Exhibit 99.3

Manulife Financial Corporation

Annual Meeting  |  May 4, 2017

Important information for shareholders

Your participation is important.

Please take some time to read

this document and vote.

  Notice of annual meeting of common shareholders

You’re invited to attend our 2017 annual meeting of   common shareholders
When    May 4, 2017    11 a.m.    (Eastern time)    Where    Manulife Head Office    200 Bloor Street East    Toronto, Canada	Four items of business •    Receiving the consolidated financial statements and auditors’ report for the year ended December 31, 2016 •    Electing directors •    Appointing the auditors •    Having a say on executive pay
	We’ll consider any other matters that are properly brought before the meeting, but we are not aware of any at this time. The annual meeting for The Manufacturers Life Insurance Company will be held at the same time and place. Please read the voting section starting on page 12. Your vote is important. By order of the board of directors, Antonella Deo Vice President and Corporate Secretary March 8, 2017

Dear fellow shareholders

On behalf of the board of directors, we are pleased to invite you to the annual meeting of common shareholders of Manulife Financial Corporation, on May 4, 2017 at Manulife’s head office, 200 Bloor Street East, Toronto. As a holder of common shares you have the right to receive our financial statements and to vote your shares.

Our 2017 management information circular, which starts on page 10, includes important information that will help you understand what you will be voting on at the meeting. This summary highlights some key things to know, but we encourage you to read the entire circular before you vote your shares. Your feedback is integrated into the board’s decision-making process.

Listening to shareholders

Manulife believes that directly engaging with shareholders and other stakeholders is critical because it allows us to hear issues directly from the source, and to respond in a meaningful and timely way.

We have had an active shareholder outreach program for a number of years and this year we expanded the scope of our outreach to address the lower support we received for our executive compensation program at last year’s annual meeting of shareholders. While a majority of votes were cast in favour, support came in at 77%. We were disappointed by the result, and at the meeting I personally committed to speaking directly with shareholders to understand their concerns and to make the changes necessary to earn the full support of shareholders.

As Chairman, this past year I led 25 meetings and conference calls with approximately 50% of our institutional shareholder base. John Cassaday, the chair of the management resources and compensation committee, joined me at these meetings and we appreciated the candor and openness of shareholders. We covered a broad range of issues, but one important focus of the discussions was our executive compensation program, our levels of executive compensation relative to global peers and our performance against our short and long-term objectives.

These meetings provided us with tremendous insight into what shareholders value in our compensation program and what they believe we should improve. We also received similar feedback from other industry participants such as proxy advisory firms. Management including the CEO were a constructive part of this process, and together we made changes that ensure appropriate compensation in relation to peers that are

2017 Management information circular 1

more effectively aligned with our financial results, strategic accomplishments and shareholder experience going forward:

1 We carried out a comprehensive review of our executive compensation program, including an extensive peer and industry review

2 We discussed several approaches and reviewed the concepts at a high level with shareholders

3 We simplified the compensation program, linked executive pay more closely to performance and improved alignment with shareholders

4 We tested our executive compensation designs rigorously, including back testing different performance measures, ranges and economic scenarios

5 We made appropriate adjustments to ensure that our compensation is in line with peers, including decreasing total compensation for our CEO and placing a greater emphasis on “at risk” components of executive compensation

Our performance in 2016   Manulife achieved strong operating results in 2016, ending the year with $4 billion in core earnings, an increase of 17% over the prior year, and achieving the target we set back in 2012. Full year net income attributed to shareholders rose to $2.9 billion – an increase of 34% over the prior year.   Total shareholder return (TSR) was 19.9% in 2016.  

On the basis of our strong operating results, and our outlook for growth going forward, the board approved an 11% increase to our dividend, marking our third consecutive year of increases, a cumulative increase of 58% over this period. While these results are excellent, we actually had more ambitious targets for the year and our three-year TSR is still below the median of our peer group. As a result, the board awarded annual incentive payouts for me and others on the senior management team that were considerably lower than target, which is fair and reasonable.

It is unusual for a CEO to be speaking positively about a reduction in his compensation, but there are times when it is warranted. As CEO, my compensation has always been paid in U.S. dollars, and as a result of the appreciation in the U.S. dollar, the past increases awarded to me by the board, and the various changes within our compensation peer group, my compensation is high relative to the companies that we benchmark against. As a result, consistent with shareholder expectations, the board reduced my 2017 medium and long-term incentive awards by 25% and also eliminated restricted share units, focusing more on “at risk” longer-term incentives. Having been an investor most of my life, I see the investors’ point of view on relative compensation and pay for performance, including where it affects me; and the reality is that I feel passionately

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6 We improved the disclosure of our executive compensation program for 2016, the changes we are making for 2017 and the rationale for the compensation decisions approved by the board

7 We will implement the changes to our executive compensation program starting with the 2017 performance year

The board also placed special emphasis on the areas of strategy, risk and management succession during its 2016 meetings. The letters that follow from the CEO and the chair of the management resources and compensation committee further clarify the changes that were made to the executive compensation program and the discretion that was used with respect to the CEO pay decisions.

continued on page 8

that CEO compensation should be totally aligned to long-term shareholder value creation. Here are some of the many financial highlights in 2016: ∎   In a challenging year for asset managers where many experienced large net redemptions, our gross flows in our wealth and asset management businesses were $120.5 billion, an increase of 3% compared with 2015; our net flows were $15.3 billion compared with $34.4 billion in 2015 ∎   Insurance sales were $4.0 billion, an increase of 11% compared with 2015 ∎   New business value was $1.2 billion, an increase of 22% from 2015 ∎   Total assets under management and administration were $977 billion as at December 31, 2016, an increase of 6% compared with 2015

Overall, our strong operating results and our strategic progress in 2016, especially in our rapidly growing Asia and our wealth and asset management businesses, give us confidence in Manulife’s strength, continued momentum and success for the long term. All of these results are reflected in the board’s decisions about the 2016 annual incentive awards and the 2017 salary and medium and long-term incentive awards, which you can read about in the chair of the management resources and compensation committee’s letter that follows.

Donald A. Guloien

President and Chief Executive Officer

2017 Management information circular 3

Executive compensation

Pay-for-performance is the underpinning principle of our compensation strategy and we have enhanced our approach over the years to strengthen this cornerstone. Our approach is focused on rewarding long-term sustainable growth and executing our business strategy. A large percentage of our executives’ compensation is in equity-based awards to make sure that executives’ and shareholders’ interests are aligned.

At last year’s annual meeting, a larger number of shareholders signaled concerns with our executive compensation program including the level of CEO pay awarded relative to both peers and performance. So in 2016, we engaged with our shareholders in addition to proxy advisory firms, listened to your concerns and took action:

∎ we simplified our compensation plans

∎ we linked pay more closely to performance

∎ we aligned compensation more closely with the shareholder experience.

We made these changes in direct response to what we heard in our meetings; to improve our evolving compensation program and the link between pay and company performance, including for the CEO. Changes to our executive compensation program will be implemented starting in 2017. You can read about the CEO’s compensation below and in his profile starting on page 82. You can also find a complete summary of the changes we are making to our 2017 compensation program on page 50.

Changes we made	How we made them
1. Simplified the compensation program	We reduced the number of performance measures in the annual incentive plan from seven to four measures and in the performance share unit plan from six to three measures We eliminated the overlap in performance measures between our short term and longer term incentive plans We extended the vesting and performance period for performance share units to three full years so they align more easily to our publicly reported results
2. Linked pay more closely to performance	We tied even more compensation to the achievement of business results by increasing the weighting of performance share units to 50% from 35% of equity-based awards for the CEO and senior executive vice presidents We tightened the performance range on net income in the annual incentive plan We reinforced the board’s ability to use discretion, including reducing the annual incentive award if relative TSR is low, even if the calculated result is high We added another Canadian company to our peer group, as suggested by many shareholders, because it is a competitor for business, capital and talent
3. Improved the alignment with shareholders	We aligned the scorecard for the annual incentive plan more closely to how our shareholders look at our performance, focusing on earnings and our strategy We made relative TSR a performance measure in our performance share unit plan rather than a modifier, increasing its impact on payouts We added book value per share excluding AOCI – a capital measure – to our performance share unit plan

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Key compensation highlights

In February of each year, the board makes the following compensation decisions regarding the named executives:

∎ the annual incentive awards based on the prior year’s results

∎ medium and long-term incentive awards that will be earned based on performance over future years

∎ increases to base salary and/or annual incentive targets, if any, for the upcoming year.

As set out in more detail starting on page 82, year-over-year compensation was generally down for our named executives reflecting the company’s short and longer-term performance relative to the goals we established and discretionary decisions made by the board:

∎ four of our five named executives were awarded a lower 2016 annual incentive than in 2015 reflecting a closer alignment of pay to our company performance

∎ the combined performance factor for the 2014 performance share units that paid out in 2016 was 75% primarily driven by both return on equity and net income results being below the performance objectives set for this grant, as well as Manulife’s three-year TSR being below the median of our performance peer group

∎ four of our five named executives did not receive a salary increase in 2017.

CEO compensation

As noted in the CEO letter, the 2016 annual incentive award he received was significantly reduced relative to his target and prior year award. This was done taking into consideration the changing compensation levels in our peer group, the depreciation of the Canadian dollar, input provided from our discussions with shareholders and a review of the company’s relative performance.

Specifically, in consultation with the CEO, the board used its discretion to reduce the CEO’s 2016 annual incentive award to 60% of target, below the calculated business performance score of 88%. This is 41% lower than the prior year. While there were many positive results in the year, we fell short of some of our ambitious targets and our three-year TSR was below the median of the peer group. Combined with his 2016 base salary and 2016 medium and long-term incentive awards which were approved in February 2016, the CEO’s 2016 U.S. dollar total direct compensation was 7% lower than 2015.

To ensure CEO compensation is more appropriately positioned relative to the compensation peer group, the board reduced the CEO’s medium and long-term incentive awards for 2017 to 75% of target and 25% lower than 2016. This reflects the board’s decision not to grant the CEO any RSUs. The resultant mix of 50% performance share units and 50% stock options aligns the CEO’s compensation directly with Manulife’s long-term performance and shareholder experience.

The combined impact of these decisions will be reflected in this and next year’s summary compensation table – however, we feel it is important for shareholders to understand the full impact of the decisions made by the board in February of this year.

2017 Management information circular 5

The graph to the right shows the CEO’s U.S. dollar total direct compensation awarded from 2014 to 2016, and his U.S. dollar total target direct compensation for 2017.   The accompanying table shows the decisions made for the CEO in 2016 and 2017. You can read more about the CEO’s compensation in his profile starting on page 82.   The CEO’s compensation is shown in U.S. dollars because we have set compensation for the named executives in U.S. dollars since 2004. As a global company, we draw from an international talent pool for executive talent at the most senior levels where U.S. dollars is the most common basis of compensation.

	2014 ($)	2015 ($)	2016 ($)	2017 ($)
Base salary	1,325,000	1,358,125	1,358,125	1,358,125
Annual incentive	2,674,181	2,085,061	1,222,313	2,037,188 (target)
Medium and long- term incentives	7,950,000	8,148,750	8,148,750	6,111,562
Total direct compensation	11,949,181	11,591,936	10,729,188	9,506,875

	Compensation decisions for 2016 performance		Compensation decisions for 2017 performance
	When the decision is made	Decisions for 2016	When the decision is made	Decisions for 2017
Base salary	February 2016	No change	February 2017	No change
Annual incentive	February 2017	40% below target	February 2018	Target shown – actual will be based on 2017 performance
Medium and long-term incentives	February 2016	At target	February 2017	25% below target

Foreign exchange rates may impact how much the named executives receive depending on the currency in which they are paid. Accordingly, we take this into consideration when making compensation decisions to ensure our named executives are appropriately positioned relative to both our Canadian and U.S. peer companies (see the summary compensation table on page 96 for more information).

Compensation in line with our performance and our peers

Paying for performance is a core principle in the design of the executive compensation program at Manulife. Executives earn incentive awards based on corporate and

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individual performance, which is assessed against pre-determined targets and our TSR compared to our peers.

We assess the effectiveness of our compensation program and its alignment to our pay for performance core principle by comparing the relationship between the CEO’s realized and realizable pay (as a percentage of his total target direct compensation) to our share price performance and our compensation peers. The graph on page 94 shows you that there is a close alignment between our CEO’s realized and realizable pay and Manulife’s TSR, compared to our peers.

Linking pay to shareholder value We also look at whether our executive compensation program is aligned with the shareholder experience by comparing our TSR with what our executives actually earned – as realized pay (what was paid to them during the year in salary, annual incentive and payouts from the medium and long-term incentive plans), and realizable pay (the value of their unvested or unexercised medium and long-term incentives).   The graph to the right shows how the CEO’s realized and realizable pay has been consistent with what our shareholders have experienced – CEO pay was lower when our TSR was low, and appropriately higher when our TSR was higher.

Please see the CEO lookback table on page 85 for another way of looking at realized and realizable pay.

	2012		2013		2014		2015		2016
Manulife TSR		30.0%		60.0%		8.7%		(3.7%)		19.9%
S&P/TSX Composite Index total return		7.2%		13.0%		10.6%		(8.3%)		21.1%
S&P/TSX Composite Financials Index		17.6%		23.7%		13.8%		(1.7%)		24.1%
CEO realized and realizable pay at year-end		$9.0M		$31.3M		$17.1M		$5.1M		$37.8M

Realized and realizable pay

Includes:

∎ cash compensation received for a given year, including salary, annual incentive earned, payouts of restricted share units and performance share units upon vesting and gains realized from exercising stock options, and

∎ the change in value of outstanding restricted share units, performance share units, stock options and deferred share units on December 31 of a given year compared to their value on December 31 of the previous year.

Total shareholder return

The change in value of an investment in Manulife’s common shares (or in the S&P/TSX Composite Index or S&P/TSX Composite Financials Index) between January 1 and December 31 of a given year, assuming dividends are reinvested.

2017 Management information circular 7

We welcome your feedback at our annual meeting

Aligning compensation with long-term shareholder value is a core principle in the design of the executive compensation program at Manulife. This circular explains the compensation decisions we made for 2016 and for the 2017 salary and medium and long-term incentives. It also highlights how the changes we are making to the program will impact compensation in the future.

We are confident that the changes to the executive compensation program – simplifying the program, reinforcing pay for performance and strengthening the link between executive pay and shareholder interests – are responsive to your concerns.

We are holding another advisory vote on executive pay at our 2017 annual meeting and, as always, we welcome your feedback.

John Cassaday

Chair of the Management Resources

and Compensation Committee

continued from page 3

Governance at Manulife

We believe that good corporate

governance is critical to our long-term
success – for us, our shareholders and
our customers. Our board of directors
sets the tone at the top, promoting a
strong culture of integrity and ethical
behaviour throughout our entire
organization.

    Shareholder engagement We and the board believe that engaging and communicating directly with shareholders and other stakeholders is important for providing timely and meaningful feedback. In addition to the extensive engagement on our executive compensation program, investors were invited to discuss a variety of other topics of interest to them. See page 127 for more about our shareholder engagement program.  

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This year, 15 people have been nominated for election to the board for a one-year term. All 15 were elected at our 2016 meeting. These directors have the mix of skills, experience and qualifications necessary for proper oversight and effective decision-making. You can read more about them starting on page 22.

