EX-97.1 2 exhibit97-1xclawbackpolicy.htm EX-97.1
Exhibit 97.1

EXECUTIVE OFFICER CLAWBACK POLICY

The Board of Directors (the “Board”) of Manulife Financial Corporation (the “Company”)
believes that it is in the best interests of the Company and its shareholders to adopt this Clawback
Policy (the “Policy”), which provides for the recovery of certain incentive compensation in the
event of an Accounting Restatement (as defined below). This Policy is designed to comply with,
and shall be interpreted consistent with, Section 10D of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), Rule 10D-1 promulgated under the Exchange Act (“Rule
10D-1”) and Section 303A.14 of the New York Stock Exchange (“NYSE”) Listed Company
Manual (the “Listing Standards”).
This Policy is separate from, and in addition to, any other policy of the Company or any of its
subsidiaries now or hereafter in existence, that relates to the clawback of incentive awards or
other forms of compensation from directors, executive officers or employees of the Company or
its subsidiaries (any such other clawback policy being referred to herein as a “Discretionary
Clawback Policy”). In the event of any conflict or inconsistency between this Policy and any
Discretionary Clawback Policy, the terms and conditions of this Policy shall prevail.
1.Administration
Except as specifically set forth herein, this Policy shall be administered by the Management
Resources and Compensation Committee (the “MRCC”) of the Board (the “Administrator”).
The Administrator is authorized to interpret and construe this Policy and to make all
determinations necessary, appropriate, or advisable for the administration of this Policy. Any
determinations made by the Administrator shall be final and binding on all affected individuals
and need not be uniform with respect to each individual covered by the Policy. In the
administration of this Policy, the Administrator is authorized and directed to consult with the full
Board or such other committees of the Board, such as the Audit Committee or the Risk
Committee, as may be necessary or appropriate as to matters within the scope of such other
committee’s responsibility and authority. Subject to any limitation at applicable law, the
Administrator may authorize and empower any officer or employee of the Company to take any
and all actions necessary or appropriate to carry out the purpose and intent of this Policy (other
than with respect to any recovery under this Policy involving such officer or employee), and the
Administrator may retain the services of external consultants of other service providers if
determined to be necessary or appropriate.
2.Definitions
As used in this Policy, the following definitions shall apply:
•“Accounting Restatement” means an accounting restatement of the Company’s
financial statements due to the Company’s material noncompliance with any financial
reporting requirement under the securities laws, including any required accounting
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restatement to correct an error in previously issued financial statements that is
material to the previously issued financial statements, or that would result in a
material misstatement if the error were corrected in the current period or left
uncorrected in the current period.
•“Administrator” has the meaning set forth in Section 1 hereof.
•“Applicable Period” means the three completed fiscal years immediately preceding
the date on which the Company is required to prepare an Accounting Restatement, as
well as any transition period (that results from a change in the Company’s fiscal year)
within or immediately following those three completed fiscal years (except that a
transition period that comprises a period of at least nine months shall count as a
completed fiscal year). The “date on which the Company is required to prepare an
Accounting Restatement” is the earlier to occur of (a) the date the Board concludes,
or reasonably should have concluded, that the Company is required to prepare an
Accounting Restatement, or (b) the date a court, regulator, or other legally authorized
body directs the Company to prepare an Accounting Restatement, in each case
regardless of if or when the restated financial statements are filed.
•“Covered Executives” means the Company’s current and former executive officers,
as determined by the Administrator in accordance with the definition of executive
officer set forth in Rule 10D-1 and the Listing Standards.
•“Erroneously Awarded Compensation” has the meaning set forth in Section 5 of
this Policy.
•A “Financial Reporting Measure” is any measure that is determined and presented
in accordance with the accounting principles used in preparing the Company’s
financial statements, and any measure that is derived wholly or in part from such
measure. A Financial Reporting Measure need not be presented within the
Company’s financial statements or included in a filing with the Securities Exchange
Commission.
•“Incentive-Based Compensation” means any compensation that is granted, earned,
or vested based wholly or in part upon the attainment of a Financial Reporting
Measure. Incentive-Based Compensation is “received” for purposes of this Policy in
the Company’s fiscal period during which the Financial Reporting Measure specified
in the Incentive-Based Compensation award is attained, even if the payment or grant
of such Incentive-Based Compensation occurs after the end of that period.
3.Covered Executives; Incentive-Based Compensation
Without limiting the terms and conditions of any Discretionary Clawback Policy, this Policy
applies to Incentive-Based Compensation received by a Covered Executive (a) after beginning
services as a Covered Executive; (b) if that person served as a Covered Executive at any time
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during the performance period for such Incentive-Based Compensation; and (c) while the
Company had a listed class of securities on a national securities exchange.
4.Required Recoupment of Erroneously Awarded Compensation in the event of an
Accounting Restatement
In the event the Company is required to prepare an Accounting Restatement, the Company shall
promptly recoup the amount of any Erroneously Awarded Compensation received by any
Covered Executive, as calculated pursuant to Section 5 hereof, during the Applicable Period.
5.Erroneously Awarded Compensation: Amount Subject to Recovery
The amount of “Erroneously Awarded Compensation” subject to recovery under the Policy, as
determined by the Administrator, is the amount of Incentive-Based Compensation received by the
Covered Executive that exceeds the amount of Incentive-Based Compensation that would have
been received by the Covered Executive had it been determined based on the restated amounts.
