Chair's Message

Dear Fellow Shareholders,

2016 was a busy year for GMP. Together with management, your Board of Directors continually monitored, evaluated and proactively debated macroeconomic and industry-specific risks and opportunities on behalf of the firm and its shareholders. We demonstrated strong conviction and discipline in making timely and informed decisions in support of longer-term sustainability. We preserved the advantages that have driven past success and exercised discipline in the pursuit of growth. GMP finished the year with significantly leaner operations, a solid capital position and scale in both its Capital Markets and Wealth Management businesses.

Operational Activities

The cost of doing business, led largely by entrenched regulatory and technology costs, continues its unimpeded march upward. At the same time, our industry continues to endure weaker levels of global capital markets activity. It became plainly evident that incumbent firms unable or unwilling to respond risked becoming less relevant. We are pleased to report that GMP responded decisively; guided by a focused purpose of always doing right by its clients and shareholders.

In 2016, the Board oversaw the identification and realization of approximately $50 million in fixed cost savings, the strategic and synergistic acquisition of Calgary-based FirstEnergy (subsequently rebranded as GMP FirstEnergy) and the decision to “stay the course” with respect to our ownership interest in Richardson GMP following a review of strategic alternatives. These actions made GMP stronger and your company is better positioned for the path forward.

Competitive Environment

Over the past three years, we have observed the emergence of two key trends in the competitive landscape. First, it comes as no surprise that there are fewer independent players given the prolonged challenging operating environment and increased regulatory pressures. And, second, the Canadian banks continue to encroach in the midcap sector of the marketplace.

In this context, the Board worked closely with management in evaluating the firm’s business model and strategic priorities. We concluded fully integrated Canadian independent firms play an important role in the efficient functioning of the Canadian capital markets. There is no greater importance than the provision of capital to the small- to mid-cap market – vital segments to the success of the Canadian economy. The firm’s vision is to solidify it’s positioning as the country’s premier independent and top choice among clients in its focused industries.

Governance and Risk

The Board takes considerable pride in the progress made in 2016 toward strengthening the firm’s governance practices. We achieved progress in three key priority areas: risk, diversity and succession planning. In risk, we continued to work closely with management in an effort to refine further the firm’s integrated risk management framework. We understand that a strong risk culture is pivotal in identifying, anticipating, and responding to the principal risks and challenges facing the industry. The Board continues to be comfortable with the firm’s risk framework and control mechanisms and is committed to ensuring they reflect best practices.

Equally essential is ensuring the firm has a strong and diverse leadership team. The Board understands and regularly debates the benefits of diversity at all levels of the corporation, including its own composition. In March 2016, the Board adopted a written diversity policy that sets measurable objectives for achieving diversity. In particular, increasing the representation of women on the Board remains a top priority. In addition to diversity, talent management and succession planning were discussed frequently to ensure a strong pipeline of leadership candidates.

Board Renewal

One of the Board’s most fundamental responsibilities is to oversee succession planning. This includes Board renewal and self-evaluation. At our Annual General Meeting of Common Shareholders on April 27, 2017, Rob Peters and Sandy Riley will retire from our Board. Rob has been a director since the firm’s IPO in 2003 and was our longest serving independent director. He provided 14 years of valuable guidance and oversight, particularly through the early years of the firm’s growth. Sandy joined the Board in 2009 and we are fortunate to have benefited from his wise counsel and industry experience. On behalf of the Board, we extend thanks to Rob and Sandy for their considerable contributions.

On the recommendation of the Governance Committee, we are pleased to welcome Don Solman to the Board. Don is the current CFO of GMP’s largest shareholder, James Richardson & Sons, Limited, and brings a broad range of industry expertise and financial acumen to the Board.


Management continues to demonstrate critical focus on the drivers that are within its control which, we believe, will contribute to the firm’s long-term sustainability. While the capital markets landscape is not without challenges, GMP has a clearly defined path and is in a stronger position moving forward.

I would like to thank my fellow Board members for their insight and sound judgement. And, on behalf of the Board, I would also like to thank our shareholders for their ongoing support.

Chair of the Board of Directors of GMP Capital Inc.