The Toronto-Dominion Bank (TD) Earnings Call Transcript & Summary

[Audio Gap] the TD Bank Group Annual Meeting of Shareholders. My name is Diana Lee, and I am Vice President, Diversity and Inclusion here at TD. Many of us are joining today's meeting from lands across North America, which is referred to by many indigenous peoples as Turtle Island. To begin our meeting today, I want to acknowledge that I am joining you from Toronto, which is the traditional territory of many nations, including the Mississaugas of the Credit, the Anishnabeg, the Chippewa, the Haudenosaunee and the Wendat peoples and is now home to many diverse First Nations, Metis and Inuit peoples. I also acknowledge that Toronto was covered by Treaty 13 signed with the Mississaugas of the Credit, and the Williams Treaties signed with multiple Mississaugas and Chippewa bands. Land acknowledgment is one step towards recognizing and honoring the enduring presence, resilience and contribution of indigenous peoples and their traditional territories that we stand on today. I am grateful to have the opportunity to live and work on this land and encourage each of us to continue on our journey in support of reconciliation, including increasing our understanding of the history and ongoing stories of indigenous peoples. Thank you.

Brian Levitt, Chairman of the Board, TD Bank Group. Brian Levitt [Foreign Language]

Good morning, everyone. Welcome to the 2022 TD Bank Group Annual Meeting of Shareholders. To our Francophone shareholders, we wish you a warm welcome to our Annual Meeting of Shareholders. I'm Brian Levitt, Chair of the Board of Directors. I'll act as Chair of the meeting as stipulated by the Bank's bylaws. This meeting is called to order. With the consent of the meeting, I'll ask Norie Campbell, TD's General Counsel to serve as Secretary of the meeting. Before we move to the business of the meeting, I want to express to all Ukrainians around the world, our sincere hope that the war will come to an end as soon as possible. You're in our thoughts. We're delighted to be able to welcome some shareholders today in person, and we also welcome those of you joining us by webcast or through the phone line. As was done last year, we've enabled question-and-comment capabilities through our phone lines and webcast with the aim of making the virtual experience -- the experience for virtual attendees as interactive as possible. As in past years, both English and French will be spoken during this meeting. Simultaneous translation will be provided in person and over both our English and French webcast and phone lines. Additionally, shareholders and proxy holders will be able to ask questions in the room over the phone line or through the webcast. Let me explain how this will work. With the goal of allowing all our shareholders and proxy holders to participate regardless of whether they're here with us in person on the phone or on the webcast, we'll take questions from the room first, then from the phone and then through the webcast. In each case, we ask that you identify whether your question relates to a motion being considered as part of the formal business of this meeting or whether it's a little more general in nature. If you're in the room and would like to ask a question, you will be prompted to approach one of the microphones on the floor at the appropriate time. Those with limited mobility, please raise your hand and a microphone will be brought to you. We will address questions that directly relate to a particular motion at the appropriate time. And we ask that you save general questions for the question-and-answer period, which will follow the formal business. To ask a question over the phone, you'll be prompted to enter the question queue at the appropriate time. When we're ready to take your questions, the operator will introduce you. We'd like to -- we would like all of our shareholders that wish to ask a question to have the opportunity to do so. So we ask that you limit yourself to one question at a time. If you have additional questions, please requeue at the microphone or on the telephone line to allow us to speak with as many shareholders as possible during the meeting. If you are on the webcast and have a question, click on the Ask a Question tab at the top right of the webcast page. Please read the instructions in the text box before submitting your question. Shareholders who wish to submit a question or comment through the webcast platform can do so at any time, and we will address them at the appropriate time. A TD representative will read out the questions received over the webcast. Questions will be read out in the language used by the submitting shareholder and if submitted in French and English translation will follow. If we have several questions that are very similar in nature, we'll read out one of the questions and mention that we've received similar questions. As in past years, the vast majority of our shareholders submitted their proxies or voting instructions in advance of the meeting, but shareholders and proxy holders, whether attending virtually or in person, will also have the opportunity to vote during the meeting. Here's how you can vote through our virtual voting platform. Once you're logged into the webcast, click the [ Vote ] tab at the top right of the webcast page and a separate browser window will open. Shareholders that are not logged into the webcast can access the virtual voting platform from the 2022 Annual Meeting page on TD's website. Once you've accessed the voting platform, you can register to vote by entering your control number as your user name and entering TD 2022, all upper case, as your password. Voting will be open so long as the formal portion of the meeting is proceeding. If you have voted in advance of the meeting and do not wish to change your vote, then you do not need to do anything. If you're with us in the room and you wish to vote during the meeting, you will need the yellow and blue ballots that were provided to you at the registration desk. I've received satisfactory proof that the Notice calling this meeting was duly publicized and sent to all shareholders of the bank. We received proxies representing more than 53% of the approximately 1.8 billion outstanding common shares. Accordingly, we have a quorum present, and I declare the meeting duly and properly constituted. As in past years, we will have a question-and-answer session after the formal business of the meeting is completed. As I noted earlier, during the formal portion of the meeting, we will pause to address questions and comments submitted by shareholders and proxy holders that are specific to the motions being considered. As always, we ask that any questions that you ask relate to the business or affairs of the bank and not be of a personal nature. For people in the room, we have a representative from TD Customer Care here with us today. Can I ask [ Isabelle Hackman ] to stand and be recognized. Isabelle there [indiscernible]. If your question is of a personal nature, we will defer your question and ask that you speak with Isabelle after the meeting or we will have one of our customer care representatives get in touch with you after the meeting. The agenda for today's meeting is available on the annual meeting page on TD's Investor Relations website and for in-person attendees, the agenda can be found in the booklet that was on your chair. Please note that discussions during the meeting may contain forward-looking statements about the Bank's outlook and objectives and strategies to achieve them. Bharat will be referring to non-GAAP financial measures, also known as adjusted results in his remarks. Details regarding forward-looking statements and non-GAAP financial measures are on the slide presented in the room and on the webcast and can also be found in the Bank's financial reporting. Now I'd like to introduce the individuals who are with me on the podium today. Bharat Masrani, Group President and Chief Executive Officer of the Bank; and Norie Campbell, Group Head and General Counsel of the Bank. As noted earlier, Norie will act as Secretary of the meeting. In addition, members of the Bank's senior executive team and Board of Directors are available to assist with questions, if necessary. Pat Lee and Helen Kim, representatives of TSX Trust Company, the Bank's register and transfer agent will act as scrutineers. Before I invite Bharat to address the meeting, I'd like to take a minute to recognize the tremendous efforts of all our TD colleagues over the past year. They successfully navigated through the second year of the pandemic, serve customers with dedication and care and contributed to the success of the communities and economies that rely on TD. On behalf of the Board, I'd like to thank them for all that they have done. Before I ask Bharat to address the meeting, I would like to take a minute to recognize the tremendous efforts of all our TD colleagues over the past year. In 2021, they successfully navigated through the second year of the pandemic served customers with dedication and care and contributed to the success of the communities and economies that rely on TD. On behalf of the Board, I would like to thank them for all that they have done. [ '21 ] TD delivered exceptional operating and financial outcomes. Our balance sheet is strong, and we have deep liquidity, critical foundations for a successful bank. As a result, we were able to invest in the business and in new capabilities, deliver a strong return for our shareholders and announced a 13% dividend increase. As we grew our business, we also took important steps to advance our environmental sustainability and governance priorities. Building on the communities, the commitments we've made through our climate action plan, TD will continue to lead in this space as we enable a more sustainable and inclusive future. I'd like to recognize the tremendous efforts of Bharat and his executive team who delivered for all stakeholders, including our shareholders. I'd also like to thank my fellow directors for their counsel and support. In closing, I want to thank our shareholders for their confidence and our millions of customers for the opportunity to serve them every day. I would like to conclude by thanking our shareholders for their confidence and our millions of customers for the opportunity to serve them every day. With that, I'll ask Bharat to address the meeting. Thank you.

