Good morning, welcome to Marsh & McLennan Companies' 2019 Annual Meeting of Stockholders. My name is Kate Brennan. I'm the corporate secretary here at MMC. Today's meeting is being webcast, I'd like to ask everyone joining us in person to turn off their cell phones and other electronic devices. Cameras and recording devices are not permitted during the meeting. Please note that remarks made by management may include statements relating to future events or results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Please keep in mind that a variety of factors could cause actual results to differ materially. In addition, remarks made today may refer to non-GAAP financial measures. Please refer to our filings with the Securities and Exchange Commission for additional information.
To conduct an orderly meeting, we will handle the business of the meeting as shown in the order of business card and ask that you honor the meeting procedures printed on that card. We ask that all stockholders please wait until the designated question and answer period for any questions or comments. With that, I'll turn the meeting over to our independent chairman, Ed Hanway.
Good morning, everyone. As Kate just mentioned, I'm Ed Hanway, the independent chair of Marsh & McLennan Companies. On behalf of the company, its directors and officers, welcome and thank you for coming to this, our Annual Meeting of Shareholders. Before turning to today's agenda, I'd like to ask the company's independent directors to stand as I introduce them. Tony Anderson, former vice chair and Midwest area managing partner of Ernst & Young. Óscar Fanjul, vice chairman of Omega Capital. Debbie Hopkins, former chief executive officer of Citi Ventures and chief innovation officer of Citigroup. Elaine La Roche, chief executive officer of China International Capital Corporation, U.S. Securities, Inc. Steve Mills, former executive vice president of Software and Systems of IBM. Bruce Nolop, former chief financial officer of E-Trade Financial Corporation. Morton Schapiro, president of Northwestern University. Lloyd Yates, executive vice president of Duke Energy and president of Duke Energy's Carolinas region.
Dave Yost, former president and chief executive officer of AmerisourceBergen. One of our independent directors, Marc Oken, the founding partner of Valoria Capital Partners and former chief financial officer of Bank of America Corporation, is unfortunately unable to attend the meeting today. Dan Glaser also joins me here on the stage. In addition to being the company's president and CEO, Dan is also a member of the board of directors. Bob Tucker of Deloitte & Touche is also in attendance. Deloitte & Touche is the company's independent registered public accounting firm, and Bob is available to answer questions during the Q&A session later in the program. With that, I hereby call the 2019 Annual Meeting of Stockholders to order. After proceeding with the formal part of the meeting, we will announce the preliminary voting results.
Dan will speak about the company, following which he will open the floor to questions. Please save any questions you might have until that time. We have received affidavits confirming the distribution of the 2018 annual report, the 2019 notice of annual meeting and proxy statement, and voting instructions to stockholders of record on March 18th, 2019. The list of registered stockholders eligible to vote at this meeting is available for inspection by any stockholder at the sign-in table. Representatives of Broadridge have been appointed to serve as inspectors of election for this meeting and have taken their inspector's oath. The inspectors have reported that more than 50% of the outstanding shares is present in person or by proxy, a quorum is present for the transaction of business. We are meeting today to vote on the matters described in the proxy statement.
Voting will take place on these matters after they are presented. The first order of business is the election of nominees listed in the proxy statement to serve as directors with terms expiring in 2020. No other nominations were submitted to the company. The company has a majority voting standard. In the case of director elections like today's, are uncontested. Accordingly, each nominee must receive a majority of the votes cast with respect to his or her nomination in order to be elected to the board. The second item on the agenda, commonly known as a say-on-pay proposal, enables our stockholders to approve, by non-binding vote, the compensation of our named executive officers as disclosed in the proxy statement.
The third and last item on the agenda calls for the stockholders to ratify the appointment of Deloitte & Touche as the company's independent registered public accounting firm for the fiscal year ending December 31st, 2019. The audit committee previously approved this appointment. The polls are now open. Stockholders present who have already voted by proxy need not vote again unless they wish to change their votes. If you still have a proxy card, please give it to an Inspector of Election. Will the inspectors please identify themselves? An inspector will furnish a ballot to any stockholder or stockholder representative who wishes to vote in person. Please raise your hand if you wish to vote in person, and we will provide you with a ballot. If you have a legal proxy from your broker, please submit it along with your ballot. Okay, will the inspectors please collect any ballots?
