My name is Robert Pace, and I am CN's Chairman of the Board. It has been our custom to hold our annual general meetings in cities across CN's North American network. It is certainly a pleasure to be here in Montreal, home to our corporate headquarters and more than 2,800 active CN employees in the region. In fact, this is CN's 21st annual meeting and the sixth one we've held in Montreal since the privatization of the company in 1995. CN and its predecessor, predecessor railways, have been part of the Montreal community for more than 150 years. Indeed, CN's roots reach back to the early days of the Canadian railroading, when in 1832, a group of Montreal businessmen opened Canada's first railway, the 23 km long Champlain and St. Lawrence Railway.
CN was incorporated in 1919, and its headquarters has remained here in Montreal ever since. November 2015 marks the 20th anniversary of CN's privatization, a significant milestone in our transformational journey from the industry laggard and largely a Canadian-only enterprise, to a true North American railway that leads the industry in efficiency and operating margins. Today, we span Canada and Mid-America from Chicago to New Orleans and Mobile, Alabama, transporting freight practically seamlessly over an almost 20,000 route mile network, reflecting more than $8 billion worth of rail acquisitions since 1998. Our operational and service excellence agenda has produced a range of innovative services for intermodal merchandise and bulk commodity shipments, putting us well on our way to becoming a true supply chain enabler.
CN's commitment to innovation, long-term investment in its business, and playing its role as the true backbone of the economy will remain hallmarks of the company, not only for the next 20 years, but for decades to come. On behalf of CN's Board of Directors, I'm now pleased to call to order the annual meeting of the shareholders of Canadian National Railway Company. I would like to welcome a number of distinguished guests we are pleased to have with us in attendance today, including CN's Director Emeritus and CN's former President and Chief Executive Officer at the time of the IPO, and I'd like to him for to stand up and be recognized, Paul Tellier, for your vision and your determination to get to where we are today. Paul's very wise. He brought along his grandson, Eric.
So my message to you is, if you just listen to half of what he tells you, you'll do very well. Before we begin with the business of the meeting, I would ask Sean Finn, our Executive Vice President of Corporate Services and Chief Legal Officer, to give a safety briefing for the meeting. Sean, thank you.
[Foreign language] Good morning, everyone. This being Railway Safety Week, day in, day out, any meeting, work assignment, or, even a meeting with customers requires we always start by a safety briefing, and this is no different this morning at our annual meeting. Obviously, we're at the Windsor Ballroom here in Montreal. There will be an audible alarm, giving us voice command if we have to leave the room. If asked to evacuate, CN employees will direct you on Stanley Street. So you go out the doors to your right, and you turn left down the corridor. Walk outside on Stanley and go right, and convene at the corner of Stanley and Cypress, Cypress Street here in Montreal.
In the event of a medical emergency, Inspector Pierre Bergeron is a qualified first aid responder, and Josée Ouellet has been designated to dial nine one one. Pierre and Josée, please stand to identify yourself. Pierre, there he is. Pierre, Josée. Excellent. [Foreign language] like I said, before any, meeting, or work, operation, this is the same event. We talk about security. In case of emergency, you are going to hear an alarm in that, in that room, in the Windsor Room, and then you will [audio distortion] through the doors on the right and then to the left, turn to the hallway and emergency exits, behind on the Stanley Street and to the right, up to the corner of Cypress and Stanley.
To the meeting point, in the case of emergency, medical emergency or other emergencies, our colleague, Inspector Pierre Bergeron, give the initial healthcare, and Mr. Ouellet, Pierre Ouellet and Josée, they were inside. They would give the help you all... Okay, thank you very much, Paul, those good words.
As Sean mentioned, every work assignment at CN begins with a safety briefing, and nothing is more important to us than creating a safe place to work. I want to take this opportunity to point out that this week is Rail Safety Week, an industry-wide initiative to make people aware of the dangers of walking, driving, and playing around railroad tracks. CN has been a participant for many years, most of which had the focus on an important role of the CN Police officers conducting safety blitzes at busy highway and railway crossings. Annually, we engage our employees and pensioners in a unique way by asking them to act as safety ambassadors to their friends and families by taking a safety pledge. Rail safety is everyone's responsibility. By looking out for each other, we can help keep our employees and community safe.
You may have noticed the rail safety booth set up outside. You can help us all spread the word by taking the Rail Safety Pledge there after the meeting, and join thousands of CN employees and retirees who have already signed on. The safety of the men and women who work for CN is of paramount importance to us as a company. We devote significant effort and resources to ensuring a safe environment and culture that minimizes work-related risks. The goal is, of course, to eliminate all accidents altogether. Through technology, employee education, and promoting a safe mindset throughout the company, we work diligently to improve our results every year. CN's significant and ongoing investment in its training programs and its new state-of-the-art training facilities in Winnipeg and Chicago are designed to strengthen CN safety culture and prepare a new generation of safety-conscious railroaders.
In spite of our best efforts, however, it saddens me to report that one of our employees died in service since our last annual meeting. Please rise and join me in a moment of silence for Mr. Ryan Edwards on July 25, 2015. This tragedy reminds us all that the railroading can be an unforgiving industry, and how important safety is. I urge everyone to be highly vigilant about personal safety and protecting our colleagues as we perform our duties. This is the best way we can honor the memory of our colleague. I would ask for a moment of silence in his memory. Thank you. I would like now to introduce the senior officers of CN who are present on the stage today. On my far right, Luc Jobin, Executive Vice President and Chief Financial Officer of the company.