Thank you, Brian, and good morning. I want to welcome everyone on the phone and the webcast as well as those of you in the room in Toronto. I'm very pleased that we could hold an in-person meeting this morning. We've not met in person since April of 2019 to discuss our performance and to take your questions. It's been a long time, too long. It is a privilege to be with you here today. Before I begin, I would like to address the ongoing tragedy in Ukraine. The war is destroying lives, putting millions at risks and displacing many. It is a terrible tragedy. To support humanitarian efforts, TD has provided more than $1 million in donations, and we have activated our branch and store network to collect donations from customers. We're also working with specialized groups to help refugees find meaningful employment, including at TD to help stabilize their families in a new country. We all hope the suffering will end as soon as possible. Let me now update you on our progress over the past year and on our views on the future. At the very beginning of this pandemic, I told you that TD would successfully navigate the crisis and emerge stronger and more resilient. Today, I am pleased to report that our bank, your bank is stronger. In fact, it is stronger than it has ever been. I want to recognize the tremendous efforts of more than 90,000 TD bankers around the world. I could not be more proud of the dedication and determination, and I thank them from the bottom of my heart. Throughout 2021, colleagues supported millions of households and businesses. Our people were there when our customers needed us most, providing thoughtful advice to help them navigate a challenging period with confidence. As a result of their efforts and the important investments we've made across the bank, we delivered strong results in every business. In Canada, we finished the year with continued momentum, delivering strong volumes as we supported a growing customer base. We also reported record wealth and insurance premium revenues while adding new products and capabilities. This included TD Easy Trade, our easy-to-use stock trading app in an industry-leading mobile platform for home and auto insurance. TD Wealth assets now sit at over $1 trillion, reflecting the trust we have earned from those we serve. In the U.S., we also introduced a number of new offerings and products to better serve our customers and grow our business. TD Bank, America's most convenient bank delivered record earnings as we offered an unexpectedly human customer experience across all channels. Improving top line growth reflected strong deposit volumes and a steady recovery in consumer activity. In wholesale, we delivered strong results once again, winning key client mandates and advancing our U.S. dollar strategy. As a result of focused efforts across the bank, the overall macroeconomic recovery and reductions in our credit loss provisions, the bank's earnings recovered, and we achieved our best year ever. Adjusted earnings were $14.6 billion, up 47% from 2020 and 17% higher from 2019's pre-pandemic levels. Supported by these results, we continue to invest in new capabilities to serve our almost 27 million customers and transform our operations to deliver innovation and execution with even greater speed. And when regulators allowed it, we increased our dividend by 13% and repurchased 21 million common shares. Throughout the year, we strengthened our bank, grew our business, served our customers and lived our purpose. In doing so, we created value for you, our shareholders. To further accelerate our growth, earlier this year, we announced an exciting transaction. The acquisition of First Horizon is a tremendous opportunity. It is strategically compelling and at closing, we'll immediately provide TD with scale in the U.S. Southeast. It will give us leadership positions in Tennessee and Louisiana deepen our existing presence in Virginia, the Carolinas and Florida and established important footholds in Georgia and Texas. These are highly attractive markets where the population is expected to grow approximately 50% faster than the national average. The transaction is also financially attractive and will allow us to deploy our excess capital to enhance long-term earnings growth. And it is a strong cultural fit. First Horizon has a similar approach to managing risk. The retail and commercial bankers like ours, share our commitment to customer service and community presence. Work is underway to obtain the required approvals, and we expect to close the transaction in the first quarter of fiscal 2023. I look forward to introducing you to First Horizon's leaders this time next year. As you can see, we accomplished a lot this past year, yet there's always more to do. Customer expectations continue to rapidly evolve. They want digital experiences that resemble their favorite online retailers or streaming services, personalized value advice to navigate a challenging environment and a trusted partner that will bring their aspirations to life. TD has built the capabilities to meet these needs. We have a deep pool of expert bankers, a strong branch and store network in Canada and the United States and a growing online and digital presence, including clear leadership as Canada's largest mobile bank. We will continue to provide legendary personalized and connected experiences across customers' channels of choice in store, on the phone, online and on the go. To help power our future, we are also developing and adding customer-facing resources across the bank and deepening our bench of innovation, talent with engineers, computer scientists, data analysts and AI experts. To exceed our customers' expectations and move at the speed of the market, we are methodically shifting how we work to drive even faster innovation and execution at scale. Through these and other efforts, TD is shaping the future of banking. As we focus on our strategy and delivered for all stakeholders, we also took steps to address important priorities critical to our collective future. There is no doubt that climate change is an urgent societal, environmental and business challenge that is fundamentally impacting current and future generations. We strongly support the transition to a low-carbon economy and have made significant commitments to help accelerate its development. We started the year by setting a clear direction with an ambitious climate action plan and became the first Canadian bank to set a 2050 net 0 target. We backed that commitment with action. We joined the UN-convened Net-Zero banking alliance to foster better global collaboration. We established clear interim targets for Scope 1 and 2 emissions and recently announced our first school 3 finance emissions targets for the energy and power generation sectors. In addition, this past year, TD Securities has helped deliver over $31 billion in sustainable financing in Canada, the U.S. and globally. We are helping the businesses we support, accelerate their plans, seize new opportunities and drive change through a specialized sustainable finance and corporate transitions group. These and other efforts delivered important progress, which we reported through a full suite of detailed reports. However, as we invest and focus on accelerating change, we know that the transition to a low carbon future will not happen overnight. It will require a determined effort over many years as we reshape entire industries and build a new economy. As we work to accelerate change and progress, energy security remains critically important through the transition. Without a reliable and responsible energy supply to meet our current and future demand, progress may solve with devastating economic and social consequences. The pressure on energy supply as a result of the war in Ukraine is a clear example of the risks. Canada can and must play a meaningful role to support energy security in both North America and globally. I encourage policymakers to continue to support and develop the responsible energy projects we need today as we all work to transition our economies for longer-term sustainable growth. The future must also be more inclusive, a society where all have the opportunity to thrive is the only path forward. We've seen the devastating impacts of buyers and racism, the vicious cycle that comes from economic inequality and the pain caused by violence and hate. TD is committed to being a force for change and for progress. We've set new representation targets internally, deployed training throughout the bank and have kept diversity and inclusion at the forefront of our efforts. In our communities, we've invested in new programs to support [ racialized ] minorities, launch initiatives to foster broader economic participation and committed our financial and human resources to help build a better tomorrow. In 2021 alone, we invested $125 million in our communities through the TD Ready Commitment, contribute directly to these and other goals. This included $10 million through the TD Ready Challenge to fund 15 organizations that are addressing learning laws in children due to pandemic disruptions, a critical need to support the success of future generations. We also launched new initiatives to encourage greater economic inclusion and access to banking. In Canada, we announced an exclusive strategic alliance with Canada Post to increase access to financial services in rural, remote and indigenous communities. And in the U.S., we introduced TD Essential Banking, a low-cost deposit account designed to meet the needs of unbanked and underbanked households. At TD, we know that we are only as strong as the communities in which we live and work. As we invest for the future with growing confidence, we must also recognize that we meet today at a complex moment. We have started to gather again in homes and restaurants, sports and entertainment venues. friends are reconnecting. Families are traveling, and colleagues are collaborating in person more frequently. You can feel the energy returning to our communities. While COVID is still clearly with us, we are learning to live with it, to adjust as needed sometimes on a daily basis as we reopen our economies. I'm hopeful that very soon life on a screen will take even more of a back seat. It's about time. A small business is rebuilt and harden sectors begin to recover, millions of people are finding jobs and coming off government programs. Governments rightly backstopped our economies and supported millions during the downturn. They were directly assisted by banks who deferred billions in loan and mortgage payments and build new capabilities literally overnight to help get funds to those who needed them. However, as we look to the future, it will be important for governments to reduce deficit built up during the pandemic and focus on growth. The federal government took some initial steps in the right direction in last week's budget, but it is important to press further on this going forward. Sound fiscal policy is critical to a prosperous future, particularly to maintain global confidence in Canada as a destination for business activity and investment. It also provides governments with levers and options should they need to respond to any future crisis. We cannot face the next crisis with limited means to address it. This matters because there are already numerous issues before us that require our attention. Inflation is back with serious potential macroeconomic repercussions if it is not effectively manage. Global supply disruptions are contributing to this problem and also threaten to slow the recovery of many businesses. And the war in Europe is creating serious economic impacts globally. We need to tackle these challenges with new approaches. For example, we should develop new manufacturing and production capabilities to help taper long-term inflation and maintain the flow of consumer goods and other products, including PPE and vaccines. We must also invest in and enhance our health care system so that we are prepared to show -- should another health emergency impact us in the future. I'm extremely optimistic about our future. Canada has all the right ingredients to address these issues and build for the future if you can leverage them appropriately. We have a highly skilled workforce with first-class universities training the next generation. We're emerging as a global technology leader growing rapidly and competing successfully for investment and talent. We continue to be a global leader in food production, and we are well positioned to become a responsible source of energy security. I believe we can achieve our full potential, but we must create the right conditions for success. One of our greatest advantages is that we have among the strongest and most stable financial systems in the world, a sector that serves us well supports millions of jobs and delivers value to all Canadians. We must extend our leadership on the world stage as a global banking center. Unfortunately, in its most recent budget, the government has chosen instead to single out our sector, which I believe is not good tax policy and could lead to unintended consequences. As we look ahead, it is critically important that we build on our strengths and unite public and private sector efforts around common goals. At TD, we look forward to participating in that dialogue. Our job at TD is to support these efforts and to successfully steer the bank forward as we serve the millions who rely on us. As I've always said, banking serves a higher purpose. We will continue to offer colleagues the opportunity to make a meaningful impact, grow their careers and work in an inclusive culture of care and respect. We will serve customers and clients with passion and skill and help them transform their aspirations into reality. We will guide our clients through complex transformations and contribute directly to sustainable future prosperity. We will help our economies recover and businesses rebuild, and we will drive progress and positive change in society at large across every community in which we operate. To the work ahead, we will deploy the resources of our strong bank with high-performing businesses backed by leading innovation and new capabilities. Of course, as always, our true strength comes from our people, our greatest competitive advantage, their commitment to the bank, to our customers and to our communities continues to be remarkable. Our purpose to enrich lives comes to life every day through their efforts. And once again, I thank them for everything they do to make TD the better bank. Fellow shareholders. I also want to thank you for your support over the past year. All of us at TD continue to work hard every day to earn your trust. Finally, I want to acknowledge the Board for their ongoing dedication, advice and support. I look forward to taking your questions. Thank you.