Erroneously Awarded Compensation shall be computed by the Administrator without regard to any
taxes paid in any and all applicable jurisdictions by the Covered Executive in respect of the
Erroneously Awarded Compensation.
By way of example, with respect to any compensation plans or programs that take into account
Incentive-Based Compensation, the amount of Erroneously Awarded Compensation subject to
recovery hereunder includes, but is not limited to, the amount contributed to any notional
account based on Erroneously Awarded Compensation and any earnings accrued to date on that
notional amount.
For Incentive-Based Compensation based on stock price or total shareholder return (“TSR”): (a)
the Administrator shall determine the amount of Erroneously Awarded Compensation based on a
reasonable estimate of the effect of the Accounting Restatement on the stock price or TSR upon
which the Incentive-Based Compensation was received; and (b) the Company shall maintain
documentation of the determination of that reasonable estimate and provide such documentation
to NYSE.
6.Method of Recoupment
The Administrator shall determine, in its sole discretion, the timing and method for promptly
recouping Erroneously Awarded Compensation hereunder, which may include without limitation
(a) seeking reimbursement of all or part of any cash or equity-based award, (b) cancelling prior
cash or equity-based awards, whether vested or unvested or paid or unpaid, (c) canceling or
offsetting against any planned future cash or equity-based awards, (d) forfeiture of deferred
compensation, subject to compliance with Section 409A of the Internal Revenue Code and the
regulations promulgated thereunder, and (e) any other method authorized by applicable law or
contract. Subject to compliance with any applicable law, the Administrator may affect recovery
under this Policy from any amount otherwise payable to the Covered Executive, including
amounts payable to such individual under any otherwise applicable Company plan or program,
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including base salary, bonuses or commissions and compensation previously deferred by the
Covered Executive.
The Company is authorized and directed pursuant to this Policy to recoup Erroneously Awarded
Compensation in compliance with this Policy unless the MRCC has determined that recovery
would be impracticable solely for the following limited reasons, and subject to the following
procedural and disclosure requirements:
•The direct expense paid to a third party to assist in enforcing the Policy would exceed the
amount to be recovered. Before concluding that it would be impracticable to recover any
amount of Erroneously Awarded Compensation based on expense of enforcement, the
Administrator must make a reasonable attempt to recover such erroneously awarded
compensation, document such reasonable attempt(s) to recover, and provide that
documentation to NYSE;
•Recovery would violate home country law of the issuer where that law was adopted prior
to November 28, 2022. Before concluding that it would be impracticable to recover any
amount of Erroneously Awarded Compensation based on violation of home country law
of the issuer, the Administrator must satisfy the applicable opinion and disclosure
requirements of Rule 10D-1 and the Listing Standards; or
•Recovery would likely cause an otherwise tax-qualified retirement plan, under which
benefits are broadly available to employees of the Company, to fail to meet the
requirements of 26 U.S.C. 401(a)(13) or 26 U.S.C. 411(a) and regulations thereunder.
7.No Indemnification of Covered Executives
Notwithstanding the terms of any indemnification or insurance policy or any contractual
arrangement with any Covered Executive that may be interpreted to the contrary, the Company
shall not indemnify any Covered Executives against the loss of any Erroneously Awarded
Compensation, including any payment or reimbursement for the cost of third-party insurance
purchased by any Covered Executives to fund potential clawback obligations under this Policy.
8.Administrator Indemnification
Any members of the Administrator, and any other members of the Board who assist in the
administration of this Policy, shall not be personally liable for any action, determination or
interpretation made with respect to this Policy and shall be fully indemnified by the Company to
the fullest extent under applicable law and Company policy with respect to any such action,
determination or interpretation. The foregoing sentence shall not limit any other rights to
indemnification of the members of the Board under applicable law or Company policy.
9.Effective Date; Retroactive Application
This Policy shall be effective as of October 2, 2023 (the “Effective Date”). The terms of this
Policy shall apply to any Incentive-Based Compensation that is received by Covered Executives
on or after the Effective Date, even if such Incentive-Based Compensation was approved,
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awarded, granted or paid to Covered Executives prior to the Effective Date. Without limiting the
generality of Section 6 hereof, and subject to applicable law, the Administrator may affect
recovery under this Policy from any amount of compensation approved, awarded, granted,
payable or paid to the Covered Executive prior to, on or after the Effective Date.
10.Amendment; Termination
The MRCC may amend, modify, supplement, rescind or replace all or any portion of this Policy
at any time and from time to time in its discretion, and shall amend this Policy as it deems
necessary to comply with applicable law or any rules or standards adopted by a national
securities exchange on which the Company’s securities are listed.
11.Other Recoupment Rights; Company Claims
The MRCC intends that this Policy shall be applied to the fullest extent of the law. Any right of
recoupment under this Policy is in addition to, and not in lieu of, any other remedies or rights of
recoupment that may be available to the Company under applicable law or pursuant to the terms
of any similar policy in any employment agreement, equity award agreement, or similar
agreement and any other legal remedies available to the Company.
Nothing contained in this Policy, and no recoupment or recovery as contemplated by this Policy,
shall limit any claims, damages or other legal remedies the Company or any of its affiliates may
have against a Covered Executive arising out of or resulting from any actions or omissions by the
Covered Executive.
12.Successors
This Policy shall be binding and enforceable against all Covered Executives and their
beneficiaries, heirs, executors, administrators or other legal representatives.
13.Exhibit Filing Requirement
A copy of this Policy and any amendments thereto shall be posted on the Company’s website and
filed as an exhibit to the Company’s annual report on Form 40-F.