Next to Luc Jobin, Claude Mongeau, President and Chief Executive Officer of the company, and next to Claude, Sean Finn, Executive Vice President of Corporate Services and Chief Legal Officer. I will act as chairman of the meeting. Sean will act as Secretary of the meeting. During the meeting, I'll entertain questions relating to a specific motion after that motion has been moved, and seconded, but before the vote on that motion takes place. If you have any questions or motions, please use the four microphones that are here when addressing the meeting. There are two microphones in the room. Also, identify yourself and state whether you're a shareholder or a proxy holder. There'll also be two short presentations. Claude Mongeau will give the President's address, and Luc Jobin will outline the highlights of CN's 2015 financial performance. After Luc's remarks, we will welcome your general questions.
On behalf of the board and the company, we'd like to thank the shareholders who submitted their proxies in advance of the meeting. Of course, only registered shareholders or their proxy holders are entitled to take an active part or vote at this meeting today. To move the meeting along, a number of shareholders have already agreed to move and second formal motions, and I'll call upon them at the appropriate time. We will ballot on [audio distortion] the non-binding advisory resolution on the company's approach to executive compensation and the shareholder proposal. I'll explain the procedure to be followed at the appropriate time. Regarding the nomination of auditors, we will proceed on this motion by a show of hands.
The corporate secretary of the company has advised me that the notice calling this meeting and the accompanying Information Circular, form of proxy, and Annual Report, were mailed starting on March 23, 2016, to holders of common shares at the close of business on March 3, 2016, the record date. A copy of the confirmation of mailing of such documents has been filed with me for inclusion with the minutes. With your agreement, I'll appoint Mark Thompson and Hakim Bouallage of Computershare Trust Company of Canada, the transfer agent for CN's common shares, to act as scrutineers at the meeting. I have been advised by the scrutineers that based on the proxies received prior to the meeting and the shareholders and proxy holders attending this meeting, there is a quorum present. I therefore declare that the meeting has been regularly called, properly constituted for the transaction of business.
The next item of business is the submission of financial statements of the company. The Annual Report of the company, which contains the consolidated statements of the company and its subsidiaries at December 31, 2015, together with the reports of the auditor and Management's Discussion and Analysis, has been mailed to the shareholders of the company who have requested it. Copies were also made available to you this morning in the adjacent room. There's no formal action to be taken today with regards to this item on the agenda. However, as I've previously mentioned, Luc Jobin, our Executive Vice President and Chief Financial Officer, will be delivering a report on the financial statements this morning. I will now proceed with the election of directors. According to a resolution of the board, 11 directors are to be elected.
Information regarding our nominee is set out in the Management Information Circular sent to shareholders. I would now ask Sean to read the names of those nominated for election as directors in the Management Information Circular. Sean?
Mr. Chairman, the following individuals are nominated for election as directors of Canadian National Railway Company: Donald Carty, Ambassador Gordon Giffin, Edith Holiday, Maureen Kempston Darkes, The Honourable Denis Losier, The Honourable Kevin Lynch, Claude Mongeau, James O'Connor, Robert Pace, Robert Phillips, and Laura Stein.
Thank you, Sean. I'll ask Gerry Weber to nominate the directors.
Mr. Chairman, my name is Gerry Weber, and I'm a shareholder of the company. I'm pleased to nominate each of the persons named by the secretary of the meeting to be elected as a director and to hold office until the next annual meeting of shareholders, or until his or her successor is fully, duly elected or appointed.
Thank you, Gerry. Lise Jolicoeur, will you second the nomination?
[Foreign language]
[Foreign language] Thank you. As there are no further nominations, I declare the nominations closed. Pursuant to a resolution adopted by the Board of Directors, 11 directors are to be elected, and 11 eligible candidates have been nominated. I now direct that a ballot be taken on the motion to elect the directors. The names of the 11 nominees for election as directors are set out on the ballot. You should mark the ballot off the names of each of the persons for whom you wish to vote and complete the form. Please sign and print your name in the places indicated at the bottom of the ballot and indicate the total number of shares entitled to vote as a registered shareholder and/or. The Board of Directors recommends voting for the election of each nominee. Many shareholders present have already filed their proxies.
These shareholders should not complete the ballot, since their shares will be voted in accordance with their instructions contained in the proxies granted to their proxy holders. Registered shareholders who have not sent in their proxies and proxy holders who are present have received a ballot at the registration desk. It is included in the agenda package handed to you this morning. If you're entitled to vote today but have not received the ballot, please raise your hand so that the scrutineers may provide you with a ballot form. Please hold on to this ballot form. We will collect them after the ballot on the shareholder proposal. We will now proceed with the appointment of auditors. I would now like to call upon Donald Carty, Chairman of the Audit Committee of the Board, to present the motion to appoint the auditors of the company.
Good morning. My name is Donald Carty. I'm a shareholder of the company, and I move that KPMG LLP be appointed auditors of the company for the fiscal year 2016, or until the close of business of the next annual meeting of shareholders.