Thank you, Bharat. At this point, I'd like to move to the formal business of the meeting. For shareholders and proxy holders who are joining remotely and have registered to access our online voting platform, the polls will open soon and will close after the presentation of our items of business. For those of you who are here with us in person, ballots were provided to shareholders and proxy holders at the registration desk. We prepared a yellow ballot for the first 3 items of business, namely the election of directors, the appointment of the auditor and the advisory vote on the bank's approach to executive compensation. A blue ballot has been prepared for the shareholder proposals to be voted on today. These proposals, along with the proposer's statements and the board's responses, are set out in the management proxy circular and in the booklet that was on your chair when you entered the room. That information booklet is also available on our Annual Meeting web page. Scrutineers have a supply of ballots in both English and French. If you have not received a ballot and would like to vote during the meeting, please raise your hand, and I'll ask the scrutineers to distribute a set of ballots to any proxy holder or shareholder in attendance who has not received a ballot or completed a proxy. If you have already voted or sent in a proxy, there is no need to complete a ballot. When you sign your ballots, please print your name clearly above your signature. We'll distribute the ballots now if anybody needs them. When proxies are submitted to our registrar and transfer agent, they are counted and tabulated by their officers. Scrutineers of the meeting will then verify and report the results. A simple majority of the votes cast during this meeting or by proxy is required to pass each of the matters to be voted on today. In the interest of having an open, fair and orderly meeting, the front page of the booklet that was on your chair contains guidelines for shareholder participation. These guidelines are based on the rules of order as well as common sense and courtesy. These guidelines are also available online on our Annual Meeting web page. If you're a shareholder or a proxy holder joining us remotely and wish to ask a question via webcast, you can submit your question at any time and please indicate whether it relates to a specific motion or whether it's of a more general nature. For example, if you'd like your question read out before the shareholder vote on the advisory vote on executive compensation, please indicate that in your submission, and we will read it out then. If it's a more general question or comment, then it will be read out during the Q&A session. As a reminder, if you wish to ask a question in person or by phone, you'll be prompted to do so at the appropriate time. If your question is of a general nature and is asked during the formal business, we ask that you defer your question until the general question-and-answer session. I ask each speaker to please keep your comments brief and to the subject under discussion so that all shareholders have an opportunity to participate. If a speaker has an additional question and if there is sufficient time, they will be recognized after we've heard from others who are waiting to speak. On behalf of your fellow shareholders, I thank you in advance for your cooperation. Copies of TD's 2021 annual report, which contains the bank's 2021 financial statements and the auditor's report on them, were sent to shareholders in advance of this meeting. You can also obtain a copy of our annual report at the entrance to the room or on our website at td.com. We'll now address any questions or comments that have been submitted by shareholders or proxy holders directly related to the 2021 financial statements. [Operator Instructions] If you have questions or comments that are not directly related to the 2021 financial statements, please hold them until the appropriate time. Are there any questions regarding the financial statements? Are there any questions or comments regarding the financial statements? I can't really see here in the room. Are there any questions? I don't see any. I will now address questions from the phone. Operator, have any questions come in.

There are no questions registered at this time.

Thank you. We'll now move to the webcast. If any questions come in through the webcast related to this matter.

Chair, no questions have come in related to this item.

Thank you. We'll now move to the election of directors. We will now move to the election of directors. To acknowledge that 2 of our current directors, Irene Miller and Joe Natale, are not standing for reelection this year. On behalf of the Board of Directors and the bank's employees, I'd like to express our sincere gratitude for their invaluable contributions during their time as directors of TD. It has been a privilege to work alongside both of you. Information about each nominee is included in the proxy circular. To facilitate the introduction of the nominees, we prepared a slide presentation that introduces each of them.

Cherie Brant, Amy Brinkley, Brian Ferguson, Colleen Goggins, Jean-Rene Halde, David Kepler, Brian Levitt, Alan MacGibbon, Karen Maidment, Bharat Masrani, Nadir Mohamed, Claude Mongeau, Jane Rowe.

The Board of Directors has fixed the number of directors to be elected at [ 13 ], and I confirm that all the nominees are eligible for election. I'll ask Norie to move the motion.

I hereby move the nomination of each of the persons whose name appears in the circular under the heading Director Nominees to be a Director of the Bank until the close of the next annual meeting of the bank's common shareholders.

Thank you, Norie. We'll now address any comments or questions that have been submitted by shareholders or proxy holders directly related to the election of directors. [Operator Instructions] As you register on the phone, we'll proceed with questions from the room. Are there any questions or comments relating directly to the election of directors? Are there any questions or comments relating directly to the election of directors. Are there any questions or comments relating directly to the election of directors. I don't see any in the room. We'll now address questions from the phone. Operator, any questions come in.

There are no questions on the phone lines.

Thank you. We'll now address questions from the webcast.

Chair, no questions have come in related to this item.

Thank you. Voting is open, and we invite shareholders and proxy holders to submit their vote, if they have not already done so. In person attendees are asked to move to item #1 on the yellow ballot, which relates to the election of directors. Please mark it now. As I mentioned earlier, if you've already voted or sent in a proxy, there's no need to do anything unless you'd like to change your vote. The next item on the agenda is the appointment of the auditor. The next item on the agenda is the appointment of the auditor. Board recommends that Ernst & Young LLP be appointed as auditor of the bank until the close of the next annual meeting. Helen Mitchell and Troy Butner representatives of Ernst & Young are available to assist with questions, if necessary. I'll ask Norie to move the motion.

I move that Ernst & Young LLP be appointed auditor of the bank to hold office until the close of the next annual meeting of the bank's common shareholders.

Thank you, Norie. We'll now address any questions or comments that have been submitted by shareholders or proxy holders that directly relate to this matter. If you're on the phone and I have a question or comment directly related to this motion, please press star one now. As you register on the phone, we'll proceed with questions in the room. Are there any questions or comments regarding the appointment of the auditor? Are there any questions or comments regarding the appointment of the auditor. I don't see any in the room. We'll now address questions from the phone. Operator, if any questions come in?

We have a question from an English participant, [ Shernell Smith ].

I just wanted to know [indiscernible] open bank for the voting do earlier this morning, well before the meeting and it is closed. Will it be open back up?

I'm sorry, the reverberation in the room meant that I couldn't really understand the question.

Regarding question for the English participant [Technical difficulty] [Technical difficulty]

It looks crying like a question is, will the phone lines be opened back up to the voting.

Sorry, the question is?

It looks like the question was will the phone lines be opened back up for the voting?

Yes.

So I think the answer to that is that the voting is occurring through the web page, maybe just refer back in the script, we can direct them. Yes. As Brian remarked earlier in the meeting, the voting is occurring through the web page. So if you went on to td.com, you can log in and use the voting tab. It's at the top right of the webcast page.

Operator, are there any other questions?

Thank you. There are no further questions registered at this time.

Thank you. On the webcast. Any questions?

There no questions have come in related to this item.

