Notice of Annual Meeting and Management Information Circular – Form 6-K

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Letter to shareholders

Dear Shareholder:

You are invited to attend our annual meeting of common shareholders on Thursday, May 9, 2024 at 5:00 p.m. (Toronto time).

Shareholders will have the opportunity to virtually attend the meeting, ask questions and vote on a number of important matters by way of live webcast at web.lumiagm.com/477258212.

The meeting will also be held at Sun Life's head office at 1 York Street (at Harbour Street), 35th floor, Toronto, Ontario, Canada.

The business of the meeting is described in the accompanying Notice of our 2024 annual meeting and Management Information Circular.

We will be conducting the annual meeting of the voting policyholders and sole shareholder of Sun Life Assurance Company of Canada at the same time. The formal business of each meeting will be conducted separately, however, management's presentation will address shareholders and policyholders.

Your vote is important. If you cannot attend the meeting, please vote by submitting your proxy by mail, internet or telephone by 5:00 p.m. (Toronto time) on Tuesday, May 7, 2024, as described on pages 11 to 15 in the attached circular.

We look forward to your attendance at this year's meeting.

Si vous désirez recevoir l'avis de convocation à l'assemblée annuelle et la circulaire d'information en français, veuillez communiquer avec le secrétaire en écrivant au 1 York Street, 31st Floor, Toronto (Ontario) Canada M5J 0B6, en composant le 1 877-786-5433, ou en envoyant un courriel à [email protected].

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Notice of our 2024 annual meeting

You are invited to our annual meeting of common shareholders:

What the meeting will cover

1.Receipt of the 2023 consolidated financial statements

2.Election of the directors

3.Appointment of the auditor

4.A non-binding advisory vote on our approach to executive compensation

5.Consideration of other business that may properly be brought before the meeting.

A total of 583,068,456 votes are eligible to be cast at the meeting.

The annual meeting of Sun Life Assurance Company of Canada will also be held at the same time.

The attached circular is being sent to you because you owned common shares of Sun Life Financial Inc. on March 15, 2024 (the record date). It includes important information about what the meeting will cover, who can vote and how to vote.

The board of directors has approved the contents of this circular and has authorized us to send it to you.

Troy Krushel

Vice-President, Associate General Counsel & Corporate Secretary

Toronto, Ontario

March 15, 2024

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Management Information Circular

March 15, 2024

In this document, we, us, our, the company, Sun Life and SLF Inc. mean Sun Life Financial Inc., and Sun Life Assurance means Sun Life Assurance Company of Canada. You, your and shareholder mean common shareholders of SLF Inc.

Unless otherwise stated, information in this Management Information Circular (Circular) is provided as of February 29, 2024.

About the meeting

Delivery of meeting materials

Notice and access

As permitted by the Canadian Securities Administrators and pursuant to an exemption from the proxy solicitation requirement received from the Office of the Superintendent of Financial Institutions Canada (OSFI), we are using notice and access to deliver this Management Information Circular (Circular) to both our registered and non-registered shareholders. Shareholders who hold common shares of SLF Inc. as of March 15, 2024, the record date for the meeting, have access to this Circular online. A package was sent to the shareholders in the mail with a notice (Notice) explaining how to access this Circular electronically and how to request a paper copy. A form of proxy for registered shareholders and share ownership account participants, or a voting instruction form for non-registered shareholders, was included with the Notice with instructions on how to vote your shares.

Notice and access allows for faster access to this Circular, helps reduce printing and postage costs, contributes to the protection of the environment and is consistent with our sustainability strategy.

How to access the Circular electronically

This Circular is available on our website (sunlife.com/2024agm), on the website of our transfer agent, TSX Trust Company (TSX Trust) (meetingdocuments.com/TSXT/slf), on SEDAR+ (sedarplus.ca) and on EDGAR (sec.gov/edgar).

Delivery of financial statements and management's discussion and analysis

How we deliver our financial statements and management's discussion and analysis (MD&A) to you depends on whether you are a registered shareholder, a share ownership account participant or a non-registered shareholder (see page 12 for a description of who falls within each of these categories of shareholders).

All registered shareholders, share ownership account participants, or non-registered shareholders may access the financial statements and MD&A online in the same manner as described above for accessing the Circular.

Registered Shareholders

As permitted under securities laws, we are using notice and access to deliver our MD&A to registered shareholders. You may access these materials online in the manner described above.

Registered shareholders who have not opted out of receiving our financial statements will receive them by mail, unless they have agreed to electronic delivery (e-delivery). Please see Go digital! below for more information on signing up for e-delivery.

Share ownership account participants and non-registered shareholders

As permitted under securities laws, we are using notice and access to deliver our financial statements and MD&A to share ownership account participants and non-registered shareholders. You may access these materials online in the manner described above.

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Go Digital!

All shareholders are encouraged to sign up for email delivery of notices of meeting.

Registered shareholders who have not opted out of receiving our financial statements and who currently receive them by mail are encouraged to agree to e-delivery to receive them. E-delivery means that you will be notified by email when the financial statements are made available, at which time they can be viewed and/or downloaded from our website.

The chart below outlines the process by which shareholders can sign up for e-delivery.

How to request a paper copy of materials provided to you through notice and access

Shareholders may request a paper copy of this Circular or our financial statements and MD&A up to one year from the date the Circular was filed on SEDAR+. If you would like to receive a paper copy prior to the voting deadline, please follow the instructions provided in the Notice or make a request by no later than April 24, 2024 on TSX Trust's website (meetingdocuments.com/TSXT/slf), by contacting TSX Trust at 1-888-433-6443 (toll free in Canada and the United States) or 416-682-3801 (other countries) or email [email protected]. A copy of the requested documents will be sent to you at no cost within three business days of your request. If you request a paper copy of any materials, you will not receive a new form of proxy, so you should keep the original form sent to you in order to vote.

Questions?

If you have questions about notice and access or to request a paper copy of this Circular after the meeting at no charge, you can call TSX Trust at 1-888-433-6443 (toll free in Canada and the United States), or 416-682-3801 (other countries) or email [email protected].

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How to attend

This year's annual meeting will be held online at web.lumiagm.com/477258212. Shareholders will also have the opportunity to attend at Sun Life's head office at 1 York Street (at Harbour Street), 35th floor, Toronto, Ontario, Canada.

Registered shareholders and duly appointed proxyholders (including non-registered shareholders who have duly appointed themselves as proxyholder) that attend the meeting online will be able to vote by completing a ballot online during the meeting through the live webcast platform.

Guests (including non-registered shareholders who have not duly appointed themselves as proxyholder) can log into the meeting as set out below. Guests will be able to listen to the meeting but will not be able to vote during the meeting.

•Step 1:

Log in online at web.lumiagm.com/477258212

We recommend that you log in at least one hour before the meeting starts.

•Step 2:

Follow these instructions:

Registered shareholders: Click "I have a control number" and then enter your control number and password "sunlife2024" (case sensitive). Your control number is the number located on the form of proxy or in the email notification you received from TSX Trust. If you use your control number to log in to the meeting, any vote you cast at the meeting will revoke any proxy you previously submitted. If you do not wish revoke a previously submitted proxy, you should not vote during the meeting.

Duly appointed proxyholders: Click "I have a control number" and then enter your control number and password "sunlife2024" (case sensitive). Proxyholders who have been duly appointed and registered with TSX Trust as described in this Circular will receive a control number by email from TSX Trust after the proxy voting deadline has passed.

Guests: Click "Guest" and then complete the online form.

Please allow ample time to log in to the meeting online before it begins. You may need the latest version of your web browser. Please do not use Internet Explorer. It is possible that internal network security protocols, including firewalls and VPN connections may block access to the webcast. If you are experiencing any difficulty connecting or watching the meeting, please ensure your VPN setting is disabled or use a computer on a network not restricted to security settings of your organization.

Additional information and updates on how to attend the meeting will be made available on our website atsunlife.com/2024agm. Please see Voting on pages11 to 15for further instructions. This Circular is available on our website, on the website of our transfer agent, TSX Trust (meetingdocuments.com/TSXT/slf), on SEDAR+ (sedarplus.ca) and on EDGAR (sec.gov/edgar).

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What the meeting will cover

Financial statements

You will receive the consolidated financial statements for the year ended December 31, 2023, the auditors' reports thereon and the actuary's report on the policy liabilities reported in the financial statements.

Electing the directors (see pages 16 to 23)

We expect that all of the nominees will be able to serve as director but if for any reason a nominee is unable to serve, the persons named in the proxy form have the right to vote at their discretion for another nominee proposed according to the company's by-laws and applicable law.

Our policy on majority voting

The election of directors at the meeting is expected to be an uncontested election, meaning that the number of nominees will be equal to the number of directors to be elected. If a director receives more "withheld" than "for" votes in an uncontested election, they must tender a written offer to resign to the Board. The Board will accept the resignation within 90 days unless there are exceptional circumstances and will disclose the reasons for its decision in a news release. The director will not participate in these deliberations.

Appointing the auditor

We maintain independence from our auditor through Audit Committee oversight, a robust regulatory framework in Canada, including the requirement to rotate the lead audit partner at least every five years, and Deloitte's own internal independence procedures which are designed to comply with Canadian Public Accountability Board and Public Company Accounting Oversight Board requirements. The Audit Committee pre-approves services provided by the auditors, and also conducts a formal review of the external auditors every year. We completed a comprehensive audit tender process in 2016 and have since carried out an annual review each year. It is our intention to carry out a more comprehensive review in 2024 following the completion of the initial adoption of International Financial Reporting Standards 17 (IFRS 17) Insurance Contracts and at a minimum every 5 years thereafter. The 2024 review will include an evaluation of the engagement partner and team, their independence objectivity, the quality of communication and audit work performed and overall review of fees. In 2023, we received 285,763,415 votes for the appointment of Deloitte as our auditor, with 37,503,264 votes being withheld. The Board, on recommendation of the Audit Committee, recommends voting FOR Deloitte as our auditor. If you do not specify in your proxy form or voting instruction form how you want to vote your shares, the persons named in the form of proxy will vote FOR the appointment of Deloitte as our auditor.