Okay, the polls are now closed. The preliminary tally, based on the votes cast as of the start of this meeting, shows the following results. With regard to item one, a majority of shares voted were voted in favor of each of the director nominees, thus they have all been elected. For item two, a majority of the shares present or represented and entitled to vote have voted in favor. Thus, stockholders have approved, on an advisory basis, the compensation of the company's named executive officers. Finally, for item three, a majority of the shares present or represented and entitled to vote have voted in favor. Thus, the appointment of Deloitte & Touche as the company's independent auditors for 2019 has been ratified. The Inspectors of Election will provide a final certified report of the vote following the meeting.
That report will become a part of the record of this meeting and is not expected to affect the outcome of the voting announced today. A summary of the outcome of the vote will be posted to the company's website, and details of the final voting results will be filed with the SEC. Before I adjourn the formal part of the annual meeting, I would like to announce that earlier this morning, the board declared a dividend of 45 and a half cents per share on outstanding common stock, payable on August 15, 2019, to stockholders of record on July 11, 2019. With that, the formal part of Marsh & McLennan Companies' 2019 annual meeting is now adjourned, and it gives me great pleasure to turn the floor over to Dan. Dan?
Good morning. Thank you, Ed. This is my seventh annual shareholders meeting as CEO of Marsh & McLennan. It's an honor to continue to lead this great company and our 75,000 colleagues around the world. I'd like to start by introducing the members of our executive committee. I'll ask each of them to stand as I call their name. John Doyle, CEO of Marsh. Peter Hearn, CEO of Guy Carpenter. Martine Ferland, CEO of Mercer. Scott McDonald, CEO of Oliver Wyman. Peter Beshar, General Counsel. Scott Gilbert, Chief Information Officer. Laurie Ledford, Chief Human Resources Officer. Mark McGivney, Chief Financial Officer, and Dominic Burke, Vice Chairman. I'd also like to recognize our board of directors, led by Ed Hanway, our independent chairman. Thank you for your exceptional leadership and governance. I'm delighted to welcome Lord Ian Lang, our former independent chairman. Ian, thank you for being here today.
Marsh & McLennan is a trusted advisor to clients around the world. We help them address the greatest challenges and opportunities of our time. That means we're in the business of change. We're at home in this dynamic landscape. Marsh and Guy Carpenter evaluate risk and advise businesses on how they can address complex challenges such as cybersecurity, geopolitical volatility, and natural disasters. Mercer counsels clients on the future of work, healthcare affordability and access, and investments for retirement. Oliver Wyman helps industry leaders and government institutions transform for the future. One lesson from nearly 150 years in this business, just as a point of clarification, that's Marsh & McLennan, not me is the flip side of risk is always opportunity. Our colleagues thrive on the opportunity to help our clients and society change what's possible.
Where there are growing systemic risks such as climate change, we see an opportunity to create sustainable and resilient solutions. Emerging technologies, while offering exponential possibilities, are creating new risks. Changing the very nature of risk, where technologies disrupt and interconnected technology platforms are increasingly vulnerable. We see an opportunity to create bold new futures. Where the nature of work evolves and critical decisions shift to individuals, we see an opportunity to reimagine the workforce, enhance the health of societies everywhere, and help people achieve financial security for life. Every day, we gather the right talent and solutions around each client's challenge from wherever they are in the company. This is the MMC advantage, bringing the full value of all of our businesses to bear.
It reflects our core belief that our businesses and the company as a whole must deliver insights and solutions to shape the industries we serve. We're also creating the potential for breakthrough impact through technology. Our four global businesses are harnessing the transformative potential of technologies to help more clients and create new sources of revenue. Recent examples include Marsh's launch of Blue Stream, a cloud-based digital broking platform. Guy Carpenter's rollout of GC Genesis, an advisory business that helps clients find the right insurtech opportunities. Mercer's strategic alliance with Morningstar to provide clients with a digital subscription access to Mercer's proprietary investment research. Our [alignment], ongoing build-out of its digital and technological capabilities. Acquisitions also play a key role in our positioning for the future, and none were more significant than Jardine Lloyd Thompson, which we closed on April 1st.