Okay. We invite shareholders and proxy holders to submit their vote if they've not already done so. The appointment of the auditor is item #2 on your yellow ballot. Please mark it now. As a reminder, if you've already voted or sent in a proxy, there is no need to do anything unless you'd like to change your vote. The next item of business is the advisory vote on the bank's approach to executive compensation. The next item of business is the advisory vote on the bank's approach to executive compensation. The resolution on the approach to executive compensation is set out in the proxy circular under the heading Advisory Vote on approach to executive compensation. I'll ask Norie to move the motion.

I hereby move that the resolution set out in the circular under the heading Advisory Vote on Approach to Executive Compensation be passed.

Thank you, Norie. We'll now address any questions or comments that have been submitted by shareholders or proxy holders that directly relate to this matter. If you're on the phone and have a question or comment directly related to this motion please press star one now. As you register on the phone, we'll proceed with questions from the room. Are there any questions or comments regarding the bank's approach to executive compensation? Are there any questions or comments regarding the bank's approach to executive compensation? Hello, [indiscernible]. Questions in the room? Seeing none. Are there questions on the phone, operator?

Thank you. There are no questions registered at this time.

Thank you. Are there questions on the webcast?

Yes. Thank you, Chair. There was a question submitted in French. I will read the question in French, and then the English translation will follow. The question is from Willie Gagnon from MEDAC. In his presentation, the CEO mentioned the issue of social and equality. The compensation of bank executives is an eloquent illustration of this. Such remuneration should be lower and take into account the vertical ratio, we invite shareholders to vote against the bank's compensation policy. The bank's CEO mentioned the issue of inequality in society. The composition of bank executives illustrate this clearly. It should be lower and take into account the vertical compensation analysis ratio. We call on shareholders to vote against the bank's compensation policy.

Thank you, Mr. Gagnon. We will take this as a comment rather than a question. Questions on the webcast?

No more questions.

Thank you. We invite shareholders and proxy holders to submit their vote if they have not already done so. 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. Brand person attendees, this is item #3 on your yellow ballot. Please mark it now. I'd like to remind you that when you finish marking and signing the yellow ballot, please print your name above your signature. I'd now ask the attendants to collect the yellow ballot so that the scrutineers can begin tabulating the votes on the first 3 items. Next to be put before the meeting are the shareholder proposals. Next to be put before the meeting are the shareholder proposals. I have shareholder proposals for consideration at this meeting. Proposal 1 was submitted by some of us of the District of Columbia in the United States. Proposals 2, 3 and 4 were submitted by Momondo, [indiscernible] also known as MEDAC of Montreal, Quebec. And Proposal 5 was submitted by Vancity Investments, management of Vancouver in British Columbia. I'd also like to mention that MEDAC submitted 5 additional proposals that were withdrawn following discussions between MEDAC and the bank. And we will invite MEDAC to present a statement regarding those withdrawn proposals after we address all of the shareholder proposals that are to be voted on. The withdrawn proposals and supporting statements as well as the bank's responses to them were included in the proxy circular at MEDAC's request.

We will invite MEDAC to present a statement regarding those withdrawn proposals after we address all of the shareholder proposals that are to be voted upon.

We'll now turn our attention to the proposals to be voted on. Proxy circular includes statements by the proposer in support of their proposal as well as the reasons why the board is recommending to shareholders that they vote against the proposals. As a result, in the interest of time, we will not be revisiting the reasons for the Board's position during the discussion of the proposals. Shareholders and proxy holders will be given an opportunity to comment on each of these proposals. As indicated earlier, I ask that each speaker be mindful of the guidelines for shareholder participation. I'd also appreciate it if each speaker would give his or her name and state whether they are a shareholder or a proxy holder. The first item is Shareholder Proposal 1 and is set out in the proxy circular under the heading Shareholder Proposals, starting on Page 81. I'll ask Norie to move the motion.

I hereby move that the resolution set out in the circular under the heading, shareholder proposals, proposal 1 be passed.

Thank you, Norie. I'll now invite Amelia Meister to present a statement on behalf of some of us. I understand that Ms. Meister is on the telephone line. Operator, could you please invite Ms. Meister to present her statement.

Thank you. Thank you to the Board and to Mr. Masrani. My name is Amelia Meister, and I am a proxy holder. I represent over 1,700 TV shareholders for all of which were able to file this proposal and presenting today. We are living in a critical moment for climate action. The latest report from the international plan panel on climate change gave dire information about how climate change is affecting us right now. The report stated that happens the global population are living currently in high-risk areas for climate catastrophe and that almost half of the world's ecosystems are already damaged by climate change to a point where they may not ever return to their natural state. The apocalyptic scenario described in the report are already playing out all over the world, including Russia and Canada where BC saw an unprecedented heatwave that kills over 700 people, followed by a record fire season, followed by historic flooding that caused billions and damage, disrupting supply chains and devastating local farming communities as they abandon hundreds of thousands of animals and the 1/3 of their livelihood to the flood. Climate change is no longer an abstract concept. It is an emergency that is happening right now, and every moment is critical for action. The International Energy Agency put out a report in 2021 that stated in order to meet a 1.5-degree Celsius warming the maximum warming to avoid catastrophic global climate disruption the world needed to stop fossil fuel expansion. The IPCC report gave the same information, but continuing on the path of fossil fuels endangers the future of the world as we know it, something that people all over the world, including here in Canada know all too well now. Climate change is more than an environmental risk as defined in your annual report. It is a systemic risk that has the potential to impact every single aspect of TD's business. It is not only TD that will be affected by an action on climate change, but the entire economic system, which ensures shareholder value. It is cross-region and cross-industry systemic risk and must be treated with the urgency and vision needed to prevent this risk. This proposal seeks to end funding to fossil fuel expansion and is a first small [indiscernible] ensure that TD takes the steps needed to address the risk of climate change as well as to prevent what shareholders view as a significant reputational risk from greenwashing. Shareholders believe that this is in line with TD's climate action plan released earlier this year and in line with the net zero Banking Alliance commitment. By ending funding to fossil fuel expansion, TD will be a leader in the Canadian banking industry on climate action and will position itself at the forefront of transition and will be more able to meet its net 0 commitment. And it will be preserving shareholder value, not just for TD but across shareholders' entire portfolios. Please vote for proposal #1. Thank you.

Thank you, Ms. Meister. We'll now address any questions or comments that have been submitted by shareholders or proxy holders that directly relate to this proposal. If you're on the phone and have a question or comment directly related to this motion, please press start one. As you register on the phone, we'll proceed with questions from the room. Are there any questions or comments relating to proposal 1. Seeing none in the room, operator, are there any questions or comments on the phone?

Thank you. There are no questions registered at this time.

Thank you, operator. Are there any questions that have come in through the website?

There are no questions that come in related to this item.

Thank you. Your Board of Directors has recommended voting against proposal 1. Voting on our webcast is open, and we invite shareholders and proxy holders to submit their vote if they have not already done so. If you've already voted or sent in a proxy, there is no need to do anything unless you'd like to change your vote. For in-person attendees, please mark Shareholder Proposal 1 on the blue ballot now. The next item is Shareholder Proposal 2, which was submitted by MEDAC. The next item is Shareholder Proposal 2, which was submitted by MEDAC. You moved the motion. I will ask Norie to move the motion.

[indiscernible] resolution set out in the circular under the heading Shareholder Proposals, Proposal 2 be passed. I hereby move that the resolution set out in the circular under the heading Shareholder Proposal 2 be passed.

I'll now invite Mr. Willie Gagnon of MEDAC to present a statement on behalf of MEDAC regarding this proposal. I will now invite Willie Gagnon of MEDAC to present a statement on behalf of MEDAC regarding this proposal. Mr. Gagnon, over to you.

Thank you, Mr. Chairman. Can you hear me well?

Yes, we hear you clearly.

Thank you very much. My name is Willie Gagnon. I represent the Mouvement d'education et de defense des actionnaires or MEDAC. We would have been happy to be there in person. But since some meetings were held only virtually because of COVID outbreaks, such as RBCs, we decided not to make travel plans. But we will be there another year. 3 of our proposals are being put to vote. The first proposal, proposals that the bank analyze the possibility of becoming a benefit company and report on this to the shareholders at the next annual meeting. A benefit company is a status that is available in about 30 U.S. states as well as British Columbia. There is a bill that has been tabled to that effect in Quebec. We would like the bank to behave as though it were a benefit company and enshrine this in its by-laws in order for this to become a requirement to act according to its purpose and not nearly a choice. We understand that the bank implements its policies, but we would have wished the bank to obligate itself formally. This is also the basis of another proposal I will address later. We would request all shareholders to support our proposal.