	Director since		Independent		2016 votes for
Joseph Caron		2010		Yes		96.76%
John Cassaday		1993		Yes		87.73%
Susan Dabarno		2013		Yes		96.79%
Richard DeWolfe		2004		Yes		99.44%
Sheila Fraser		2011		Yes		98.98%
Donald Guloien		2009		No		99.62%
Luther Helms		2007		Yes		99.24%
Tsun-yan Hsieh		2011		Yes		96.61%
Thomas Jenkins		2015		Yes		99.32%
Pamela Kimmet		2016		Yes		96.92%
Donald Lindsay		2010		Yes		99.56%
John Palmer		2009		Yes		99.53%
James Prieur		2013		Yes		96.66%
Andrea Rosen		2011		Yes		99.66%
Lesley Webster		2012		Yes		96.73%

Please read the circular and vote your shares
Your vote is important to us – we encourage you to attend the meeting or to vote by proxy (over the internet, by phone or by mail). See page 14 for details about how to vote. The meeting will cover four items of business: 1. Receiving our financial statements 2. Voting to elect directors 3. Voting to appoint the auditors 4. Voting to have a ‘say on executive pay’		Our 2017 annual meeting When May 4, 2017 at 11 a.m. (Eastern time) Where Manulife Head Office 200 Bloor Street East Toronto, Canada
You will vote on all items except for the financial statements. The board recommends you vote FOR these items. If you attend the meeting in person, you will also have the opportunity to ask questions of the board and management.

Richard B. DeWolfe

Chairman of the Board

2017 Management information circular 9

  About this management
     information circular

We’ve sent this management information circular to you because you owned common shares of Manulife Financial Corporation as of the close of business on March 8, 2017. It includes important information about the meeting, the items of business to be covered and how to vote your shares.

You’re entitled to receive notice of and vote these shares at our 2017 annual meeting of shareholders.

Management is soliciting your proxy for the meeting, which means we’re contacting you to encourage you to vote. This will be done mainly by mail, but you may also be contacted by phone, including in connection with the use of the Broadridge QuickVote^™ service. We have retained Kingsdale Advisors (Kingsdale), and they may assist us with this process. We pay the costs of the engagement with Kingsdale, which we expect to be approximately $40,000.

    In this document: ∎  we, us, our and Manulife mean Manulife Financial Corporation ∎  you, your and shareholder refer to holders of Manulife common shares ∎  circular means this management information circular ∎  meeting means our annual meeting of common shareholders on May 4, 2017 ∎  common shares or shares means common shares of Manulife Financial Corporation ∎  Manufacturers Life means The Manufacturers Life Insurance Company   Information in this circular is as at February 28, 2017 and in Canadian dollars, unless indicated otherwise. Any information contained in, or otherwise accessible through, websites mentioned in this circular does not form a part of this document.  

For more information

You can find financial information about Manulife in our annual report, which
includes our audited consolidated financial statements and management’s
discussion and analysis (MD&A) for the year ended December 31, 2016. The
Audit Committee section of our annual information form has information about
the audit committee including the committee charter.

These documents are available on manulife.com, on SEDAR (sedar.com) and on
EDGAR (sec.gov/edgar). You can also ask us for a copy of our annual report –
simply email us at shareholder_services@manulife.com

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Where to find it

About the meeting
13	Who can vote
14	How to vote
17	What the meeting will cover
About the directors
21	Key things about the board
22	Director profiles
37	2016 board committee reports
41	How we pay our directors
Executive compensation
50	2017 executive compensation program changes at a glance
52	Compensation discussion and analysis
52	Our compensation philosophy
54	How the board oversees compensation
56	Managing compensation risk
60	The decision-making process
62	Benchmarking against our peers
64	Our compensation program and 2016 performance
82	Compensation of the named executives
96	Executive compensation details
96	Summary compensation table
98	Equity compensation
103	Retirement benefits
110	Termination and change in control
116	Compensation of employees who have a material impact on risk

Governance at Manulife
120	About the Manulife board
122	Roles and responsibilities
122	Promoting a culture of integrity and ethical behaviour
122	Strategic planning
123	Risk oversight
124	Leadership development and succession
127	Communications and shareholder engagement
128	Board committees
129	Serving as a director
129	Serving on other boards
130	Integrity
130	Equity ownership
130	Term limits
130	Independence
131	Diversity
132	Skills and experience
134	Director development
136	Assessment
136	Board succession
Other information
137	Liability insurance
137	Loans to directors and officers
137	Directors’ approval

When you see this symbol, you will learn where you can find more information about a particular topic

2017 Management information circular 11

  About the meeting

This year’s annual meeting is on May 4, 2017.

Read this section to find out who can vote, how you can vote and what you’ll be voting on.

Questions? Call the transfer agent in your region or Kingsdale Advisors if you have any  questions:
Kingsdale Advisors	1-888-518-1563 (for shareholders in North America) 416-867-2272 (for shareholders outside North America) email: contactus@kingsdaleadvisors.com
Canada	CST
	1-800-783-9495
United States	Computershare
	1-800-249-7702
Hong Kong	Computershare
	852-2862-8555
Philippines	Rizal Commercial Banking Corporation
	632-318-8567

Where to find it

Who can vote	13
How to vote	14
What the meeting will cover	17

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ABOUT THE MEETING

Who can vote

If you held Manulife common shares as of 5 p.m. (Eastern time) on March 8, 2017 (the record date), you’re entitled to receive notice of and vote at our 2017 annual meeting. We had 1,975,994,427 common shares outstanding as of this date and each share carries one vote.     About quorum Before the meeting can go ahead, at least two shareholders have to be present at the meeting, in person or by proxy.    

We must receive a simple majority of votes cast for an item to be approved. We are not aware of any person who beneficially owns or exercises control or direction (directly or indirectly) over more than 10% of the voting rights attached to Manulife common shares.

Voting restrictions

If any person, an entity controlled by any person, or any person together with an entity he or she controls, beneficially owns more than 20% of the shares that can be voted, that person or entity cannot vote unless the Minister of Finance (Canada) allows it.

Common shares that are beneficially owned by the Government of Canada, any province or territory of Canada, any foreign government, or any political subdivision or agency of any of those entities cannot be voted, except under circumstances approved by the Minister of Finance (Canada).

2017 Management information circular 13

How to vote

There are two ways to vote – by proxy or in person at the meeting. How you vote depends on whether you’re a registered shareholder, an ownership statement holder or a non-registered (beneficial) shareholder.

See page 16 for important details about voting by proxy		Registered shareholders and ownership statement holders (your package includes a proxy form) You’re a registered shareholder if you have a share certificate in your name or your shares are recorded electronically in the Direct Registration System (DRS) maintained by our transfer agent. You’re an ownership statement holder if you hold a share ownership statement that was issued when Manufacturers Life demutualized.
Vote by proxy You or your authorized representative must sign the proxy form. If you’re a corporation or other legal entity, your authorized representative must sign the form.	u	You can vote your shares in one of four ways:
			On the internet – Go to the website indicated on your proxy form. You’ll need the personal identification/control number on the form.
			By phone (Canada and U.S. only) – Call the toll-free number on the proxy form and follow the instructions. You’ll need the personal identification/control number on the form.
			By mail – Complete your proxy form and return it in the envelope provided.
			On your smartphone – Use the QR code found on your proxy form.
		Your proxy must be received by 5 p.m. (Eastern time) on May 2, 2017 for your vote to be counted. If you’re mailing your proxy form, be sure to allow enough time for the envelope to be delivered. The time limit for the deposit of proxies may be waived by the Chairman at his discretion, without notice. If the meeting is adjourned, your proxy must be received by 5 p.m. (Eastern time) two business days before the meeting is reconvened.
Vote in person at the meeting You’ll need to bring identification with you to the meeting.	u	Check in with our transfer agent when you arrive at the meeting. Do not complete the proxy form before the meeting because you’ll vote in person at the meeting.
Changing your vote You can revoke your proxy form if you change your mind about how you want to vote your shares.	u	Sending new instructions with a later date on how you wish to vote will revoke the instructions you previously submitted. You can send a new proxy on the internet, by phone or by mail, by following the instructions above. Or send a notice in writing, signed by you or your authorized representative to: Corporate Secretary, Manulife Financial Corporation, 200 Bloor Street East, Toronto, Canada M4W 1E5. Your new proxy must be received by 5 p.m. (Eastern time) on May 2, 2017 for your vote to be counted. If you’re mailing your new proxy form, be sure to allow enough time for the envelope to be delivered. If the meeting is adjourned, your proxy must be received by 5 p.m. (Eastern time) two business days before the meeting is reconvened. If you miss the deadline, you can only revoke your proxy by giving a notice in writing to the Chairman at the meeting before the meeting begins. The notice must be signed by you or your authorized representative.

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ABOUT THE MEETING

See page 16 for important details about voting by proxy		Non-registered (beneficial) shareholders (your package includes a voting instruction form) You’re a non-registered shareholder if you hold your shares through an intermediary (a bank, trust company, securities broker or other financial institution). This means the shares are registered in your intermediary’s name and you’re the beneficial shareholder.
Vote by proxy You or your authorized representative must sign the voting instruction form. If you’re a corporation or other legal entity, your authorized representative must sign the form.	u	You can give your voting instructions in one of four ways:
			On the internet – Go to the website indicated on your voting instruction form and follow the instructions on screen.
			By phone (Canada and U.S. only) – Call the toll-free number on your voting instruction form and follow the instructions.
			By mail – Complete your voting instruction form and return it in the envelope provided.
			On your smartphone – Use the QR code found on your voting instruction form.
		Your intermediary must receive your voting instructions with enough time to act on your instructions. Check the form for the deadline for submitting your voting instructions. If you’re mailing your voting instruction form, be sure to allow enough time for the envelope to be delivered. The time limit for the deposit of proxies may be waived by the Chairman at his discretion, without notice.
Vote in person at the meeting You’ll need to bring identification with you to the meeting.	u	Check in with our transfer agent when you arrive at the meeting. Do not complete the voting instruction form before the meeting because you’ll vote in person at the meeting.
Changing your vote You can revoke your voting instruction form if you change your mind about how you want to vote your shares.	u	Follow the instructions on your voting instruction form, or contact your intermediary for more information.

2017 Management information circular 15

More about voting by proxy

Voting by proxy is the easiest way to vote. It means you’re giving someone else (your proxyholder) the authority to attend the meeting and vote for you according to your instructions.   Donald A. Guloien, President and Chief Executive Officer or, failing him, Richard B. DeWolfe, Chairman (with full power of substitution) have agreed to act as Manulife proxyholders to vote your shares at the meeting according to your instructions.   If you do not name a different proxyholder when you sign your form, you’re authorizing Mr. Guloien or Mr. DeWolfe to act as your proxyholder to vote for you at the meeting according to your instructions.   About confidentiality and voting results Our transfer agents independently count and tabulate the votes to maintain confidentiality. A proxy form or voting instruction form is only referred to us if it’s clear that a shareholder wants to communicate with the board or management, the validity of the form is in question, or the law requires it.   After the meeting we’ll post the voting results on manulife.com, on SEDAR (sedar.com) and on EDGAR (sec.gov/edgar).

If you do not indicate on the form how you want to vote your shares, Mr. Guloien or Mr. DeWolfe will vote:

∎ FOR the election of the 15 nominated directors in this circular

∎ FOR the appointment of Ernst & Young LLP as auditors

∎ FOR the advisory vote on our approach to executive compensation.

You can also appoint someone else to be your proxyholder – he or she does not need to be a Manulife shareholder. Print the person’s name in the blank space provided on the proxy form or voting instruction form. Remember to tell them so they know they must attend the meeting and vote your shares according to your instructions. If you do not specify how you want to vote your shares, your proxyholder can vote your shares using their best judgment.

If there are amendments to the items to be voted on or any other matters that are properly brought before the meeting or any adjournment, your proxyholder can vote your shares as they see fit.

Questions?

Call the transfer agent in your region or Kingsdale Advisors if you have any questions or to ask for a new proxy form (see page 12 for details).

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ABOUT THE MEETING

What the meeting will cover

The meeting will cover four items of business.

1. Financial statements (manulife.com)

We’ll present our 2016 consolidated financial statements and the auditors’ report on those financial statements. You can find a copy in our 2016 annual report on manulife.com.

2. Electing directors (see page 20)

You will elect 15 directors to serve on our board until either the end of next year’s annual meeting of shareholders, or earlier if they resign from the board. All 15 nominated directors currently serve on the board.

You can read about the nominated directors beginning on page 20.

The board recommends that you vote FOR the election of each nominated director.

3. Appointing the auditors

Ernst & Young LLP (Ernst & Young) have been our external auditors for over five years and the audit committee recommended that the board re-appoint them as our auditors for fiscal 2017 to serve until the end of our next annual meeting.

The table below lists the services Ernst & Young provided to Manulife and its subsidiaries in the last two fiscal years and the fees charged by them:

(in millions)	2016		2015
Audit fees		$30.3		$29.0
Includes the audit of our financial statements as well as the financial statements of our subsidiaries, segregated funds, audits of statutory filings, prospectus services, report on internal controls, reviews of quarterly reports and regulatory filings
Audit-related fees		$2.2		$2.6
Includes consultation concerning financial accounting and reporting standards not classified as audit, due diligence in connection with proposed or consummated transactions and assurance services to report on internal controls for third parties
Tax fees		$0.3		$0.1
Includes tax compliance, tax planning and tax advice services
All other fees		$0.4		$0.6
Includes other advisory services
Total		$33.2		$32.3

2017 Management information circular 17

Our auditor independence policy requires the audit committee to pre-approve all audit and permitted non-audit services (including the fees and conditions) to be provided by the external auditor. If a new service is proposed during the year that is outside the pre-approved categories or budget, it must be pre-approved by the audit committee, or by a member that the committee has appointed to act on its behalf. The board recommends that you vote FOR the appointment of Ernst & Young as auditors. 4. Having a say on executive pay (see page 49) The board believes that compensation programs must be sound, fair, competitive with the market and support our strategy and progress.

Audit committee review The audit committee conducts a formal review of the external auditor every year and a more comprehensive review every five years. These reviews are based on recommendations by the Chartered Professional Accountants of Canada (CPA Canada) and the Canadian Public Accountability Board to assist audit committees in their oversight duties and the comprehensive review was last conducted in 2014, covering the five-year period ended December 31, 2013. The 2016 review looked at the engagement partner and team, their independence and objectivity and the quality of audit work performed.

The board recognizes the increased scrutiny of executive compensation generally and believes that shareholders should have the opportunity to fully understand our compensation objectives, philosophy and principles, and have a say on our approach to executive compensation. As a result, we’re asking you to vote on the following resolution:

Resolved, on an advisory basis and not to diminish the role and responsibilities of the board of directors, that the shareholders accept the approach to executive compensation disclosed in the management information circular delivered in advance of the 2017 annual meeting of common shareholders of Manulife Financial Corporation.

This is an advisory vote, so the results are not binding. The board will, however, take the results into account, together with feedback received from other shareholder engagement activities, when making decisions about compensation policies, procedures and executive pay in the future.

Please see page 2 for an overview of our performance for the year, our executive compensation program and the impact that had on executive compensation for 2016. We also describe these in more detail starting on page 49. This disclosure has been approved by the board on the recommendation of the management resources and compensation committee.

The board recommends that you vote FOR our approach to executive compensation.

18 Manulife Financial Corporation

ABOUT THE MEETING

If a significant number of shareholders oppose the resolution, the board will engage with shareholders (especially those who are known to have voted against it) to understand their concerns and will continue to review our approach to executive compensation in the context of those concerns. We encourage any shareholders who may vote against the resolution to contact the board to discuss their specific issues or concerns (see page 120 for details about how to contact the board and page 127 for details about our shareholder engagement activities).