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Auditor's fees

The table below shows the fees relating to services provided by Deloitte for the past two years.

¹Adjustment to 2022 fees of $1.4 million for audit fees.

Audit fees relate to professional services rendered by the auditors for the audit of our annual consolidated financial statements, the statements for our segregated funds and services related to statutory and regulatory filings. Audit fees of $21.4 (2022: $19.7) relates to the audit of the consolidated financial statements of SLF Inc. and its subsidiaries to support the audit opinion expressed in the independent auditor's report; the remaining audit fees of $9.3 (2022: $9.2) relate to audit of the statements for segregated funds and statutory and regulatory filing. The increase in audit fees in 2023 compared to 2022 is largely due to audit work in executing on the adoption of new accounting standards (IFRS 17 Insurance and IFRS 9 Financial Instruments), and adjustments in scope resulting from acquisitions.

Audit-related fees include assurance services not directly related to performing the audit of the annual consolidated financial statements of the SLF Inc. These include internal control reviews, specified procedure audits and employee benefit plan audits.

Tax fees relate to tax compliance, tax advice and tax planning.

All other fees relate to products and services other than audit, audit-related and tax as described above.

We have a policy that requires the Audit Committee to pre-approve any services that are to be provided by the external auditor. The committee has, subject to reporting requirements, pre-approved certain audit, audit-related and other permissible non-audit services that are consistent with maintaining the independence of the external auditor. You can find more information about this policy in our annual information form which is available on SEDAR+ (sedarplus.ca) and on EDGAR (sec.gov/edgar).

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Having a "say on pay"

We will ask the shareholders to consider and vote on the following resolution. The Board recommends that shareholders vote FOR the resolution. If you do not specify in your proxy form or your voting instruction form how you want to vote your shares, the persons named in the form of proxy will vote FOR the resolution:

"RESOLVED THAT on an advisory basis and not to diminish the role and responsibilities of the Board of Directors, the shareholders accept the approach to executive compensation disclosed in the Management Information Circular dated March 15, 2024 delivered in advance of the annual meeting of common shareholders on May 9, 2024."

One of the Board's primary responsibilities is to ensure Sun Life is able to attract, retain and reward qualified executives. While shareholders will provide their collective views on our approach to executive compensation through the advisory vote, the directors are still fully responsible for their compensation decisions. We will file the results of the votes, including the advisory vote, on SEDAR+ (sedarplus.ca) and publish them on our website. In 2023, we received 300,855,136 votes for our approach to executive compensation, and 13,845,754 votes against. If a significant number of shareholders oppose the "say on pay" resolution, the Board will consult shareholders to understand their concerns, and then review our approach to executive compensation with their concerns in mind. Our executive officers have a material interest in the outcome of the vote because it may affect our process for determining their compensation. It is impossible, however, for us to describe the impact of the vote or the consultations before they have taken place.

Considering other business

You can vote on other items of business that are properly brought before the meeting. As of the date of this Circular, we were not aware of any other items to be brought forward.

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Voting

Who can vote

You are entitled to receive notice of and vote at our annual meeting of common shareholders if you were a shareholder of record as of 5:00 p.m. (Toronto time) on March 15, 2024.

As of March 15, 2024, we had 583,068,456 common shares outstanding. Each common share carries one vote. We require a simple majority of votes cast for any of the items of business to be approved.

At least two persons holding, or representing by proxy, at least 25% of the shares entitled to vote constitute a quorum for the transaction of business at the meeting.

Common shares beneficially owned by the following entities and persons cannot be voted (except in circumstances approved by the Minister of Finance):

•the Government of Canada or any of its agencies.

•the government of a province or any of its agencies.

•the government of a foreign country or any political subdivision of a foreign country or any of its agencies.

•any person who has acquired more than 10% of any class of our shares.

Also, if a person, or an entity controlled by a person, beneficially owns common shares that in total are more than 20% of the eligible votes that may be cast, that person or entity may not vote any of the common shares (unless permitted by the Minister of Finance).

To our knowledge, no person or company beneficially owns or exercises control or direction over, directly or indirectly, more than 10% of the voting rights attached to our common shares.

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How to vote

You have three ways to vote:

1.by proxy;

2.by attending the meeting and voting by online ballot through the live webcast platform; or

3.by attending the meeting and voting in person.

Please identify which type of shareholder you are, then follow the applicable instructions to vote

Voting by proxy before the meeting

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If you did not receive a proxy form with a control number

To vote by proxy, you will need a control number.

If you did not receive a form of proxy or email notification from our transfer agent containing the control number, at least one business day prior to the meeting please:

•contact TSX Trust at 1 (866) 751-6315 (within North America) or 1 (416)-682-3860 (outside of North America), or

•complete a form online using the following link: tsxtrust.com/control-number-request to obtain your control number.

If you change your mind

You can revoke instructions you have already provided by giving us new instructions. If you have followed the instructions for attending and voting at the meeting online, voting at the meeting online will revoke your previous instructions.

Registered shareholders and share ownership account participants can download a blank proxy form from meetingdocuments.com/TSXT/slf and send a new proxy form in one of the following ways:

•complete and sign the proxy form with a later date than the one you previously sent, and deliver or deposit it to TSX Trust before 5:00 p.m. (Toronto time) on Tuesday, May 7, 2024.

•submit new voting instructions to TSX Trust by telephone or internet before 5:00 p.m. (Toronto time) on Tuesday, May 7, 2024.

•deliver or deposit a notice in writing with your new instructions signed by you, or your attorney as authorized by you in writing, to us before 5:00 p.m. (Toronto time) on Wednesday, May 8, 2024, or if the meeting is adjourned or postponed, before 5:00 p.m. (Toronto time) on the business day before the meeting is reconvened, at: SLF Inc., 1 York Street, 31st Floor, Toronto, Ontario, Canada M5J 0B6 Attention: Corporate Secretary.

•if you are attending the meeting in person, give your written instructions signed by you, or your attorney as authorized by you in writing, to the Chair of the meeting before the start of the meeting or before the meeting is reconvened.

If you did not receive a voting instruction form with a control number

To vote by proxy, you will need a control number.

If you did not receive a voting instruction form with a control number, please contact your nominee (i.e. your securities broker, clearing agency, financial institution, trustee or custodian or other intermediary).

If you change your mind

You can send a new voting instruction form to your nominee. To allow your nominee time to act on your instructions, you should provide them your instructions at least seven days before the meeting.

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Voting during the meeting

Shareholders will have the opportunity to attend the meeting virtually, or to attend in person at Sun Life's head office at 1 York Street (at Harbour Street), 35th floor, Toronto, Ontario, Canada. Attending the meeting, in person or online, gives you an opportunity to ask questions, vote on a number of important matters and hear directly from management.

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More about voting by proxy

Voting by proxy gives a proxyholder the authority to attend the meeting and vote on your behalf. If you specify how you want to vote, your proxyholder must vote according to your instructions.

The enclosed proxy form names Scott F. Powers, Chair of the Board, or in his absence, M. Marianne Harris, Chair of the Governance, Investment & Sustainability Committee, or in her absence, another director appointed by the Board, as your proxyholder.

If you appoint them as proxyholders but do not specify how you want them to vote, your shares will be voted:

•FOR electing each of the director nominees who are listed in the proxy form and Circular.

•FOR appointing Deloitte as auditor.

•FOR the advisory resolution accepting our approach to executive compensation.

You can appoint another person to vote your shares by printing their name in the space provided on the proxy form or voting instruction form and registering them with TSX Trust. This person does not need to be a shareholder, but your vote can only be counted if they participate in the meeting and vote for you. Regardless of who you appoint as your proxyholder, if you do not specify how you want to vote, your proxyholder can vote as they see fit. Your proxyholder can also decide how to vote on any other matters that may properly come before the meeting, and on any amendments or variations to the items listed above, whether or not the amendment, variation or other matter that comes before the meeting is routine or contested (as permitted by law).

TSX Trust must receive your voting instructions by 5:00 p.m. (Toronto time) on Tuesday, May 7, 2024 to have your vote recorded. If the meeting is adjourned or postponed, TSX Trust must receive your voting instructions by 5:00 p.m. (Toronto time) on the date that is two business days before the meeting is reconvened.

Processing the votes

TSX Trust counts and tabulates the votes on our behalf. Individual shareholder votes are kept confidential and voting instructions are only communicated to management if it is clear that the shareholder wants to communicate directly with management, or when the law requires it.

We will file the voting results at SEDAR+ (sedarplus.ca) and publish them on our website.

Solicitation of proxies

We solicit proxies by mail, but our outside agency, Morrow Sodali (Canada) Ltd. may also contact you by mail, email or phone to ask you to vote. SLF Inc. pays for the costs of the proxy solicitation. We expect to pay approximately $40,000 to Morrow Sodali (Canada) Ltd. for their services, plus any related expenses. You can reach them toll-free at 1-888-777-1546 or by email at [email protected].

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Director nominees at a glance

At the 2024 annual meeting you'll be asked to elect 11 directors to hold office for a term ending on the conclusion of the next annual meeting. All of the 11 nominees currently serve on our Board.

Board composition and size are reviewed every year (see more about the selection process on page 36).

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Director nominee profiles

The following profiles provide information about each of the director nominees as at the date of this Circular, including when they joined our Board, their business experience, their committee memberships, their attendance at Board and committee meetings in 2023, the level of support received from shareholders at our 2023 annual meeting, and other public company directorships held in the last five years.

The Board recommends that shareholders vote for electing each of the director nominees profiled below.