Thank you, Mr. Gagnon. These are comments that have been submitted by shareholders or proxyholders that directly relate to this proposal. If you're on the phone and have a question or comment directly related to this motion, please press star one now. As you register on the phone, we'll proceed with questions from the room. Are there any questions or comments regarding Proposal 2? [Foreign Language] Seeing none, operator, are there any questions or comments on the phone?

There are no questions registered at this time.

Are there any questions on the webcast?

There are no questions or comment related to this item.

Your Board of Directors has recommended voting against Proposal 2. We invite shareholders and proxyholders to submit their vote if they have not already done so. If you've already voted or sent in a proxy, there is no need to do anything unless you'd like to change your vote. For in-person attendees, please mark Shareholder Proposal 2 on the blue ballot now. The next item is Shareholder Proposal 3. I will ask Norie to move the motion.

I hereby move the resolution set out in the circular under the heading Shareholder Proposals, Proposal 3 be passed.

I'll now invite Mr. Gagnon to present a statement on behalf of MEDAC regarding Proposal 3. Mr. Gagnon, over to you.

Proposal 3 is entitled Advisory Vote on Environmental Policy. It is proposed that the bank adopt an annual advisory voting policy with regard to its environmental and climate action plan and objectives. This is a proposal that has been made frequently, especially in other countries. A number of public companies here and elsewhere have already adopted that practice based on the say-on-pay vote. I'm referring to CN, CP, Glencore, Nestle, Rio Tinto, Unilever, Shell, the list is long. We have made this proposal to all major banks. The results we have received so far are substantial and encouraging. We dare to hope that the bank will take those results into account and implement that practice, which we believe is exemplary. This is one more instrument for shareholders to express their point of view. In the bank's reply, it is stated that the potential disadvantages of say on climate policy have been recognized. We disagree with those conclusions. And it is also stated in your reply that such a vote would not lead to an achievable consensus. That is not the purpose. The purpose is to take the temperature, is to canvas the opinion of shareholders on environmental issues. And obviously, we invite all shareholders to support our proposal. Thank you.

We'll now address any questions or comments that have been submitted by shareholders or proxyholders that directly relate to this proposal. If you're on the phone and have a question or comment directly related to this motion, please press star one now. As you register on the phone, we'll proceed with questions from the room. Are there any questions or comments regarding Proposal 3? I see none in the room. Operator, are there any questions on the phone?

There are no questions registered on the phone line.

Are there any questions on the webcast?

There no questions or comments related to this item.

Your Board of Directors has recommended voting against Proposal 3. We invite shareholders and proxyholders to submit their vote if they have not already done so. If you've already voted or sent in a proxy, there's no need to do anything unless you'd like to change your vote. For in-person attendees, please mark Shareholder Proposal 3 on the blue ballot. The next item is Shareholder Proposal 4. I ask Norie to move the motion.

I hereby move that the resolution set out in the circular under the heading Shareholder Proposals, Proposal 4 be passed.

Thank you, Norie. I'll now invite Mr. Gagnon to present a statement on behalf of MEDAC regarding Proposal 4.

Proposal 4 intended for French to be enshrined in the bank's basic documents in order for it to become a requirement that could not be set aside. As has been the case on a number of occasions included by other banks. Your bank has an impeccable approach to language, and we would have hoped that you would give an example to other public companies in this respect. You are not of the same opinion. We were hoping that the rationale we had presented in respect of language being part of the company's social responsibility be heard. In your reply, you referred to unnecessary expenses and Francophone clients, whereas we would have preferred you to address the bank's social responsibility. Yes, the bank is exemplary matters of language, and we would have liked that to be enshrined as an obligation in the bank's charter. So we would invite shareholders to support our proposal.

I'll now address any questions or comments that have been submitted by shareholders or proxyholders that directly relate to this proposal. If you're on the phone and have a question or comment directly related to this motion, please press star one now. As you register on the phone, we'll proceed with questions from the room. Are there any questions or comments regarding Proposal 4? Seeing none in the room, are there any questions on the phone, operator?

There are no questions registered at this time.

Are there any questions on the web?

Chair, no questions have come in related to this item.

Your Board of Directors has recommended voting against Proposal 4. We invite shareholders and proxyholders to submit their vote if they have not already done so. If you've already voted or sent in a proxy, there is no need to do anything unless you'd like to change your vote. For in-person attendees, please mark Shareholder Proposal 4 on the blue ballot now. The next item is Shareholder Proposal 5. I ask Norie to move the motion.

I hereby move that the resolution set out in the circular under the heading Shareholder Proposals, Proposal 5 be passed.

I'll now invite Kelly Hirsch to present a statement on behalf of Vancity Investment Management. I understand that Ms. Hirsch is joining us by phone. Operator, could you please invite Ms. Hirsch to present her statement.

Ms. Hirsch?

Wonderful. Thank you very much for having me here today, and thank you for the productive discussions that we've had on this issue with TD. And yes, so I just want to give a little more color to our proposal that we filed. So economic inequality has been steadily increasing since the 1970. A major contributor to the inequality is the increasing gap between what executives are paid and what the larger workforce is being paid. In 1978, the average CEO pay in the U.S. was only 31x higher than the average workers' pay. This is now skyrocket to 351x. Canada is not immune to this phenomenon. In 2020, CEO pay at the top 100 companies on the TSX was 202x the pay of an average worker. Wages are still diverging with average pay increases for executives at 17% from 2019 to 2020. This compares to only 4% for the average worker over the same time period. This highlights that the value being created by companies is increasingly accumulating at the top of the organization, which is driving wealth and inequality more broadly. On a society level, this growing inequality leads to poor outcomes for individuals across socioeconomic device. Much research has shown that unequal societies are associated with poor health, more violence, a lack of community life and increased rates of mental illness across socioeconomic classes. Specific to TD, compensation gap within an organization lead to lower employee morale, which can destroy company value as unmotivated employees are less likely to perform at their best and generate value for an organization. This can also lead to higher employee turnover, which is a significant cost for organizations, especially for human capital-intensive companies such as TD. It is critical to recognize that the ratio from a single year is not the focus. In order for the ratio to be useful, investors, employees and management need to see the trend over time. This allows TD to ensure the wage gap is not widening. If it is, as has been the tendency for the past few decades, this tool will be critical to identify that and make corrections to ensure employee sentiment stays positive, preventing turnover costs and decreased productivity. This disclosure is already a requirement in the U.S. and U.K., and they're a well-established method, including outlined in GRI reporting standards to calculate and provide this disclosure. We firmly believe it is possible and in the best interest of TD and the company's shareholders to begin tracking and disclosing the CEO to median worker pay ratio. Therefore, we propose the Board of Directors undertake a review of executive compensation levels in relation to the entire workforce and at reasonable cost and admitting proprietary information provide a report to shareholders and publicly disclose the CEO compensation to median worker pay ratio. Thank you very much.

Thank you, Ms. Hirsch. We will now address any questions or comments that have been submitted by shareholders or proxyholders that directly relate to this proposal. If you're on the phone and have a question or comment directly related to this motion, please press star one now. As you register on the phone, we'll proceed with questions from the room. Are there any questions or comments regarding Proposal 5? None in the room, operator, are there any on the phone?

We have a question from an English participant, [ Latifa Hewitt ].

My name is [ Latifa Hewitt ] and I'm glad to be here. I just want to piggyback also with the shareholder or the proxyholder said before. I started speaking. I feel like that is a valid point on what she's saying. The employee is being enthused to work here, to make money where they work. They have to be motivated and encouraged and light their environment. I also want to say, aside from that, I'm having trouble accessing my funds from this company. I've been a shareholder and I invest and I've seen none of my profits, and I'm not even able to access a vote. I don't know what went on with my control number, but I'm not having access to anything. Once again, my name is Latifa Hewitt.

Okay. I think we'll have somebody from TD customer care contact you Ms. Hewitt. If you could give the operator your contact details so that we'll be able to get back to you and we'll try and straighten out your access. And we appreciate your comment on the motion. Are there other questions on the phone, operator?

There are no further questions registered at this time.

Any questions on the web?

Yes, Chair. There is a comment submitted in French. I would read it in French and then follow in English. The comment is from Mr. Gagnon from MEDAC. MEDAC supports Vancity's proposal on disclosing the compensation ratio. We invite shareholders to vote in favor of this proposal.

Thank you again, Mr. Gagnon. Are there any other questions on the web?

No more.