Thank you, Donald. Paul Butcher, would you please second the motion?
[Foreign language]
[Foreign language] Thank you, Paul. All those in favor of the motion, please signify it by raising your hand. And all those opposed? This is good. I declare that KPMG LLP has been appointed as auditors of the company to hold office for the fiscal year 2016, or until the close of the next annual meeting of shareholders. The next item on the agenda is the consideration of the non-binding advisory resolution on the company's approach to executive compensation. The statement of executive compensation is contained in the company's Information Circular sent to shareholders, disclosing such approach in detail. The results of the vote will not be binding on the board.
However, t he board will take into account the results of the vote, together with all other pertinent information or comments from shareholders when the company considers the approach to executive compensation. I'll ask Janet Drysdale to present the motion.
Mr. Chairman, my name is Janet Drysdale, and I'm a shareholder of the company. I move that the non-binding advisory resolution on the company's approach to executive compensation, as set out on page 9 of the Management Information Circular, be approved.
Thank you, Janet. Mark Lerner, will you second the motion?
Mr. Chairman, my name is Mark Lerner, and I'm a shareholder of the company, and I second the motion.
Thank you, Mark. I now direct that a ballot be taken on the motion to adopt the non-binding advisory resolution on the company's approach to executive compensation. You should sign and print your name in the places indicated at the bottom of the ballot. Please indicate the total number of shares that you're entitled to vote as a registered shareholder and/or proxy holder. You are asked to either vote for or against the motion. The Board of Directors recommends voting for the motion. Please hold on to your ballot forms. We'll collect them after the ballot on the shareholder's proposal. The next item of business is a shareholder proposal, which was submitted for consideration at the meeting.
For this portion of the meeting, we'll proceed as follows: As the shareholder submitting the proposal could not attend this meeting, we have agreed at their request to introduce the motion on their behalf. We're good people. The company will then state its position on the proposal. The vote on the shareholder proposal will be conducted by ballot. I would now like to call on Sean to read QV Investors Inc.'s shareholder proposal.
Thank you, Mr. Chairman. The proposal reads as follows: "Be it resolved, the Board of Directors shall require that the Audit Committee will request proposals for the audit engagement no less than every eight years.
Thank you, Sean. The supporting statement submitted by QV Investors Inc. in connection with its proposal is set forth in the Proxy Circulars. We'll now ask Cristina Circelli , to present the motion.
[Foreign language]
[Foreign language] Thank you, Cristina. Sam Forgione, will you second the vote?
Good morning, Mr. Chairman. My name is Sam Forgione. I'm a shareholder of the company, and I second the motion.
Thank you, Sam. I'll now call upon Donald Carty, in his role as chair of the Audit Committee and director of the company, to present the board's position with regard to that proposal.
Thank you, Mr. Chairman. First, let me say that we welcome our shareholders' interest in this important topic. The board's recommendation relating to the is set forth in the Proxy Circular. CN's Audit Committee is absolutely committed to the highest standards of corporate governance. We believe that a comprehensive review of our auditor and oversight by CN's Audit Committee is actually preferable to a mandatory tendering of the audit. The CN Board of Directors is also of the view that its current practice with respect to the regular review of audit quality, the auditor's performance and fees, lead partner rotation, and strong regulatory oversight, are consistent with its commitment to best practices in corporate governance. Therefore, we believe that it's appropriate to keep the decision and the timing of any potential tendering processes with the Audit Committee, and we recommend that shareholders vote against this proposal. Thank you.
Thank you, Don. Are there further comments on this proposal? As there are no further comments on this proposal, I now ask Computershare Trust Company of Canada to conduct the ballot for the shareholder proposal. Only registered shareholders and proxy holders who have not already sent in their proxy forms will be entitled to vote. I would ask you to follow the same procedure explained earlier in the ballot. When your ballot form is completed, please hand it together with the other ballots to the nearest attendant. One here. Any other ballots? Just raise your hand. Are there any other ballots? There's a couple down in the back there. Any other ballots? Please raise your hand. Okay, I therefore declare the poll closed. The scrutineers will collect all the ballots, count the votes, and report back to me. We do not have any other business before the meeting.
While the scrutineers are computing the ballots, we now move on to the next item: our CEO's presentation. 2015 was a record year for CN on many fronts. Thanks to the company's agenda of operational excellence, our focus on supply chain collaboration, and solid execution, CN 2015 growth continued to outpace that, the overall economy, generating the highest volumes and earnings in the company's history. It is my great pleasure to now call upon our President and Chief Executive Officer, Claude Mongeau, to address shareholders about our substantial 2015 successes and to talk about the next steps in CN's remarkable transformational journey. Claude?
Thank you, Bob. And I apologize for my raspy voice. [audio distortion] To be here, before there are many faces that are recognized from our employees and our shareholders and our Board of Directors. You know, you have seen the transformation. Remarkable transformation is something that needs to be celebrated. We often take, you know, those dates as granted, and you say: Well, I won't celebrate 19 years. I celebrate 20. The important thing is to celebrate at least often enough to be able to reflect on where you are coming from. And, without being presumptuous, I think that reflecting on CN's uniquely successful business transformation is not just important for our shareholders, present and future. It's important more broadly because we don't have many examples of such remarkable transformation.