About shareholder proposals We must receive shareholder proposals for our 2018 annual meeting by 5 p.m. (Eastern time) on December 9, 2017 to consider including them in next year’s circular. Submissions must be in writing and meet the requirements of the Insurance Companies Act (Canada), which you can find online at http://laws-lois.justice.gc.ca. Send your proposal to: Corporate Secretary Manulife Financial Corporation 200 Bloor Street East Toronto, Ontario M4W 1E5 Canada Fax: 416-926-3041

2017 Management information circular 19

  About the directors

Read about the nominated directors before you vote your shares.

This year, 15 directors have been nominated for election to the board for a one-year term. All were elected at our 2016 meeting. These directors have the mix of skills, experience and qualifications necessary for proper oversight and effective decision-making.

Where to find it

Key things about the board	21
Director profiles	22

2016 board committee reports	37
How we pay our directors	41

20 Manulife Financial Corporation

ABOUT THE DIRECTORS

Key things about the board

Gender diversity

We promote gender diversity on our board and introduced a formal diversity policy in 2014. Our objective is to have women make up at least 30% of our independent directors, and we’ve met this goal since 2013. We also had a female Chair of the board from 2008 to 2013. See page 131 for more about diversity.

Majority voting

Shareholders can vote for, or withhold their vote from, each director. Directors who receive more withheld than for votes must submit their resignation.

The corporate governance and nominating committee will review the details surrounding the resignation and report to the board. The board will accept the resignation unless there are exceptional circumstances. The board will decide within 90 days of the meeting and a news release will be issued disclosing the resignation or the reasons why the resignation was not accepted. The director will not participate in these deliberations. The resignation will be effective when it is accepted by the board.

This policy applies only in uncontested elections, where the number of nominated directors is the same as the number of directors to be elected.

Term limits

Independent directors can serve on the board for up to 12 years to balance the benefit of experience with the need for new perspectives. We introduced this policy in 2013, and at the same time eliminated the mandatory retirement age of 72. See page 130 for more information.

The Chairman can be in the role for a full five-year term regardless of the number of years the individual has been a director.

2016 attendance

The table below shows the number of board and committee meetings held in 2016 and overall attendance. Quorum for board meetings is a majority of the directors and directors are expected to attend all meetings of the board and the committees they’re members of, unless there are extenuating circumstances. Average attendance was 100% in 2016, and all but one director on the board at the time attended our 2016 annual meeting of shareholders.

	Number of meetings		Overall meeting attendance
Board		9		100%
Audit committee		6		100%
Corporate governance and nominating committee		4		100%
Management resources and compensation committee		8		100%
Risk committee		6		100%

2017 Management information circular 21

Director profiles

Richard B. DeWolfe (Chairman since 2013)
	Westwood, MA, U.S.A. ∎ Age 72 ∎ Independent Areas of expertise ∎     Senior executive ∎     Public sector ∎     Financial ∎      Risk management ∎     U.S. operations | Governance ∎     Human resources management and executive compensation
Mr. DeWolfe’s extensive business, investment and leadership experience in the public and private sectors qualify him to serve as a Manulife director and Chairman. He brings governance expertise through previous experience as chairman of a public company and a director of several well known organizations in the U.S.

Richard DeWolfe has been Chairman since May 2, 2013, and is Managing Partner of DeWolfe & Company, LLC, a real estate management and investment consulting firm. He was Chairman and CEO of The DeWolfe Companies, Inc., the largest home ownership organization in New England, from 1992 to 2002. The DeWolfe Companies, Inc. was listed on the American Stock Exchange until it was acquired by Cendant Corporation in 2002. He serves on the board of the following not-for-profit organizations: the American College of Corporate Directors, Massachusetts General Hospital (President’s Council), Boston University (Trustee Emeritus), The Boston Foundation (Director Emeritus), The Boston Center for Community and Justice (Honorary director), Wilson Center’s Canada Institute (Advisory Board) and Quissett Harbor Preservation Trust (Chairman) and Partners HealthCare System, Inc. Mr. DeWolfe holds a Bachelor of Applied Science, Marketing and Finance from Boston University and an Executive Masters Professional Director Certification from the American College of Corporate Directors, a public company director education and credentialing organization. Other public company boards in the past five years Avantair, Inc., 2009-2013			Director since April 2004 Term limit: 2018 2016 votes for: 99.44% Meets share ownership guidelines 14.16% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Mr. DeWolfe is not a member of the audit, management resources and compensation or risk committees, but attends at the invitation of the respective committee chair
Audit	6 of 6	100%
Corporate governance and nominating	4 of 4	100%
Management resources and compensation	8 of 8	100%
Risk	6 of 6	100%

22 Manulife Financial Corporation

ABOUT THE DIRECTORS

Joseph P. Caron
	Vancouver, BC, Canada ∎ Age 69 ∎ Independent Areas of expertise ∎     Senior executive ∎     Public sector ∎     International relations ∎     Asia operations | Governance ∎     Human resources management and executive compensation ∎     Technology
Mr. Caron brings business, government and international experience to the board, providing a well rounded perspective that positions him well to serve on our board, the management resources and compensation committee and as chair of the corporate governance and nominating committee.

Joseph Caron is Principal and Founder of Joseph Caron Incorporated, a consulting business established in 2010 to provide strategic counsel to Asian businesses seeking to grow in Canada and Canadian businesses and organizations focused on development in Asia. His experience includes four years with HB Global Advisors Corporation, the international consulting firm of Heenan Blaikie LLP (2010 to 2013), and almost four decades with the Government of Canada where he served in a number of key diplomatic posts, including Ambassador to the People’s Republic of China (2001 to 2005), Ambassador to Japan (2005 to 2008) and High Commissioner to the Republic of India (2008 to 2010). He also serves on the board of the Vancouver International Airport. Mr. Caron holds a Bachelor of Arts in Political Science from the University of Ottawa. He holds honorary degrees from York University and Meiji Gakuin University, and has been named a Distinguished Fellow of the Asia Pacific Foundation and an Honorary Research Associate of the University of British Columbia’s Institute of Asian Research. Other public company boards in the past five years Westport Innovations Inc., 2013-June 2016			Director since October 2010 Term limit: 2023 2016 votes for: 96.76% Meets share ownership guidelines 16.35% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Corporate governance and nominating (chair since May 2014)	4 of 4	100%
Management resources and compensation	8 of 8	100%

2017 Management information circular 23

John M. Cassaday
	Toronto, ON, Canada ∎ Age 63 ∎ Independent Areas of expertise ∎     Senior executive ∎     Marketing ∎      Risk management ∎     Canada & U.S. operations | Governance ∎     Human resources management and executive compensation
Mr. Cassaday has strong business and senior executive experience and also serves on other public company boards. This experience qualifies him to serve on our board and the corporate governance and nominating committee and as chair of the management resources and compensation committee.

John Cassaday is currently a corporate director. Mr. Cassaday was previously President and Chief Executive Officer of Corus Entertainment Inc., a position he held since its inception in 1999 until his retirement on March 31, 2015. Corus is a Canadian leader in pay and specialty television and in Canadian radio and a global leader in children’s programming and licensing. Prior to Corus, Mr. Cassaday was Executive Vice President of Shaw Communications, President and Chief Executive Officer of CTV Television Network and President of Campbell Soup Company in Canada and the United Kingdom. He also serves on the board of Irving Oil Ltd. (non-public company). Mr. Cassaday has an MBA (Dean’s List) from the Rotman School of Management at the University of Toronto. Mr. Cassaday is eligible for re-election under the transitional provision of the term limits adopted in 2013 (see page 130). Other public company boards in the past five years Gibraltar Growth Corporation, 2015-present Sleep Country Canada Holdings Inc., 2015-present Spin Master Ltd., 2015-present Sysco Corporation, 2004-present Corus Entertainment Inc., 1999-March 2015			Director since April 1993 Term limit: 2019 2016 votes for: 87.73% Meets share ownership guidelines 8.76% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Corporate governance and nominating	4 of 4	100%
Management resources and compensation (chair since May 2011)	8 of 8	100%

24 Manulife Financial Corporation

ABOUT THE DIRECTORS

Susan F. Dabarno
	Bracebridge, ON, Canada ∎ Age 64 ∎ Independent Areas of expertise ∎     Senior executive                             ∎    Technology ∎      Financial ∎     Global financial services executive | Knowledge of investment management ∎     Canada operations | Governance ∎     Human resources management and executive compensation
Ms. Dabarno brings extensive financial services experience to the board and her roles in various executive capacities and accounting background qualify her to serve on the audit committee and management resources and compensation committee.

Susan Dabarno has been a corporate director since 2011. She has extensive wealth management and distribution expertise and served from 2009 to 2010 as Executive Chair, and from 2003 to 2009 as President and Chief Executive Officer, of Richardson Partners Financial Limited, an independent wealth management services firm. Before joining Richardson Partners Financial Limited, Ms. Dabarno was President and Chief Operating Officer at Merrill Lynch Canada Inc. She is a former director of the Toronto Waterfront Revitalization Corporation (government funded organization) and Bridgepoint Health Foundation (not-for-profit). Ms. Dabarno is a Chartered Professional Accountant and holds a Class II Diploma from McGill University. Other public company boards in the past five years People Corporation, 2011-2013			Director since March 2013 Term limit: 2025 2016 votes for: 96.79% Meets share ownership guidelines 5.10% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Audit	6 of 6	100%
Management resources and compensation	8 of 8	100%

2017 Management information circular 25

   Sheila S. Fraser

	Ottawa, ON, Canada ∎ Age 66 ∎ Independent Areas of expertise ∎     Senior executive ∎     Public sector ∎     Financial ∎      Risk management ∎     Human resources management and executive compensation ∎     Technology
Ms. Fraser’s extensive professional experience and her contributions to the accounting and auditing profession qualify her to serve on our board, the risk committee and as chair of the audit committee. Her other board experience and international work provide an added perspective to her board and committee work.

Sheila Fraser is currently a corporate director. Ms. Fraser served as Auditor General of Canada from 2001 to 2011 and, prior to joining the Office of the Auditor General in 1999 as Deputy Auditor General, she was a partner at Ernst & Young LLP for 18 years. Ms. Fraser’s contributions to the accounting and auditing profession include her current role as a Trustee of the International Financial Reporting Standards (IFRS) Foundation. She has also chaired two committees of the International Organization of Supreme Audit Institutions as well as the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants and, until December 31, 2013, was a member of the International Federation of Accountants-International Public Sector Accounting Standards Board. She also serves on the board of the International Institute for Sustainable Development – Experimental Lakes Area (not-for-profit). Ms. Fraser holds a Bachelor of Commerce from McGill University and is a Fellow of the Institute of Chartered Professional Accountants of Ontario and the Ordre des comptables professionnels agréés du Québec. Other public company boards in the past five years Bombardier Inc., 2012-present			Director since November 2011 Term limit: 2024 2016 votes for: 98.98% Meets share ownership guidelines 17.30% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Audit (chair since May 2013)	6 of 6	100%
Risk	6 of 6	100%

26 Manulife Financial Corporation

ABOUT THE DIRECTORS

Donald A. Guloien (President and Chief Executive Officer)
	Toronto, ON, Canada ∎ Age 59 ∎ Not independent (management) Areas of expertise ∎     Senior executive                                 ∎    Public sector ∎     Financial                                              ∎    Risk management ∎     Global financial services executive | Knowledge of investment management ∎     Asia, Canada & U.S. operations | Governance ∎     Human resources management and executive compensation ∎     Technology
As President and Chief Executive Officer of Manulife, Mr. Guloien is responsible for the day-to-day management of Manulife’s affairs. He brings extensive background, experience and knowledge as a 36-year veteran of Manulife. He is the only non-independent and executive director on our board.

Donald Guloien is President and Chief Executive Officer of Manulife, a member of the board of directors and chair of Manulife’s executive committee. Before being appointed to his current role in 2009, Mr. Guloien served as Chief Investment Officer, where he was recognized as a leading global investment executive. He was responsible for Manulife’s worldwide investment operations, and led the significant growth of Manulife Asset Management, a global leader in wealth management services, including retail mutual funds, pension funds, and endowments. Mr. Guloien has wide-ranging international experience. In his investment role he was responsible for Manulife’s global investment operations in Canada, the United States, the United Kingdom, Japan and Asia. In June 2007, his portfolio was expanded to include Manulife’s Asian Insurance and Wealth Management operations representing Japan, China, Hong Kong, Indonesia, the Philippines, Singapore, Taiwan, Vietnam, Malaysia, Thailand and Macau. Mr. Guloien has been named International Business Executive of the Year by the Canadian Chamber of Commerce, awarded The Queen Elizabeth II Diamond Jubilee medal and received an Arbor Award for his contributions to the University of Toronto. He serves on the board of the following not-for-profit organizations: Geneva Association, Mayor of Shanghai’s International Business Leaders’ Advisory Council (Vice Chairman), Business Council of Canada (Director), Canadian Life and Health Insurance Association (Director), The Hospital for Sick Children (Board of Trustees), Branksome Hall (Board of Governors), United Way (Campaign Cabinet) and the University of Toronto (Campaign Cabinet). Mr. Guloien holds a Bachelor of Commerce from the University of Toronto and is a Fellow, Life Management Institute. He is also a member of the Ticker Club and the World Presidents’ Organization.			Director since May 2009 Term limit: applies to independent directors only 2016 votes for: 99.62% Meets executive share ownership guidelines Other public company boards in the past five years none
2016 meeting attendance
Board	8 of 8	100%
The board held one meeting for independent directors in February 2016, which Mr. Guloien was not invited to attend
Board committees
Mr. Guloien is not a member of any of the board committees but attends at the invitation of the Chairman and/or committee chair

2017 Management information circular 27

Luther S. Helms
	Paradise Valley, AZ, U.S.A. ∎ Age 73 ∎ Independent Areas of expertise ∎     Senior executive                                    ∎    Risk management ∎     Financial                                                  ∎    Technology ∎     Global financial services executive | Knowledge of investment management ∎     Asia & U.S. operations | Governance
Mr. Helms brings extensive banking, investment and financial services experience and a U.S. perspective to the board, which also qualify him to serve on both the audit and corporate governance and nominating committees.

Luther Helms is the founder of and advisor to Sonata Capital Group. Sonata is a privately-owned registered investment advisory firm. Mr. Helms has extensive banking and financial services experience, holding various positions at Bank of America Corporation, including Vice Chairman from 1993 to 1998, and he was Vice Chairman of KeyBank from 1998 to 2000. He also serves on the board of Point Inside, Inc. (non-public). Mr. Helms has an MBA from the University of Santa Clara and a Bachelor of Arts, History and Economics from the University of Arizona. Other public company boards in the past five years ABM Industries Incorporated, 1995-March 2017			Director since May 2007 Term limit: 2019 2016 votes for: 99.24% Meets share ownership guidelines 13.64% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Audit	6 of 6	100%
Corporate governance and nominating	4 of 4	100%

28 Manulife Financial Corporation

ABOUT THE DIRECTORS

Tsun-yan Hsieh
	Singapore, Singapore  ∎ Age 64 ∎ Independent Areas of expertise ∎     Senior executive ∎     Financial ∎      Asia & Canada operations | Governance ∎     Human resources management and executive compensation ∎     Technology
Mr. Hsieh’s extensive management leadership, management consulting and academic experience, combined with his Asia perspective, qualifies him to serve on our board and the management resources and compensation committee.

