are joining us remotely to act as scrutineers for each of the meetings. I have preliminary attendance report of the scrutineers, and there are 7,497 shareholders holding 329,107,074 common shares of Sun Life Financial represented by proxy. This represents 56.2% of the issued and outstanding common shares as of the record date of March 18, 2022. There are 4,237 voting policyholders of Sun Life Assurance represented by proxy, and this represents 17.6% of the voting policyholders who asked to receive the materials for this meeting as of the record date of March 18, 2022. The full shareholder of Sun Life Assurance, being Sun Life Financial, is represented by proxy. A quorum is present for each meeting, and I declare these meetings to be properly constituted and declare the polls open on all resolutions. Our auditor, Deloitte LLP, is represented virtually today by Tony Caruso and Margaret Tang. Copies of the auditor's report and annual financial statements of Sun Life Financial were published and sent to shareholders who requested them. We would be pleased to take any questions on the annual financial statements of Sun Life Financial at this time. An opportunity to submit questions about the annual financial statements of Sun Life Assurance will be provided later in the meeting. Please hold questions unrelated to the annual financial statements for the general question period. Troy, are there any questions or comments from participants with respect to the annual financial statements?

Chair, there were no questions or comments on the annual financial statements.

Thanks. We will now proceed with the election of directors of Sun Life Financial. We have 2 new directors standing for election for the first time at the meeting today. Helen Mallovy-Hicks and Marie-Lucie Morin. I know if we were all together, you'd join me in wishing a warm Sun Life welcome to each of them. I would also like to recognize one of our long-time Sun Life Directors, Martin Glynn, who will be retiring after today's annual meeting, having served Sun Life shareholders well for 12 years. It's been a tremendous pleasure to serve with Martin, who has been an excellent director and a contributor in the boardroom. Martin, on behalf of your colleagues, the Sun Life Board, I wish you the very best in the next phase of your life. I will now ask Troy to nominate the individuals proposed for the election as directors.

I'm pleased to nominate the following individuals to serve as directors of Sun Life Financial Inc. until the close of the next annual meeting or until their successors are elected or appointed: Deepak Chopra, Stephanie Coyles, Ashok Gupta, Marianne Harris, David Ho, Helen Mallovy-Hicks, Marie-Lucie Morin, Scott Powers, Kevin Strain and Barbara Stymiest.

Thank you, Troy. The company did not receive advance notice of any other nominations of directors, and therefore, I declare that the nominations are closed. So are there any questions or comments from participants on the nomination?

Chair, there are no questions or comments on the nominations.

Thanks, Troy. Shareholders may now proceed to vote on the election of directors of Sun Life Financial by selecting your choice under your display screen. As a reminder, if you have already voted or sent in a proxy, there is no need to do anything else unless you would like to change your vote. Please vote now. [Voting]

The next item on the agenda is the appointment of our auditor, and I'll ask Troy to make the appropriate motion.

I'm pleased to move that Deloitte LLP be appointed the auditor of Sun Life Financial Inc. until the close of the next annual meeting.

Thank you, Troy. Are there any questions or comments from participants on the appointment of the auditor?

Chair, there were no questions or comments on the appointment of the auditor.

Thanks. Shareholders will now proceed to vote on the appointment of the auditor of Sun Life Financial by selecting your choice on the display screen. Again, if you have already voted or sent in a proxy, there is no need to do anything unless you would like to change your vote. Please vote now. [Voting]

The next item of Sun Life Financial business is an advisory vote on the approach to executive compensation as disclosed in the Management Information Circular. The resolution is set out on Page 23 of that circular. I will now ask Troy to make a motion approving this resolution.

I move that the resolution, the full text of which is set out on Page 23 of the Management Information Circular dated March 18, 2022, be adopted by the shareholders of Sun Life Financial Inc.

Thank you, Troy. And are there any questions or comments from participants on the advisory vote on the approach to executive compensation?

Chair, there were no questions or comments on the advisory vote on the approach to executive compensation.

Shareholders will now proceed with the advisory vote on executive compensation using the online poll. As was the case previously, if you have already voted or sent in a proxy, there is no need to do anything unless you would like to change your vote. Please vote now. [Voting]

We will now proceed with the items of business for the Annual Meeting of Sun Life Assurance. The audited financial statements of Sun Life Assurance were mailed to voting policyholders who requested them. Troy, are there any questions or comments from participants on the annual financial statements?

Chair, there were no questions or comments on the annual financial statements.