This combination is about growth in talent, capabilities, revenue, and earnings, furthering our position as the world's premier professional services firm in the areas of risk, strategy, and people. We were thrilled to welcome more than 10,000 new colleagues from JLT and to begin a new era for our combined firm. While JLT puts us on a new trajectory, we've been driving growth for some time. Our 2018 financial results extended our long track record of sustained value creation. We generated $15 billion in consolidated revenue in 2018, an increase of 7% compared with 2017, or 4% on an underlying basis. Adjusted operating income rose 8%, consolidated adjusted margin increased 30 basis points, our 11th consecutive year of margin improvement. Our adjusted earnings per share grew 11% to $4.35, another year of double-digit growth.
For the fifth year in a row, we increased our dividends per share by double digits, reduced our total shares outstanding, fulfilling our capital commitments to shareholders. In 2018, we returned nearly $1.5 billion to shareholders in the form of dividends and share repurchases. We reduced our share count by 1%, increased dividends per share by 10%. Even more gratifying than the results we achieved in 2018 is how we achieved them. Fostering a culture of integrity and striving to always do what's right for the client in an environment of inclusion and respect, one that enables extraordinary people to do their best and most fulfilling work. Our strong growth and profitability in the first quarter marks a great start to 2019, is consistent with our plan to deliver strong results this year. None of this could happen without the support of our colleagues, clients, and shareholders.
I'd like to thank our colleagues for their dedication, our clients for their trust. Finally, I'd like to thank our shareholders for supporting Marsh & McLennan as we strive to deliver innovation, impact, and growth. Thank you very much for your time today. Before I take any questions, I'd like to turn it over to Kate for an overview of the Q&A procedures.
Thank you, Dan. Before we move into the Q&A period, I just want to highlight a couple of the meeting procedures found on the back of your order of business card. If you'd like to ask a question, please line up at the designated microphone and wait to be recognized. There's a microphone on either side here. After you're recognized, please state your name, your status as a stockholder or a proxy holder, and if you're a proxy holder, the name of the stockholder that you represent. Please limit your questions and comments to two for up to two minutes each for a total of four minutes. In fairness to all stockholders in attendance, the Chairman, the CEO, or I as Corporate Secretary, may stop certain comments or questions such as those that are unrelated to company business, or are repetitive.
With that, we will take our first question.
Hi, Joe Fernicola, long-term retail shareholder. That's why I'm not dressed for the occasion. I remember when you first came to the company and Ian retired. We had a nice space. If you remember, it was dark, almost like a movie theater. Remember?
Yes.
We had coffee, we had yogurt, we had breakfast, we had something to talk about, even though the stock wasn't doing so well. You came in. I don't know if it's you or it's just market conditions, but I like to think it's you, Mr. Glaser.
It's probably me.
Yeah. Here's the thing. I don't think I was here last year. Sometimes I have conflicting meetings to go to, I'm disappointed because I didn't take any coffee this morning because I thought I had a cup of coffee, you didn't deliver. I mean, the dividend is fine. A little coffee, too, everybody. I must comment that the room is a lot cozier than it was when you first came, and the seats are extremely comfortable. They go back, and they've got wheels on this chair. I like that a lot. Now, I do have a question for you, and it has to do with the changes in technology. One of them being the blockchain. The other is the cryptocurrency market growing.
What is our company's view on this whole area, this arena? Are we in the blockchain, are we going to be developing our own blockchain, dealing with IBM?
I think that'll lead us in.
Are you dealing in cryptocurrencies? For instance, are you having any customers anywhere in the world that might say, "Well, we want to pay you in crypto." Are we using it if we are? I don't know. Are we using it as an asset class that we're saving on the side, so when it goes to $250,000. Recently, a Monet painting sold at Sotheby's for $110 million. In 1986, it was purchased for $2.5 million. It's the Haystacks. You probably heard about it, right? Do we have any of that hanging on the walls here?
You've got multiple questions. Let me take them in turn.
I didn't want to take up too much time, obviously.
It's okay. Thank you very much for your question. Let me start with technology. Clearly, this is a world of tremendous advances in technology, and whether you're talking about issues like blockchain or artificial intelligence, use of robotics, machine learning, I can tell you we are involved in experimenting across that spectrum. In fact, just this week, Guy Carpenter had an announcement of some of the activity that it is doing in blockchain to simplify the way we transact business with insurance companies and reinsurance companies as a way to create greater efficiency for our clients. We're absolutely involved in blockchain. We have experiments and activity throughout each of our operating environments on blockchain. It's still very early stages to determine whether it will be a meaningful part of our business going forward.