Your Board of Directors has recommended voting against Proposal 5. We invite shareholders and proxyholders to submit their vote if they have not already done so. 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. For in-person attendees, please mark Shareholder Proposal 5 on the blue ballot. That completes the proposals. I'll wait a moment while you finish voting. For our in-person attendees, please remember to print your name above your signature. I'll now ask the attendants to collect the blue ballots. I'll now ask Mr. Gagnon to present his statement on behalf of MEDAC regarding the 5 shareholder proposals which were withdrawn. Gagnon, over to you.

We had submitted 5 additional proposals to the bank. Since we have already spent a lot of time on shareholder proposals, I will be as brief as possible and will nearly list the reasons why we have agreed that these additional proposals not be put to a vote. Proposal A, dealt with the formal representation of employees in the decision-making, especially strategic decision-making. The bank has agreed to examine these issues in greater detail, and we look forward to hearing more about what you have found next year, especially the models that exist in Continental Europe and the United Kingdom. We had made a proposal related to disclosing information on female managers. We were requesting that this information be broken down by level. And in your response, you state that the bank has agreed to improve its disclosure. We had given you, as an example, the Royal Bank's disclosure, which is not perfect, but is exemplary. And we look forward to your disclosure being harmonized in future. Third proposal dealt with decarbonization. We were asking the bank to adopt interim targets for achieving carbon neutrality. You have joined a number of bodies in that respect. We look forward to you joining the principles for responsible banking. And we have agreed not to request that this proposal be put to a vote given your commitments. However, we are alarmed by the recent publication of a report that stated that Canadian banks have increased their proportion of fossil fuel financing in 2021 by 63%. We will keep a close eye on this. Our fourth withdrawn proposal dealt with an environmental and climate committee of the board. We were asking you to create a new board committee to address environmental issues. In fact, Mark Carney, the Former Governor of the Bank of Canada and the Bank of England and now Special Envoy on Climate Action and Finance at the United Nations, had called for the same measure. You explained in your response that these issues are enshrined in the mandates of various board committees, which to us is equivalent to what we were requesting since environmental and climate issues will loom large in the near future in the concerns of public companies. Our fifth withdrawn proposal dealt with the circular economy and disclosure on that issue. We see that the bank has joined Circular Economy Leadership Canada, which satisfies us. Again, we continue to hope that you will join the UN Principles for Responsible Banking. Mr. Chairman, we are very happy with the engagement of the bank this year. Our discussions were very high quality. Thank you very much for your attention. I'm well aware that there were a lot of proposals. And I believe that this came to pile up over time, and given the crisis situation we are in, it is normal. Thank you very much.

Thank you, Mr. Gagnon, and thank you for your comments about the quality of engagement with the bank. On behalf of the bank, we have exactly the same appreciation with the quality of our engagement with you. [indiscernible] in the management proxy circular. And so in the interest of time, we won't repeat the bank's views. But as I just said to Mr. Gagnon in French, he said that he feels that we've had a constructive engagement. And from the bank's point of view, we feel the same way. I understand that the scrutineers have a preliminary tabulation of votes cast in respect of each of the items of business before the meeting. I now ask Pat Lee, representing the bank's register and transfer agent to provide us with the scrutineer's report.

Mr. Chairman, for the information of the shareholders, we wish to report that 54.1% of the eligible shares have been voted at this meeting. The results with respect to the election of directors are; a substantial majority of the votes cast at the meeting were voted in favor of the 13 nominees named in the Management Proxy Circular, with each nominee receiving in excess of 96% in favor. The result with respect to the appointment of auditor is 98.7% voted in favor of Ernst & Young LLP and 1.3% withheld from voting. The result with respect to the advisory vote on the approach to executive compensation is 95.4% voted in favor of the resolution and 4.6% voted against. The results with respect to the shareholder proposals are; Proposal 1, 6.5% voted in favor, 93.5% voted against with less than 74 million shares abstained from voting. Proposal 2, 3.6% voted in favor, 96.4% voted against with less than 4.1 million shares abstained from voting. Proposal 3, 27% voted in favor, 73% voted against with less than 56.4 million shares abstained from voting. Proposal 4, 0.5% voted in favor, 99.5% voted against with less than 2.9 million shares abstained from voting. Proposal 5, 14.4% voted in favor, 85.6% voted against with less than 41.6 million shares abstained from voting. Mr. Chairman, that concludes the scrutineer's report.

I now declare that the 13 director nominees named in the proxy circular have been duly elected. Ernst & Young LLP has been duly appointed as auditor. The resolution on the advisory vote on the approach to executive compensation has been passed. And shareholder proposals 1, 2, 3, 4 and 5 have been defeated. Final voting results will be made available shortly on td.com. This concludes the formal business of the meeting. We'll now move to shareholders' questions and comments. I remind you that questions should be of a general interest and not of a personal nature. If you're asking a question of a personal nature on the phone, we'll have one of our customer care representatives get in touch with you after the meeting. Before asking your question, please state your name and state whether you are a shareholder or a proxy holder. We'll now proceed with the questions. Bharat, would you please conduct the remainder of this portion of the meeting.

Thank you, Brian. I always look forward to this portion of the meeting where we have the opportunity to hear from you, our shareholders and answer your questions. Let's begin with questions from the people in the room with us today. Questions. Yes, #2.

My name is Lucian Vital. I'm an employee-shareholder. First, thank you for the chance to ask a question today. In your earlier remarks, you touched on TD's climate action plan and some of the steps that have been taken towards TD's net-zero target. I was wondering if you could comment further or provide a further update on TD's progress?

Thank you for your question. It's great to see our folks in the room as well, particularly, they're not only employees, but shareholders of the company, and thank you for the question. I'd say before I get to the climate action plan, it is important to note the bank's history on environmental issues. I mean we are very proud as to where TD has come from. We were -- we setup the TD Friends of the Environment Foundation more than 30 years ago, a long before people were talking about the environment. But as a bank, we knew this is an important issue and we need to deal with it. We were the first North American bank to go carbon neutral in 2010, long before it became popular for banks to now announce or companies to now announce that they plan to go carbon neutral, we did that in 2010. We've been a leader in green bond issuance, one of the largest in the world, helping out companies to raise financing that is green in nature and environmentally sensitive and friendly in nature. We -- as you pointed out, on the climate action plan, we were the first Canadian bank to announce our climate action plan where we are targeting to be net-zero, including in finance emissions by 2050 in accordance with the Paris agreement. And I would also say, this part sometimes gets missed, we were the first Canadian bank, a few years ago, we announced that we will be providing CAD 100 billion in financing to move to a low carbon world. This was TD's commitment that we'll do that within 10 years. Well, I'm happy to report, in 4 years, we have reached the level of CAD 86 billion already. And our climate action plan, I said, our target is to get to net-zero by 2020. And in fact, in our plan, we had said we'll come up with interim targets, which we now have. As many of you may be aware, for Scope 1 and 2, we said we'll have a reduction. We've outlined that in our ESG report regarding -- by 2025, what we'll do regarding Scope 1 and 2. With respect to Scope 3, that's the finance emissions, we came up with our interim targets for the energy and power generation sectors, and that is also outlined as to how we plan to get there. So I feel that as a bank, I feel very proud about our history, our plans to go forward. This is the way to move forward as well. I should also add one of the important functions of the bank to help our clients get to a net-zero world in a low carbon economy. And there, we've established a center of expertise within the bank to help folks within TD, but also help our clients. We in TD Securities have setup a sustainable finance and a transitions group to work with clients and to see what do they need to do to get to net-zero, because that's an important component of the world moving to a better place in this very important regard. And of course, I said that in my remarks, we are part of the net-zero banking alliance convened by the United Nations and Mark Carney, I think somebody mentioned Mark's name in one of the proposals. He is very much part of it. And we are proud to be part of that organization, which looks at global collaboration as to how can we get to a net-zero world. And so finally, as you rightly have pointed out, it's going to take a lot of effort among everybody to get to that world. But in the meantime, there's a transition required. There is no way that we can flick a switch and get there. And I think we've seen recently as to what is going on in Europe that reliance on energy supply through this transition on countries or actors, they may not be in keeping with what the world wants is an important issue. And hence, in my comments, in my remarks earlier, I said, through this transition, energy security is critically important for the world as well. And I think Canada can play an important role there, because if the world needs energy through this transition, it requires responsible players to be at the table, countries that have very strong environmental standards, very strong governance and enforcement of such standards should be the ones providing that energy in a responsible and an orderly manner. So -- and I don't want to take the whole time here talking about TD's plans, but I think it gives you some sense as to how we have been thinking about it, but this goes back 30, 35 years in the bank and feel very proud as to how far we've come and our plans moving forward. But thank you for your question. Really appreciate it. #4, where do I see. All right, #4, yes.