The next item of business is the election of directors of Sun Life Assurance. In accordance with the Insurance Companies Act, at least 1/3 of the directors must be elected by voting policyholders only. 4 of the 10, Stephanie Coyles, Marianne Harris, Marie-Lucie Morin and Scott Powers are proposed as nominees for election as policyholder directors. Troy, will you please nominate the individuals proposed for election as policyholder directors?

I'm pleased to nominate Stephanie Coyles, Marianne Harris, Marie-Lucie Morin and Scott Powers to serve as policyholders directors of Sun Life Assurance Company of Canada until the close of the next annual meeting.

The company did not receive advance notice of any other nomination of policyholders, and therefore, I declare the nominations closed. Troy, are there any questions or comments from participants on the nomination?

Chair, there were no questions or comments on the nominations.

Thanks. Policyholders will now proceed to vote on the election of policyholder directors of Sun Life Assurance using the online poll. Again, if you've already voted or sent in a proxy, there is no need to do anything unless you would like to change your vote. Please vote now. [Voting]

I now turn to the election of shareholders directors by the full shareholder of Sun Life Assurance, being Sun Life Financial. 6 shareholder directors are proposed for election. Sun Life Financial has, by written resolution, elected the following shareholder's directors to serve until the close of the annual meeting to be held in 2023: Deepak Chopra, Ashok Gupta, Helen Mallovy-Hicks, David Ho, Kevin Strain and Barbara Stymiest. The next item on the agenda is the appointment of our auditor, and I'll ask Troy to make the appropriate motion.

I'm pleased to move that Deloitte LLP be appointed the auditor of Sun Life Assurance Company of Canada until the close of the next annual meeting.

Thank you, Troy. Are there any questions or comments from participants on the appointment of the auditor?

Chair, there were no questions or comments on the appointment of the auditor.

Policyholders will now proceed to vote on the appointment of the auditor of Sun Life Assurance, again using the online poll. If you've already voted or sent in a proxy, there is no need to do anything unless you would like to change your vote. Please vote now. [Voting]

For those of you who have not voted on all of the resolutions, please do so now as I will shortly close the poll. I will close the polls on all resolutions in 1 minute to allow online viewers to catch up. [Voting]

The polls are now closed. While we await the preliminary report of the scrutineers, Kevin will provide an update on Sun Life's business progress in 2021 and speak about the company's future and its priorities. Kevin, over to you.

Well, thanks, Bill and [Foreign Language]. It's an honor to speak with you today. Our purpose of helping clients achieve lifetime sense of security and live healthier lives has never been more meaningful than in the past 2.5 years. The pandemic has put pressure on both our physical and our financial health as well as our mental health, and it has really driven home the importance of what we do for all of us at Sun Life. As a purpose-driven company, all of our actions for our clients, our employees, advisers and for you, our shareholders and policyholders, are aligned to our purpose. We were hoping to see you in person today at the AGM. However, we find ourselves once again navigating a new wave of the pandemic. The COVID-19 pandemic's deadly toll, social injustice inequities, environmental threats and geopolitical aggressions have redefined our lives and our priorities. These pressures have weighed heavily on all of us mentally, physically and emotionally. We felt isolated during lockdowns and seen great illness and tragic loss of life. To date, Sun Life has paid more than $1 billion in COVID-related claims. Each of these payments is a fulfillment of our purpose. It's about being there for our clients when it matters the most. In many ways, the last few years have left us feeling drained, tired and isolated. However, we've also seen some bright glimmers of light that give us hope. It's been inspiring to see the resilience and adaptability of the human spirit, the way we help families, friends, neighbors and our communities. Our employees exemplify this resilience, adaptability, brightness and hope with the work that we do for our clients in delivering financial health and financial outcomes. In Canada, we're making it easier for our clients with diabetes to live healthier lives through our Diabetes Signature Solutions pilot program. This pilot helps eligible Canadians with diabetes get access to affordable insurance tailored to their needs. It allows clients to secure the best terms possible by reaching specific health goals and provides support through a diabetes management program. While we're still in the early days, this program is already helping our clients. For example, we heard from a young adult who has type 2 diabetes. Because of this preexisting condition, she has never applied for health insurance, assuming she would be declined. Through our Diabetes Signature Solutions pilot, she submitted an application and was approved. She told us the diabetes-related information she received through the pilot has been a big help in supporting her health and wellness. It's even helped her to accept her condition, which she struggled with until she realized how common the diagnosis is for young people and that there's a lot of support available to help her navigate her health journey. Another story comes to us from Malaysia. Our client not only supports herself, but also helps to take care of her elderly parents. When COVID-19 lockdown restrictions had a major financial impact on her income, her adviser reached out with several COVID-19 specific benefits in addition to our regular plan offerings. We were able to offer her a payment bonus on our policy and defer her premiums until she was able to start earning her full income again. These actions not only helped protect her financial security to meet her immediate needs, but also kept her policy in place for the future. As you can tell from these examples, financial security and health are the kernels of every person's aspirations. You've heard from client stories from me now. So how about hearing from one of our U.S.-based clients directly. [ Mika ] shares his experience with PinnacleCare, Sun Life U.S.'s leading health care navigation and medical intelligence provider. [Presentation]