Share ownership

The director nominee profiles also include information about the value of their holdings of SLF Inc. common shares and deferred share units (DSUs). A DSU is equal in value to a common share but cannot be redeemed until a director leaves the Board. Common shares and DSUs count towards the achievement of our share ownership guidelines for directors which each director is expected to meet within five years of joining

the Board. The director share ownership guidelines were revised in 2022 to increase the share ownership guideline effective January 1, 2023 to $805,000 in common shares and/or DSUs. New directors must achieve the guideline within five years of joining the Board and existing directors have an additional year to achieve the increased guideline. For director nominees who have not achieved the guideline, we determine if they are "on target" by calculating the number of common shares and DSUs they will hold by their achievement due dates based on the form of remuneration they have individually elected. For this purpose we assume that the share price and dividend rate remain constant until the applicable achievement due date. The amounts shown in the profiles are as of February 29, 2024 and February 28, 2023 when the closing price of our common shares on the Toronto Stock Exchange (TSX) was $72.08 and $65.94, respectively. You can find additional information about our director compensation program and share ownership guidelines starting on pages 61 to 64.

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Additional information

To the best of the company's knowledge, other than as set out below, no proposed director as at the date of this Circular:

(a)is or has been, in the last ten years a director, chief executive officer or chief financial officer of any company (including SLF Inc.) that was subject to a cease trade or similar order or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days that:

(i)was issued while the proposed director was acting in the capacity as director, chief executive officer or chief financial officer; or

(ii)was issued after the proposed director ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer; or

(b)is or has been, in the last ten years a director or executive officer of any company (including SLF Inc.) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or

(c)has, within in the last ten years, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the proposed director; or

(d)has been subject to

(i)any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or

(ii)any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable security holder in deciding whether to vote for a proposed director.

Ms. Coyles was a director of Postmedia Network Canada Corp. while it completed a restructuring following an arrangement plan under the Canada Business Corporations Act in October 2016. Ms. Coyles is no longer a director of Postmedia Network Canada Corp.

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Governance

Our Board regularly reviews our governance processes and practices to make sure the Board continues to effectively oversee management and our business affairs, and to ensure our governance framework meets regulatory requirements and reflects evolving best practices.

We believe our governance processes and practices are consistent with the Insurance Companies Act (Canada), the Canadian Securities Administrators' corporate governance guidelines, guidelines issued by OSFI for effective corporate governance in federally regulated financial institutions, the TSX corporate governance rules, the New York Stock Exchange (NYSE) corporate governance rules for U.S. publicly listed companies and the Philippine Stock Exchange corporate governance guidelines applicable to us.

Governance at a glance

We say "Yes" to

¹acronym for Lesbian, Gay, Bisexual, Transgender, Queer or questioning, and Two Spirited people

²individuals who have self-identified as members of the Black, Indigenous, People of Colour, disabled and/or LGBTQ2+ communities

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We say "No" to

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The Board of Directors

Mandate, roles and responsibilities

The Board is responsible for supervising the management of the business and affairs of the company. Its mission is to be a strategic asset of the company, measured by effective execution of its overall stewardship role and the contribution the directors make, individually and collectively, to the long-term success of the enterprise. The Board's duties and responsibilities are set out in its charter, which is reviewed by the Board and the Governance, Investment & Sustainability Committee at least annually.

The Board's charter is incorporated by reference into this Circular and has been filed with securities regulators

on SEDAR+ (sedarplus.ca) and EDGAR (sec.gov/edgar) and can be found on our website (sunlife.com).

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•approved the strategic plan, and the business, capital, investment plans and the Chief Sustainability Officer plan.

•approved the acquisition of Dialogue Technologies Inc., a Canadian-based health and wellness virtual care platform, deepening Sun Life Canada's commitment to health.

•onboarded two new directors (appointed in 2022 and 2023 respectively) to enhance the skills, experience and expertise on the Board, complement the existing Board composition and enhance Board diversity.

•approved amendments to our Board Diversity Policy.

•reviewed CEO and Executive Team succession planning and approved the appointment of a newly created role of Vice-Chair, Strategic Partnerships, and the appointment of the new President of Sun Life Asia, who will transition to the role in 2024.

•received updates on a variety of topics including Sun Life's culture, information technology, cybersecurity, and digital leadership, generative AI, sustainability, shareholder activism and financial sector turbulence.

•continued to prioritize Board oversight of environmental, social and governance (ESG) matters, including approving disclosures in our annual management's discussion and analysis (MD&A) in line with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), and continuing to support sustainability as an area of focus in our Client impact strategy to ensure that sustainability is integrated into everything we do, including in our strategy, culture, and operations (see page 35).

•received Climate Change training.

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Board Chair, Committee Chairs, President & CEO

The Board Chair is an independent director. The Board Chair is responsible for providing leadership that enhances the effectiveness and independence of the Board. The Board Chair manages the Board's affairs to assist the directors in carrying out their responsibilities and helps the Board operate cohesively. The Board Chair works closely with the Chair of the Governance, Investment & Sustainability Committee to regularly evaluate, and in appropriate circumstances propose enhancements to, the Board's governance structure and procedures. The Board Chair is a regular attendee of Board committee meetings.

The Board Chair and respective committee chairs are responsible for setting meeting agendas and reviewing the meeting materials with management before meetings so that the meetings are productive and enhance the Board's effectiveness and independence.

Committee chairs are consulted in advance in connection with the appointment, reassignment, replacement or dismissal of senior management within their respective committee's areas of responsibility, including those in OSFI-identified control functions. Committee chairs are consulted annually on the performance assessment and compensation awarded to those individuals. Each committee chair is an independent director and generally holds the position for five years. Committees, in consultation with the Board Chair, can hire independent advisors.

The role of President & CEO is held by Kevin D. Strain. He is also a director of the Company. There is a written statement of mandate for the President & CEO which is reviewed by the Board annually and which specifies the President & CEO's overall accountability for leading the company's business operations and creating sustainable value for all stakeholders. The President & CEO is responsible for championing the company's global mission, purpose and values, managing the company's resources to ensure optimal performance, and setting a standard for culture, conduct and character through their own behaviour and actions. The President & CEO attracts and develops the leadership talent required for activation of Sun Life's purpose, execution of Sun Life's strategy and long-term success, while demonstrating leadership in risk management, corporate governance and regulatory compliance, consistent with Sun Life's risk appetite and culture.

The full position descriptions of our President & CEO, our directors, our Board Chair and our committee chairs can be found on our website (sunlife.com/en/about-us/leadership/board-of-directors/).

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Culture and conduct

At Sun Life, we have built a strong corporate culture reflected in our core values of being Caring, Authentic, Bold, Inspiring and Impactful. These values set the tone and guide our high business standards, integrity and ethical behaviour, respect and doing the right thing for our Clients. The Board establishes the "tone from the top" and makes every effort to ensure that senior management consists of people who create and sustain a culture of integrity throughout the organization. Questions about ensuring we uphold this culture is part of our annual Board, committee and chair effectiveness review process.

The Board has established the Code that applies to every director, officer and employee, with no exception. All receive annual training and are required to complete a declaration of compliance with the Code.

To ensure that our culture stays strong, enables our strategy, and continues to create value, we actively manage it. The Code and the practices surrounding its enforcement are one of the many ways that we specify and reinforce expected behaviours and ways of working at Sun Life.

Our Code promotes speaking up and outlines our commitment against retaliation. Our Code also requires employees and directors to report all known and suspected breaches. Our Ethics Hotline empowers our employees to play an active role in protecting the organization. Employees may use the Ethics Hotline to report allegations of misconduct anonymously or if they feel their concerns have not been resolved using other reporting methods.

Communications that accompanied the Code in 2023 further reinforced our expectations of behaviours in the workplace; emphasizing the importance of speaking up, fostering a workplace that is free of harassment of any kind and promoting diversity, equity and inclusion.

The Governance, Investment & Sustainability Committee is responsible for reviewing the effectiveness of the Code, monitoring compliance with the Code and reporting the results of its review to the Board annually. On a quarterly basis, the Chief Compliance Officer reports on breaches of the Code and reviews our controls and compliance with the Governance, Investment & Sustainability Committee.

A copy of our most recent Code is available on our website (sunlife.com). The Code has been filed with the securities regulators in Canada on SEDAR+ (sedarplus.ca) and with the SEC on EDGAR (sec.gov/edgar).

Related party transactions

We are required by the Insurance Companies Act (Canada) and the Trust and Loan Companies Act (Canada) (the Acts) to develop procedures to identify potential or actual transactions with related parties of the company, a group that includes directors and senior officers. We are also required to have our conduct review committee (the Governance, Investment & Sustainability Committee) review on an annual basis, the related party procedures and their effectiveness in ensuring that we comply with the related party provisions of the Acts and to review any related party transactions requiring regulatory reporting. We have established procedures for a broad range of potential transactions with related parties of the company and in 2023 the Governance, Investment & Sustainability Committee reviewed these and their effectiveness to ensure that any transactions with related parties of the company that may have a material effect on the stability or solvency of the company are identified (also see page 56).

Strategic planning

The Board sets the strategic direction for the company and approves the annual strategic plan, including the Company's purpose statement, enterprise and group strategies, and the annual business capital, investment, and Chief Sustainability Officer plans. It also reviews the effectiveness of our strategic planning process on a regular basis.

As part of the strategic plans and priorities for each of our four business groups, in 2023 the Board focused on the key risks and uncertainties facing the business relating to strategic execution including the changing economic and geopolitical environment, climate change (including stakeholder and regulatory expectations

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on climate and social actions), operational resilience (including people resources and technology and cyber risks), strategic execution, the competitive and regulatory environment, and maintaining strong financial discipline and a strong capital position. The Board also reviewed trends emerging in strategic and financial decision making with a focus on the uncertain and volatile macroeconomic outlook, the evolving geopolitical climate, shifting demographics changing the landscape of needs, the complex and changing healthcare landscape, the evolution of work and search for talent, the acceleration of digital and disruptive technologies, such as generative AI, increasing climate regulation, and the interconnectedness between these factors. Consideration was also given to the alignment of the strategic plan projections with our risk appetite and the uncertainty brought on by continued inflation and interest rates. The Board is taking intentional actions to strengthen resilience and agility, ensuring that Sun Life can respond swiftly against opportunities and risks as the external environment shifts. The Executive Team reviewed and discussed the feedback and perspectives provided by the Board and the Board then approved the updated strategic plan at its meeting in August.

