National Post (National Edition)

Manulife looks east for next CEO

Head of Asia division will replace Guloien

- BARBARA SHECTER

TORONTO • Don Guloien, who took over as chief executive of Manulife Financial Corp. at a turbulent time in the insurer’s history, is retiring at the end of September at the age of 60.

He will be replaced by Roy Gori, 48, who he hired to run the company’s Asia division in 2015, and who was then tapped last year to become president of the company.

In an interview Thursday, Guloien said he hired the Australian citizen and Citi veteran with an eye to adding him to the bench lineup of possible successors.

“(Given) the importance of Asia to the company, it would be silly to fill that role with anyone I didn’t think could be CEO,” Guloien told the Financial Post.

He said Gori, who worked for Citi for more than two decades in locations including Sydney, Singapore and Thailand, quickly proved himself to be adept at collaborat­ion, and gained the respect of colleagues beyond the Asian operations.

“It wasn’t a tough decision at the board,” Guloien said, adding that a key to landing the CEO job was a shared vision that Manulife must embrace digital technology and a “customer-centric” approach across all of its geographic locations and product groups.

“He’s been a great collaborat­or and contributo­r to the cultural change we’re trying to make in the company. Obviously, he’ll be able to do that from a much bigger perch,” Guloien said. “It’s great to be passing the baton to a guy who shares the same vision, the same goal, but can actually do it probably faster and more capably than I can.”

Gori said he feels he can continue along the path set by his predecesso­r.

“The organizati­on really is in great shape,” he said.

Currently vice-president and general manager of the Asia division, Gori will take additional responsibi­lity for leadership of Manulife’s Canadian, U.S., and investment operations on June 5. His appointmen­t as CEO — which takes effect Oct. 1, when he will also join the board — is subject to immigratio­n approvals, Manulife said in a statement Thursday.

In the same statement, the insurance giant announced the unexpected departure of Craig Bromley, who was senior executive vice-president and general manager of the company’s U.S. unit, John Hancock.

Guloien declined to elaborate on Bromley’s departure, or say what role, if any, the CEO succession plan might have played. “It’s part of a leadership change,” he said. “We’ve really said as much as we want to.”

Guloien took over as head of Manulife from longtime CEO Dominic D’Alessandro in 2009 as the company, which was heavily exposed to equity markets, dealt with the fallout from the 2008 financial crisis.

“Donald’s eight-year tenure as CEO began in the aftermath of the most serious financial crisis in modern history, and at a moment when Manulife faced a number of difficult internal and external challenges,” Richard DeWolfe, chairman of the board, said in a statement.

“Today, the company has a strong, global footprint positioned for growth, with more than $1-trillion in assets under management and administra­tion and $4 billion in core earnings in 2016 alone.”

The latest CEO transition is not the only executive shakeup that drew attention from company watchers. The departure of Bromley from John Hancock was “unexpected,” Barclays Capital Inc. analyst John Aiken said in a note to clients.

Bromley is to be replaced on an interim basis by Michael Doughty, president and general manager of John Hancock Insurance, leaving the future leadership there uncertain.

Aiken told clients Guloien’s upcoming departure after a 36-year career is “disappoint­ing.” But the analyst called Gori a “strong” replacemen­t, and said the ample transition period suggests there won’t be any change to Manulife’s business or strategy in the near term.

The announceme­nt of Guloien’s retirement came just months after Manulife turned the page on its postcrisis issues with a settlement of long-standing class action lawsuits in Ontario and Quebec. In January, the company announced a $69-million settlement of the suits, which related to the company’s disclosure of market price risk in segregated funds and variable annuity products. The settlement was made without any admission of wrongdoing or liability, Manulife said at the time.

At the height of the financial crisis in 2008, when stock markets plunged, Manulife slashed its dividend by half and issued more than $2 billion of stock to shore up capital. A broad hedging program was implemente­d to reduce exposure to stock market swings, and, under Guloien, the company reined in sales of variable annuity products.

Guloien said he doesn’t view the settlement of the lawsuits as a bookend to his start in rockier times at Manulife, but he’s pleased to have closed that chapter, along with meeting key financial targets in time for his retirement.

“It’s nice to leave as little unfinished business for the new CEO as possible,” he said.

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Donald Guloien

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