Tsun-yan Hsieh is Chairman of LinHart Group PTE Ltd., a firm he founded in 2010 to provide leadership services internationally. Mr. Hsieh, a resident of Singapore, has extensive consulting experience in business strategy, leadership development and corporate transformation. Mr. Hsieh joined McKinsey & Company in 1980 and was elected a director from 1990 to 2008, when he retired. During his tenure, he served as Managing Director of Canada and ASEAN practices and led McKinsey’s Organization and Leadership Practice globally. At the National University of Singapore, Mr. Hsieh holds the joint appointment of Provost Chair Professor at the Business School and the Lee Kuan Yew School of Public Policy. He serves on the board of the following non-public companies and not-for-profit and other organizations: Duke-NUS Graduate Medical School Singapore, LinHart Group PTE Ltd. (Chairman/Director), Manulife US Real Estate Management Pte Ltd. (Chair), National University of Singapore Business School (Management Advisory Board), Singapore Institute of Management (Member of Governing Council) and Singapore Institute of Management Pte Ltd. Mr. Hsieh has a Bachelor of Science in Mechanical Engineering from the University of Alberta and an MBA from Harvard Business School. Other public company boards in the past five years Singapore Airlines, 2012-present Bharti Airtel Limited, 2010-2015 Sony Corporation, 2008-2013			Director since October 2011 Term limit: 2024 2016 votes for: 96.61% Meets share ownership guidelines 33.65% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Management resources and compensation	8 of 8	100%

2017 Management information circular 29

P. Thomas Jenkins
	Canmore, AB, Canada ∎ Age 57 ∎ Independent Areas of expertise ∎     Senior executive                                    ∎    Public sector ∎     Financial                                                  ∎    Risk management ∎     Asia, Canada & U.S. operations | Governance ∎     Human resources management and executive compensation ∎     Technology
Mr. Jenkins brings extensive business perspective to the audit and risk committees through experience in business, other public company boards and the boards and committees of various government, business and other organizations.

Thomas Jenkins is Chairman of the Board of OpenText Corporation. From 2005 to 2013, Mr. Jenkins was Chief Strategy Officer of OpenText. Prior to 2005, Mr. Jenkins was President and Chief Executive Officer of OpenText. Mr. Jenkins has served as a Director of OpenText since 1994 and as its Chairman since 1998. He is a former director of BMC Software, Inc., a non-public software corporation based in Houston, Texas, and serves on the board of the following not-for profit organizations: School of Public Policy, University of Calgary (Executive Fellow), National Research Council of Canada, Ontario Global 100 Network (Chair), C.D. Howe Institute, Canadian Council of Chief Executives. Mr. Jenkins received an MBA from the Schulich School of Business at York University, a Masters of Applied Sciences from the University of Toronto and a Bachelor of Engineering & Management from McMaster University. Mr. Jenkins received an honorary doctorate of laws from the University of Waterloo and an honorary doctorate of Military Science from the Royal Military College of Canada. He is a recipient of the 2009 Ontario Entrepreneur of the Year, the 2010 McMaster Engineering L.W. Shemilt Distinguished Alumni Award and the Schulich School of Business 2012 Outstanding Executive Leadership award and is a 2017 Inductee of the Order of the Business Hall of Fame. He is a Fellow of the Canadian Academy of Engineering. Mr. Jenkins was awarded the Canadian Forces Decoration and the Queen’s Diamond Jubilee Medal. Mr. Jenkins is an Officer of the Order of Canada. Other public company boards in the past five years OpenText Corporation, 1994-present Thomson Reuters Corporation, 2013-present TransAlta Corporation, 2014-present			Director since March 2015 Term limit: 2027 2016 votes for: 99.32% Meets share ownership guidelines 6.21% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Audit	6 of 6	100%
Risk	6 of 6	100%

30 Manulife Financial Corporation

ABOUT THE DIRECTORS

Pamela O. Kimmet
	Atlanta, GA, U.S.A.  ∎ Age 58 ∎ Independent Areas of expertise ∎     Senior executive ∎     Financial ∎      Global financial services executive | Knowledge of investment management ∎     U.S. operations | Governance ∎     Human resources management and executive compensation
Ms. Kimmet’s extensive senior executive experience and international perspective qualify her to serve on our board and the risk and management resources and compensation committees.

Pamela Kimmet is the Chief Human Resources Officer at Cardinal Health, Inc., a health care services company which distributes pharmaceuticals and medical products, manufactures medical and surgical products and provides logistics and other services designed to improve the cost-effectiveness of healthcare. Prior to July 1, 2016, Ms. Kimmet was the Senior Vice President, Human Resources, Coca-Cola Enterprises, Inc., a position she held since 2008. Ms. Kimmet has extensive human resources leadership experience, including in the financial services industry with senior positions at Bear, Stearns & Company, Inc. and Citigroup, Inc. Ms. Kimmet is a fellow of the National Academy of Human Resources, Vice Chair of the HR Policy Association and Chair of its Center for Executive Compensation, former Chair of the National Business Group on Health, and a member of the Personnel Roundtable. She holds an MBA from Michigan State University and a Bachelor of Science in Industrial and Labor Relations from Cornell University. Other public company boards in the past five years none			Director since March 2016 Term limit: 2028 2016 votes for: 96.92% Meets share ownership guidelines 9.43% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Ms. Kimmet joined the board and the risk and management resources and compensation committees effective March 7, 2016.
Board	7 of 7	100%
Board committees
Risk	5 of 5	100%
Management resources and compensation	6 of 6	100%

2017 Management information circular 31

Donald R. Lindsay
	Vancouver, BC, Canada ∎ Age 58 ∎ Independent Areas of expertise ∎     Senior executive                                    ∎    Risk management ∎     Financial                                                  ∎    Technology ∎     Global financial services executive | Knowledge of investment management ∎     Asia, Canada & U.S. operations | Governance ∎     Human resources management and executive compensation
Mr. Lindsay’s CEO and international business experience, and nearly two decades of experience in senior executive roles in investment and corporate banking and global financial services, qualify him to serve on our board and on the risk committee.

Donald Lindsay is President and CEO of Teck Resources Limited, Canada’s largest diversified mining, mineral processing and metallurgical company, a position he has held since 2005. Mr. Lindsay’s experience includes almost two decades with CIBC World Markets Inc., where he ultimately served as President after periods as Head of Investment and Corporate Banking and Head of the Asia Pacific Region. Mr. Lindsay earned a Bachelor of Science in Mining Engineering from Queen’s University and holds an MBA from Harvard Business School. Other public company boards in the past five years Teck Resources Limited, 2005-present			Director since August 2010 Term limit: 2023 2016 votes for: 99.56% Meets share ownership guidelines 14.24% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Risk	6 of 6	100%

32 Manulife Financial Corporation

ABOUT THE DIRECTORS

John R.V. Palmer
	Toronto, ON, Canada ∎ Age 73 ∎ Independent Areas of expertise ∎     Senior executive ∎     Public sector ∎     Financial ∎      Risk management ∎     Asia & Canada operations | Governance ∎     Human resources management and executive compensation
Mr. Palmer’s experience with regulators in different jurisdictions, including seven years as Superintendent of Financial Institutions, Canada, and his accounting background qualify him to serve on our board, the audit committee and the risk committee, which he chaired from 2010 to May 2016.

John Palmer is Chairman and a founding director of the Toronto Leadership Centre, an organization focused on leadership in financial supervision. Mr. Palmer was the Superintendent of Financial Institutions, Canada from 1994 to 2001, following his career at KPMG LLP (Canada) where he held senior positions, including Managing Partner and Deputy Chairman. He was also the Deputy Managing Director of the Monetary Authority of Singapore and has advised other regulators including the Australian Prudential Regulation Authority. He serves on the board of the following non-public companies and not-for-profit organizations: Prudential Advisory Services Pte Ltd., Tenaugust Properties Inc. and Toronto Leadership Centre (Chairman). Mr. Palmer is a Fellow of the Institutes of Chartered Professional Accountants of Ontario and British Columbia and holds a Bachelor of Arts from the University of British Columbia. Other public company boards in the past five years Fairfax Financial Holdings Limited, 2012-present			Director since November 2009 Term limit: 2022 2016 votes for: 99.53% Meets share ownership guidelines 16.40% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Audit	6 of 6	100%
Risk (chair from 2010 – May 2016)	6 of 6	100%

2017 Management information circular 33

C. James Prieur
	Chicago, IL, U.S.A. ∎ Age 65 ∎ Independent Areas of expertise ∎     Senior executive                                    ∎    Risk management ∎     Financial                                                  ∎    Technology ∎     Global financial services executive | Knowledge of investment management ∎     Asia, Canada & U.S. operations | Governance ∎     Human resources management and executive compensation
Mr. Prieur’s strong financial background and his wealth of senior executive experience in the insurance business in Canada, the U.S. and globally qualify him to serve on our board, the management resources and compensation committee and as chair of the risk committee.

James Prieur has been a corporate director since 2011 and, prior to that time, Mr. Prieur served as Chief Executive Officer and director of CNO Financial Group, Inc. from 2006 until his retirement in 2011. CNO Financial Group is a life insurance holding company focused on the senior middle income market in the U.S. Prior to joining CNO Financial Group, Mr. Prieur was President and Chief Operating Officer of Sun Life Financial, Inc. from 1999 to 2006 where he had previously led operations in Asia, Canada, United States, and the United Kingdom. He serves on the board of the Alberta Investment Management Corporation, a Crown corporation of the Province of Alberta, as well as the following not-for-profit organizations: President’s Circle of the Chicago Council on Global Affairs, and The Pacific Council on International Policy and its China Committee. Mr. Prieur is a Chartered Financial Analyst and holds an MBA from the Richard Ivey School at Western University and a Bachelor of Arts from the Royal Military College of Canada. Other public company boards in the past five years Ambac Financial Group, Inc., 2016-present			Director since January 2013 Term limit: 2025 2016 votes for: 96.66% Meets share ownership guidelines 13.59% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Management resources and compensation	8 of 8	100%
Risk (chair since May 2016)	6 of 6	100%

34 Manulife Financial Corporation

ABOUT THE DIRECTORS

Andrea S. Rosen
	Toronto, ON, Canada  ∎ Age 62 ∎ Independent Areas of expertise ∎     Senior executive ∎     Financial ∎      Risk management ∎     Global financial services executive | Knowledge of investment management ∎     Canada operations | Governance ∎     Human resources management and executive compensation
Ms. Rosen’s experience as a global financial services executive with particular experience in investment banking, wholesale and retail banking, risk management, human resources management and executive compensation qualify her to serve on our board and serve on the audit and corporate governance and nominating committees.

Andrea Rosen has been a corporate director since 2006. Prior to January 2005, her experience includes more than a decade with TD Bank Financial Group, where she ultimately served as Vice Chair, TD Bank Financial Group and President of TD Canada Trust. Earlier in her career, she held progressively senior positions at Wood Gundy Inc. and was Vice President at Varity Corporation. She serves on the board of the Alberta Investment Management Corporation, a Crown corporation of the Province of Alberta. Ms. Rosen has an LLB from Osgoode Hall Law School, an MBA from the Schulich School of Business at York University and a Bachelor of Arts from Yale University. Other public company boards in the past five years Emera Inc., 2007-present Hiscox Limited, 2006-2015			Director since August 2011 Term limit: 2024 2016 votes for: 99.66% Meets share ownership guidelines 24.64% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Audit	6 of 6	100%
Corporate governance and nominating	4 of 4	100%

2017 Management information circular 35

Lesley D. Webster
	Naples, FL, U.S.A. ∎ Age 64 ∎ Independent Areas of expertise ∎     Senior executive                                    ∎    Risk management ∎     Financial                                                  ∎    Technology ∎     Global financial services executive | Knowledge of investment management ∎     U.S. operations | Governance
Ms. Webster’s extensive senior executive experience in financial services in the U.S., and in enterprise risk management, capital markets and trading in particular, qualifies her to serve on our board, the management resources and compensation committee and the risk committee.

Lesley Webster is President and founder of Daniels Webster Capital Advisors, an enterprise risk management consulting firm established in 2006. Ms. Webster has extensive financial industry experience and was Executive Vice President of JP Morgan Chase’s firm-wide Market and Fiduciary Risk Management from 1994 until 2005. Prior to that, she was global head of U.S. Dollar Fixed Income Derivatives at UBS Securities, Inc. and head of Fixed Income Arbitrage trading at Chase Manhattan Bank. Ms. Webster earned a PhD in Economics from Stanford University and a Bachelor of Arts in Economics from the University of Illinois at Urbana. Other public company boards in the past five years MarketAxess Holdings Inc., 2013-2015			Director since October 2012 Term limit: 2025 2016 votes for: 96.73% Meets share ownership guidelines 29.66% increase in number of shares and DSUs owned from February 29, 2016 to February 28, 2017
2016 meeting attendance
Board	9 of 9	100%
Board committees
Management resources and compensation	8 of 8	100%
Risk	6 of 6	100%

Other information about the directors

Mr. DeWolfe served as an independent director of Avantair, Inc. (Avantair) between 2009 and August 2013. On July 25, 2013, an involuntary petition under chapter 7 of title 11 of the United States Code (Bankruptcy Code) was filed in the United States Bankruptcy Court for the Middle District of Florida, Tampa Division (the Bankruptcy Court) against Avantair (Case No. 13-09719). On August 16, 2013, the Bankruptcy Court entered an order for relief under chapter 7 of the Bankruptcy Code. Sales of certain assets have been authorized and proceeds from the sales have been distributed. The chapter 7 trustee has asserted claims against the former officers, directors and certain employees of Avantair, including Mr. DeWolfe (the Avantair Parties). The trustee has not commenced litigation against any of the independent directors. In April 2015, the Avantair Parties participated in a court-ordered pre-suit mediation with the chapter 7 trustee along with various plaintiffs who had asserted claims against various Avantair Parties in multiple jurisdictions. The majority of these claims do not involve the independent directors of Avantair. The chapter 7 trustee reached an agreement with the Avantair Parties to resolve the trustee’s threatened claims in exchange for a settlement payment of US$8 million and relinquishment of certain competing claims in the bankruptcy. The independent directors are not funding any portion of the $8 million payment. An evidentiary hearing for approval of the settlement by the Bankruptcy Court was conducted from January 22 through January 27, 2016. On November 18, 2016, the Bankruptcy Court approved the settlement, thereby ending the bankruptcy proceeding. Mr. DeWolfe continues to deny the allegations previously asserted by the chapter 7 trustee and in related lawsuits.

36 Manulife Financial Corporation

ABOUT THE DIRECTORS

2016 board committee reports

Corporate governance and nominating committee
Joseph Caron (chair) John Cassaday Richard DeWolfe Luther Helms Andrea Rosen	All members of the corporate governance and nominating committee are independent. The Chairman is also a member.
The committee met four times in 2016. It has approved this report and is satisfied that it has carried out all of the responsibilities required by the committee charter.

Key responsibilities	Key activities
Managing board renewal and succession, including identifying the necessary competencies, expertise, skills, background and personal qualities for potential candidates, identifying qualified candidates, maintaining an evergreen list of qualified candidates and reviewing committee membership	∎    Reviewed the necessary characteristics, experience and expertise for prospective directors. ∎    Reviewed and updated the evergreen list of qualified candidates. ∎    Reviewed committee membership and recommended changes to the board for approval. ∎    Reviewed the board diversity policy and diversity objectives and considered any changes necessary to achieve the goals outlined in the policy.
Developing effective corporate governance policies and procedures, including subsidiary governance	∎    Monitored corporate governance developments, and assessed current corporate governance practices against emerging best practices and other applicable requirements. ∎    Reviewed the details of, and compliance with, board and committee charters and mandates of board and committee chairs, directors and the CEO. ∎    Reviewed all significant changes in director status and confirmed no adverse impact. ∎    Implemented enhanced shareholder engagement principles to help shareholders understand how the board engages with shareholders and how they may contact the board. ∎    Reviewed the annual report on subsidiary governance.
Developing and overseeing the processes for assessing board, committee and individual director effectiveness including the committee chairs and Chairman	∎    Worked with an independent consultant to assist in the implementation of assessments of the board, the Chairman, the committees and chairs of each. ∎    Reviewed and confirmed the independence of the directors. ∎    Assessed the board’s relationship with management.
Coordinating the director orientation and education program	∎    Considered the relevant topics and developed the agenda for the director education program.
Reviewing director compensation	∎    Monitored developments in director compensation.