There are lessons to be learned when you reflect, and I would like to spend a few minutes to do just that. Twenty years ago, we were in 2015, we were privatized. This was a pivotal policy decision. CN had a proud history. Bob mentioned a few highlights. Clearly, we were an institution in this country as a Crown corporation for decades. People don't remember often, but CN incubated the CBC. We gave birth to Air Canada. We had many, many, dimensions to our vast operation beyond just a beautiful rail footprint. And a beautiful rail footprint we built. I'm a bit biased, but I believe there are no other rail networks equivalent in Canada. But it's fair to say that at the time, we were a so-called perennial industry laggard.
We did not have a sense of urgency, did not have always the right incentives, and did not perform to our full potential as a railroad. It took a man like Paul Tellier in 1992 to come over and set an agenda of change. He shook things up, I remember, and he laid out a bold vision for the future. This eventually led to an opportunity, and once again, a pivotal policy decision by the Canadian government to actually privatize CN, unlocking our powerful forces of innovation with a framework that is shareholder-driven, but an eagerness to innovate on a commercial basis. We had a beautiful network, but we lacked the drive and the incentive to go to our full potential.... Paul set out a simple but bold vision: to become the best North American railway.
Now, at the time, some would have said, "Wow, what does he have in his water?" But, you know, if you don't shoot high, you don't get anywhere. And that bold vision, we ultimately delivered. I hope to convince you of that in the next few minutes. So it was about becoming the best and becoming North American from a Canadian footprint at the time. That's what we did. You look at our network today, we started off with being North American by expanding our franchise. Five successful acquisitions allowed us to reach [audio distortion] way down with America to the Gulf of Mexico, a unique rail franchise that spans the continent. And in the railroad business, my friend JJ will say it often, "It's the map that you sell," and we have a beautiful map.
We had, among our acquisitions, we also injected the source of additional fundamental transformation. The leader that succeeded Paul was Hunter Harrison, and he came with an agenda of efficiency. Powerful forces again were unleashed, and we took our efficiency, our asset utilization, our cost structure, to a whole new level, all of it with process innovation, and a strong focus on execution. But Hunter has moved on. The team today, for the last several years, is continuing on that transformation journey. We are taking CN to the next level, and our focus is on fundamental customer innovation, doing what we can do well at high efficiency levels, but with a more customer-centric agenda, with a sense of purpose in terms of end-to-end supply chain enabling, the way I like to call it. We have taken our service level.
Jim Vena, leads our operating team, has injected a new juggling ball into our app. We do everything we did before in terms of efficiency, as good or better than before, but we've injected a clear sense of what it takes to serve our customers in a better way. We are doing that with partners. Partners across our network, collaboration with boards, service level agreements with our customers, a stronger sense of purpose and engagement within our workforce. All of these things is how we are continuing the journey successfully in this remarkable transformation. Of course, we are here to support our shareholders, and all of this fundamental innovation is driving wonderful, unique, and highly exceptional financial results. Let me just get you to the metrics. The famous operating ratio is a closely watched measurement in the industry.
We have been the undisputed leader on that score since 1998, and we've established a record last year of 58.2%. Look, we'll give you the contour. Our earnings grow, which is even more important. You don't pay a dividend on a ratio by percentage. You pay a dividend out of earnings, have grown almost 20% for 20 years straight. I invite you to look in your portfolio. Please come back and tell me how many companies you own, and have done that over the last 20 years. I'm ready. This is good financial performance, and of course, we have rewarded our shareholders. When we were privatized in 1995, we were a CAD 2 billion company. At the time, it was the largest IPO in Canadian history, but we've increased the value of CN shares several folds.
Today, we are the largest industrial company in Canada and market cap. We are worth more than CAD 60 billion. We've paid out more than CAD 7 billion dividends in the time frame. So we've created CAD 70 billion of shareholder value creation. I am not saying this to brag. I want to make a point. We sometimes think that, you know, profits are, you know, suspect, that success in financial markets should be looked upon with some concern. Nothing is further from the truth. If the value created is done in a fundamental innovation journey, if it's done in a sustainable way, we are creating this value for a wide array of shareholders who need the income for their own needs. Our shareholders are like Caisse de dépôt, the Canada Pension Plan, a range of institution across North America.
They depend on CN stewardship, how we grow the capital they invest in the company. So doing, performing well is exactly what the market is calling. That's what the policy framework is incenting, and that is why the decision by the Canadian government was the right one. They sold it perhaps on the cheap at CAD 2 billion, you might say. But I would tell you, every year for the last several years, we pay in excess of CAD 1 billion dollar of income tax and other taxes to the Canadian government. Think of it. They're getting half of CN privatization every year, and have done so for 20 years. So the government got a good deal, and all other stakeholders also got a very good deal, and that is my point. This fundamental innovation has allowed a transformation to our service.