[ Mika's ] story is a great example of supporting health outcomes. We helped him navigate a complicated health care system while delivering a personalized health experience. In late 2021, we introduced our refreshed business strategy with a focus on accelerating our priorities, driving bolder outcomes, and most importantly, having a greater impact on our clients' lives. Driving positive financial and health outcomes are the heart of our plan. Our diversified businesses are what truly make us unique. This brings together asset management, insurance, wealth and health protection across our 4 pillars. All of this helps deliver on our purpose and ultimately reach our ambition to be one of the best asset management and insurance companies in the world. Our strategy is all about delivering client impact. It starts with our company by having an inclusive culture and highly engaged people who are motivated to deliver on our purpose, along with the power of our trusted brand. The core of our strategy is brought to light through digital leadership, sustainability, financial discipline and distribution excellence. These last 2 strategic priorities, financial discipline and distribution excellence are foundational to our success. We continue to emphasize high-quality distribution, focus on the client and their outcomes through our best-in-class adviser channel and through third parties or new innovative channels. Key to our growth is a prudent approach to financial discipline that includes financial performance, risk management and strong capital management. Turning to digital leadership, the pandemic accelerated the need for digital tools and innovation. We've enhanced relationships from in-person to online. We've moved from paper-based to digital, from the office to our homes, and we've taken health care from the waiting room to any room in your home. All of this has made it easier for our clients to do business with us from wherever they are and whenever they want. Digital leadership is about accelerating our capabilities, changing how we work together, and thinking and acting like a digital company. And the proof is there. We are seeing this in our clients' actions. For example, in Asia last year, 71% of new business applications for wealth and life insurance were submitted digitally, up 48% from the year before. And in Canada, we digitally processed over 90% of retail insurance applications and group benefits health and dental claims, and over 80% of retail wealth transactions were done digitally. Virtual health through Lumino and Dialogue has given our Canadian clients access and peace of mind when it comes to their health and health care needs. In 2021, our Lumino Health provider search engine was used over 4.1 million times. We also saw an increase in Sun Life clients looking to use Lumino Health virtual care to access doctors and health care practitioners. More than 0.5 million clients and their families have access to Lumino Health virtual care. In our U.S. business, we launched Benefits Explorer earlier this year. It's an interactive online platform designed to provide personalized live educational content and tools to help clients make meaningful benefits decisions. These are just a few examples of initiatives that are creating exceptional digital experiences and forming strong relationships with our clients while delivering on our health strategy in Canada and the U.S. While the COVID-19 pandemic has defined our lives over the past few years, climate change will define our lifetime for generations to come. The need to make everything we do more sustainable has never been greater. Driving sustainability, another pillar of our strategy, has been at the heart of our efforts for many years now. And to be truly sustainably driven, we believe our plan has to be tied to our purpose. As part of our strategy, we employed Sun Life's first Chief Sustainability Officer, with a mandate to lead company-wide actions and embed sustainable practices across our businesses. We also committed to the goal of net zero greenhouse gas emissions by 2050 or sooner as an asset owner and asset manager. And last year, we also achieved carbon neutrality across our global business operations. We believe we can make the biggest impact in areas that we know best to drive meaningful change by increasing financial security, fostering healthier lives and advancing sustainable investments. In 2021, we've also committed to $20 billion in new sustainable investments over the next 5 years. Our asset management pillar will play a significant role in advancing sustainable investments and increasing financial security. A great example of this is Stellar, our first ESG-focused savings plan in Hong Kong. Stellar actively integrates ESG concepts into its investment strategies, managing risk and optimizing opportunities to assets with a high ESG rating. To develop Stellar, we applied the proprietary ESG Plus framework that belongs to SLC Management, our alternative asset management company. Stellar is a legacy planning tool that enables long-term savings to pass across multiple generations. It supports allocating sustainable investments, including green bonds, renewable energy and energy transition, all made through SLC Management, our affiliate companies, InfraRed Capital Partners and BentallGreenOak, as well as our local investment team in Hong Kong. Stellar pays particular attention to carbon profiles, selectively investing in asset and relatively lower carbon intensity. We're excited about Stellar and the impact it will make towards our sustainability goals. And in the U.S., we entered into an agreement to acquire DentaQuest, one of the largest providers of Medicaid dental benefit,s, serving more than 33 million members. This transaction will be one of the largest transactions in Sun Life history, valued at more than $3 billion. We were attracted to DentaQuest because of its focus on underserved populations and improving access to dental care. This strongly aligns to our sustainability focus of fostering healthier lives. We're looking forward to DentaQuest becoming part of the Sun Life family. We expect this transaction to close in the first half of this year, subject to regulatory approvals. Further to our focus on stable, sustainable business, we continue to make progress towards our 2025 diversity, equity and inclusion goals. This includes gender parity at the VP level and above and having 25% of our senior leaders in North America from underrepresented communities. Overall, more than 59% of our employees across the company identify as women and 35% are VPs or higher. 