Management updates the Board on the execution of the strategy and strategic considerations at every regular Board meeting. The Board must approve any transaction that will have a significant strategic impact on the company.

Risk Management Oversight

The Board is responsible for ensuring the governance of all risks across the enterprise and has primary responsibility for taking action to ensure risk management policies, programs and practices are in place. By approving our Risk Management Framework and Risk Appetite Policy, and providing ongoing oversight of the risk management programs, the Board monitors that key risks are appropriately identified and managed. The Board also oversees business and strategic risk through review and approval of the Business and Strategic Plans, and regularly discusses key themes, issues and risks arising in connection with the design or implementation of these plans.

You can find more information about our risk management practices and the oversight provided by the Board and the Board committees in the description of our Board committees beginning on page 52 and in our Annual Information Form and Management's Discussion & Analysis for the year ended December 31, 2023 which are available on our website (sunlife.com), on SEDAR+ (sedarplus.ca) and on EDGAR (sec.gov/edgar).

Internal control and management information systems

The Board has approved a comprehensive Internal Control Framework that codifies the company's existing system of internal controls set out in policies and related documents. The Internal Control Framework

is based on Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

The Audit Committee reviews and monitors the effectiveness of our internal control and management information systems and receives regular reports on internal control from management, including corporate oversight functions in the actuarial, finance, and internal audit departments. This oversight provides reasonable assurance of the reliability of our financial information and the safeguarding of assets.

Succession planning and talent management

The Management Resources Committee has primary oversight of talent development and succession planning for senior management and the President & CEO's assessments of the other senior officers. The Board has primary oversight of talent management, succession planning and the performance assessment of the President & CEO. The Management Resources Committee and the Board conduct in-depth reviews of succession options relating to senior management positions and the President & CEO, respectively, and, when appropriate, approves the rotation of senior executives into new roles to broaden their responsibilities and experiences and deepen the pool of internal candidates for senior management positions.

Annually the Management Resources Committee reviews in detail updated succession plans for Executive Team roles and heads of key control functions. Each committee also reviews the talent and succession plans relevant to their specific functions and responsibilities.

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Over the course of the year, the Board will typically have direct exposure to senior executives as they present on their part of the company's activities.

The Board typically hosts one or more social events that includes members of management below the Executive Team. These events allow the Board to interact and build relationships with high performance and high potential employees who are our future leaders.

Succession planning and talent management processes are a key part our enterprise strategy to strengthen diversity, equity and inclusion, discussed in greater detail below.

Diversity, equity and inclusion

Our diversity, equity and inclusion aspirations are at the centre of our company values and are critical to the Board and executive management. Highly qualified directors and executive leaders who reflect the Clients we serve, our employees around the world and the communities where we operate, bring broader perspectives and experience to deepen our insight, enhance innovation and accelerate growth. We strive to create an inclusive, high-performing culture where all employees, regardless of sex, gender identity, race, religion, age, country of origin, physical ability, sexual orientation or other diversity attributes, can contribute to their full potential. We are committed to creating equal opportunities and fostering inclusion. The Board is also committed to complying with applicable laws as they relate to discrimination and strives to create and implement policies in a manner consistent with any and all such laws.

For more information on our diversity, equity and inclusion initiatives, please see our Diversity, Equity and Inclusion Strategy 2025 and our Sustainability Report on our website (sunlife.com/en/about-us/diversity-equity-and-inclusion/ and sunlife.com/sustainability).

To drive our diversity, equity and inclusion aspirations we, for example:

•In 2021, signed on to the goals in the BlackNorth Initiative, which aims to remove systemic barriers that negatively affect Black Canadians, and participate in the Avenue: Black Undergraduate Law Internship Program;

•In 2021, became a member of the Canadian Council for Aboriginal Business, and began our Progressive Aboriginal Relations (PAR) certification. We formed working groups and an executive steering committee and are currently completing our third year of the PAR-committed actions. In 2023, we completed phase

2 of the committed status and started work on phase 3. We are utilizing PAR as a vehicle to drive Sun Life towards reconciliation with strengthened relations within Indigenous communities across Canada. We are focused on four key performance areas - Leadership Commitments, Employment, Economic Prosperity, and Communities, which are all centred on the philosophy, "Nothing about you, without you". We will work to centre Indigenous voices as we continue to progress on our aspirations and actions.

•Continued to reach young, diverse talent via the Dean Connor Inclusion Scholarship for Black and Indigenous Students (Canada) and Scholarship for LGBTQ Scholars (Philippines);

•Extended our benefits offering to same-sex partners, and creating gender neutral bathrooms and improving paternity leave for our employees in India; and

•Formed a new partnership with Women In Capital Markets in Canada to access new pools of diverse talent for our Asset Management business.

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Advancement of women and underrepresented groups in our workplace

We have an enterprise strategy to strengthen diversity, equity and inclusion. The strategy focuses on a series of actions that review and enhance our talent management practices, enrich our already collaborative and inclusive culture, and ensure our investments and participation in the community support our objectives.

Below is a list of some of the efforts we have made to support our aspirations for the advancement of women and underrepresented groups in our workplace.

•Recruitment - we require a gender, racially, and ethnically diverse slate of highly qualified candidates when we select leaders for executive officer and senior leadership positions. In situations where we are working with external executive search firms, one of the standard terms and conditions in our contracts is the requirement to present diverse and highly qualified candidate slates. We also apply a language analysis tool to our recruitment postings, to ensure our language is gender inclusive and an artificial intelligence résumé screening tool to minimize discrimination and bias while recommending top candidates.

•Inclusion Networks - we have 11 internal, voluntary, employee-led inclusion networks with more than 10,600 members across Sun Life. They share a common purpose: to foster a diverse, inclusive workplace by connecting members with a common cause or interest. Not only do these groups support Sun Life's organizational mission, values and practices, they enable the development of future leaders, increase employee engagement and provide a platform for community outreach. In other words, these groups make a positive impact on workplace culture, talent development and communities and causes outside the organization.

•Mentorship and Development Programs - we have a number of informal and formal mentor and mentee opportunities across our company. We have expanded our career coaching program in Canada and the U.S. and implemented a global mentorship framework to ensure consistency across our businesses.

•Community Involvement - we celebrate events such as International Women's Day and Pride Month and sponsor several charities and programs related to gender equality and advancing inclusion, especially for disadvantaged or marginalized communities such as:

-the Simmons Conference, the Women in Insurance STEM program, the Bentley University program for first-generation college students, the Right to Play and Kids Help Phone programs for Indigenous children and youth across Canada,

-the Foundation for Black Communities, serving Black communities across Canada, and

-the Dean Connor Sun Life Inclusion Scholarships for Black and Indigenous Students.

For more information on our community involvement, please see our Sustainability Report on our website (sunlife.com/sustainability).

•Building External Partnerships - we believe it is important to build key relationships with external partners that have the same aspiration to building diverse and inclusive communities that also enable us to establish relationships with diverse talent for future opportunities, including Bentley University's Center for Women and Business, and INDspire. For more information on our external partnerships, please see our Sustainability Report on our website (sunlife.com/sustainability).

•Employee Training - we offer diversity, equity and inclusion education seminars through our online learning resources as well as through internal, executive-led forums that focus on fostering mutual understanding, and encourage participants to get more comfortable having uncomfortable conversations and were the first insurance company to invest in Kaleidoscope by Hive Learning, a leading interactive digital inclusion program. Please see our Diversity, Equity and Inclusion Strategy 2025 on our website (sunlife.com/en/about-us/diversity-equity-and-inclusion/) for more information on our employee diversity, equity and inclusion training.

•Flexible Work Arrangements - our company continued to provide various additional support measures in order to attract and retain talent, including diverse talent. These include flexible work arrangements, myWellness or Care days to enable employees to manage their health and well-being, and support childcare, eldercare or other responsibilities.

•Monitoring Activities - we regularly monitor and review the number of women and underrepresented groups in executive and senior leadership positions through our annual talent review and succession planning process (see page 31), in order to help track our progress in eliminating potential barriers to advancement. One of the key metrics we review is the number of women and underrepresented groups in executive and senior leadership roles and in our management pipeline.

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•Compensation Analyses - at the conclusion of our annual performance management and compensation cycle, we analyze compensation levels across the organization, including the compensation of women holding executive officer and senior leadership positions, to help ensure fair and equitable treatment, free from bias. We also periodically review pay outcomes with a lens for employees that identify as members of underrepresented groups in addition to gender. For more information, please see our Sustainability Report on our website (sunlife.com/sustainability).

We pride ourselves on creating an inclusive and welcoming environment that encourages diverse perspectives, experiences, preferences and beliefs. Below are examples of how we have been recognized for our ongoing gender equality, diversity, equity and inclusion aspirations:

•we have been included in the Pax Ellevate Global Women's Index Fund (PXWEX) since 2014,

•we received Parity Certification by Women in Governance for our strong aspiration to gender equality in the workplace,

•in 2016 we signed the 100% Talent Compact pledge to move to closing the gender wage gap in Boston, and

•Sun Life U.S. was recognized as a top company for future leaders in the U.S. by TIME Magazine.

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Aspirations for representation of women and underrepresented groups in executive officer positions

We hold ourselves accountable for delivering real change and we track our progress over time. We identify areas for improvement by benchmarking against external best practices and monitoring various indicators of DE&I. 

