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No one can accuse Gail Cook-Bennett of taking the easy route. She broke gender barriers 30 years ago by joining the board of Manufacturer's Life Insurance. This year, in the midst of an economic crisis, the precise, cerebral economist became board chair at what is now Manulife Financial Corp., a global giant. The appointment came as Manulife was dealing with tumultuous fallout from stock-market exposure in one of its annuity product areas. Ms. Cook-Bennett believes the upheaval will forge change - in how deeply directors question managers on technical issues, and in opportunities for women. In such a demanding era, expertise, not gender or rank, should be the ticket to board appointments, she believes.

What does it take to be a director these days?

It takes time, it takes curiosity, it takes work.

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Should the Manulife board have done more to advocate prudence by management?

The board's role is clearly oversight, and there is an important role on risk exposures and capital ratios. We're looking at this: As these measures - and events that determine these measures - become more complex, the board has to change its focus.

The board has always been interested in risk exposure. The audit committee drills down further on the implications for financial statements. But there will probably be a rebalancing between what the audit committee does and what the whole board does. That will require more depth of education for the full board, not just for the audit committee.

Manulife was incredibly successful in staying away from the toxic products, the collateralized debt obligations and that sort of thing. What Manulife has is an exposure to the equity market. This affects our financial statements through the accounting side, not the cash side.

So there will be greater focus by the board on risk exposure?

I would think that going through a situation like this for the second time in 77 years, we are all going to learn - managements as well as boards.

Is the legacy of outgoing CEO Dominic D'Alessandro intact?

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Absolutely. He's done a remarkable job.

You have to look through [the upheaval]to what our franchises are, to our competitive position and strength as a company. When you look at that and understand what is showing through on the bottom line as a result of accounting requirements, you understand that, relatively speaking, we are in very strong position.

Is there more contact now between the board and the executive team?

That's true. When you go through a period like this, a board and its chair and the committee chairs have to be very careful not to fall over the line into management responsibilities. Having said that, when you have turbulent times and this sort of volatility, it is necessary for the board to go down another layer or two to be sure they understand what is going on, and to monitor even more carefully.

What do you mean?

I'm talking about just in terms of the questioning being deeper during a period of turbulence than in normal times. You would have to monitor the capital ratios, understand what our exposures are. We did that before, but now it's a monitoring that is somewhat deeper in certain areas. That is not extraordinary. You would expect that in any time of upheaval.

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How often do you talk to the CEO?

I have an office right next door and when I want to talk to him or he wants to talk to me, we're right there. In fact, that is one of the ways I define my job as a new chair, who came in just at the time of the turbulence - that I would simply be available to be briefed and ask questions. That is what I did.

What is the major change you are making in the chair's role?

Any chair in this position would adjust the sails a little bit and it could be in the area of risk management oversight, in monitoring capital ratios. It is understanding what position we're in. It's being able to not only respond, but to question in areas where it might have been viewed as a little more technical in the past.

Does that imply management did not do its proper job?

The issue is that risk management is applied to events. If events change, that is part of the equation that's changed. This management team kept us out of all the toxic products. We are in these guaranteed [annuity]products which our management regards as good products - they're like mini-pension plans...

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But the decision was made by Manulife to self-insure risk in those products, instead of hedging.

That's correct. People look at the positive side of hedging; there are negative sides of hedging. But that is in management's domain, obviously.

As a pioneering female director, have you paved the way for more women on boards?

The objective would be to use talent that is available - whether that has come about as fast as one would have liked. One of the specifications years ago maybe inadvertently left women out - that they had to be CEOs. There were not many women who were CEOs. Having said that, I repeat over and over that there are extremely talented women who could bring breadth and depth to any board.There is one other woman on the Manulife board, so it hasn't really exploded since you joined.

It hasn't exploded, no. The facts are the facts.

When you joined, is it true they didn't even have a woman's washroom for the board?

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That's true. There was not a dedicated place so they managed to find a place. I think the issue was it was not on the same floor. That's a long time ago.

How did you get recruited?

Some senior women at Manulife felt it was time for a woman on the board. Sid Jackson [the chairman] was doing his due diligence, he met me at a meeting, and that's how it all started.

What do Manulife's women say now about getting more female directors?

I haven't had that specific conversation but I'm sure they would not be averse to it.

Can you see how this will happen?

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We will have a turnover of board members during my tenure for the next 4½ years and we have to manage that process. What you are going to require in 2008, going forward for the next decade, may well be different than the backgrounds you've had in the past.

Although you don't want a group of technicians sitting around the board, it may be that it is appropriate to have questions coming that are a little deeper in some areas.

How will that affect the gender balance?

Given the types of people we want, women will have a fair crack at it. I think we've got away from this notion that you have to be a CEO to sit on the board. You don't want a technician acting as a technician, but you want someone who has had oversight over some of those areas or has come up through those ranks. That would seem to accommodate many women out there who could make a contribution to the board.

Are you reading anything that might be a guide to this crisis?

I don't know that it's a guide to this crisis but I belong to a book club and we're starting War and Peace.

It will certainly soak up your available time.

You build up the muscles carrying it around.


Gail Cook-Bennett

Titles: Chair of Manulife Financial Corp., director of Petro-Canada and Emera Inc.

Born: Ottawa in 1940


BA Honours, economics, Carleton University

MA, PhD, economics, University of Michigan

Career highlights:

1968-1974: Taught economics at University of Toronto

1974-1978: Executive vice-president of the C.D. Howe Institute 1978: Joined the board of Manufacturer's Life Insurance

1982-1998: Vice-chair of Bennecon Ltd., consulting firm formed with her late husband Roy Bennett

1998-2008: First chair of Canada Pension Plan Investment Board, which invests the $119-billion CPP fund

2008: Became chair of Manulife Financial Corp.

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