The committee meets without management present at each meeting. The committee also works with an independent consultant to conduct a biannual review of director compensation. The next review will occur in 2017. The committee did not retain a consultant or incur any fees for compensation matters in 2016. In 2015, it paid Pearl Meyer & Partners $27,546 (paid in U.S dollars and converted to Canadian dollars at an exchange rate of US$1.00 = $1.3223 as of the date of invoice). There is cross-membership between the corporate governance and nominating committee and each of the audit and management resources and compensation committees.

2017 Management information circular 37

Audit committee
Sheila Fraser (chair) Susan Dabarno Luther Helms Thomas Jenkins John Palmer Andrea Rosen	The audit committee and the board have determined that all members of the committee are independent, financially literate and qualify as audit committee financial experts under the Sarbanes-Oxley Act of 2002. All of the members also meet additional independence standards for audit committees under applicable U.S. and Canadian laws and securities exchange rules. The committee also serves as the conduct review committee.
The committee met six times in 2016, including one joint meeting with the risk committee. It has approved this report and is satisfied that it has carried out all of the responsibilities required by the committee charter.

Key responsibilities	Key activities
Overseeing the quality and integrity of financial information including the effectiveness of our systems of internal control over financial reporting	∎   Reviewed significant accounting and actuarial practices and policies (and areas where judgment was applied), financial disclosure (and recommended them to the board for approval), and management’s report on the effectiveness of internal controls over financial reporting. ∎   Reviewed the internal control framework and recommended it to the board for approval.
Overseeing the performance, qualifications and independence of our external auditors	∎   Conducted the annual review of Ernst & Young, including the engagement partner and audit team, their independence, objectivity and quality of audit work performed, and recommended their reappointment as auditors to the board for approval. ∎   Reviewed and approved or pre-approved the auditor independence policy, the scope of the annual audit plan and all related services and fees, recurring audit and non-audit services for the coming year, and audit and non-audit services proposed during the year outside of previous approvals.
Overseeing our compliance program, including compliance with legal and regulatory requirements and the effectiveness of our compliance practices	∎   Reviewed reports on compliance with applicable laws and regulations. ∎   Reviewed reports on the anti-money laundering/anti-terrorist financing program. ∎   Reviewed the disclosure policy.
Overseeing our finance, actuarial, internal audit and global compliance functions	∎   Reviewed reports, opinions and recommendations from the Chief Actuary. ∎   Reviewed the annual report of the external actuarial peer reviewer. ∎   Reviewed and approved the internal audit plan and reviewed periodic reports on internal audit activities and audit results. ∎   Reviewed and approved the mandates of the Global Compliance Chief, Chief Auditor, Chief Financial Officer and Chief Actuary and the global compliance, internal audit, finance and actuarial functions, and reviewed the performance evaluation and assessed the effectiveness of each.
Developing our ethical standards and policies on managing conflicts of interest and protecting confidential information and monitoring customer complaints	∎   Reviewed the code of business conduct and ethics and the procedures relating to conflicts of interest and restricting the use of confidential information. ∎   Reviewed reports on compliance with the code and Ethics Hotline activities.
Monitoring arrangements with related parties and transactions that could have a material impact on our stability or solvency	∎   Reviewed the effectiveness of the procedures to identify material related party transactions and oversaw the implementation of enhanced procedures.

The committee meets without management present at each meeting. The committee also met in private with Ernst & Young, the independent actuarial peer reviewer, the Chief Financial Officer, Chief Risk Officer, Chief Actuary, Chief Auditor and Chief Compliance Officer throughout the year. There is cross-membership between the audit committee and each of the other board committees.

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Management resources and compensation committee
John Cassaday (chair) Joseph Caron Susan Dabarno Tsun-yan Hsieh Pamela Kimmet (joined March 7, 2016) James Prieur Lesley Webster	All members of the management resources and compensation committee are independent and meet the additional independence standards set out in our director independence policy in compliance with applicable securities exchange rules. A majority of the members have experience in executive compensation and financial experience, and several have experience in risk management.
The committee met eight times in 2016. It has approved this report and is satisfied that it has carried out all of the responsibilities required by the committee charter.

Key responsibilities	Key activities
Overseeing global human resources strategy, policies and programs	∎    Reviewed the 2017 compensation program, including changes to simplify compensation plans, link pay more closely to performance and align compensation more closely with shareholder experience, and recommended the 2017 compensation program to the board for approval. ∎    Reviewed the results of the global employee engagement survey. ∎    Reviewed the compensation programs, including base pay, incentives, pension and benefit plans and made recommendations to the board. ∎    Reviewed reports on talent management. ∎    Reviewed updates to the global compensation policy.
Developing and maintaining succession plans for the CEO and other senior executives	∎    Maintained a succession plan for the CEO and reviewed the succession plans for other senior executives.
Reviewing senior executive appointments before recommending them to the board for approval	∎    Reviewed several executive appointments and recommended to the board for approval.
Reviewing and recommending compensation performance goals and objectives for the CEO and other senior executives, assessing the performance of the CEO and other senior executives in light of their performance goals and objectives and recommending their compensation	∎    Reviewed and approved the CEO’s annual objectives, assessed the CEO’s performance against the objectives and made compensation recommendations for approval by the board. ∎    Reviewed the performance assessment and compensation recommendations for the members of the Executive Committee and the head of each oversight function and approved their annual objectives. ∎    Reviewed the approach to senior executive compensation benchmarking. ∎    Considered the feedback from shareholder engagement meetings regarding compensation programs.
Overseeing compensation plans and ensuring the compensation program aligns with risk management policies and practices and corporate strategy	∎    Confirmed the alignment of compensation programs with sound risk management principles and established risk appetite.
Overseeing governance of employee pension plans	∎    Reviewed the annual pension report and global benefits program report.

The committee meets without management present at each meeting. The committee also works with a consulting firm to receive independent advice on compensation matters, and has retained Hugessen Consulting Inc. (Hugessen) as its independent advisor since 2006. The committee chair approves all of the work undertaken by the independent advisor. Please see page 55 for more about the independent advisor. The committee met in private with their independent advisor throughout the year. There is cross-membership between the management resources and compensation committee and each of the other board committees.

2017 Management information circular 39

Risk committee
James Prieur (chair) Sheila Fraser Thomas Jenkins Pamela Kimmet (joined March 7, 2016) Donald Lindsay John Palmer Lesley Webster	All members of the risk committee are independent and a majority are knowledgeable about risk management and risk disciplines.
The committee met six times in 2016, including one meeting held jointly with the audit committee. It has approved this report and is satisfied that it has carried out all of the responsibilities required by the committee charter.

Key responsibilities	Key activities
Identifying and assessing our principal risks and overseeing the programs, procedures and controls in place to manage them	∎   Reviewed reports from the Chief Risk Officer on risk appetite, risk limits, principal risk exposures, stress tests and emerging risks and policies, procedures and controls in place to manage principal risks. ∎   Reviewed reports from the Chief Auditor on the adequacy and effectiveness of the procedures and controls to manage the principal risks. ∎   Reviewed reports on capital targets and ratios. ∎   Reviewed reports on the information services risk management program. ∎   Reviewed reports from business divisions on the key risks and risk management strategies for the relevant business.
Developing, overseeing and reviewing our enterprise risk management framework, risk appetite and risk limits	∎   Reviewed risk appetite and risk limits and recommended to the board for approval, and considered the appropriate balance of risk and return.
Reviewing the risk impact of the business plan and new business initiatives, including consistency with our risk appetite and related risk management and controls	∎   Reviewed the risk impact of the strategic plan, including consistency with the approved risk appetite and related risk management and controls.
Aligning our compensation programs with sound risk management principles and our established risk appetite	∎   Reviewed reports on the alignment of compensation programs with sound governance principles and established risk appetite.
Overseeing the risk management function	∎   Reviewed and approved the mandates of the Chief Risk Officer and the risk management function, and reviewed the performance evaluation and assessed the effectiveness of each. ∎   Reviewed and approved the budget, structure, skills and resources of the risk management function.
Overseeing our compliance with risk management policies	∎   Reviewed and approved changes to the risk policy framework and related policies.

The committee meets without management present at each meeting. The committee also met in private with the Chief Risk Officer, Chief Information Security Officer, Chief Auditor, Chief Compliance Officer and the Chief Actuary throughout the year. There is cross-membership between the risk committee and the audit and management resources and compensation committees.

40 Manulife Financial Corporation

ABOUT THE DIRECTORS

How we pay our directors

We structure director compensation with three goals in mind:

∎ to reflect their responsibilities, time commitment and expected contribution

∎ to align their interests with those of our shareholders

∎ to be competitive with global financial institutions that are comparable to us in scope and complexity.

The corporate governance and nominating committee assists the board in reviewing director compensation every two years, and works with a consulting firm to receive independent advice where required. It did not retain a consultant in 2016, but worked with Pearl Meyer to conduct the 2015 review. Pearl Meyer used the compensation peer group described starting on page 62, supplemented by data from compensation surveys, to benchmark our director compensation program. After the 2015 review the board decided that changes to the director compensation program were not necessary in 2016 and the next review will occur in 2017. See the committee’s report on page 37 for more information.

We pay our directors in U.S. dollars because paying in a global currency helps us assemble a board that reflects our global presence and compete with other large global financial institutions.

The table on the next page shows the director fee schedule for services they provide to Manulife and Manufacturers Life. Fees are divided equally between the two companies. We also reimburse directors for travel and other expenses for attending board, committee and education sessions when they travel at least 150 km from their residence. The Chairman does not receive fees other than his annual retainer, but he is entitled to receive the travel allowance. Independent directors do not receive stock options or participate in a non-equity compensation plan or pension plan. Occasionally directors will attend meetings of committees they are not members of, but they do not receive a meeting fee for attending these meetings.

2017 Management information circular 41

	Director fees US$
Annual retainers
Board member		150,000
Chairman		400,000
Vice chair of the board (if applicable, paid in addition to the annual board member retainer and any other retainers that apply)		50,000
Observer to subsidiary board (requested from time to time, may be paid an additional retainer and/or meeting fee at the board’s discretion)		variable
Committee chair retainers
Audit committee Management resources and compensation committee Risk committee		40,000
Corporate governance and nominating committee		25,000
Committee retainers
Audit committee Management resources and compensation committee Risk committee		8,000
Corporate governance and nominating committee		5,000
Meeting fees
Board meeting		2,000
Committee meeting (paid to committee members only)		1,500
Education session not held on a board or committee meeting date		1,500
Travel allowance for attending meetings (per round trip of at least 150 km)
Within North America, Europe or Asia		1,000
Between North America or Asia and Europe		1,500
Between North America and Asia		3,000

42 Manulife Financial Corporation

ABOUT THE DIRECTORS

About equity ownership

Directors must own equity in Manulife so their interests are aligned with the interests of our shareholders. Directors can count Manulife common shares or deferred share units towards meeting the ownership guidelines. Deferred share units are notional shares that have the same value as Manulife common shares and earn additional units as dividend equivalents at the same rate as dividends paid on our common shares.

We require all directors except Mr. Guloien to own common shares and/or deferred share units with a total market value of at least three times the annual board member retainer. All directors currently meet their equity ownership requirements. Please see page 46 for more information about deferred share units as well as each director’s current equity ownership. As CEO, Mr. Guloien has separate share ownership requirements, which he satisfies. You can read more about this on page 59.

If a director does not meet their ownership requirement, that director must elect to receive the entire annual board member retainer in deferred share units at the next possible election date if they continue to not meet the requirement at that time. We also encourage directors to continue investing in Manulife shares once they’ve met the minimum.

2017 Management information circular 43

2016 Director compensation

The table below shows the compensation paid to the independent directors in 2016 for services provided to Manulife, Manufacturers Life and any Manulife subsidiary. Amounts were converted to Canadian dollars using the opening Bank of Canada exchange rate on the business day before each quarterly payment date:

∎ US$1.00 = $1.3023 on March 30, 2016

∎ US$1.00 = $1.2999 on June 29, 2016

∎ US$1.00 = $1.3079 on September 29, 2016

∎ US$1.00 = $1.3522 on December 29, 2016

	Annual fees
			Committee retainers ($)				Meeting fees ($)
	Annual retainer ($)		Chair		Member		Board		Board committee
Joseph Caron		197,336		32,889		17,102		23,738		33,527
John Cassaday		197,336		52,623		17,102		23,738		31,574
Susan Dabarno		197,336		0		21,049		23,738		37,439
Richard DeWolfe		526,230		0		0		0		0
Sheila Fraser		197,336		52,623		21,049		23,738		29,620
Luther Helms		197,336		0		17,102		23,738		29,612
Tsun-yan Hsieh		197,336		0		10,525		23,738		21,652
Thomas Jenkins		197,336		0		21,049		23,738		29,624
Pamela Kimmet		164,779		0		17,577		18,528		29,625
Donald Lindsay		197,336		0		10,525		23,738		19,702
John Palmer		197,336		18,071		21,049		23,738		31,574
James Prieur		197,336		34,651		21,049		23,738		37,439
Andrea Rosen		197,336		0		17,102		23,738		29,612
Lesley Webster		197,336		0		21,049		23,738		35,486

Pro-rated fees

The following directors’ fees were pro-rated:

∎ Pamela Kimmet joined the board, the management resources and compensation committee and risk committee on March 7, 2016.

∎ John Palmer resigned as risk committee chair effective May 5, 2016.

∎ James Prieur was appointed risk committee chair effective May 5, 2016.

Subsidiary board fees

One of our directors received fees for services he provided to a subsidiary in 2016 through our subsidiary governance oversight program:

∎ Tsun-yan Hsieh served on the board of Manulife US Real Estate Management Pte Ltd., and received fees for his service as shown in the table above.

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ABOUT THE DIRECTORS

Total compensation for the independent directors is capped at US$4 million ($5.26 million): US$2 million ($2.63 million) each for Manulife and Manufacturers Life. Canadian amounts have been calculated using an average exchange rate for 2016 of US$1.00 = $1.3156. Total compensation paid to the independent directors in 2016 was below the capped amount. Mr. Guloien does not receive director compensation because he is compensated in his role as CEO.

				All other compensation		Total compensation		Allocation of annual fees
Travel fees ($)		Subsidiary board fees ($)		Donated to charity of director’s choice ($)		($)		Fees earned (cash) ($)		Share-based awards (DSUs) ($)
	11,971				1,000		317,564		217,896	98,668
	4,057				1,000		327,430		163,215	163,215
	6,711				1,000		287,273		241,805	44,468
	11,971				1,000		539,201		269,101	269,101
	11,971				1,000		337,337		237,669	98,668
	10,663				1,000		279,451		139,226	139,226
	11,863		54,004		1,000		320,117		54,004	265,114
	11,971				1,000		284,718		0	283,718
	9,361				1,000		240,870		157,481	82,389
	11,971				1,000		264,272		131,636	131,636
	4,057				1,000		296,824		147,912	147,912
	11,971				1,000		327,184		0	326,184
	4,057				1,000		272,845		0	271,845
	10,619				1,000		289,227		90,891	197,336
					TOTAL	$	4,384,314

Allocation of annual fees

Directors decide if they want to receive all or part of their compensation in deferred share units (DSUs) instead of cash:

∎ Fees earned is the amount received in cash.