We also provide workforce diversity data to leaders across Sun Life to help them analyze performance and keep us on track with our aspirations. This data includes how we are progressing on representation and engagement survey results related to inclusive behaviours that contribute most to company culture. Refer to our ESG Performance Tables (sunlife.com/content/dam/sunlife/regional/global-marketing/documents/com/esg-performance-2023-e.pdf). 

To address underrepresentation, we have aspirations to improve the representation of women leaders by setting an aspirational goal of gender parity at the Vice-President level and above globally by 2025 and an aspirational goal to reach 25% underrepresented groups at the Vice-President level and above in North America by 2025. The following shows the percentages of self-identified women and underrepresented groups who are senior management (Vice-President and above) of the company as of February 29, 2024.

¹Vice-Presidents (VP) include Managing Directors at SLC Management.

²individuals who self-identify as members of the Black, Indigenous, and/or People of Colour communities

³U.S. refers to the U.S. Group Benefits, Dental and In-Force management business of Sun Life U.S. as reported by Sun Life Financial Group Inc.

The following chart shows the number and percentage of men and women who are executive officers (members of the Executive Team), direct reports of the President & CEO and senior executives of the company as of February 29, 2024. The executive officers are also officers of Sun Life Assurance.

¹President & CEO Direct Reports includes eleven Executive Officers, and two Senior Executives that report directly to the President & CEO.

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Sustainability

Our sustainability ambition is to maximize our positive impact and ensure the resiliency of our organization, in support of our Purpose of helping Clients achieve lifetime financial security and live healthier lives. We aim to create competitive advantage and differentiation for our business through the following focus areas of our sustainability plan: financial security, healthier lives, sustainable investing and climate change. These efforts build from our foundation of operating as a trusted and responsible business. This area represents table stake issues that we believe every company should act on. Our annual sustainability report and complementary web disclosures provide more information about our sustainability commitments and performance and is available on our website (sunlife.com/sustainability).

The Board uses reports from the Board Committee Chairs (detailed below), and other direct presentations by management and external experts, to decide the nature and extent of its input and to provide challenge, advice and guidance on the enterprise approach to sustainability and climate change (see also page 26). Our four Board committees have oversight over aspects of sustainability including climate change:

•the Governance, Investment & Sustainability Committee (GISC) of the Board assists the Board with its oversight of sustainability matters, including those related to climate. The GISC is responsible for reviewing and approving Sun Life's Sustainability Policy, overseeing progress against Sun Life's Sustainability Strategy and commitments (including decarbonization targets), reviewing and recommending Board approval of the annual Sustainability Report and the annual Chief Sustainability Officer plan, and overseeing the development and implementation of Sun Life's Climate Transition Plan. In addition, the GISC reviews any material issues related to sustainability raised by management throughout the year. In 2023, the committee was renamed and its Charter was updated to reflect its broad responsibility for overseeing sustainability-related matters, including Sun Life's sustainability strategy and the development of Sun Life's Climate Transition Plan.

•the Risk Committee of the Board assists the Board with enterprise-wide oversight of the management of current and emerging risks, which may include climate-related risks and, broadly, environmental risks. For more detail on the Risk Committee's role, refer to our annual MD&A available on our website (sunlife.com/en/investors/financial-results-and-reports).

•the Audit Committee reviews environmental, social and governance (ESG) disclosures (including climate-related disclosures) required to be included in Sun Life's financial disclosure documents, and reviews management's quarterly reports on the effectiveness of Sun Life's internal controls over financial reporting, including any evolving standards over ESG disclosures. For more information on our climate- related disclosures, refer to our annual MD&A available on our website (sunlife.com/en/investors/financial-results-and-reports).

•the Management Resources Committee provides oversight of our diversity, equity and inclusion strategy. For more information on our diversity, equity and inclusion at Sun Life, please see our Diversity, Equity and Inclusion Strategy 2025 on our website (sunlife.com/en/sustainability/trusted-and-responsible-business/fostering-dei/).

For 2023, Board approved the addition of a Sustainability modifier grants under the Executive Sun Share Unit Plan grants in 2023 and beyond. The modifier (+/- 10 percentage points) is based on our performance over three years against four sustainability goals. Goals include sustainable investment, gender and underrepresented ethnicity representation at executive levels and greenhouse gas emissions reduction in our operations.

We also continued to expand our dedicated group of climate experts responsible for integrating climate across our business. These responsibilities include: climate change risk, climate change performance, climate change strategy and program management.

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Building an effective Board

The Governance, Investment & Sustainability Committee is accountable for recruiting highly qualified candidates with the competencies, experience and characteristics required to drive effective governance and create sustainable value for Sun Life's stakeholders over the long term.

Board size

The Board reviews its size every year to ensure it will promote open dialogue and effective decision making, ensure the right caliber and scope of director expertise, allow for Board renewal and provide for effective committee membership. According to our by-laws, our Board can have a minimum of eight and a maximum of 20 directors. At its meeting held on February 7, 2024, the Board fixed the number of directors to be elected at the meeting at 11. All of the director nominees currently serve as directors. Directors are elected for a one-year term. The Board can appoint directors between shareholder meetings.

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Independence

A director is independent under our Director Independence Policy if they do not have a direct or indirect relationship with SLF Inc. that could reasonably be expected to interfere with their ability to exercise independent judgment. You can find a copy of our Director Independence Policy on our website (sunlife.com).

The Governance, Investment & Sustainability Committee evaluated the independence of each director nominee according to our Director Independence Policy and confirmed that 10 of the 11 are independent, and that all of the current members of the Audit Committee and Management Resources Committee meet the additional independence requirements set out in that policy for membership on those committees. Kevin D. Strain is not independent because he is our President & CEO.

Independent Chair of the Board

The roles of the Board Chair and the President & CEO are separate. The Board believes that this separation increases the effectiveness of the Board and facilitates enhanced oversight of management. Mr. Powers is our Board Chair and an independent director. Having an independent Board Chair promotes strong Board leadership, encourages open discussion and debate at Board meetings, and avoids potential conflicts of interest.

Private Meetings

The independent directors meet privately with the President & CEO and privately without management at each Board meeting. The Board Chair and committee chairs encourage open and candid discussions among the independent directors by providing them with an opportunity to express their views on key topics before decisions are made. The independent directors also routinely meet privately with the heads of key control functions at committee meetings (see committee reports pages 52 to 60).

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Selecting directors

The GISC, together with the Board Chair, have primary responsibility for identifying potential new directors and have adopted guidelines for director recruitment.

As part of the recruitment process, the GISC develops a preferred candidate profile that reflects the particular competencies, experience and other characteristics required to complement the existing Board profile, taking into account both current and future needs.

Candidates are identified through executive search firms and referrals. An evergreen list of prospective candidates is maintained, which is comprised of individuals who the committee feels may be appropriate as a Board candidate when a vacancy arises.

Because we believe that a diverse group of highly qualified directors produces better corporate governance and oversight, when recruiting candidates for appointment or election to the Board, the GISC:

•is committed to ensuring equitable and inclusive recruitment practices and will require search firms to identify and present highly qualified diverse and balanced slates of potential Director candidates, including women and members of the Black, Indigenous, People of Colour, disabled and/or LGBTQ2+ communities (underrepresented groups)¹,

•will consider applicable legal and regulatory requirements; and

•will strive to create equity by ensuring candidates have equal access to opportunities, free of bias and discrimination.

The GISC will also consider the Board's representation aspirations for women and underrepresented groups on the Board (see page 40) when recruiting candidates. Executive search and background screening firms conduct reference and background checks on potential candidates. Suitable candidates are interviewed by the Board Chair, the committee chairs and the President & CEO. The committee receives input from all of these sources in connection with its recommendation to the Board for the appointment or nomination of a new director.

Every year the GISC recommends a list of candidates for nomination to the Board.

¹individuals who self-identify as members of the Black, Indigenous, People of Colour, disabled and/or LGBTQ2+ communities.

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Diversity and skills

We expect our directors to act ethically and with integrity in all personal, business and professional dealings. Directors must understand our corporate vision and strategic objectives, continually build their knowledge about our businesses and the financial services sectors in which we operate, and prepare for and actively participate in Board and committee meetings in an objective way. They must also understand the Board and committee charters and our corporate governance policies and practices, comply with our Code and meet our share ownership guidelines (see page 62). Directors have unrestricted access to management, as necessary, to carry out their responsibilities.

We have eight key attributes we expect of our directors when they carry out their duties:

Diversity

We believe that a diverse group of highly qualified directors produces better corporate governance and oversight, as such the Board has adopted a diversity policy that includes provisions on representation and diverse candidate slates. The objective of the Board's diversity policy is to ensure that the Board as a whole possesses diverse qualifications, skills, experience and expertise relevant to the company's business, in order to fulfil its mandate.

Effective implementation of the Board's diversity policy is the responsibility of the GISC and the Board Chair. See "Selecting directors" above for more information on how Sun Life ensures diverse candidates are considered as prospective Board members.

To ensure the Board's diversity aspirations are effectively implemented, the GISC assesses the effectiveness of the Board's diversity policy on an annual basis by:

•considering the level of diversity on the Board based on the above factors, which includes the consideration of the level of gender representation and representation of underrepresented groups¹.

•progress towards the Board's aspirational representation goals for women and underrepresented groups¹ on the Board, and

•whether its representation aims have been achieved or exceeded.

¹individuals who self-identify as members of the Black, Indigenous, People of Colour, disabled and/or LGBTQ2+ communities.

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Representation aspirations for women and underrepresented groups on the Board

The Board's diversity policy includes provisions relating to identification and nomination of women directors and underrepresented groups¹. Taking into account the desired qualifications, skills, experience, expertise and the Board's aspirations for diversity, it aims to have:

•individuals self-identifying as men and individuals self-identifying as women each comprise at least 35% to 45% of directors; and

•members of the Black, Indigenous, People of Colour, disabled and/or LGBTQ2+ communities (underrepresented groups)¹ collectively comprise 20% to 25% of directors.

