Remarks to the 2014 Annual and Special Meeting of Shareholders

Transcription

1 Remarks to the 2014 Annual and Special Meeting of Shareholders May 13, 2014 Halifax, Nova Scotia Bill Morneau Executive Chair Check Against Delivery

2 2 Good afternoon. I m Bill Morneau, Executive Chair of the Board of Morneau Shepell. It is my pleasure to extend a warm welcome to our shareholders and our guests who have joined us in the room, and to those joining us by webcast. It s no accident that we re in Halifax today. Morneau Shepell has been operating here nearly 40 years, and we employ 115 people in Atlantic Canada, out of our more than 3,500 employees across the country. We are the region s and Canada s largest provider of HR consulting and outsourcing services. In Atlantic Canada, we have a large client base across both the public and private sectors governments, leading businesses, educational and health organizations, among others. And there will be more to say about that in a few minutes. Here s a headline for you, from the April 14th edition of the Globe and Mail: Nova Scotia leads where Canada lags: R&D. The Globe article is about entrepreneurs who are taking action to invest in innovation, and indeed to reverse the brain drain that has been a challenge in Atlantic Canada for too long. At Morneau Shepell, we know and see a renewed focus in Atlantic Canada on building the future on talent and innovation. We d like to think that we are part of that story, too. Take our consulting work with the New Brunswick government in pension reform in the development of shared risk, often called target, pension plans. Our work is all about innovation, creating solutions to better share the risks of pension plan investing between employers and their employees, all towards making these plans more secure and sustainable for the long term. It s a subject much in the news these days. The federal government now says it will look at these solutions for Crown corporations and federally regulated companies. Well, New Brunswick got there first, working with us. And I might add, it s an approach that we helped the government of PEI develop a made in PEI version for their public sector pension programs. Innovation in all aspects of our business is a vital part of the Morneau Shepell story today. But so is business performance that speaks to you, our shareholders, and your expectations for results and for an attractive return on your investment. In 2013, we delivered another solid year of financial results and business highlights that Alan and Scott Milligan will cover in more detail. The fact is, your company is strong today and getting stronger, building on a solid base. And that is due, in part, to the value we deliver to organizations focused on helping their people stay healthy and be more engaged and productive at work.

3 3 Broadly speaking, I believe workforce or labour productivity ranks up there near the top of urgent issues facing Canadian business leaders and policymakers. In this area, Canada just isn t keeping pace with the world we re stagnating. It s a very old story. But, even so, it s still remarkable, if you believe that high productivity should be a natural outcome of Canada being the world leader in post-secondary graduates by population. Where is the disconnect here? For a generation or more now, we ve heard that productivity is mainly about investment in technology. Or if it s not about that, then it s a code word for cutting jobs. But there is another angle to the story that is now beginning to get more, and much needed, airtime. And that is the connection the relationship between productivity and mental health in the workplace. And specifically: The increasing levels of stress and anxiety experienced by Canadians in the workforce, the negative impact this is having on productivity, and what this means for Canada in terms of social costs, not to mention the economy. Most importantly, what does it mean for Canadian workers who are suffering the effects of poor mental health? Why this topic is timely is that, this year, Morneau Shepell has completed a study in this area with Queen s University. The study was developed out of our uniquely robust database, and the information that we have as the largest provider of Employee Assistance Programs in Canada. Our EAP database is built on the inputs of employees (and their dependents) from some 8,000 client organizations. It reaches into the lives of some five million Canadians that s the number of Canadians served through our Employee Assistance Plan business. One seventh of the population. Big numbers. In summary, this is what we ve learned: Workforce stress has virtually doubled in the past four years. And that is evident in rising mental-health claims and the cost of high absenteeism among Canadian workers. More worrisome, given Canada s productivity performance, workplace stress is likely to get worse before it gets better. At the same time, the study provides insights into how organizations can be more effective in managing and mitigating the effects of workplace stress and anxiety.

4 4 For example, it suggests that remediation or intervention, in its various forms really does work. This is reflected in significant reductions in time off work absenteeism for people who seek help in contrast to the people who don t. These findings aren t surprising if you consider the social, demographic and competitive factors in Canada today: Globalization which creates an impetus to speed, and volatility in business. Many more factors are influencing business decisions from around the globe and creating a less secure employment picture for Canadians. Financial insecurity debt levels of Canadians keep rising. Job security the average job tenure is declining and will continue to decline. Demographics The middle class is sandwiched between worries over aging parents and their Millennials struggling to get out the door. Corporate turbulence. Downsizing. Technology taking jobs and entire sectors away. A decrease in unionized power, the loss of worker status. Not to mention the decline of defined benefits plans. And other factors changing family structures, marital discord, and longer life spans also bring huge stress. People worry: Will I have enough to retire on? These are all serious issues on the national agenda. Clearly, the conversation needs to expand and intensify in Canada around the relationship between mental health and our productivity as a country. Creating awareness, while important, isn t enough. We need advocacy, better policy, and solutions from business too. The stigmas and stereotypes associated with mental health, and the barriers to action, have no place in any organization. So where does Morneau Shepell come in? We are well-positioned to work with our clients to provide solutions that address some of these issues. In other words, your company is focused on the right things not just today, but for tomorrow. We found through our research with Queen s University, that remediation works. In other words, we can actually help to improve the productivity of our clients and their employees and their employees family members. In closing, let me say that being on the right side of any issue or opportunity while always desirable isn t enough for a business. You need vision, strategy, priorities and indeed the ability to execute and deliver consistent, sustainable performance which is what every shareholder should expect. I m so pleased that we have, in my estimation, the best team we could hope for to deliver for our constituents.

5 5 And to talk in greater depth about all this here is Alan Torrie, our President and CEO. Caution Regarding Forward-Looking Statements This document may contain forward-looking statements within the meaning of applicable securities laws, such as statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Use of words such as may, will, expect, believe, or other words of similar effect may indicate a forward-looking statement. These statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those described in the Company s publicly filed documents (available on SEDAR at and in the firm s MD&A under the heading Risks and Uncertainties. Those risks and uncertainties include current economic conditions, income tax matters, ability to maintain profitability and manage growth, reliance on information systems and technology, reputational risk, dependence on key clients, and reliance on key professionals. Many of these risks and uncertainties can affect the firm s actual results and could cause the Company s actual results to differ materially from those expressed or implied in any forwardlooking statement made by the Company or on the firm s behalf. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. All forward-looking statements in this document are qualified by these cautionary statements. These statements are made as of the current date and, except as required by applicable law, the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Additionally, the Company undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of the Company, its financial or operating results or its securities.