We have, with our go-to-market approach, with our partnerships, many of our partners are here in the room as we speak, like the Port of Montreal. We are aiming to help our customers win in the marketplace. Beware of the advocacy sometimes. Look at the facts. We are not, you know, we are a bus service. Let's be clear about it. We are a network. We are not a taxi service, but we are a very solid and reliable service within the constraints of our operation, and our efficiency allows us to have rates that are the best in the world. What country can count on railroads that are highly profitable, create value for their shareholders, and offer superior service at the lowest rates in the world? Please look up and come back to me with the countries. I'm ready. And the profitability allows investments.
Luc will give you the contour later. Investments in service, investments in ability, in our ability to grow with our customers and continue with our innovation pipeline, in investments to keep become safer every day, so that we do our job in a way that is sustainable, safe, and in harmony with the communities we go through. Bold innovation requires profits. Companies that struggle very rarely innovate. Successful companies that create value in a sustainable way and have the right vision, with the right business agenda, with the right team to execute, as promised, it's a precious things. We don't have many companies like that, so we should be very proud. We should celebrate success more often, and we should make sure that this lasting value, that the promise for continued transformation, that that promise benefits from the right policy framework.
We should not listen to those who advocate without facts, those who are looking to swing the agenda their way to get regulatory leverage. Customers deserve a proper set, safeguards and sense of regulation. But the government, the ones that created this success, should make sure that they protect and propel innovation agenda forward. This is what we need, and we have to have a fact-based approach to policy making. I have a raspy voice. It's not as strong as it used to be, but I believe I'm right, and I hope that stakeholders, our shareholders, the people that support and partner with us, the policymakers, take this 20-year anniversary as an opportunity to reflect and do what's right on both sides of the border. Because we are a true backbone to the economy. Very few companies touch so many in so many ways.
We go across this country and across the continent from sea to sea to sea. We touch every sector. We are there to move what others produce, and we're doing a good job. We move and touch more than $250 billion of economic activity. It matters. I sometimes say to my team, and I'm a bit concerned as I say that, given how many are in this room, but if we don't show up one morning to the office, this country and this continent would come to a grinding halt. So please don't take us for granted. Reflect on what's required, what's right, and maintain the right policy framework on a go-forward basis. There will be over the next year on both sides of the borders to reflect on those words. I hope my voice carries loud enough.
Turning back to the shareholders to conclude, with the right policy framework, which I have confidence will be maintained despite my appointed message, I would like to tell you that we are here to continue to do what we have to do to build for the future. We are not in this quarter-to-quarter . We have a long-term vision. We know what we stand for. We stand for operational and service excellence, and we mean every word. Our goal is to create value for our customers, playing our role as a backbone to the economy and deliver safely and sustainably. If we do that, and it's in that order, we will continue to drive shareholder value for many, many years to come. Thank you. I will be happy to take your question later.
Claude, on behalf of our board and thousands of railroaders in the company, we are so proud of your leadership. Thank you. CN's agenda of operational excellence delivered record volumes and revenues in 2015. Key operating and service metrics remain solid, and we continue to drive incremental improvement in our broad safety records. Revenues increased by 4%, adjusted diluted earnings per share rose by 18%, and free cash flow topped $2.4 billion. This was indeed a remarkable achievement. Now I'll call on Luc Jobin, CN's Executive Vice President and Chief Financial Officer, to discuss CN's 2015 financial performance. Luc?
Thank you, Mr. Chairman. [Foreign language] So let me get right to it. Claude has just reviewed with you the key pillars of our strategic agenda and how we remain focused on delivering superior service while continuing to drive operational efficiency. This is the formula that allows us to operate at low incremental costs. The end goal is a railroad that delivers value to our customers and ultimately to our shareholders. The company's financial results achieved these past five years substantiate the benefits of becoming a true supply chain enabler. Our strategic agenda is delivering. In 2015, CN achieved the highest annual revenues and earnings in the company's history. On a reported basis, earnings per share grew to $4.39.
Excluding items that affect the comparability of financial results, CN has grown adjusted earnings per share at an impressive compound annual rate of 17% for the last 5 years. In 2015 alone, adjusted earnings per share grew a solid 18%, achieving our initial earnings growth guidance in spite of a challenging economic environment. I will briefly comment on the key drivers that underpin this performance. In 2015, the company moved nearly 5.5 million carloads, 2% less than in 2014. Overall revenues, 4% to over $12.6 billion, achieving the highest level in the company's history. The volume decrease was driven by weaker growth, both globally and in North America, resulting in lower volumes of energy-related commodities, iron ore.
This was partly offset by strong US consumer demand, supporting the overseas intermodal, providing higher volume of finished vehicles as well as forest products for the growing US housing market. The company also benefited from pricing gains ahead of inflation and the positive impact of a weaker Canadian dollar, while experiencing lower fuel surcharge rates. At the same time, CN continued to manage expenses. In 2015, operating expenses decreased by 2%. The reduction was mainly the result of a lower fuel expense and solid cost management efforts, partly offset by the impact of a weaker Canadian dollar. In 2015, the company achieved a record and industry-leading operating ratio of 58.2%. This represents an improvement of 370 basis points over the last year. As we look ahead, we continue to see CN's operating performance leading the industry.