∎ Share-based awards is the amount received in DSUs.

2017 Management information circular 45

Current equity ownership

The table below shows the amount of equity each director owned at February 28, 2017, the change from last year (February 29, 2016), and whether or not they meet the ownership guidelines. Directors may beneficially own these shares or exercise control or direction over them.

	Equity ownership as at February 28, 2017				as at February 29, 2016
	Common shares (#)		DSUs (#)		Common shares (#)		DSUs (#)
Joseph Caron		8,836		35,812		8,836		29,537
John Cassaday		21,840		146,137		21,840		132,601
Susan Dabarno		45,000		2,295		45,000		0
Richard DeWolfe		14,000		134,751		14,000		116,302
Sheila Fraser		580		43,991		580		37,416
Luther Helms		2,100		80,520		2,100		70,604
Tsun-yan Hsieh		0		61,942		0		46,346
Thomas Jenkins		233,000		25,728		233,000		10,596
Pamela Kimmet		45,000		4,243		45,000		0
Donald Lindsay		20,000		46,570		20,000		38,271
John Palmer		0		71,388		0		61,328
James Prieur		100,000		52,156		100,000		33,957
Andrea Rosen		11,500		70,363		11,500		54,178
Lesley Webster		12,000		37,368		12,000		26,074

More about deferred share units

Deferred share units vest in full on the grant date but directors can only exchange their deferred share units for cash or shares after they leave the board (within one year of leaving). If a director chooses to receive shares in exchange for their deferred share units, we issue shares from treasury or purchase shares on the open market. Deferred share units can only be transferred when a director dies.

Deferred share units are paid to directors under the stock plan for non-employee directors. We calculate the number of deferred share units to be granted by dividing the dollar value to be received by the closing price of our common shares on the TSX on the last trading day prior to the grant date. Directors receive additional units as dividend equivalents when dividends are paid on our common shares. Please see page 102 for more information about the stock plan for non-employee directors.

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ABOUT THE DIRECTORS

We calculate the value of each director’s equity ownership by multiplying the number of their common shares and deferred share units (DSUs) by $23.73, the closing price of our common shares on the Toronto Stock Exchange (TSX) on February 28, 2017. Fluctuations in foreign exchange rates will cause variances in the minimum ownership requirements. The minimum as of February 28, 2017 was $596,160 (US$450,000, using an exchange rate of US$1.00 = $1.3248).

Net change
Common shares (#)		DSUs (#)		Percentage change		Value ($) as at February 28, 2017		Meets equity ownership guideline
	0		6,275		16.35%		1,059,497
	0		13,536		8.76%		3,986,094
	0		2,295		5.10%		1,122,310
	0		18,449		14.16%		3,529,861
	0		6,575		17.30%		1,057,670
	0		9,916		13.64%		1,960,573
	0		15,596		33.65%		1,469,884
	0		15,132		6.21%		6,139,615
	0		4,243		9.43%		1,168,536
	0		8,299		14.24%		1,579,706
	0		10,060		16.40%		1,694,037
	0		18,199		13.59%		3,610,662
	0		16,185		24.64%		1,942,609
	0		11,294		29.66%		1,171,503

2017 Management information circular 47

Outstanding share-based awards

The table below shows the market value of deferred share units that have vested but not paid out as at December 31, 2016. Directors received these deferred share units as part of their compensation. These are valued using the closing price of our common shares on the TSX on December 31, 2016.

(as at December 31, 2016)	Share-based awards held		Share price		Market or payout value of vested share-based awards not paid  out or distributed
Joseph Caron		35,812	$	23.91	$	856,264.92
John Cassaday		146,137	$	23.91	$	3,494,135.67
Susan Dabarno		2,295	$	23.91	$	54,873.45
Richard DeWolfe		134,751	$	23.91	$	3,221,896.41
Sheila Fraser		43,991	$	23.91	$	1,051,824.81
Luther Helms		80,520	$	23.91	$	1,925,233.20
Tsun-yan Hsieh		61,942	$	23.91	$	1,481,033.22
Thomas Jenkins		25,728	$	23.91	$	615,156.48
Pamela Kimmet		4,243	$	23.91	$	101,450.13
Donald Lindsay		46,570	$	23.91	$	1,113,488.70
John Palmer		71,388	$	23.91	$	1,706,887.08
James Prieur		52,156	$	23.91	$	1,247,049.96
Andrea Rosen		70,363	$	23.91	$	1,682,379.33
Lesley Webster		37,368	$	23.91	$	893,468.88

48 Manulife Financial Corporation

  Executive compensation

Executive compensation is designed to contribute to our long-term sustainable growth by rewarding executives for strong performance in executing our business strategy.

Where to find it 

2017 executive compensation program changes at a glance	50
Compensation discussion and analysis	52
Our compensation philosophy	52
How the board oversees compensation	54
Managing compensation risk	56
The decision-making process	60
Benchmarking against our peers	62
Our compensation program and 2016 performance	64
Compensation of the named executives	82

Executive compensation details	96
Summary compensation table	96
Equity compensation	98
Retirement benefits	103
Termination and change in control	110
Compensation of employees who have a material impact on risk	116

2017 Management information circular 49

2017 executive compensation program changes at a glance

What we are changing		Why we use these performance measures
Simplifying the annual incentive plan (see page 68) Using four measures instead of seven	Net income attributed to shareholders (25%)	Aligns compensation with shareholder experience
	Core earnings excluding investment-related experience (25%)	Reflects the underlying earnings capacity and valuation of our business We use core earnings1 as the basis for management planning and reporting and, along with net income attributable to shareholders, as a key measure used to evaluate our operating segments For the annual incentive plan, we exclude core investment-related experience gains to align with operational performance
	New business profitability (30%)	Wealth and asset management core earnings Measures growth in our global Wealth and Asset Management (WAM) businesses, a key area of strategic focus
		New business value1 Measures how our insurance new business will impact earnings in the future – especially in Asia, key to our strategy
	Customer, employee and strategic initiatives (20%)	Links compensation directly to our strategy
Simplifying the performance share unit (PSU) plan (see page 77) Using three equally-weighted measures instead of six Relative TSR becomes a measure instead of a modifier Extending the vesting and performance period to three full years	Book value per share excluding accumulated other comprehensive income (AOCI) (33%)	Focuses on long-term growth in equity needed to support the company’s growth, and is used to value insurance companies and investment firms
	Core return on equity1 (33%)	Reflects the efficient use of capital in generating core earnings
	Relative TSR (34%)	Aligns compensation with shareholder experience
Putting a greater weighting on PSUs (see page 75)	PSUs increasing to 50% of equity-based compensation for CEO and senior executive vice presidents, to tie a higher proportion directly to the achievement of business results
Making a change to our peer groups (see page 63)	Power Financial Corporation added to our compensation and performance peer groups to increase the number of Canadian peers

1 About non-GAAP measures

We use a number of non-GAAP financial measures to measure overall performance and to assess each of our businesses. A financial measure is considered a non-GAAP measure for Canadian securities law purposes if it is presented other than in accordance with generally accepted accounting principles used for our audited financial statements.

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How we calculate them

Net income consistent with methodology disclosed in MFC’s annual report, available at www.manulife.com. Comprised of core earnings, and items excluded from core earnings including the impact of equity markets and interest rates, changes in actuarial methods and assumptions made in the year, costs related to integration and acquisitions, tax and other items

Core earnings allows investors to focus on the Company’s operating performance by excluding the direct impact of changes in equity markets and interest rates, changes in actuarial methods and assumptions as well as a number of other items, outlined below, that we believe are material, but do not reflect the underlying earnings capacity of the business. For example, due to the long-term nature of our business, the mark-to-market movements of equity markets, interest rates, foreign currency exchange rates and commodity prices from period-to-period can, and frequently do, have a substantial impact on the reported amounts of our assets, liabilities and net income attributed to shareholders. These reported amounts are not actually realized at the time and may never be realized if the markets move in the opposite direction in a subsequent period. This makes it very difficult for investors to evaluate how our businesses are performing from period-to-period and to compare our performance with other issuers

Core earnings for our diversified WAM franchise, including mutual funds, group retirement and savings products, and institutional asset management capabilities. While there is some overlap with the core earnings measure, we have called this out as a separate measure due to the strategic importance of the WAM business. WAM core earnings historically represent less than 20% of total core earnings

Represents the change in shareholders’ economic value as a result of sales¹ in the period. Calculated as the present value of shareholders’ interest in expected future distributable earnings, after the cost of capital, on actual new business sold in the period

Strategic initiatives based on enterprise priorities that will drive growth with a balanced approach to risk. Customer centricity initiatives aligned to delivering demonstrable success in enhancing the customer journey. Employee engagement targets for our most senior employees

Calculated by dividing total common shareholders’ equity less AOCI by the number of common shares outstanding at the end of the period. We exclude AOCI because it includes items such as currency impacts, which can be volatile and distort results

Core earnings available to common shareholders as a percentage of the capital deployed to earn the core earnings. Calculated using average common shareholders’ equity

TSR compared with the median of our performance peer group. TSR is a measure of the performance of common shares held by investors. Calculated by combining the price appreciation or depreciation, plus the value of dividends paid to shareholders (assuming dividends are reinvested in additional shares)

Non-GAAP measures include: assets under management and administration, constant currency basis (measures that are reported on a constant currency basis include percentage growth in assets under management and administration, gross flows, new business value and sales), core earnings, core return on equity, gross flows, net flows, new business value and sales.

Non-GAAP financial measures are not defined terms under GAAP and are unlikely to be comparable to similar terms used by other issuers. Therefore, they should not be considered in isolation or as a substitute for any other financial information prepared in accordance with GAAP.

For more information about these non-GAAP measures, see Performance and Non-GAAP Measures in our most recent Management’s Discussion and Analysis, which is available on our website (manulife.com), on SEDAR (sedar.com) and on EDGAR (sec.gov/edgar).

2017 Management information circular 51

COMPENSATION DISCUSSION AND ANALYSIS

Our compensation philosophy

Executive compensation is designed to contribute to our long-term sustainable growth by rewarding executives for strong performance in executing our business strategy.

Pay for performance is at the core of our approach to executive compensation. Compensation is tied to the achievement of our short, medium and long-term goals, so that most of what our executives earn is variable and not guaranteed. In practice this has meant that executives earn more when performance is strong, and earn less when performance is not strong. The board also has the discretion to adjust incentive payouts to reflect business performance.

We have set compensation for the named executives in U.S. dollars since 2004. As a global company, we draw from an international talent pool for executive talent at the most senior levels where U.S. dollars is the most common basis of compensation for these executives. Foreign exchange rates may impact how much the named executives receive depending on the currency in which they are paid. Accordingly, we take this into consideration when making compensation decisions to ensure our named executives are appropriately competitively positioned relative to both our Canadian and U.S. peer companies.

Five principles guide every compensation decision

Pay for performance is at the core of our compensation approach

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What we do
	Compensation aligned with business strategy
	∎	incentive compensation is tied to the achievement of key performance measures, prudently balancing time horizons and performance perspectives
	∎	performance measures are tied directly to our business strategy and shareholder value
	∎	performance share units vest and pay out based on relative and absolute TSR
	Compensation aligned with long-term shareholder value
	∎	most compensation is directly affected by our share price
	∎	the annual incentive plan incorporates measures tied to our future success
	∎	share ownership guidelines, clawback provisions and stock option exercise restrictions discourage executives from taking undue risk
	Compensation and performance benchmarked against peer companies
	∎	executive pay is benchmarked against our compensation peer group
	Compensation aligned with good governance practices
	∎	aligned with the Financial Stability Board’s Principles for Sound Compensation Practices
	∎	employees must annually certify compliance with our code of business conduct and ethics
	∎	management resources and compensation committee gets independent advice
	∎	shareholders have a say on executive pay
	∎	we engage with shareholders about our executive compensation program
	Compensation aligned with risk management objectives
	∎	incentive compensation for divisional heads of control functions is based on measures that are not directly linked to the business they oversee
	∎	we stress test compensation plan designs
	∎	the CEO and CFO must hold Manulife equity after leaving Manulife
	∎	executive compensation clawed back for wrongdoing, even when a financial restatement is not required

What we don’t do
×	No grossing up of perquisites
×	No repricing or backdating of stock options
×	No hedging or monetizing of equity awards
×	No multi-year guarantees in employment agreements
×	No severance of more than two years on termination following a change in control

2017 Management information circular 53

COMPENSATION DISCUSSION AND ANALYSIS

How the Manulife board oversees executive compensation

The table below explains the role of the board, management and outside advisors in designing and awarding executive compensation.   We make sure Manulife’s executive compensation program follows good governance practices by aligning it with the Financial Stability Board’s (FSB) Principles for Sound Compensation Practices, the FSB’s Implementation Standards and other governance best practices related to compensation.   We conduct an internal audit of the executive compensation program every year to confirm alignment with the FSB’s Principles and Implementation Standards.  

Board of directors Oversees our overall approach to compensation, including alignment with sound risk management principles and Manulife’s risk appetite Approves: ∎   overall financial plans and strategy upon which the targets for our incentive programs are based ∎   major compensation decisions, including compensation for the CEO and other senior executives	Board committees The board carries out its compensation-related responsibilities with the help of two committees All board committee members are independent
		See page 130 for information about director independence You’ll find more about each committee’s members and responsibilities starting on page 37

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Independent advisor to the board

The management resources and compensation committee works with Hugessen Consulting Inc., a consulting firm that provides independent advice on executive compensation. Hugessen has been advising the management resources and compensation committee since 2006. The independent advisor:

∎ attends committee meetings

∎ provides advice about decisions related to compensation

∎ reports on compensation trends.

The table below shows the fees paid to Hugessen for its work with the committee in the last two years:

	2015		2016
Executive compensation-related fees		$373,968		$407,417
All other fees		$0		$0

Hugessen meets the requirements of an independent advisor and does not work with management directly without the committee’s prior approval. Hugessen did not perform any other work for Manulife in 2016 or 2015.

q

Management resources and compensation committee ∎    Oversees our approach to human resources, including the executive compensation program ∎    Recommends major compensation decisions to the board ∎    All members are knowledgeable, senior business leaders with broad business experience as a senior officer or chair of the board of a major organization (public, private or not-for-profit), and the majority have experience in executive compensation ∎    At least one member also serves on the risk committee   Risk committee ∎    Oversees the alignment of our incentive compensation plans with sound risk management principles and practices and our risk appetite ∎    The majority of members have knowledge of risk management, as well as technical knowledge of relevant risk principles ∎    At least one member also serves on the management resources and compensation committee Management’s executive compensation committee ∎    Includes the Chief Risk Officer, the Chief Financial Officer and the Executive Vice President, Human Resources ∎    Reviews incentive plan business performance measures, targets, weightings and results for alignment with Manulife’s business strategy and risk management objectives ∎    Monitors the incentive program designs of our peers ∎    Reviews compensation program changes for alignment with Manulife’s risk management objectives   Chief Risk Officer ∎    Participates in management resources and compensation committee meetings where recommendations for the design of the compensation program are reviewed and approved and there is informed discussion of the relevant risks associated with the compensation program ∎    Reviews the incentive compensation oversight process ∎    Reviews changes to the compensation program to make sure they are in line with our risk management objectives ∎    Also a member of management’s executive compensation committee

2017 Management information circular 55

COMPENSATION DISCUSSION AND ANALYSIS

Managing compensation risk

Compensation is aligned with the company’s risk appetite and risk management objectives, and discourages inappropriate risk taking.   We use a compensation risk framework to structure how we manage the risks associated with the compensation program and the design features that mitigate these risks. The framework includes four categories, which shape the development of our compensation program. We assess our compensation program against the framework every year.  