45% of our executive team identify as women. And after today's meeting, our Board will be at gender parity. In addition to the progress we're making on gender parity, we are putting significant focus on increasing the number of senior leaders in North America from underrepresented communities. We currently have 16% of North American executives who identify themselves as part of an underrepresented community. We're also excited to be a member of the Canadian Council for Aboriginal Businesses, and we're one of the first insurance companies in Canada to begin Progressive Aboriginal Relations, or PAR, certification. I'm proud of the positive social and environmental impact we've had and the work we're doing towards our sustainable commitments. And because our work is far from complete, we continue to find ways to make an impact for all of our stakeholders. We believe that creating a more sustainable world and delivering strong returns to our shareholders go hand-in-hand. Bill spoke about our strong financial highlights this past year, and our results were impressive. We were pleased to be able to deliver for our shareholders and policyholders. And keeping with this theme, breaking news, we just released our Q1 2022 results. I'm pleased to announce that Sun Life delivered solid first quarter results, driven by the strength of our diversified business model. We saw insurance and wealth sales grow this quarter. This highlights the value our clients place on financial security and healthier lives. We also delivered strong long-term investment performance. As Bill said earlier, our capital position remains strong. And to that end, we're pleased to announce a 4.5% increase in our dividend to $0.69 per common share. This reflects our confidence in meeting our medium-term financial goals. More details about our Q1 results can be found on our website. Our business was built for times like these. These -- we're being here to support our clients, helping their financial future and ensuring that they can live the healthiest life possible where they can access the care and support they need, and being there in the most difficult times when a client or the family members need support the most. Sun Life is recognized as a company having a strong strategy and even stronger execution. None of this happens without having exceptional leadership. I want to recognize and thank Sun Life's executive team for their support and leadership as I assumed my role as CEO last August. I also want to thank our Board of Directors for their guidance and leadership. As Bill Anderson said earlier, he will be retiring after 12 years on our board, 5 of them he served as Chair. I want to personally thank Bill for his support and mentorship. Bill, on behalf of our employees, advisers, clients and shareholders, thank you for your contribution to Sun Life. We wish you the very best in your retirement. And with that, we want to welcome Scott Powers, who becomes our Board chair following today's meeting. Scott brings an exceptional business background, experience and expertise to our Board in his new role. Scott, I look forward to continuing working with you in your new capacity. Before we close, I do want to address the invasion and war in Ukraine. We have many employees, advisers, clients who are deeply worried about the safety of their Ukrainian family and friends. Together with the global community, we remain concerned about the humanitarian crisis in Ukraine and the surrounding regions and the threats to global peace and stability. Our hearts go out to the people of Ukraine and everyone affected by this senseless invasion and war. To date, Sun Life, its companies and affiliates, along with our employees, have donated more than $1.1 million to various charities that are supporting -- that are providing direct humanitarian support in Ukraine. The last few years have been a challenge but there are many new things we learned, new skills, new ways of working, new ways of being resilient, new ways to look after each other. As we begin to move towards the post-COVID environment, it's easy to look back and want things to be how they were before. At Sun Life, we're looking forward, not back, preparing ourselves to create an even brighter future for our clients, our people and our communities. We are seizing this once-in-a-lifetime opportunity to merge into a post-pandemic world as an asset management and insurance company that is older, more innovative and more sustainable than we were before the pandemic started. Reemerging differently after a global crisis isn't new for Sun Life. We've done it before, reemerging bigger, better and stronger after the Spanish flu, the Depression, World Wars and the 2008 global financial crisis, and we are doing it again. To get this right, we are asking ourselves, "How can we reimagine our operations to be better, more effective and more efficient than we were before the pandemic? How can we accelerate digital innovation and deliver even bolder client experiences and outcomes? How can we recreate the workplace experience and shape our future at work?" Sun Lifers around the world are working every day to answer these questions and propel us forward. These are just some of the sparks of a brighter future for Sun Life. My fellow shareholders, I'm honored to lead a company that is empowered by passionate and engaged people. We're a company that puts people first and delivers great client experiences, all united by a common purpose. Thank you for your ongoing trust and confidence in Sun Life. Sun Life's future remains bright for our clients, our people and for you, our shareholders, because optimism makes for a brighter tomorrow. Before I turn it back to Bill, I'll leave you with a video that speaks to our sense of optimism. [Presentation]