Our objective of driving the top line while managing our costs as wisely as ever. Despite a challenging market environment in 2015, we demonstrated the agility and resiliency of our operating model by continuing to improve our operating performance. As prospects in key commodity markets turn, we moved quickly to rightsize our resources, ending the year, about 350 less locomotives in active service, 10,000 rail cars parked, and 2,400 fewer employees. We achieved record levels for car velocity as well as for train and yard productivity. All this was accomplished while continuing to deliver superior end-to-end service to our customers, consistent with the supply chain focus of our strategic agenda. Now, how we manage resources and execute the strategy also translates into solid cash generation.
In 2015, CN generated close to $2.4 billion of free cash flow. Excluding the benefit of non-strategic asset sales, this is a 16% improvement over 2014. But even more important, cash flow generation at CN is achieved while we continue financially. Capital investment in our franchise is both essential to sustain the safety and integrity of our network, and to support our strategic agenda. CN deployed $2.7 billion on capital programs in 2015. Now, this represents just over 50% of our operating income. We're investing in a consistent and disciplined manner that supports long-term value creation. Over the last five years, the company has made capital investments amounting to nearly $11 billion.
In line with our unwavering commitment to safety, $6 billion went into core track infrastructure, including the replacement of rail, ties, and bridges. This also includes other safety investments, such as wayside inspection devices, new track geometry equipment, and other safety-related technologies. With regards to service and productivity, we've invested around $1.8 billion since 2010 to increase our network capacity and improve resiliency. This comprises sizable investments ranging from intermodal facilities and logistics terminals, to double tracks and long sidings, yard enhancements, and improved connections on the EJ&E. In this time frame, we've also devoted $1.6 billion to rolling stock, including close to 400 additional locomotives, along with more rail cars and intermodal equipment. Last, but certainly not least, we've dedicated roughly $600 million on information technology, along with two state-of-the-art employee training facilities.
These investments provide the skills and timely information required for our people to make informed decisions, and these are key to supporting safety and productivity, enabling a supply chain approach, driving our first mile, last mile customer service initiatives. So we're focused on creating the CN, and we are determined to strengthen CN's role as a true backbone of the economy. Our strong cash flow performance and our disciplined approach to capital helps us maintain a strong balance sheet. Disciplined and consistent financial management is another key piece of the CN foundation. Our investment-grade credit rating allows us to have continuous access to low-cost sources of funds. I'd like to address shareholder returns, if I may, now. Rewarding shareholders for their investment in CN is a priority. The dividend has grown every year since the company was privatized. That's 20 years of uninterrupted dividend growth.
During this time, CN has grown dividends at an average rate of 17% per year. Earlier in 2016, the company's Board of Directors approved a 20% increase in our annual dividend. This is consistent with our stated objective of gradually moving towards a 35% dividend payout ratio. Meanwhile, we've had significant share buyback programs in place throughout the last five years, amounting to nearly $7.5 billion. In 2015, the company bought back over $1.7 billion worth of stocks. In our current program, which runs until October of 2016, provides for the potential repurchase of up to 33 million shares, and we have allocated some $2 billion to support this program.
So when you combine dividends and share buybacks, the value returned to shareholders is over $11 billion in the last five years. In addition, shareholder value creation has translated into a significant stock price appreciation. Over the last five years, adjusting for the stock split, our Canadian stock price increased by 130%. And when you add in the reinvestment of dividends, cumulative total return is over 150%. By comparison, over the same period, the TSX increased by 12% and the S&P increased by 81%. Yesterday, we reported our first quarter of 2016 earnings. The company achieved a diluted earnings of $1, an increase of 16% over the same period last year.
We continued to calibrate in the first quarter our resources to the evolving and weakening volume environment, while making solid progress in safety, service, and operational performance. Regarding our outlook for 2016, we remain constructive in terms of CN's prospects, notwithstanding the fact that we continue to experience high volatility, weaker conditions in a number of economic sectors. The pace of North American industrial production is also slowing down considerably. Fortunately, however, the consumer-driven sectors of the economy should continue to support moderate growth in housing, automotive, and intermodal activities. These factors will result in more modest freight demand, and when combined with the strengthening of the Canadian dollar versus the U.S. currency, this will make things more challenging for us in 2016.
Accordingly, we're aiming to deliver 2016 earnings per share in line with last year's adjusted diluted EPS of $4.44. In addition, we plan capital investments of approximately $2.75 billion for 2016, also in line with last year's program. As we look ahead to the balance of 2016, despite a challenging environment, we are committed to managing the business in a manner that protects earnings while not sacrificing our long-term competitiveness. Both said it, we have a proven strategic agenda of operational and service excellence while being a true supply chain enabler. The CN leadership team remains focused on ensuring that the company is well-positioned and continues to deliver value to our customers and to our shareholders for many years to come. Mesdames et messieurs, c'est tout de ma part. This is my report. Thank you very much.
Thank you, Luc. I have now received the report of the scrutineer. According to the proxies received and the ballots cast, each director nominee receives at least 96.2 shares voted in favor of his or her election. I therefore declare the 11 nominees set out in the Management Information Circular have been duly elected as directors of the company to hold office till the next annual meeting of shareholders, or until their successors are duly elected or appointed. I also declare that the non-voting advisory say on pay resolution on the company's approach to executive compensation has been approved by 98% of the holders represented in person or by proxy at this meeting. Finally, having received the vote, only 2.9 of the shares voted in its favor, I declare the shareholder's proposal is defeated.