Diversity of our Independent Director Nominees

As of the date of this Circular 5 out of our 10 (50%) independent director nominees¹ and 3 out of our 4 (75%) current committee chairs self-identify as women, 3 out of our 10 (30%) independent director nominees² self-identify as a member of an underrepresented group³ and combined with our representation of women, 8 out of 10 (80%) of our independent Board nominees will be diverse⁴. No directors have self-identified as Indigenous peoples or persons with disabilities.

Key competencies and experience

The GISC ensures at all times that the Board includes members with a broad range of business and strategic experience and expertise so that the Board is able to effectively carry out its mandate. On an annual basis, the GISC and the Board determine the key competencies and experience that they believe are necessary for the Board as a whole to possess in order to be an asset to the company and fulfil its responsibilities. These include the eight key attributes listed on page 39 and the specific competencies and experience listed in the following table (skills matrix) and described in the text that follows. The table below also shows the key competencies and experience that each independent director nominee has indicated they bring to the Board. Each such director nominee has also identified the principal areas of expertise that they possess and those are listed in the respective director nominee profiles on pages 17 to 23. The GISC reviewed the areas indicated by each nominee and the rationale provided for their respective selections and is satisfied that the nominees possess skills in those areas.

¹5 out of 11 (45%) of all director nominees self-identify as women

²3 out of 11 (27%) of all director nominees self-identify as a member of an underrepresented group (one self-identifies as Chinese and two self-identify as South Asian).

³individuals who self-identify as members of the Black, Indigenous, People of Colour, disabled and/or LGBTQ2+ communities.

⁴8 out of 11 (73%) of all director nominees self-identify as women or belonging to an underrepresented group.

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The GISC also reviews the membership of each committee annually to ensure each committee is comprised of members with the competencies and experience required to fulfil the committee's mandate.

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Orientation and development

Our orientation program for new directors includes informal introductory meetings with each Executive Team and Board member, formal information sessions, and a directors' manual with information about the company, the Board and its committees, Board administration, directors' duties, policies applicable to the directors, and future meeting schedules. The Board Chair matches new directors with an experienced Board member to act as a mentor by providing perspective and informal feedback and offering insights on Board culture and dynamics.

Formal information sessions cover the company's four business groups, each corporate function, our corporate strategy and financial objectives and are tailored to account for individual backgrounds, experience and the expected committee responsibilities. The Board Chair and committee chairs meet with new directors to discuss the role of the Board and Board committees in detail.

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In addition, we hold regular education sessions in conjunction with Board and committee meetings to give directors a deeper understanding of our businesses and operating environment, to address ongoing and emerging issues in the functional areas of Board oversight, and to encourage more in-depth discussion in specific areas. The table below lists the education sessions we organized for our directors in 2023.

¹The overall attendance rate of Board and committee members at these education sessions was 100%.

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Commitment and Tenure

Meeting attendance

The GISC reviews the attendance record of each director as part of the nomination process. Directors must attend at least 75% of Board and committee meetings every year. A director who does not meet this attendance requirement in two consecutive years must, if requested by the GISC, offer to resign.

The table below shows the number of Board and committee meetings held in fiscal 2023 and the overall meeting attendance of the relevant members for that period. You can find the details about each director's meeting attendance in the director profiles beginning on page 17. From time to time unscheduled Board meetings may be called on short notice to consider mergers and acquisitions (M&A) transactions or other matters and one or more of our directors may be unable to attend these meetings due to the short notice. Where a director is unable to attend a meeting, feedback and questions based on meeting materials are directed to the Board Chair or the Chair of the applicable committee, as appropriate, to address at the meeting. All of the nominated directors attended the annual meeting in May 2023.

The table below shows the Board and committee meeting attendance in fiscal 2023 for Ms. Stymiest, who is not standing for re-election pursuant to our Board term limits. At our 2023 Annual Meeting Ms. Stymiest received 307,712,811 votes in favour of her appointment, with 6,989,419 votes being withheld.

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Serving on other public company Boards and audit committees

The Board has a policy limiting the number of public company directorships that directors should hold. Directors who are employed full-time should hold no more than one other public company directorship and directors who are not employed full-time should hold no more than three other public company directorships.

The Board has also adopted a policy limiting the number of Board interlocks among our directors. This policy is intended to promote independence and avoid potential conflicts of interest. No more than two directors may serve together on the same Board of another public company, and directors may not serve together on the Boards of more than one other public company (each, an interlock), without the prior consent of the Governance, Investment & Sustainability Committee. Currently, Ms. Harris and Ms. Mallovy Hicks both serve on the Board of the Public Sector Pension Investment Board.

Directors are also required to notify the Board Chair, the Chair of the GISC, the President & CEO and the Chief Legal Officer prior to accepting a directorship on an additional public, private or not-for-profit board, to provide an opportunity for them to verify that the director continues to have the time and commitment to fulfil their obligations to the Board and to be satisfied that the director is in compliance with the above policies, including the impact of any public company or other interlocks and no real or apparent conflict of interest would result.

The NYSE corporate governance rules suggest that audit committee members should not serve on more than three public company audit committees. All of the current members of the Audit Committee comply with this standard.

Tenure

Our Director Independence Policy includes provisions on directors' tenure. Independent directors will generally retire from the Board after they have served for 12 years. The independent directors can waive this retirement requirement to allow a director to serve for up to three additional years if they unanimously determine that it is in the company's best interests to do so. Thereafter, the retirement requirement can be waived by the independent directors on an annual basis if they unanimously determine that it is in the company's best interests to do so. The Board does not have a mandatory retirement age for directors. Other mechanisms of Board renewal include the rigorous Board and committee assessments (see page 47), the evergreen list of prospective candidates (see page 37) and the annual review of the directors' skills matrix (see page 40).

The average tenure of the independent director nominees is 4.4 years.

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The table below shows the directors who are currently expected to retire or who will be required to retire under our director tenure provisions, unless waived, during the next three years, and the areas of expertise that they have indicated they bring to our Board.

¹In his capacity as non-executive Chair of the Board, Mr. Powers attended committee meetings of the Board.

The President & CEO must resign from the Board when they retire or leave the company.

A director must tender a written offer to resign if they receive more withheld votes than for votes from shareholders in an uncontested election.

If requested by the Governance, Investment & Sustainability Committee, a director must tender a written offer to resign if:

•they have not attended at least 75% of Board and committee meetings for two consecutive years.

•their principal employment or other business or professional circumstances have changed materially.

Committee chairs are appointed annually. Generally, a director will serve as a committee chair for five years.

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Assessing the Board

The Board, Board committees and individual directors participate in an annual assessment process with the assistance of an independent consultant as needed. The last independent assessment process was conducted in 2021. As part of the 2023 assessment process, each of the Board members completed questionnaires to assess the Board, each of the Committees and the Committee Chairs and the Board Chair conducted interviews with each of the Board members, in each case with the objective of:

•providing the Board with insight into its functioning and effectiveness, including the performance of the Board, and the performance and leadership of the Board Chair and committee chairs in carrying out their mandates.

•identifying opportunities to enhance governance in ways that will have a direct impact on the company's performance and ability to meet its strategic and operational priorities.

•providing the Board insight into areas of individual director contributions in order to plan for future Board education, recruitment and succession planning.

•enhancing the working relationship among Board members and between the Board and management.

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Shareholder engagement and communications

The Board believes it is important to have constructive engagement with the company's shareholders to allow shareholders to express their views. Sun Life has well developed practices to facilitate constructive engagement with its investor base. The table below outlines the key contacts and methods that shareholders can use to engage with Sun Life and access important information:

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Contacting the Board

Shareholders and other interested parties can contact the directors and the company directly to give feedback:

Board of Directors

Sun Life Financial Inc.

1 York Street, 31st Floor

Toronto, Ontario, Canada M5J 0B6

Email: [email protected]

Contacting Investor Relations

Investor Relations

Sun Life Financial Inc.

1 York Street, 29th Floor

Toronto, Ontario, Canada M5J 0B6

Email: [email protected]

Disclosure policy

The Board reviews and approves the content of all major disclosure documents including the annual and interim financial statements, MD&A, earnings news releases, the annual information form and this Circular.

We strive to be responsive to the disclosure needs of the investment community and other stakeholders and provide timely, consistent and accurate information to the investing public while meeting our disclosure obligations. The Governance, Investment & Sustainability Committee receives a report annually on the status of compliance with and effectiveness of our disclosure and securities trading policy and the policy

is reviewed on a regular basis to determine whether revisions are required to respond to legal and regulatory developments, to reflect changes in the business environment or internal operations or to enhance governance.

The table below lists our corporate governance documents and when they are reviewed. All of them are available on our website (sunlife.com). Our Code is also available on SEDAR+ (sedarplus.ca) and on EDGAR (sec.gov/edgar).

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Shareholder contacts

For dividend information, change in share registration or address, lost stock certificates, tax forms, estate transfers or dividend reinvestment, please contact:

Additional contact information for other regions is available at sunlife.com/en/investors/shareholder-services/shareholder-contacts/.

For other shareholder inquiries, please contact: Shareholder Services

Sun Life Financial Inc.

1 York Street, 31st Floor

Toronto, Ontario, Canada M5J 0B6

Email: [email protected]

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Shareholder proposals

We did not receive any shareholder proposals for consideration at the meeting. We received one shareholder proposal for consideration at the 2023 annual meeting, which received 269,449,009 (85.7%) votes against, 43,251,918 (13.7%) votes for and 1,911,816 (0.6%) votes withheld. Shareholder proposals for our 2025 annual meeting must be sent to us in writing. We must receive them by 5:00 p.m. (Toronto time) on December 16, 2024 to consider including them in our management information circular for the 2025 meeting.

Send the proposal to the Corporate Secretary at Sun Life Financial Inc.