It's something that we're in the vanguard on, and we'll move forward. Cryptocurrency is a bit different. I don't believe right now that we are dealing in payments in crypto and allowing clients to pay us in some sort of cryptocurrency, et cetera. We certainly support our clients, both throughout our businesses when they're either engaging or experimenting around cryptocurrency. For us, I don't believe we're transacting at this stage in crypto. In terms of artwork-
you'll probably know as much as I know, so I don't-
You don't do the joke.
Yeah, I know. Annual meetings, I don't joke around all that much, but I do think that somebody should get you a cup of coffee at the end. Please.
Ethan Craw, shareholder. For the first time in over 14 years, Mercer is being led by someone who came up through consulting. Can we get any insights as to whether or not there will be any major initiatives or drives, things that will bring it back to its world-class leadership-
that it built up over the 30 years it was led by Ian Smith and Diljan Asia and Peter Coster?
Yeah, sure.
I don't know if you want to answer it or you want to give it to Martine.
I'll answer the questions. At the end, I don't think whether one of our businesses is led by somebody who came up from it is a guarantee of performance, much like I don't expect we hire somebody from the outside to look at any of our businesses, and it's a guarantee of non-performance. I think that circumstances require different things at different times. Martine certainly has earned the right to lead Mercer, was the clear candidate in our succession planning exercise. Has had all kinds of roles, of not only being an actuary, okay, fine, but all through that, leading different businesses successfully throughout Mercer and even throughout her career outside of Mercer. A strong history of success. Mercer is still the leading provider of human resources consulting services in the world. It's not a back-to-basics movement because they've never left.
I share your view that probably within Mercer, there's sort of a groundswell of support just because it's like, okay, somebody who's done the work, who's actually worked with clients on actuary programs, have done work in DB, in health, in career, and has been involved in the investment business, is now our leader, and how empowering that can be for the organization. We're looking forward to the next several years and looking for Mercer to really demonstrate continued excellence. Many of the issues that are facing our clients with regard to people are not solved. The workforce of the future, the use of artificial intelligence, retirement security, affordability and access to healthcare. Mercer is really involved in the challenges of our time, and we're very encouraged by initial strategies that we're looking at, and we're looking forward to continuing developments. Thank you for your question.
Thank you.
Hi, I'm Kate Monahan. I'm Shareholder Engagement Manager at Friends Fiduciary Corporation, we're long-term shareholders. I have two questions. The first is, to what extent is our company involved in facilitating the underwriting for coal projects in Southeast Asia? Does our company see any political, social, or financial risks emerging from the Southeast Asian coal sector, where the rapid expansion of coal power threatens the goals of the Paris Agreement? My second question is that I understand that our company provides Adani with insurance brokerage and risk management services, and over 50 major banks and insurance companies and engineering consultancies have ruled out working with Adani on the Carmichael coal project due to reputational risks. This project is deeply controversial and unpopular in Australia and, again, incompatible with the goals of the Paris Agreement.
As long-term investors, we're worried about the reputational risk from actively working with Adani, and we're wondering if you could speak to the company's thinking on this. Thank you.
Okay. Let me take the second question first because I'm not aware of the issue nor the client, so I can't comment as to whether a client of the firm or not. In turn, let me take a step back for a second and say the company absolutely recognizes the issues that the world is facing with regard to climate resilience. In fact, not only are we involved in a big company in our own right, trying to find ways of working which are more sustainable and more environmentally friendly, but also we work with clients to address similar issues. This company, in 2008, was in the vanguard of forming a corporate responsibility committee of the board. In 2018, we formed an ESG committee within the company, which is led by Kate.
Issues such as our involvement with coal or any individual projects, I would say, would more likely fall inside our ESG committee, and we can address it on that basis and determine the right outcome, not only on coal, but on other issues which are important to our shareholders or important on a sustainability or resilience basis. I'd be happy to have you follow up with Kate and have Kate follow with you and get more information. Thank you. Other questions, thoughts? Okay, hearing none, I'll hand back over to you, Kate.
Back to Mr. Chairman. Actually, I think that concludes the annual meeting for today. I guess I have a few directions on how to leave the auditorium, but it's clear the doors are behind you and, stockholders, if you use the doors behind you and employees can use the doors on the side, we'll manage traffic a bit that way. Thank you all very much for attending.