I would now like to present the members of your Board of Directors and congratulate them on their election to the board. They are a talented group from all over North America who make every effort to bring value to the shareholders. I'll ask each of them seated before the stage here to rise and face the audience and remain standing till all of them have been introduced. I would ask you hold your applause until they have been introduced. Donald Carty. Ambassador Gordon Giffin. Edith Holiday. Maureen Kempston Darkes. The Honourable Denis Losier . The Honourable Kevin Lynch. James O'Connor. Robert Phillips. Laura Stein. Claude Mongeau on the stage, and I'm Robert Pace, and I'm the Chairman of the CN Board of Directors. Ladies and gentlemen, these are your directors.
Today, we are fortunate to have with us several former CN directors, whom we've honored as directors emeritus, in recognition of their extraordinary contributions to the CN Board of Directors. From New Jersey, Michael Armellino. From Edmonton, Alberta, Hugh Bolton. And from Calgary, Alberta, Jim Gray. In addition, we recently lost a CN director emeritus, a very dear friend and supporter, with the passing of one of our most well-known and decorated directors, Cedric Ritchie. Cedric was sought after by many boards in Canada and was widely considered to be one of Canada's most prominent and highly regarded banking leaders. We were very fortunate to have him on CN's board for eight years, and on behalf of all of us at CN, he'll be sadly missed.
As we have completed all of the business to come before this meeting, I will entertain a motion to conclude the formal part of this meeting. Fiona Murray, would you kindly introduce a motion to that effect?
Mr. Chairman, my name is Fiona Murray. I'm a shareholder of the company, and I move that part of this meeting be concluded.
Thank you, Fiona. Paul Deegan, will you second the motion?
[Foreign language]
All those in favor, raise your hands. Motion passed. We now have time for general question period. We invite any shareholder or proxy holder of the company who has a question to come forward and use the floor microphone. In the interest of time and fairness to everyone who wishes to ask a question, I ask you to restrict your questions to matters relevant to the business of the company. In order to allow the maximum number of shareholders who wish to ask questions to participate, we ask that you keep your questions short. Anyone who wants to ask more than one question will be asked to hold his or her second question until anyone else that wants to ask a question has had an opportunity to do so.
Prior to asking your question, please state your name and whether you are a shareholder or a proxy holder of the company.
My name is John Coffin, and I'm a shareholder of CN. For the benefit of us who are not railroaders, could you explain operating efficiency and how it's what makes it up?
Well, thank you. You don't get me going on this because it's a complex subject. You know, we are a network business, so the importance is, and we are very capital-intensive , so it's all about efficiency and running a balanced network such that you can achieve higher asset utilization. The good news in the rail industry is that, you know, asset utilization, which is good for cost, is also fundamental to good service. If we can move our cars and our trains faster from point A to point B, we need fewer locomotives, we need fewer cars , so we are more efficient, but we also have faster transit time, which is what customers are buying in transportation.
One of our challenge over the year is that if you focus only on asset utilization, you can get to a point where the first mile, last mile dimension of the service may suffer. That's why our agenda of having a more customer-centric approach rounds out the transformation to allow us to protect and expand efficiency, but do so with good service outcome for the customer. We are a bus service, however. We are not a taxi service. I like to say sometimes when I meet government officials, you know, every customer would like the bus to stop on the corner of their street. Some of them actually would like to have a shelter in case it rains.
But if we have one customer at a time, an opportunity to go to the government and ask for services to be invoked on the railroad, the ability of the railroad to manage an efficient bus service is diminished. We might get requests for buses on every street, with stops at every corner, and if we're not careful, way too many shelters, and that's not a good thing. That's why the right policy framework, based on commercial decisions, based on a sense of purpose with the right business agenda, is so much more powerful than falling on the request for more regulatory leverage that we hear too often when people want to pull the government aside. Thank you for the question.
Thank you, sir. Microphone number two.
[crosstalk] shareholder and a proxy holder, I would like to know the impact of the new regulation. Near, near what you're going to do around cities or on, you know, on, on return and so on. I know it's a, it's a very good question of balance. New question of balance. Okay, we slow down our train in big cities to 35 miles an hour, I believe. But we do it in big urban centers, and it is a practice that we're doing in transporting dangerous goods, and we spread it to include new categories of dangerous goods for security purposes. If we were to slow down the trains everywhere on our network, it wouldn't be realistic.
But to do it in high-density population area where the risk are higher, and it is a very balanced measure, and we can make it an effective network as part of the security measure. Thank you.
Thank you. Thanks for the question.
Good morning. My name is Jay Mann, and I'm a shareholder of the company. I'd like to hear the company's views on Mr. Emerson's Canada Transportation Act Review report and the Canadian government's response to it.
Jay, that's a very good question. I'm sure it's [audio distortion] Well, let me seize on the opportunity. I think you are very perceptive. I was very pleased by the Emerson Report, broadly speaking. I chose today to talk about our remarkable business transformation on the day of our annual general meeting to make a broad policy point. One of the reasons is that this report from David Emerson on the Canada Transportation Act Review will lead to policy decisions by the government. The review was asked after a very exceptional grain crop two years ago. It was a grain crop of massive size. Statistically, there is less than 0.5% of a 1% chance to have such a large crop, which means that we may not have another one as large for several decades, if not a century.