Email:[email protected]

Mail:1 York Street, 31st Floor

Toronto, Ontario, Canada M5J 0B6

Our policy on proxy access

Under the Board's proxy access policy, qualifying shareholders may submit one or more director nominations to be included in the Circular and form of proxy and ballot for any annual meeting. To make a nomination, qualifying shareholders must, prior to the deadline for submitting shareholder proposals above, submit a nomination notice in the required form. The policy has the following principal features:

•one or more nominating shareholders (up to a maximum of 20) may nominate up to the greater of two directors and 20% of the Board.

•nominating shareholders must collectively own at least 5% of the company's common shares.

•nominating shareholders must have held their shares for at least three years.

•the proposal will be included in the company's Circular, form of proxy and ballot for the annual shareholders' meeting.

•nominating shareholders may include a statement of up to 500 words in support of their candidates.

A copy of the policy is available on our website (sunlife.com).

Alternatively, in accordance with section 147 of the Insurance Companies Act (Canada), shareholders holding in the aggregate not less than 5% of the company's shares for the minimum period of time set out by the Insurance Companies Act (Canada) may submit a formal proposal for individuals to be nominated for election as directors in accordance with the specified procedures to be followed.

Our advance notice by-law

Our by-laws specify that a shareholder who wishes to nominate an individual for election as a director at an annual meeting must provide between 30 and 65 days advance notice to the company. The notice to the company must include information about the nominee, including age, address, principal occupation, the number of SLF Inc. shares owned or controlled, and any other information that would be required to be disclosed in a dissident's proxy circular in connection with solicitations of proxies for the election of directors. The notice must also include information about the nominating shareholder, including ownership or control of, or rights to vote, SLF Inc. shares and any other information that would be required to be disclosed in a dissident's proxy circular in connection with solicitations of proxies for the election of directors. The company may require additional information to be provided, including information to comply with requirements of OSFI relating to the suitability of directors and potential changes to the Board.

The advance notice provisions described above do not apply to nominations made by or on behalf of the Board or by shareholders pursuant to shareholder proposals, requisitioned meetings, or through our proxy access policy which have separate requirements and deadlines. In addition, in the case of a special meeting at which directors are to be elected, a shareholder's notice of a nomination must be provided not later than 15 days after the date of the special meeting is announced.

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Committee reports

The Board's four standing committees are:

•Audit Committee

•Governance, Investment & Sustainability Committee

•Management Resources Committee

•Risk Committee

The Board delegates work to its committees to fulfil its responsibility to supervise the management of the business and affairs of the company. The committee charters are reviewed at least annually and updated as required. All standing committees are comprised entirely of independent directors as defined in our Director Independence Policy.

The committees meet prior to Board meetings at which the annual business plan and our annual and quarterly financial results are reviewed and approved, and at other times as required or appropriate.

The Board Chair and the committee chairs review and approve the agenda for each committee meeting. Agendas are developed using the forward agenda and items noted for consideration or follow-up at prior meetings. The committees hold private meetings with individual members of management, including the heads of key control functions at the beginning and/or end of each meeting, discuss reports prepared by management, and then meet in private at the end of each meeting. Each committee chair reports to the Board on the committee's deliberations and any recommendations that require Board approval.

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Audit Committee (AC) Report

The members of the AC are satisfied with the committee's mandate and that it met the terms of its charter in 2023.

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Governance, Investment & Sustainability Committee (GISC) Report

The members of the GISC are satisfied with the committee's mandate and that it met the terms of its charter in 2023.

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Management Resources Committee (MRC) Report

The members of the MRC are satisfied with the committee's mandate and that it met the terms of its charter in 2023.

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Risk Committee (RC) Report

The members of the RC are satisfied with the committee's mandate and that it met the terms of its charter in 2023.

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Director compensation

Compensation discussion and analysis

Our philosophy, approach and process

We have two primary compensation objectives:

•to align directors' interests with the interests of our shareholders

•to fairly and competitively compensate directors in order to attract well qualified Board members.

The Board's philosophy is to compensate directors fairly for the time and effort required to fulfil their responsibilities and contribute to the effective leadership and direction of the enterprise.

We compare the target pay for our directors (excluding the Board Chair and the President & CEO) against the total compensation (annual retainer and meeting fees) paid to directors of financial services sector peers. We determine the median pay for the "typical director" at other financial institutions by reviewing publicly available information from our peer group (see below). We calculate the amount that a typical director at each financial institution would receive in a year assuming an equal number of Board and committee meetings at each institution and an equal number of committee memberships for each director. We also benchmark the total compensation paid and trends in director compensation using a broad survey of the public companies included in the TSX60. Typically we assess the competitiveness of our directors' compensation program every two years.

We benchmark pay for the Board Chair against the compensation paid to the chairs of companies in our peer group. The median total compensation among peer Board chairs is used as a baseline to assess the competitiveness of the Board Chair's compensation. The Governance, Investment & Sustainability Committee also considers other qualitative factors when making recommendations to the Board on the Board Chair's compensation.

The GISC considers the responsibilities and time commitment required to be an effective director as well as the competitiveness of our program relative to our peer group and makes recommendations to the Board.

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Program structure

Directors receive an annual retainer, committee retainers and travel fees for serving on the Boards of SLF Inc. and Sun Life Assurance. The cost is shared equally between the two companies. Directors are also reimbursed for travel and other expenses they incur to attend our Board and committee meetings. Committee chairs receive an additional retainer because of their increased responsibilities.

Directors receive a portion of their annual Board retainer in DSUs pursuant to our Deferred Share Unit Plan (see below). The Board Chair receives a separate annual retainer that includes a portion in DSUs (see below). He is also reimbursed for travel and other expenses he incurs while carrying out his duties as Board Chair. He does not receive travel fees.

Mr. Strain does not receive any director compensation because he is our President & CEO. Details regarding Mr. Strain's compensation can be found in the Executive Compensation section of this Circular beginning on page 65.

Directors' Compensation

The Governance, Investment & Sustainability Committee (GISC) reviews director compensation every two years. In 2022, the GISC retained Meridian Compensation Partners (Meridian), an independent compensation consultant, to provide a competitive review of our director compensation program. Meridian used data from our peer group and data from constituents in the TSX60 Index. Based on Meridian's analysis the GISC recommended, and the Board approved, a $50,000 increase to the total compensation for the directors, including the Board Chair, with an increase to the minimum required to be taken in DSUs for directors from $120,000 to $160,000, and for the Board Chair from $220,000 to $245,000.

The table below shows the directors' compensation structure for 2023:

¹$245,000 of which must be received in DSUs with the balance to be received in cash, DSUs and/or shares.

²$160,000 of which must be received in DSUs with the balance to be received in cash, DSUs and/or shares.

³Travel fees are (i) $1,500 when travel time for a round trip was two to six hours and (ii) $3,000 when travel time for a round trip was six hours or more.

Directors can choose to receive the balance of their compensation in any combination of cash, additional DSUs and common shares of SLF Inc. acquired on the open market. Directors cannot redeem their DSUs until they leave the Board. All DSU awards are paid out in cash. For information on the material terms of the Deferred Share Unit Plan see page 92.

Except for the Deferred Share Unit Plan, independent directors do not participate in the company's stock option plan or any other equity-based or incentive compensation arrangements.

Director Share ownership guidelines

We believe it is important for our directors to have a significant stake in the company to align their interests with those of our shareholders.

Directors (other than Mr. Strain) must own at least $805,000 (7x the cash portion of the independent director base retainer) in common shares and/or DSUs where such amount shall be achieved by directors who joined the Board on or after December 31, 2022 within five years of joining the Board. Directors who joined the Board prior to that date shall have one additional year to achieve the increased ownership requirement. Directors may not engage in equity monetization transactions, including pledges or hedges involving securities of SLF Inc. (see page 80).

As President & CEO, Mr. Strain has separate share ownership requirements which are described on page 80.

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Share ownership

The table below shows the common shares and DSUs each director (other than Mr. Strain) held as of February 29, 2024 and February 28, 2023, the portion of their base retainer they chose to receive in common shares or DSUs (excluding the portion of the annual Board retainer that is automatically paid in DSUs) and the percentage of total annual Board retainer received in common shares or DSUs.

¹The director share ownership guidelines were revised in 2022 to increase the share ownership guideline effective January 1, 2023 from $735,000 to $805,000 in common shares and/or DSUs.

²For the portion of their retainer that directors are not required to receive in DSUs, the % reflects the amount of compensation that director has elected to receive in common shares or DSUs that can otherwise be received in cash.

³Reflects the total % of their retainer that directors received in common shares or DSUs (optional and required amounts).

⁴Ms. Coyles used 100% of her after tax director income to purchase common shares of the company on the open market.

The closing value of our common shares on the TSX was $72.08 on February 29, 2024 and $65.94 on February 28, 2023.

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Compensation details

Director compensation table

We paid a total of $3,612,681 to the directors of SLF Inc. and Sun Life Assurance in 2023, compared to $2,758,297 in 2022.

¹Independent directors do not participate in the company's stock option plan.

²This includes DSUs awarded in 2023, including both mandatory DSUs as well as DSUs elected to be received by the directors in lieu of cash fees.

The Insurance Companies Act (Canada) requires that an insurance company's by-laws set a maximum amount of remuneration that may be paid in aggregate to all directors for their services during a fixed period of time. Directors receive an annual retainer, committee retainers and travel fees for serving on the Boards of SLF Inc. and Sun Life Assurance. The cost is shared equally between the two companies. By-law No. 1 of the Company currently sets that amount at $2,600,000 and the by-laws of Sun Life Assurance also set that amount at $2,600,000, for an aggregate limit of $5,200,000 between the two companies.