My name is [ David Peters ]. I'm a shareholder. Recently, Citicorp and JPMorgan Chase have disclosed their exposure to Russia. And I was wondering if you would comment on the TD Bank's exposure in its portfolio to Russia. And I'd like to ask a question. In doing your sovereign risk analysis, do you consider the mental health situation of the leader of a foreign country when you loan money to them or buy their bonds? Anyway, I've noticed the smile up there on the face.

Firstly, [ David ], it's great to see you. I hope you're well and have managed through this dreaded pandemic well. It looks like you're looking well. So great to see you, and please pass on my best to the family as well. We've had a long history with the Peters family at the bank. Regarding your question, and I will include Ukraine in it since it's a war zone there as well. TD does not have any direct exposure to the Ukraine. And with respect to Russia, very immaterial exposures. We don't lend on a direct basis, but sometimes we act as an intermediary for settlements, et cetera, et cetera, but that's a very small part of our exposures to that part of the world. With respect to your second question, of course, whenever we do any type of lending, due diligence, analysis, the character of people we are dealing with is a core component of the due diligence. So we try our very best to ensure that we are dealing with appropriate parties that exhibit the best of humankind. And so that is part of our process. And we hope that the situation in Europe stabilize as soon as possible. What a trade being played out in 2022, nobody would have thought that. And it's right for you to point out how important an issue it is for the world. Thank you for the question. Any other questions in the room? I don't see any. Okay. Now we'll take questions from the phone. Operator, do we have any questions from the phone?

Our first question is from an English participant, Emily DeMasi.

I thank the chair members of the board and fellow shareholders. My name is Emily DeMasi, and I work for EOS at Federated Hermes, and I'm here as a proxyholder on behalf of our institutional investor clients who own CAD3.7 billion in TD Equity, effectively making them the bank's sixth largest shareholder. We're also active participants in the Institutional Investors Group on Climate Change, IIGCC. IIGCC's investor expectations for the banking sector include aligning the bank's financing with the delivery of the goals of the Paris agreement, governance of climate risks and opportunities and the bank's disclosure of its climate governance, strategy, risk management approach and metrics and targets to be in line with the recommendations of the TCFD. Today, I'd like to address the bank's climate strategy as it relates to a just transition as we consider this important for the long-term success of TD. We appreciate the bank's net-zero by 2050 target, the transparency around its methodology and the initial sector-based decarbonization target set by the bank. We'll monitor the ongoing process against these and the disclosure of more robust sector-based targets. We also appreciate that TD has committed to take action to support the just transition with a focus on supporting workers, businesses and communities impacted by the transition to a low carbon economy. We just like to understand more about how the bank is integrating considerations for a just transition into its engagement with clients' financing practices and policies. Special consideration and plan should be detailed for communities most adversely affected by the fossil fuel industry. Our concern here is that as other financial institutions withdraw from these activities, a concentration of risk may occur within the Canadian banking sector. To mitigate these risks, banks should be working with communities towards achieving a just transition. This engagement will support TD in navigating risks and opportunities within the low carbon transition with respect to environmental justice and human rights. I ask the Chair, will TD's commitment to a just transition be supported by reporting on specific actions the bank will take to achieve the just transition, including clarity on how borrowers' own commitments, capacity and strategy to achieve the just transition is factored into financial decision-making and when can we expect such disclosures?

So Brian, are you taking this? I think she's addressing this to the Chair.

The bank is recognized as a leader both in the substance of our climate action plan and the comprehensive and transparent disclosure that we provide with respect to its implementation and its details. It's our intention to keep current with the evolution of financial institution practices in this regard and maintain our leadership position.

Thanks, Brian, and thank you for your question. It is an important question. And as I said in my remarks, part of the program we have here is to help our customers get to a net-zero world, and we are totally on site with having a just an orderly transition here. But we do recognize it is a transition and all of us need to be active in that to make sure that as a bank we are part of the solutions for many of these aspects. So thank you, and appreciate your comments. Any other questions, operator, on the phone?

Our next question is from an English participant, Angus Wong.

I'm a proxy holder. So this -- so in the International Energy Agency Net-Zero Emissions by 2050 report, the IEA says beyond projects already committed as of 2021, there are no new oil and gas fields approved for development in our pathway and no new coal mines or mines extensions are required. Yet in TD's urging of shareholders to reject Resolution 1 that was introduced today, it quotes the IEA, and I quote, the need to continue to invest in the responsible production of fossil fuels during the transition period in order to facilitate a just and orderly transition has been acknowledged by policymakers such as the European Commission and by experts bodies, such as the International Energy Agency, including in its net-zero report, which is the basis of currently used by TD and some other major banks as a benchmark determining their 2030 emissions reduction targets. When I read the urging to reject this resolution by the board, it leads a little bit of TD attempting to use this information between its shareholders to vote against this proposal, a very important proposal as introduced by Amelia Meister earlier today. Can you explain the contradiction in the explanation to convince shareholders to reject this proposal?

Thank you, Mr. Wong, for your question. I think we've laid out our rationale in the proxy as to why we feel the way we do. And with respect to the IEA, no doubt, there is some confusion as to what it has said, but it is also very clear in the report that in order to have an orderly transition, continued energy availability is critically important, otherwise you're going to have societal and economic impacts that obviously one has to consider. So I hope the IEA will clarify its position. As you said, there could be an interpretation issue there. But from our perspective, it is very clear that through this transition, continued supply of responsible energy is necessary and continues to be supportive. But we appreciate your question. Any other questions, operator, on the phone?

Our next question is from an English participant, Rueben George.

My name is Rueben George. I'm the Spokesperson Manager at Tsleil-Waututh Nation Sacred Trust Initiative. I'm calling from my homeland in Vancouver. To Tsleil-Waututh Nation, the people [indiscernible] live at the terminus of the TMX, the Western Marine Terminal. It's not just in your backyard, it's in your breadbasket. I'm joining you today because we believe TD is considering more involvement in financing the Trans Mountain Expansion Project. After the Trans Mountain revealed, the costs have skyrocketed to CAD21.6 billion. Finance Minister Freeland announced that no further public money would be invested in the project. This is misleading because any debt incurred by the Crown Corporation like Trans Mountain is a public debt. However, TMX is now needs to raise CAD10 billion from the private sector. With the fundamentals of the TMX are at worse than ever, it seems destined to be and will be a stranded asset. Minister Freeland explicitly named TD Securities as a key advisor on TMX. We know that TD also helped to structure the purchase of the Trans Mountain by Canada from Kinder Morgan after the pipeline company concluded that TMX was too risky and uncertain. We all know that TD also funded the Dakota Access Pipeline. TD conducted internal study following the event of Stand N Rock in 2016 that caused significant reputational harm to TD. TD has financed over CAD140 billion in the fossil fuel sector since the Paris accord. This is the 11th most of all financial institutions in the world. I'm here to tell you, your shareholders, your customers directly that Tsleil-Waututh Nation does not consent to TMX. We conducted our own independent assessment under unextinguished indigenous law, which applied world-leading oil field science to reach our final decision to withhold our free, prior and informed consent. TD talks a good game about indigenous rights and environmental responsibility as you did in your opening. But you continue to walk in the opposite direction by financing fossil fuel projects that violate indigenous rights. My question to you are, will you release the full report on standing to your investors so they can understand TD's approach to indigenous rights? Why does TD's due diligence policy allow to continue to finance projects that do not have free pardon form consent and which will worsen the climate crisis that we're in now today?

Thank you for your question, and happy to note that it is sunny in Vancouver, it's a little warm in Toronto, but I'm not sure it's as sunny as it might be in Vancouver. You raised very important issues in your question. Firstly, on pipelines. It is important that there is a safe way of transporting oil and gas. Otherwise, the other mode is to take -- to use railroads, which are even bigger problem and we've seen that happen in Canada before. So it's hard for me to comment on a specific situation like -- the Trans Mountain pipeline is owned by the Government of Canada. And I'm sure the Government of Canada will do what is appropriate in raising financing or whatever the case might be. I think your question, we've signed up to the equator principles. Our outreach to all stakeholders, including indigenous communities is a very important part of our process. Before we do any form of financing, this due diligence process requires us to engage with all stakeholders. So that is an important component of how we think about this. But as I've said, we need to recognize that we have to go through a transition here to get to a low carbon economy and responsible players are critically important in order to get there. Regarding your question on how our due diligence works, how it may impact communities, I will ask some of our people. I can think of Janice Farrell Jones who runs our ESG Group in the bank and her partner Nicole Vadori to get in touch with you, to tell you exactly in detail what the bank's due diligence process is, how we measure compliance around it and what kind of backup work we do before we engage in any form of financing in this important area. But I appreciate your comments and look forward to your speaking with our folks that I just pointed out. If you can let the operator know your contact details, we'll make sure our folks reach out to you and give you more detail. Operator, are there any other questions?