Business risk Business risk has two aspects: ◾  the risk that our compensation program encourages behaviour that is not in line with our business strategy, our risk appetite statement and our goal of generating long-term shareholder value ◾  the risk that the compensation program discourages the taking of healthy risks We seek to manage both aspects of business risk by including performance measures in our incentive plans that align compensation with our business strategy and reflect the impact employees have on performance	Talent risk Talent risk is the risk that our compensation program will not attract and retain talented employees We seek to manage this risk by designing our compensation program to be competitive and appealing to the talent we want to attract		Performance risk Performance risk is the risk that our compensation program will not motivate employees to maintain high performance standards We seek to manage this risk by including appropriate links between pay and performance and designing compensation to optimize business results	Compliance and ethical risk Compliance and ethical risk is the risk that our compensation program will encourage employees to engage in questionable, unethical or illegal behaviour We seek to manage this risk through strong oversight and control mechanisms, and by structuring our compensation program in a way that minimizes the potential incentive to breach compliance and ethical guidelines
		See page 123 for information about our risk appetite and our enterprise risk management framework

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Mitigating compensation risk

We seek to manage potential risk through our risk management policies, the design of our executive compensation program and proper oversight of our incentive plans, and integrating the consideration of our risk appetite into our incentive plans and performance assessments.

Program design

∎ compensation award horizons are appropriately balanced between short, medium and long term

∎ incentive plans include several performance measures, combining various performance scenarios

∎ specific risk control and capital adequacy measures are embedded in the performance share unit awards

∎ incentive plan awards depend on both company performance and TSR, which links our strategy and risk appetite with improving shareholder outcomes and capital strength

∎ compensation for the Chief Risk Officer and Chief Actuary is not linked to our business performance, to promote unbiased oversight and advice to senior management and the board

∎ annual incentives for divisional control function heads providing oversight are not directly linked to the performance of businesses they oversee

Incentive plan oversight

∎ the management resources and compensation committee oversees all incentive plans, including payout distribution, control and monitoring processes and the potential impact they may have on business risk

∎ division heads, with the support of divisional risk officers, human resources division heads, and divisional compliance officers, review and approve significant changes to material divisional incentive compensation plans, and attest annually that they do not generate inappropriate levels of business risk to the division and to Manulife as a whole

∎ we stress test and back test compensation plan designs to make sure payouts under different scenarios are appropriate and in line with our business performance

∎ the Chief Risk Officer and the risk committee also review the incentive plan oversight process

Risk perspective in performance assessment

∎ individual risk management objectives are included in annual goals for all senior leaders

∎ we assess employees against risk management criteria to make sure they are mindful of the risks inherent in their jobs and are working within the boundaries of our policies and practices, while still providing appropriate incentives for material risk takers to achieve our objectives

∎ performance assessments are expected to reflect how the employee contributed to managing our risk profile within our risk appetite and also take into account any signals from Internal Audit, Compliance or Risk Management highlighting inappropriate actions

2017 Management information circular 57

COMPENSATION DISCUSSION AND ANALYSIS

Risk management policies

∎ Clawbacks – if a vice president or above commits fraud, theft, embezzlement or serious misconduct, whether or not there is a financial restatement, the board can, at its discretion, cancel some or all of his or her vested or unvested incentive awards, and require repayment of all or a portion of the incentive awards that have already been paid. In addition, if there is a material restatement of our financial statements related to CEO misconduct, the board will claw back the CEO’s incentive compensation in excess of the amounts that would have been awarded based on the material restatement

∎ Share ownership requirements – all executives are required to meet share ownership requirements. The CEO and CFO are required to maintain their share ownership for one year after leaving Manulife

∎ Share retention requirements – the CEO must hold at least 50% of the realized gains from the exercise of stock options in common shares during his employment and for one year post employment. The CFO must hold at least 50% of the realized gains from the exercise of stock options in common shares during his employment and for one year post employment, to the extent he does not otherwise meet his share ownership requirement

∎ No hedging – executives and directors are not allowed to use strategies (for example, short selling, or buying or selling a call or put option or other derivatives) to hedge or offset a change in price of Manulife securities. This policy is incorporated into our code of business conduct and ethics. All employees and directors are required to certify compliance with the code every year.

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Share ownership guidelines

Executives are required to own Manulife securities as a way to align their interests with those of our shareholders.

Executives have five years from the day they are appointed or promoted to the position to meet the requirement.

Deferred share units (DSUs), restricted share units (RSUs), performance share units (PSUs), common shares and preferred shares that executives own personally all qualify to meet the guideline, but stock options do not. We use the grant price or the current market price (whichever is higher) to calculate the value of awards, and assume a performance factor of 100% for PSUs.

The table below shows share ownership for each named executive as at February 28, 2017. We calculated the value of their shareholdings using $23.73, the closing price of Manulife common shares on the TSX on February 28, 2017. Salaries were converted to Canadian dollars using the exchange rate of US$1.00 = Cdn$1.3248 on that date.

	Required ownership as multiple of base salary		RSUs ($)		PSUs ($)		DSUs ($)		Personal shareholdings ($)		Total holdings ($)		Share ownership as multiple of base salary
Donald Guloien		7.0		6,856,092		13,603,773		5,027,693		2,935,876		28,423,434		15.8
Steve Roder		4.0		3,857,982		7,326,931		1,948,326		–		13,133,239		12.4
Roy Gori		4.0		3,911,319		5,385,449		3,618,388		–		12,915,156		12.2
Warren Thomson		4.0		2,511,852		4,150,987		4,907,163		1,119,676		12,689,678		11.7
Craig Bromley		4.0		2,628,861		4,430,122		–		593		7,059,576		7.6

2017 Management information circular 59

COMPENSATION DISCUSSION AND ANALYSIS

The decision-making process

We use the following process to determine compensation for the CEO, all executive committee members and heads of control functions, including the named executives. Base salary increases and long-term incentives are awarded at the beginning of each year. Annual incentives are approved after the end of each year.

Review plan design		^	Set performance goals		^	Ongoing review of market and trends		^
Management presents its initial recommendations for compensation structure and supporting rationale for the upcoming year to the management resources and compensation committee. This includes: ∎   compensation components ∎   compensation mix ∎   performance measures The management resources and compensation committee discusses the recommendations and provides feedback to management The risk committee reviews the risk management aspects of the program and satisfies itself that the compensation program is aligned with our risk management objectives The management resources and compensation committee recommends the compensation program and structure to the board for approval. It seeks advice and guidance about compensation issues from its independent compensation advisor, and may seek feedback from shareholders and proxy advisory firms			The board approves the CEO’s individual performance goals The management resources and compensation committee: ∎   reviews, approves and recommends to the board the individual performance goals of the executive committee members and heads of control functions ∎   reviews, approves and recommends to the board the business performance measures and financial targets for incentive plan purposes. Targets are aligned with the board-approved plans and are intended to be achievable yet provide a performance “stretch” ∎   stress tests different scenarios to set appropriate financial targets, performance peer group composition and plan changes			The management resources and compensation committee: ∎   reviews the composition of the compensation peer group ∎   reviews the competitive positioning of target compensation against desired market positioning ∎   reviews ongoing trends
							See page 62 for more about compensation benchmarking
	See page 64 for this year’s compensation program			See pages 69 and 77 for this year’s performance goals

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Assess performance		^	Finalize compensation
The CFO presents and discusses the business performance results with the management resources and compensation committee The independent advisor provides an independent view of business performance that is used for the incentive plans The management resources and compensation committee reviews the performance factors for the annual incentive plan and performance share units The board reviews and decides whether to use its discretion to make an adjustment to the performance factors, and then approves the performance factors			The CEO discusses and approves the individual performance and compensation recommendations for all executive committee members and heads of control functions with the management resources and compensation committee During sessions held without management, the management resources and compensation committee and the board discuss compensation for the CEO, all executive committee members and heads of control functions The board exercises independent judgment when making final compensation decisions
				See the named executive profiles starting on page 82 for details about their compensation this year
	See pages 72 and 80 for this year’s performance results

2017 Management information circular 61

COMPENSATION DISCUSSION AND ANALYSIS

Benchmarking against our peers

We regularly benchmark our compensation against our peers to make compensation competitive so we can attract and retain executive talent. We also benchmark our performance against our peers to assess our relative performance for our performance share unit awards.  

Benchmarking compensation for individual roles

We look at how other companies compensate roles that are similar to ours, benchmarking each component of compensation as well as total direct compensation. This makes compensation appropriately competitive so we can attract and retain high performing executive talent.

For our named executives, we primarily benchmark against our compensation peer group. For the role of Senior Executive Vice President and Chief Investment Officer, we also look at the pay practices of asset management advisory firms similar in size to Manulife Asset Management, our global asset management arm.

We also refer to pay information from three surveys published by prominent consulting firms:

∎ Diversified Insurance Survey: widely referenced survey of pay levels among major insurance companies in the United States

∎ Financial Services Executive Compensation Survey: survey of major financial institutions in Canada

∎ Insurance Executive Rewards Survey: survey of major insurance companies in the Asia Pacific region.

We target total direct compensation for our executives at the median level of the external market, but will position high performing executives above the median to reflect sustained high performance over time.

Peer groups

We use two peer groups:

∎ a compensation peer group to benchmark executive pay

∎ a performance peer group that we use to assess our relative TSR for our performance share unit awards.

We review the companies in both groups every year to make sure they continue to meet the following criteria:

∎ are similar in size

∎ have an international footprint

∎ are in similar lines of business

∎ compete with us for talent (for the compensation peer group)

∎ have readily available compensation data (for the compensation peer group).

The management resources and compensation committee selected 13 companies that meet these criteria for the compensation peer group: eight insurance companies (including Power Financial Corporation in 2016) and five Canadian banks.

The performance peer group includes 14 companies: the eight insurance companies in the compensation peer group, and six additional insurance companies that meet the criteria of similar size, international footprint and similar lines of business. These insurance companies are not in the compensation peer group because they do not disclose compensation data in a manner that allows us to reliably benchmark compensation for our named executives. The Canadian banks are not included in the performance peer

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EXECUTIVE COMPENSATION

group because, while they are important competitors for capital and Canadian talent, they are not true competitors for many of our business lines and may not have the same exposure to macroeconomic market influences.

∎	AFLAC Inc.	∎	Bank of Montreal
∎	Ameriprise Financial Inc.	∎	Bank of Nova Scotia
∎	MetLife, Inc.	∎	Canadian Imperial Bank	u	Compensation peer group
∎	Power Financial Corporation		of Commerce
∎	Principal Financial Group Inc.	∎	Royal Bank of Canada
∎	Prudential Financial, Inc.	∎	Toronto-Dominion Bank
∎	Prudential plc
∎	Sun Life Financial Inc.
∎	AIA Group Limited
∎	Allianz SE
∎	Assicurazioni Generali SpA	u	Performance
∎	Aviva plc		peer group
∎	AXA SA
∎	Zurich Insurance Group Ltd.

New for 2016 and 2017

We have added Power Financial Corporation to our compensation and performance peer group in 2016 and our performance peer group in 2017 to increase the number of Canadian peers, and because it is a competitor for capital.

Power Financial Corporation, which owns Great West Life, a Canadian insurance competitor, meets the criteria of similar size, international footprint and similar lines of business.

Where we rank in our compensation peer group

The graph below shows how we rank against the compensation peer group median by five factors, illustrating why this group is appropriate as a benchmark for compensation. Total assets, market capitalization and revenue are the most recently reported figures and are in U.S. dollars. TSR is as at December 31, 2016 and is based on local currencies.

(source: Bloomberg)

2017 Management information circular 63

COMPENSATION DISCUSSION AND ANALYSIS

Our compensation program and 2016 performance

Total compensation

Our executive compensation program for the executives named in this circular has six key components.

Base salary Set in February of each year and effective March 1st	u	Fixed compensation based on role, performance, qualifications and experience	u	Each executive’s salary depends on: ∎   qualifications, experience and role ∎   performance in the role ∎   past promotions and career progression ∎   salaries paid for comparable roles at peer companies ∎   salaries of comparable roles within Manulife We benchmark salaries and salary ranges at least once a year against comparable roles in peer companies and other executives at Manulife
Annual incentive ∎   annual cash-based incentive Awarded in February of the following year for the preceding year’s performance	u	Variable compensation designed to reward senior executives for meeting company objectives and individual performance goals over a calendar year where performance is assessed based on “what” was achieved (contribution) and “how” they were achieved (exhibiting our cultural behaviours) Ties compensation to short-term priorities that will result in sustainable performance over time	u	We set a target award for each executive (a percentage of base salary) based on competitive market data and the executive’s level The amount we actually pay depends on a combination of company and individual performance Company performance objectives are tied to the achievement of performance targets that position the company for future success Individual performance objectives are aligned with our company strategy and fall into three categories: ∎   business objectives ∎   leadership objectives ∎   risk management objectives

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Medium and long-term incentives (equity-based incentives) ∎   restricted share units ∎   performance share units ∎   stock options Awarded at the beginning of each year	u	Variable compensation designed to reward senior executives for meeting company objectives and individual performance goals over a multi-year period Ties compensation to company and share price performance over both the medium and long term Strengthens retention and reinforces alignment with shareholder value, especially for senior executives	u	We set awards for each executive based on level, contribution, potential and market competitiveness, and benchmark the award levels every year against comparable roles in peer companies The amount each executive ultimately receives depends on our performance: ∎   the value of restricted share units depends on the price of Manulife common shares at the time of vesting ∎   the value of performance share units depends on the price of Manulife common shares at the time of vesting, as well as how we perform against internal and relative performance measures that are aligned with our company strategy ∎   the value of stock options depends on the price of Manulife common shares at the time of grant and when stock options are exercised We do not consider the outstanding value of restricted share units, performance share units and stock options an executive already holds when granting awards
Pension	u	Assists our employees as they save for their retirement	u	We typically offer capital accumulation plans, including defined contribution, cash balance and 401(k) plans, depending on the country where the employee works
Benefits and wellness		Protects and invests in the well-being of our employees		We offer group life, disability, health and dental insurance and wellness and other programs that reflect local market practice in the country where the employee works
Perquisites		Offers market-competitive benefits		We offer perquisites depending on local market practice.

2017 Management information circular 65

COMPENSATION DISCUSSION AND ANALYSIS

Compensation mix

The charts below show the mix of components that make up total target direct compensation for our senior executives, and how those components pay out over time.

Most of each executive’s compensation is variable (or at risk), and a significant portion is tied to our share price. The proportion of at risk pay increases by level, making the link between pay and performance more pronounced for senior executives, because of the greater influence they have on our results. The combination of different incentive plans ensures that executives consider both the short-term and the long-term impact of their decisions.

The board believes this combination of components and time horizons helps to drive performance, align executive interests with those of shareholders, provide for competitive pay opportunities and encourage retention.

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Compensation is aligned with business strategy and paid out over time

2017 Management information circular 67

COMPENSATION DISCUSSION AND ANALYSIS

About the annual incentive award

Our annual incentive plan is designed to reward senior executives for meeting company objectives and individual performance goals over a calendar year where performance is assessed based on “what” was achieved (contribution) and “how” they were achieved (exhibiting our cultural behaviours). Incentive compensation for higher level positions is more affected by total company results, while the emphasis at less senior levels in the organization is more on divisional, business unit or functional goals, with some links to global results to foster collaboration and a business owner mentality.

