Manulife CEO Phil Witherington unveiled his new strategy on Wednesday with the release of Manulife’s third-quarter financial results.Sammy Kogan/The Globe and Mail
Six months into his tenure, Manulife chief executive officer Phil Witherington is laying out a new list of strategic priorities that will see the insurer invest more money in its domestic operations and in artificial intelligence, expand its U.S.-based business to more middle-income clients and gain more footing in India.
Mr. Witherington unveiled his new strategy Wednesday with the release of Manulife Financial Corp.’s MFC-T third-quarter financial results. In an interview with The Globe and Mail, he said the insurer is well-positioned to thrive in a rapidly changing operating environment, but the “refresh strategy” will ensure the company remains agile to act on future growth opportunities for the next 10 years.
“While we are pleased with our momentum toward our 2027 targets, we’re taking actions to ensure we look past that horizon to deliver for all of our stakeholders for the long-term,” Mr. Witherington said.
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The company reported a jump in its third-quarter “core earnings” of $2-billion or $1.16 a share, compared with $1.8-billion or $1 a share in the third quarter of 2024. Core earnings are an adjusted profit figure the company uses.
However, the company’s net income for the quarter was $1.8-billion, flat from a year prior.
The 2027 financial targets – which were first announced in 2024 – include boosting Manulife’s return on equity to 18 per cent and having Asia account for 50 per cent of Manulife’s revenue.
Chief financial officer Colin Simpson said in an interview that the new priorities coincide with a more positive time for the company, compared to the last decade when the insurer had to turnaround certain operations, such as the long-term care business.
“We have gone from a situation where we were fighting to be heard, and there were so many reasons people were throwing back at us on why not to choose Manulife,” Mr. Simpson said. “But now, we’ve entered a new phase where we are answering the question of why should you choose us over the next 10 years.”
Over the last six months, Mr. Witherington has collaborated with his entire team, says Mr. Simpson, on setting up what future success will look like.
Part of that includes diversifying the business. Mr. Witherington said when he looks to the future, there are three “mega economies” emerging: the United States, China and India.
Currently, Manulife has a strong business presence in the United States through John Hancock Life Insurance Company, and it has been operating in China under a joint venture as Manulife-Sinochem since 1996.
But in India, one of the largest growing markets for insurance, Manulife’s brand has been relatively small. In 2020, it signed a joint venture with the asset management arm of Mahindra & Mahindra Ltd. to launch a retail investment business.
On Wednesday, Manulife announced a second joint venture in India with Mahindra that extends into insurance services.
“Through our strategy we are clarifying that we have an aspiration to have a bigger impact and a greater exposure to the India markets, in particular insurance,” Mr. Witherington said.
The new strategy will also see Manulife improve its Canadian group benefits business with faster digital applications for customers while continuing to spend $200-million annually on technology and artificial intelligence with the ambition to make Manulife an AI-powered organization.
Mr. Witherington said AI applications are being used in Asia to help advisers quickly identify insurance and financial gaps for clients, a tool that is being rolled out to other markets, including Canada and the U.S. He also pointed to AI underwriting technology that can approve life insurance applications instantaneously, compared to hours or days.
“We expect AI to generate $1-billion of value between 2025 and 2027,” he added.
Mr. Witherington said his new ambition is to be the number 1 choice for customers, saying it “anchors” the company’s next moves.
“People are living longer. When we look at our markets around the world, this is a common characteristic,” he added. “That means that retirement gaps and protection gaps are growing when it comes to life and health insurance.”
The gaps are one of the reasons Manulife has made a commitment to spend $350-million by 2030 to launch the Longevity Institute, a global initiative that will facilitate research and partnerships around helping people navigate longer lifespans, both financially and healthwise.
In the U.S., John Hancock provides insurance and wealth management to high-net-worth clients. It is also the market where Manulife first launched Vitality – a behavioural program to incentivize clients to be active and eat healthier.
Mr. Witherington previously spent two years in Hong Kong as Manulife’s head of Asia.Sammy Kogan/The Globe and Mail
Now, Mr. Witherington wants to grow that business to include more mass affluent and middle-income clients, and to share certain Vitality perks to other regions. For example, two weeks ago, GRAIL – an early cancer detection test first launched to U.S. clients through John Hancock – was approved for life insurance clients in Canada.
Mr. Witherington took over the role of CEO from Roy Gori on May 8, one month after U.S. President Donald Trump announced sweeping tariffs on a number of products – including goods from Canada.
He previously spent two years in Hong Kong as Manulife’s head of Asia. It is a region close to his heart, having spent the majority of his 25-year career in multiple roles for Manulife, AIA Group Limited and HSBC Holdings PLC. It is also where he met his wife Joan and started to raise their two sons.
In 2014, he joined Manulife as chief financial officer of Asia and went on to become interim CEO of Asia for six months in 2017. In 2018, he relocated his family to Toronto when he was appointed CFO of Manulife, a position he held for five years before returning to Asia.
Now, as a Canadian citizen and living in Toronto, he says he was proud to start his first 100 days as CEO visiting the Manulife employees in Waterloo, Halifax and Montreal.
“Canada and the U.S. have a really important role to play in our global strategy,” he added. “We are a proudly Canadian-headquartered, diversified global financial institution and it’s critical that we actually we pay attention to Canada and invest to grow here.”