Thank you, Kevin. Yes, that was an awesome video. Ladies and gentlemen, the scrutineers have completed their preliminary tabulation of the votes cast in respect of each of the items of business on the agenda, and I will now ask Troy to speak to the preliminary voting results. Troy, over to you.

For Sun Life Financial, the scrutineers have reported that over 56.2% of eligible shares have been voted at this meeting. I'm pleased to report that all 10 director nominees named in the circular have been elected, with votes ranging from 98.1% to 99.8% in favor. Deloitte LLP was reappointed as our auditor with over 88.4% of the votes in favor. The advisory resolution on the approach to executive compensation was passed with over 94.8% of the votes in favor. With Sun Life Assurance, the scrutineers have reported that over 17.6% of eligible votes have been cast at this meeting. I'm pleased to report that all 4 policyholder director nominees named in the circular have been elected, with over 92.8% of the votes in favor, and all 6 of the shareholder's directors have been elected. Deloitte LLP was reappointed as our auditor with over 99.9% of the votes in favor.

So that concludes the formal business portion of our meetings for this year, and we are now pleased to entertain questions from registered shareholders, voting policyholders and duly-appointed proxy holders doing the stream by webcast. I'd like to remind you that questions should be of interest to all shareholders and not of a personal nature. If your question is related to a personal matter, a Sun Life representative will contact you after the meeting. [Operator Instructions] Troy, are there any questions?

Yes, Bill. We have the following comments and questions from [ Richard Sambrook ], a Sun Life shareholder since demutualization and a policyholder since 1988. First, Richard would like to congratulate and complement our Sun Life employees and advisers on a remarkable performance throughout the pandemic. Their adaptiveness from a historically and largely in-person business model has truly been remarkable. Second, he would like to thank our outgoing Board members, Martin Glynn and Chair Bill Anderson, for their contributions and responsiveness to stakeholders. Richard welcomes Scott Powers to his new expanded role and responsibilities as the incoming Chair of the Board. Lastly, as a Canadian descendant of Ukrainian grandparents, Richard thanks Sun Life for its very quick moral and financial support of the victims of oppression in Ukraine. Richard indicates his question is about the broad concern with cybersecurity threats. When we listen to public cybersecurity firms, he tends to hear 2 common themes. First, that nothing is static, everything is evolving, and sooner or later, expect to be attacked. Second, that current cybersecurity firms apply layering with a focus on 3 things: prevention, minimization and recovery. When he heard the recent announcement that Sun Life was going to be hiring AWS to do data management in the cloud, he wondered if that is the sort of thing could lead to potential problems, particularly with regard to recovery and backup protocols. Richard asked if our CEO feels comfortable with Sun Life's overall safety and security, systems and protocols in the current hostile cyber environment.

And thank you, Rich, for the question. Clearly, Scott will be -- or sorry, Kevin over here.