It also happened to occur in a year of very difficult winter conditions. So not just the railroad, but the entire grain supply chain was tested. Unfortunately, it created a shortfall in our capacity to move the grain in a very timely basis. We ultimately moved it all in a year, but there were times where farmers and other grain stakeholders were concerned. This created a bit of a crisis. The previous government reacted very badly, in my view, without sufficient facts. Very late in the game, they introduced a number of regulation changes which were not well thought out, frankly, are not supported by the facts, and will undermine investment and innovation in the rail industry if they are not repealed in due course. The government has recently announced they will extend those measures as they consider the recommendation from David Emerson.
It's interesting and very telling that despite all of the advocacies from a number of sectors, but mostly from grain country, asking for more regulation on the back of what happened, Mr. Emerson, in his perspective and wisdom, actually called it right. He said it was an exceptional set of circumstances. And he surprisingly, he actually recommended that grain, of all sectors, should have more commercial approach, not more regulation. Now, I think his approach is evidence-based. He had a lot of time to reflect on it. I am hopeful that with the new Liberal government, with our Minister of Transport and his colleagues, which are saying, and so far are indeed acting accordingly, that they will have a very evidence-based policy approach. We'll have the courage to step back. I hope they listen a bit to my speech and what we have to say.
I hope they focus on innovation. I hope they continue to try the tested approach of driving commercial decisions, because this is the promise for continued innovation. And it's in my-- I believe in the bottom of my heart and with everything I know, that is with what the country requires. So they should have listened to Mr. Emerson and sunset the clause. They will have another chance as they review his recommendation and set out policy for the future in the interest of the country, not just the railroads. Thank you, Jay.
Microphone number two.
Michel Gauthier, I am shareholder. This year, it has been a long time that the company, it was effective in North America, in railroads. And recently, there is another company that is catching up. Yeah. And I would like to know, if we are losing parts of the market, what do we do to protect our market parts, and what do we do to increase our parts on the market? Thank you. Thank you for your question. I will answer in English, if you want.
CN is a leader in contested state industry. We are the undisputed leader in the North American rail industry, not just financially, but in a broad set of measures. We wish to be the safest railroad and become an industry leader in that regard, too. We think our agenda on all fronts service, supply chain thinking, efficiency, profitability, and safety, to name a few. We think we have the team, and we have the agenda to stay a leader for many years to come. If you compare our performance to that of CP, you are correct. They are themselves with Hunter at the leadership, at the helm of CP. They are on a remarkable transformation of their efficiency, and we can see them in the rearview mirror very close. They are number two.
It's a good thing that, when you step back and, take the broad picture, it echoes what I have said. You know, it's not just one railroad that had a remarkable business transformation. The two Canadian railroads at the moment are the envy of the world. We are the most efficient, and I am convinced over time, CP will evolve like we have to be also as good on service and supply chain thinking. But we're not gonna make it easy for them to catch us. And if we, perform and if they chase us hard, this is what the market is for. This is what I mean with the right policy framework, commercial incentives, natural rivalry. You know, a drive to perform for all stakeholders leads to outcomes that are not possible to arrive at in an adjudication process or a regulatory body.
That's just reality. It happens on the ground, not in Ottawa, and that's my message. Thank you for your question.
[Foreign language]
Just another one. There's a, in Salaberry-de-Valleyfield, there's a CSX, the new port there that they have. Does it have any impact, negative impact on the CN?
No, it is normal competition. You want your competitors to invest and grow their business and provide choices to customers. We compete hard for US business in Prince Rupert, in Vancouver, and through Halifax and Montreal. So CSX wants to compete, and they need to invest. That's what they did. We are gonna compete out there and earn our fair share of the traffic.
Microphone number one.
[Foreign language] Congratulations for your performance. But what it shows me, and I'm very pleased, is determination. I am Michel Ferland. I am a proxy holder. My wife couldn't make it. It is the same thing. It is the same thing. My wife want to show. We have to say the truth occasionally. I would like, yeah, but I want you to ask him question, Danny. What is planned for the future? Because you were perfect. We receive the competition. In Canada, you made a important acquisition, so it is in mutation. You talk about the streamlining of the quality of personnel, of staff, the customer-centric effort. Those people, they can do that, too. Your competitors, what you can do differentiate us?
Excellent, excellent question. Our locomotives are the same. Our infrastructures are the same, and we share the same clients who know [audio distortion] resources. But the vision, the clear vision, the sense of purpose, and the culture of focus on the matters that drive performance is what distinguishes us from our competition. And that's the part that is very difficult to replicate. We have been the leader for many, many years, and we think that others can follow and try to emulate, and they will find a way to emulate. But we are not standing still while they catch up on what we do today. We are hard at work, trying to think about what it is we need to do tomorrow. I don't have all the answers, and if I did, I would not broadcast them on the web.
But, you know, that's what we are doing. Just a [Foreign language] principal .
Just out of you, mister, earlier, was telling me, because I was starting, I just started giving you, without a tie, a chair. Well, yeah.
Well, I want to thank you all for coming to and participating in this business meeting. Merci and bonjour and h ave a good day. Thank you.