Our next question is from an English participant, Amelia Meister.

So my question is also on the climate action plan that was recently released. And the shareholders that I represent are happy to see that TD has now made some interim targets as per the proposal that we filed in 2020. However, [indiscernible] are concerned that these targets are not ambitious enough in the short-term and they are intensity targets rather than absolute targets. In 2018, the IPCC report stated that the world needed a 50% reduction in greenhouse gas emissions across all sectors, regions, industries and countries by 2030 in order to prevent catastrophic climate change. TD's most ambitious targets not only fell short of this necessary reduction, but are not absolute targets, which make room for potential increases in emissions should intensity increase in the targeted sectors. My question is why has TD chosen to ignore the signs and fall short of the necessary targets? And why has TD chosen intensity targets rather than absolute targets like its competitors, Bank of Montreal?

We believe in both. We think by the time we get to 2050, absolute targets would absolutely matter, and that's the only way you can get to net-zero. But to drift through this transition, we also believe that we have to support players that are working to get to net-zero. These might be very responsible players. They may need to invest in new technologies, to reduce their own carbon footprint, and we have to ensure energy security through this transition. So we feel there's room for both. And we will as well, provide more information on absolute targets as we move along this journey. But as we have said, transition is an important component of our climate action plan. And to support responsible players that are trying to get to a low carbon economy are very important in this equation. And they are part of our, what I'll call, sustainable finance and transitions group's target to meet with them to see what it will take for many of these players to get to a net zero world. So we think there's room for both. And we will ensure that we provide reporting as to what progress we are making in the future. Thank you for your question. Operator, are there any other questions?

There are no further questions registered at this time.

Operator, are there any questions on the webcast?

We've received the following question from Jeff Carlson, a shareholder, who asks, we have now listened to several shareholder proposals and speeches by special interest groups MEDAC, Vancity Investment Management and some of us. Shareholders have heard such proposals often the same ones in previous AGMs, and each time these proposals have failed to pass usually with an overwhelming number of votes cast against them. Addressing such proposals by TD management requires a considerable effort and time commitment. As shareholders, we all have a vested interest as to the details of these discussions held between bank management and the proponents of these proposals. Therefore, the details of these discussions must be made public so that shareholders can properly understand their full nature and consent. My questions are, what related specific dialogue has been held with these groups, including meetings and discussions of any kind? And when and how will these minutes of these discussions be made available to all shareholders?

We have a whole process around how we engage on any proposals that are submitted to the bank. There is an ongoing dialogue that takes place. We have a group in our bank that engages with these groups to make sure that we have the full details as to what is being asked. There is an ongoing process with our board and our board chair as well, where appropriate, to engage with these folks. And we've laid out the reasons for the proposals and the bank's position on it, and that's how we run our process. And a lot of these discussions are very detailed and obviously are important for you to know of. And whatever we feel is appropriate, that is noted in our proxy. So that's how we run our process. And we think it works well and gives both sides of the argument well. Operator, any other questions on the webcast?

Yes, we have a question or comment from [ John Flanigan ], shareholder. This is a general comment. My concern is with respect to the lack of recognition by small business banking advisers of the Competition Act Section 55 and 55.1 that covers the direct sales industry. I've been in the direct sales industry for the past 30 years and very frustrated with the reaction by all 5 major Canadian banks to the Direct Sellers Association of Canada, www.dsa.ca. I would appreciate someone from the bank to reach out to me and to allow me to further share information about the Competition Bureau's Canada Competition Act Section 55 and 55.1.

Yes, we will ensure if you'd like to give your contact details to the operator, we will -- or to the -- or send it to us by -- on the webcast, and we'll make sure that our folks get in touch with you to provide you any clarifications you may require regarding our small business banking practices. Any other questions through the webcast, operator?

Yes, we have a general comment from shareholder, [ Frederic Fromm ]. Depositors' trust and confidence are vital to our bank. The government's invoking the Emergency Measures Act in February shocked many as did the freezing of over 200 bank accounts. Testimony at a parliamentary committee revealed that its considerable number of people withdrew money in panic. Would the directors consider a court challenge to the government's action of freezing bank accounts of people who had not been charged or convicted of any crime? This might reassure depositors that the bank will do everything necessary to protect their money.

The Emergency Act was obviously not a good event for Canada. It's done in an emergency. As a bank, we follow the rules that apply to our industry, and that's what we did. And as a bank, that's what you should expect of us that we will follow the rules and regulations that are out there. We do collaborate with governments to ensure that these rules are clear and that there is no ambiguity around them. So that's how we manage those situations. Any other questions through the webcast?

Yes. The next question was submitted in French by Willie Gagnon from MEDAC. I will read the question in French and provide the English translation. Laurentian Bank has already committed to holding an advisory vote on its environmental policy each year. With today's 27% vote in favor of this shareholder proposal, will the bank do the same in the future?

Mr. Gagnon, I appreciate the question. Yes, we heard the result and we will consider this very carefully as we do every year. But I think it is important to note that approximately half of our outstanding shares were voted today, and we need to take into consideration as what the bank situation would be with all our shareholders. So we certainly will take into consideration as we move forward. But you've seen our rationale as to why we do not think it's appropriate for the bank to go with the proposal as you had submitted. So our position does not change, but we, as usual, every year, we'll make sure that we engage with the appropriate parties and consider our position on a go-forward basis. Any other questions on the webcast?

Yes. The next question was submitted in French by Willie Gagnon from MEDAC. So I read in French and provide the English translation. Scotiabank now produces a vertical analysis through a ratio of its compensation, others have done so since 2016. Given the results of 14% obtained today in favor of Vancity's proposal, to that effect, will the bank produce those ratios in the future? The Bank of Nova Scotia publishes a vertical analysis ratio of its compensation. Desjardins has also been doing so since 2016. We've been calling for it for several years now and we are not alone. Given today's 14% vote in favor of Vancity's shareholder proposal to do so, does the bank intend to publish its pay ratios in the future?

Mr. Gagnon, we have outlined our rationale as to why we think such a ratio is not appropriate or helpful given the type of businesses we run in various jurisdictions and various different segments of banking. So of course, like the previous question, we look at this on an ongoing basis as to what might make sense and what might be useful. So yes, we will look at it, but our view is unchanged from the rationale we provided to the proposal in the proxy. Any other questions through the webcast?

Yes, we have a comment from [ John Flanigan ], a shareholder. I have a concern about the objection to executive compensation, and I would like to enlighten my fellow shareholders of the 4 cash flow quadrants. If all the shareholders can visualize a plus sign, up in the top left is an E, which stands for employee. In the bottom left is an S, which stands for a small business owner or self-employed. Up in the top right is the B, which stands for big business, i.e., the bank. Down in the bottom right is an I, which stands for investor. Now if the activist shareholders object to CEO and President's compensation, Mr. Masrani is responsible for 90,000 of the bank's employees. For those that don't think they are being adequately compensated, change the quadrant you earn your income from.

I guess this is just a comment and I'll leave it at that. Thanks for your comment. Any other questions through the webcast?

Yes, we have a question from [ Dan Welch ], shareholder. TD's commitment to ESG is broad. A lot of the questions that have been asked today are focused on the environment. Social issues are extremely important, especially basic human rights. How do we balance social versus environmental issues in procurement and financing?

You bring up such an important point, and that's why in my prepared remarks, I did talk about the importance of social responsibility as well. And at the bank, we take that very seriously and proud of our history and we will continue to work in that respect with issues such as diversity and inclusion, which is a core part of our culture, and we will continue to work to ensure that the social side of the ESG equation is not lost. So appreciate your comment. Any other questions come in through the webcast?

There are no further questions from the webcast at this time.

Any questions on the phone?

There are no questions registered on the phone lines.

And I don't think I see anybody in the room standing to ask any questions. Well, thank you for your questions. As usual, this is terrific to engage with our shareholders. And if there's any further questions people have or clarifications they want, please reach out to us. Appreciate it. And Brian, I'll hand it back to you.

Thank you, Bharat. This concludes our meeting. On behalf of the bank, I'd like to thank you for participating and for your ongoing commitment to TD. I wish all the best to you and your families and hope that you stay safe and healthy. I wish you health and happiness. Thank you.