Thanks, Richard for your question. This is something that as the CEO of a global financial institution, we think a lot about cyber and cyber risk, and we've certainly seen that increasing. We have an excellent Chief Information Officer in Laura Money and a Chief Information Security Officer in Abhay Raman who are thinking about this all the time along with our business groups. And we have a very strong cybersecurity program that looks at a number of things, actively scanning the external environment, and we work with the companies and governments to make sure we're aware of what the threats are, monitoring our systems for potential vulnerabilities. And that's something that we do on a constant basis. Rolling out -- we rolled out multifactor authentication this year for our clients globally to help protect them. We practice effective operational and cyber resilience programs. And have a robust employee education, communication and training program on the cyber front. When it comes to questions like AWS and the cloud, that's also an area that we work very closely with our -- with the cloud providers we use, and AWS is one of them. It's an area that we continue to have ways of monitoring looking at what they're doing. Of course, the cloud is very important today. You can't get a modern IT system that's not in the cloud. It provides data, it provides flexibility, allows for us to get closer to our clients and learn more about them and create solutions more quickly. So it's important, but we work closely with the cloud to have the same level of standards that we do for our other cyber security. So it's something we take very seriously, Richard. It's something that we have a strong focus on. It's something that you can never take for granted, and we're always looking to see where it's moving and where it's heading.

Tony, are the other questions?

Yes, Bill. We have another question from a shareholder, [ Jeff Carlson ]. Jeff refers to the expiry of our normal course issuer bid in August 2020 and indicates that it's not clear to him if Sun Life's decision to not renew its normal course issuer bid was due to the OSFI restrictions on dividend increases and share buybacks and or if it was for some other reason. But whatever the reason, Jeff believes the company not repurchasing or buying back any of the shares in 2021 was a very good thing and hope that continues. Jeff indicates that using company earnings or debt for that matter to buy back its own shares is a poor use of capital and does not demonstrate a vision of long-term growth for Sun Life. At worst, when such purchases are made, Jeff indicates the shares may be purchased at overvalued market prices, which, therefore, destroys shareholder value. His question is, "Will management and the Board continue to forgo its previous policies or share buybacks? And if such allocated capital cannot be effectively deployed, will it be returned to shareholders as dividends?"

So Kevin, why don't you take that first and then I'll comment on that.

Jeff, thanks for the question. This is another area we look at very closely. As a company, we benefited from a very strong capital position. And the way we think about capital deployment, is that, first, we look at organic growth needs of the business. And that's the first place we deploy our capital. Second, we look at our common shareholder dividends. And we're committed to growing our dividends to be between 40% and 50% of our underlying earnings and that's a strong commitment we have and it's the second priority. Then we look at our capital position, and we consider our merchant acquisition needs and the needs to maybe create scale or new capabilities in our businesses. And that would be the third priority. Once we've looked at those 3 priorities, we look at our capital position, we look at the economic conditions. And if we have capital that's in excess of what we believe we need at the time, we return it to our shareholders. And that's how we think about our buyback. At the current time, we have CAD 4.7 billion in capital at our holding company, but most of that is spoken for. I mentioned earlier that we have the DentaQuest acquisition that we expect to close very shortly, and that's going to be over $3 billion. So the big deployment of our capital coming up is related to DentaQuest -- we do assess this on a quarterly basis. It's a dynamic process, depends on uses we have for capital, depends on economic conditions. And so that's how we look at the buyback program. And when we do it, we make sure that it's delivering value to the shareholders.

And I would just add to that, Jeff. The -- in terms of the Board's responsibilities, the oversight of capital allocation is one of the most important things we do, and it's constantly discussed with management and with the Board. And certainly, there is total alignment with the Board. And management, and I would concur with everything Kevin said, we clearly look at capital allocation and distributions to shareholders on a regular basis. Of course, we declare dividends quarterly, and we review these issues on distributions to the shareholders on that basis. Tony?

Bill, there are no further questions.

Okay. Thank you for the questions. And before closing the meeting, I'd just like to add to Kevin's comments with respect to Scott Powers, who will be Sun Life's next Chair. I want to wish a heartfelt congratulations to Scott. He served as a Sun Life Director -- or as a Board member since 2015. Scott is a highly respected business leader and a Board member who brings strong leadership, extensive experience in financial services and a strategic disciplined approach to governance. Scott is a great choice to guide the Board during a time of significant change and opportunity in the asset management and insurance industries. And Scott has the complete confidence of all the Board and the executive team. So I want to wish Scott the very best in his new role. And thank you to everyone for once again joining our virtual annual meeting and welcoming us into your homes. We wish we could have connected with you in person, but we are thankful for the ability and opportunity to virtually engage with you, our shareholders, and voting policyholders at this year's event. Please stay healthy and safe, and I know we are all hopeful to see you in person next year. As Kevin said, thank you for your continued trust and confidence in Sun Life and enjoy the rest of your evening.