Performance measures and weightings are:

∎ linked to our strategy with targets set consistently with our board approved plan

∎ stress tested and back tested to make sure potential awards are aligned with business performance and do not encourage inappropriate risk-taking

∎ recommended by senior management and reviewed and approved by the board.

The board can adjust the calculated result up or down when significant events outside management’s control make awards unreasonable, unrepresentative or inappropriate.

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How we calculate the award for the senior executives

New for 2017

Key changes to the annual incentive plan

∎    four measures instead of seven

Simplified plan

∎    no overlap in measures with the PSU plan

∎    higher threshold performance

Better link between pay and performance

∎    narrower range of performance outcomes and payout range on net income

∎    scorecard more closely aligned with how our shareholders look at our performance, focusing on earnings and key initiatives

Improved alignment with shareholders

2017 Management information circular 69

COMPENSATION DISCUSSION AND ANALYSIS

Performance criteria for the 2016 awards (weighting)

Financial success 50%		Net income attributed to shareholders (25%)
		Aligns compensation with shareholder experience
	t	Threshold 0	Target 100	Maximum 200
		50% below target	at target	50% above target
		Core earnings excluding investment-related experience (25%)
		Core earnings measures our underlying earnings capacity and is an important factor in valuing Manulife’s share price
	t	Threshold 0	Target 100	Maximum 200
		25% below target	at target	25% above target
Operational success 40%		New business value (10%)
		Measures how our insurance new business will impact earnings in the future
	t	Threshold 0	Target 100	Maximum 200
		50% below target	at target	50% above target
		Wealth and Asset Management core earnings (10%)
		Measures how we are profitably growing our global Wealth and Asset Management business
	t	Threshold 0	Target 100	Maximum 200
		50% below target	at target	50% above target
		Expense management (10%)
		Managing our costs to build competitive advantage
	t	Threshold 0	Target 100	Maximum 200
		30% below target	at target	30% above target
		Financial flexibility (10%)
		Managing our capital to give us financial strength and flexibility
	t	Threshold 0	Target 100	Maximum 200
		75% below target	at target	75% above target
Building for the future 10%	t	Strategic initiatives (10%) Key initiatives based on our enterprise strategy that will drive growth with a balanced approach to risk

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EXECUTIVE COMPENSATION

Performance criteria for awards starting in 2017 (weighting)

Financial success 50%		Net income attributed to shareholders (25%)
		Same weighting, narrower performance range
	t	Threshold 25	Target 100	Maximum 200
		30% below target	at target	40% above target
		Core earnings excluding investment-related experience (25%)
		Same weighting and performance range
	t	Threshold 0	Target 100	Maximum 200
		25% below target	at target	25% above target
New business profitability 30%		New business profitability (30%)
		Measures profitable growth in new business across our portfolio Includes the following measures of the business:
	t	∎    New business value for insurance businesses
		∎    Wealth and Asset Management core earnings
		Threshold 0	Target 100	Maximum 200
		50% below target	at target	50% above target
Building for the future 20%		Customer, employee and strategic initiatives (20%)
	t	Higher weighting, and scope expanded to include customer experience and employee engagement Qualitative, but informed by quantifiable measures and deliverables aligned with our strategic and annual operating plan. Established at the beginning of the year and approved by the management resources and compensation committee

As part of our simplification of the 2017 annual incentive plan, expense management and financial flexibility measures are no longer included. These items are incorporated within the broader financial and new business profitability targets, as well as directly in the personal objectives of our named executives.

Please turn to page 50 for more details about why the measures we’re introducing for 2017 are important and how we calculate them.

2017 Management information circular 71

COMPENSATION DISCUSSION AND ANALYSIS

2016 annual incentive

The company performance score applicable to named executives for the 2016 annual incentive award is 88%. This was based on performance against measures and objectives that were set at the beginning of the year, in line with our board-approved business plan (see the table below). During 2016, the board approved an adjustment to the business plan and our net income target which transferred an anticipated charge from our 2017 plan to our 2016 plan. This charge related to a change to the discount rate used in the valuation of our policyholder liabilities (the ultimate reinvestment rate or URR) in advance of an anticipated regulatory change by the Actuarial Standards Board expected to take effect in 2017, which we proactively adopted in the third quarter of 2016.

In 2016 we introduced core earnings excluding investment-related experience to replace the previous core earnings measure, and tightened the related performance range. Excluding core investment-related experience better aligns this measure with the operational performance of our divisions. We use core earnings as the basis for management planning and reporting and, along with net income attributable to shareholders, as a key measure to evaluate our operating segments. You’ll find more information about each named executive’s annual incentive award, and a discussion of their performance against their individual goals, in the profiles starting on page 82.

Company performance score for 2016
Performance type	What we measured (weighting)	Performance range						Actual		Score		Weighted score
		Threshold 0		Target 100		Maximum 200
Financial success (50%)	Net income attributed to shareholders1 ($ millions) (25%)		1,851		3,702		5,553		2,929		58%		15%
	Core earnings excluding investment-related experience ($ millions) (25%)		2,775		3,700		4,625		3,824		113%		28%
Operational success (40%)	New business value ($ millions) (10%)2		618		1,235		1,853		1,226		98%		10%
	Wealth and Asset Management core earnings ($ millions) (10%)		342		683		1,025		629		84%		8%
	Expense management3 (10%)										103%		10%
	Financial flexibility3 (10%)										55%		6%
Building for the future (10%)	Strategic initiatives3 (10%)										110%		11%
	2016 company performance score												88%

1 Net income reflects an after-tax charge of $313 million related to a change in the discount rate used in the valuation of our policyholder liabilities in anticipation of regulatory change in 2017.

2 Target and actual do not include P&C Reinsurance because new business value is not an appropriate incentive measure for that business.

3 The scores for expense management, financial flexibility and strategic initiatives are based on performance against several predetermined goals that are consistent with our business plan.

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EXECUTIVE COMPENSATION

Understanding the score

Financial success

Net income was $2,929 million – 34% higher than 2015 but below target, as market volatility throughout 2016 and the strengthening of reserves related to our review of actuarial methods and assumptions had a negative effect on our results.

Core earnings excluding investment-related experience was $3,824 million – 12% higher than 2015 and higher than our target, highlighting Manulife’s operating momentum. A turnaround in core investment-related experience increased overall core earnings to $4,021 million – 17% higher than 2015 and achieving target set in 2012. See page 2 for a more detailed discussion of this year’s financial performance.

Operational success

New business value was 22% higher than 2015 and largely in line with target, driven by strong sales growth and higher product margins in Asia.

Wealth and Asset Management core earnings of $629 million were in line with 2015 but below target. Higher fee income on higher asset levels and higher tax benefits in the U.S. were offset by changes in business mix, fee compression in the U.S. pension business and strategic investments to optimize our operational infrastructure and expand our distribution reach in Europe and Asia.

Expense management reflects our Efficiency and Effectiveness (E&E) initiative, which leverages our global scale and capabilities to achieve operational excellence and cost efficiencies throughout the company. E&E has resulted in over $500 million in annual net pre-tax savings over four years. The savings have allowed us to fund other new initiatives, including those in the Building for the future category below.

The below target financial flexibility score reflects the impact of lower interest rates on local capital requirements in Asia which reduced overall net remittances from subsidiaries.

Building for the future

The strategic initiatives score reflects solid progress on delivering on our strategy.

New business value in Asia has grown at an accelerated rate, helped by the exclusive partnerships we have signed with other financial institutions in the region. Our Wealth and Asset Management businesses are also strongly positioned to grow with sizeable scale, thanks to strong organic growth and a number of acquisitions. Technology is transforming our industry and the lives of our customers, and we are investing across the company in re-engineering our business and dramatically improving the customer experience. Highlights from 2016 include:

∎ our life insurance offerings across Canada, the U.S. and parts of Asia now include wearable devices to help our customers live healthier lives and save money

∎ in Canada, we are using advanced, predictive analytics to simplify underwriting and eliminate unnecessary medical testing

∎ in the U.S., we launched the first phase of our new digital buying platform, and made our first foray into digital advice

∎ in mainland China, we are using the WeChat messaging platform to process claims, reducing processing time from more than one week to as little as one day.

2017 Management information circular 73

COMPENSATION DISCUSSION AND ANALYSIS

About the medium and long-term incentives

We grant equity-based incentives every year, offering a competitive mix of restricted share units, performance share units and stock options depending on the executive’s position.

	RSUs		PSUs		Stock options
Chief Executive Officer		25%		35%		40%
Senior executive vice presidents		25%		35%		40%
Executive vice presidents		35%		35%		30%
Chief Risk Officer/Chief Actuary		70%		0%		30%

		Medium-term incentives Restricted share units	Performance share units
What they are	u	Notional shares that pay out based on the price of Manulife common shares	Notional shares that pay out based on our performance and on the price of Manulife common shares
Vesting and payout	u	Vest and pay out in cash within three years Their payout value is equal to the average closing price of Manulife common shares for the five trading days before the day they vest	Vest and pay out in cash within three years The number of units that vest depends on our performance against absolute and relative performance measures that are set at grant, aligned with our strategy and approved by the board Their payout value is equal to the average closing price of Manulife common shares for the five trading days before the day they vest, multiplied by the performance share unit performance factor
				See page 78 for details about the performance conditions for the PSUs awarded for 2016
Dividend equivalents	u	Credited as additional units at the same rate as dividends paid on Manulife common shares

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Long-term incentive Stock options	New for 2017 Greater emphasis on performance- based incentives for the CEO and senior executive vice presidents The weighting of PSUs is increasing to 50%, to tie a higher proportion of equity-based incentives directly to the achievement of business results
Rights to buy Manulife common shares in the future at a specified price
Vest 25% every year for four years from the grant date Stock options granted in 2015 and later cannot be exercised until five years from the grant date except under extenuating circumstances The exercise price is equal to the grant price Their ultimate value is the difference between the exercise price and the price of Manulife common shares when they’re exercised Stock options expire at the end of 10 years and are only transferable when the executive dies
Do not earn dividend equivalents

2017 Management information circular 75

COMPENSATION DISCUSSION AND ANALYSIS

Grants	u	The grant price is the closing price of Manulife common shares on the TSX on the last trading day before the grant date, or the average closing price for the five trading days before the grant date (whichever is higher) The grant value of stock options is calculated using the Black-Scholes methodology
Notice of retirement	u	Beginning with the 2015 grant, senior vice presidents or above have to provide three months’ notice before leaving Manulife or they will lose their post-termination retirement benefits and all outstanding grants will be forfeited
Restrictions on stock options	u	Stock options granted in 2015 and later cannot be exercised until five years after the grant date. We added this restriction in 2015 because we believe executives should not benefit from short-term spikes in our share price while their stock options continue to be exercisable for several years
Blackout periods	u	Medium and long-term incentives are not granted when our reporting insiders are prohibited from trading, which is commonly referred to as a blackout period. Annual awards are normally granted following the end of the blackout period after our year-end financial results are announced. Awards can also be made to select new executives at the time of hire. If the hire date falls within a blackout period, the grant is delayed until after the end of the blackout period

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EXECUTIVE COMPENSATION

How we calculate the payout for performance share units

Performance share units vest and pay out based on the following formula.

Targets for the three-year performance period are set at the time of the grant, consistent with our business plan. The board can adjust the calculated result up or down when significant events outside management’s control make awards unreasonable, unrepresentative or inappropriate.

See page 62 for information about the performance peer group.

New for 2017

Key changes to the PSU plan

∎    three equally weighted measures instead of six

Simplified plan

∎    single performance period of three years instead of three distinct periods with targets set in advance

∎    no overlap with the short-term incentive measures

Better link between pay and performance

∎    increased the weighting of PSUs to 50% from 35% of equity-based awards for the CEO and senior executive vice presidents

∎    added new Canadian peer to the performance peer group to give more context to our relative performance

Improved alignment with shareholders

∎    relative TSR now a measure instead of a modifier, increasing ties to shareholder experience

∎    vesting and performance period extended to three full years so they align more easily to our publicly reported results

2017 Management information circular 77

COMPENSATION DISCUSSION AND ANALYSIS

Performance criteria for the PSUs awarded for 2016 (weighting)

Manulife performance factor		Net income attributed to shareholders (25%)
		Aligns compensation with shareholder experience
	t	Threshold 0	Target 100	Maximum 150
		50% below target	at target	25% above target
		Return on equity (25%) Reflects the efficient use of capital in generating earnings
	t	Threshold 0	Target 100	Maximum 150
		50% below target	at target	25% above target
		Average MCCSR ratio (25%) Focuses executives on building financial strength so we can meet our obligations to our policyholders
	t	Threshold 0	Target 100	Maximum 150
		80% of target	at target	115% of target
		Wealth and Asset Management core earnings (12.5%) Measures how we are growing our Wealth and Asset Management business
	t	Threshold 0	Target 100	Maximum 150
		50% below target	at target	25% above target
		New business value (12.5%) Measures how our insurance new business will impact earnings in the future – especially in Asia
	t	Threshold 0	Target 100	Maximum 150
		50% below target	at target	25% above target
Relative TSR modifier		Relative TSR Compared to the median of our performance peer group. Applied as a modifier to the result from our internal performance measures Aligns with shareholder experience. Tells us how well we are doing at increasing shareholder value compared with our peers
	t	Threshold 80%	Target 100%	Maximum 120%
		30 pts below median	at median	30 pts above median

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Performance criteria for the PSU awards starting in 2017 (weighting)

Performance factor		Book value per share excluding AOCI (33%)
		Focuses on long-term growth in equity needed to support the company’s growth, and is used to value insurance companies and investment firms
	t	Threshold 0	Target 100	Maximum 180
		10% below target	at target	8% above target
		Core return on equity (33%)
		Reflects the efficient use of capital in generating core earnings
	t	Threshold 0	Target 100	Maximum 180
		40% below target	at target	32% above target
		Relative TSR (34%)
		Compared to the median of our performance peer group. Becomes a measure instead of a modifier, which gives it higher weighting
	t	Threshold 0	Target 100	Maximum 180
		30 pts below median	median	24 pts above median

We have simplified the 2017 PSU plan to include three measures, at the same time eliminating overlap with the annual incentive plan measures. The 2017 measures focus on longer term growth and the impact to our overall balance sheet, core earnings return on invested equity and have included relative TSR as a measure rather than a modifier.

Please turn to page 50 for more details about why the measures we’re introducing for 2017 are important and how we calculate them.

2017 Management information circular 79

COMPENSATION DISCUSSION AND ANALYSIS

Payout for medium-term incentives that were awarded in 2014

Restricted share units and performance share units awarded in 2014 vested and were paid out on December 15, 2016. The amounts in the table below include reinvested dividends.

	Vesting date		Grant date price ($)		Combined performance factor		Vesting date price ($)		Payout as a % of grant value
2014 RSUs		Dec 15, 2016		21.20		-		24.38		126%
2014 PSUs		Dec 15, 2016		21.20		75%		24.38		95%

The 2014 restricted share units paid out at 126% of their grant value.

The 2014 performance share units vested with a combined performance factor of 75%, based on the formula below.

Performance was assessed using performance measures and goals that were set in 2014, at the time of grant, in line with our board-approved business plan. No discretion was applied on the results.

								As a percentage of original award
Donald Guloien	159,445	x	75%	x	$24.38	=	$2,915,448		95%
Steve Roder	54,152	x	75%	x	$24.38	=	$990,166		95%
Roy Gori	–	x	–	x	–	=	–		–
Warren Thomson	44,122	x	75%	x	$24.38	=	$806,764		95%
Craig Bromley	34,094	x