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Executive compensation

This section discusses our approach to executive compensation, how we make decisions, the different components of our programs, what we paid our NEOs in 2023 and the rationale for our decisions. Management prepared the compensation discussion and analysis, and compensation details provided below on behalf of the Management Resources Committee (MRC). It was reviewed and approved by the MRC and our Board. The executive compensation disclosure includes non-IFRS measures. Additional information concerning these measures is available in Section M - Non-IFRS measures in our 2023 MD&A, which is incorporated by reference in this section. Our 2023 MD&A has been filed with securities regulators in Canada and with the SEC and available at sunlife.com, sedarplus.ca and sec.gov/edgar. All figures are in Canadian dollars unless stated otherwise.

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Letter to shareholders

To our fellow shareholders:

At the core of our compensation philosophy is the belief that attracting and retaining great talent within a strong, high-performance culture is critical to the achievement of long-term, sustainable growth. Every year, a critical focus for the Committee is providing oversight of the total compensation process, including the design, goal setting, performance monitoring, and oversight of final recommendations. Our plans are regularly assessed against Financial Stability Board (FSB) principles and good governance practices. We apply a rigorous process to review business and incentive outcomes and ensure true pay-for-performance and alignment to shareholder objectives. We consider input from the Chief Risk Officer and an independent, expert advisor to ensure appropriate challenge is in place. We are pleased that our approach to date has received strong shareholder support. At our last AGM, 95.6% voted in favour of our compensation program. We value your input and encourage you to continue to exercise your "say on pay" in 2024.

In this letter and the following pages, we aim to provide the information you need to understand our approach to executive pay, including an overview of 2023 company performance. Beyond pay, the Committee is also actively involved in overseeing a broader talent and succession agenda. We close off this note by highlighting other key areas of focus for the Committee last year, and a look ahead on planned actions to continue to effectively attract, retain, motivate, and reward our people.

2023 Company Performance Highlights

2023 was a year of strong performance. The Board is pleased with management's execution of strategic priorities and delivery of financial results.

Advancing 2023 Key Strategic Priorities

n Canada, we added complementary capabilities in the health arena by acquiring Dialogue Health Technologies Inc. (Dialogue), Canada's premier health and wellness virtual care platform. We also launched the Lumino Health™ Pharmacy, a new online pharmacy app, and invested in its underlying technology platform, Simpill Health Group Inc. (Pillway). These actions strengthen and

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expand our health business and ability to support Canadians in managing their health journey, preventing and mitigating health risks, and living healthier lives.

In the U.S., through DentaQuest, we expanded access to quality oral health care, including for those in underserved areas, by opening new care practice offices, extending our partnership with Teledentistry.com, and expanding our use of mobile dental clinics. We now support approximately 36 million members across the country.

In Asia, we continued to execute on our growth strategy by investing in strategic partnerships and establishing digital leadership. We successfully launched our 15-year exclusive bancassurance partnership with Dah Sing Bank in Hong Kong and increased our strategic investment in Bowtie Life Insurance Company Limited, Hong Kong's first virtual insurer. We also introduced eSunPro, a new digital health care service platform to assist Clients from diagnosis to treatment to recovery.

In addition to creating positive impact for Clients and communities, we believe in delivering on our Purpose and priorities internally. We are proud that Corporate Knights named Sun Life as one of the Global 100 Most Sustainable Corporations for the 15th year in a row. We are also pleased that we continue to receive recognition as a Great Place to Work®, with certifications in eight countries and special recognition as a great workplace for mental health, women, and technology.

Delivering Financial and Client Performance

In our annual incentive plan (AIP), 75% of funding is based on performance versus financial goals and the remaining 25% is driven by performance versus target on key Client goals.

Key Financial Results

This is our first year reporting financial results under the new IFRS 17 and 9 accounting standards - one of the largest and most complex transitions in Sun Life's history. To support year-over-year comparison, 2022 financial results are shown restated on an IFRS 17 basis.

Notwithstanding an environment of economic and geo-political complexities and challenges, reported earnings per share (EPS) and retuon equity (ROE) increased meaningfully year-over-year. Underlying EPS, a measure that adjusts for factors such as differences between actual and expected market movements, was up over 10%. Sales in our Group Health & Protection and Individual Protection businesses grew significantly, while wealth sales & asset management gross flows declined due to market uncertainty. Our results highlight the resilience of our diversified business mix and geographic footprint. We also benefited from our capability to execute and create momentum in our acquisitions and partnerships. Our Canada, U.S., and Asia businesses contributed strong earnings performance, partially offset by MFS Investment Management, where performance was impacted by the decline in average net assets. SLC Management recorded positive net inflows and growth in fee-related earnings. See the summary table and our 2023 MD&A for more details.

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¹2022 results are presented under an IFRS 17 basis. Note restated results may not be fully representative of our future earnings profile, as we were not managing our asset and liability portfolios under the new standards, IFRS 17 and IFRS 9. For more details, see the heading "Note to Readers: 2022 Restated Results on Adoption of IFRS 17 and IFRS 9" in our 2023 MD&A.

²Underlying net income, underlying ROE, and underlying EPS are non-IFRS measures, are not standardized financial measures under the financial reporting framework used to prepare our financial statements and may not be comparable to similar financial measures disclosed by other issuers. See Section M - Non-IFRS measures in our 2023 MD&A.

Key Client Results

Our strategic priorities are designed to drive our Client Impact strategy and generate positive, longer-term Client outcomes. In our annual incentive, we measure our annual performance against key Client experience goals, including customer satisfaction (CSAT) and key Client business outcomes. In 2023, our CSAT results were mixed across business areas. Globally, we improved year-over-year but we missed our target. We are listening closely to Client feedback to inform actions to improve the experience going forward. Performance on key Client business outcomes was generally above target. We made good progress, for example, across multiple business areas in enhancing experience in digital channels - leveraging technology to make applications, onboarding, and interactions easier for Clients.

2023 Compensation Highlights

With consideration to the company's 2023 performance, the Board, on the recommendation of the Committee, approved the following annual and long-term incentive decisions.

Annual Incentive Plan

In AIP, our financial performance is measured against goals established in our annual business plan. With the IFRS 17 transition, management and the Board acknowledged some uncertainty in setting 2023 business plan targets. Financial and AIP results were monitored throughout the year and at mid-year, the Board approved an increase in earnings targets for the AIP. Incorporating this increase:

•AIP total company performance factor, including for CEO and CFO, is 131% (page 113).

•Annual incentive business group performance factors, including for NEO business group Presidents, range from 108% to 137% (page 113).

•Based on our principles and consistent with our approach in prior years, these scores include an adjustment to ensure we are rewarding appropriately for performance and delivering a fair and reasonable result. This year a negative adjustment of 9 percentage points (pp) was applied to moderate cumulative, positive impacts on earnings and growth results versus business plan that do not reflect underlying business performance or to mitigate unforeseen positive impacts resulting from transition to the new accounting standard. (page 114).

Our above target total company AIP funding of 131% reflects strong performance on reported and underlying earnings and growth, and mixed results on Client measures. Additional details on the use of discretion in compensation plans can be found on page 80.

Long-term Incentive Plan

For the 2021 grant vesting in 2024, performance in our Executive Sun Share Unit Plan is based on absolute and relative total shareholder retu(TSR) over a five-year period. Our five-year annualized TSR is 13.2% and ranks in the second quartile among global insurance competitors.

•Sun Share performance factor of 89% (page 88). No discretion was applied.

•NEOs have 25 - 75% of their total long-term incentives delivered in performance-based, at-risk Sun Shares (page 85).

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Our below target Sun Share performance factor is driven by outcomes in recent years when, relative to traditional insurance peers, Sun Life benefited less from rising interest rates and was more sensitive to equity market volatility given that a higher share of earnings is derived from asset management businesses.

Overall, we assess that our incentive plans delivered rewards consistent with our annual results and long- term, relative performance. We continue to ground our decisions in the principle of pay-for-performance based on a rigorous assessment of the delivery of strategic and financial objectives.

2023 CEO Performance and Compensation

When determining compensation for the CEO, we consider target compensation set with the inputs of market data, business and individual performance versus annual strategic and financial goals, funding under the compensation plans, and results in the broader context of Client, employee, and shareholder experience. The Board's assessment of the CEO's performance includes consideration of results versus short, medium, and long-term goals, as well as broader strategic, sustainability and financial performance. Our process seeks input from the CEO through a self-assessment as well as feedback from the executive team and all Board members. The Committee considers the Board's performance assessment, reviews compensation history and market information, and seeks input from our independent advisor in making a compensation recommendation to the Board.

Following the review, the Committee recommended, and the Board approved, actual 2023 total direct compensation (TDC) for Mr. Strain of $10,508,000, $858,000 above his target of $9,650,000 and $1,518,000 above 2022 actual TDC. 2023 annual incentive compensation was awarded at $2,358,000, reflecting the 131% total company performance factor and a 120% individual performance multiplier, which was 57% above target and 38% above 2022 actual.

In addition, the Committee recommended, and the Board approved, target TDC of $11,000,000 for Mr. Strain in 2024, $1,350,000 above 2023, with the increase delivered in a combination of annual- and long- term incentives to reflect a market competitive pay mix and align to shareholders interests. We believe the compensation awarded to Mr. Strain appropriately reflects his growth and performance in the President & CEO role, leadership in executing on our strategy, and long-term value delivered, as well as competitive pay levels. Additional details on Mr. Strain's compensation can be found on page 97.

Committee Focus in 2023

In addition to compensation matters, the Committee provided guidance on a broad range of topics to advance the talent agenda.

Given Sun Life's strength resides in our ability to build great talent now and for the future, the Committee focused attention on management's leadership development activities, including the launch of a new Sun Life Executive Development program. We reviewed and applied appropriate challenge to succession plans and key talent moves throughout the year. We regularly discussed potential talent, culture, and behaviour risks, including assessing data on attrition, engagement, and manager effectiveness.

We also believe our culture is an incredible asset to the company and a source of differentiation. As a result, the Committee provided oversight in the codification of Sun Life's unique, Client-focused, caring culture. We provided guidance in the articulation of Sun Life values, behaviours, beliefs, and mechanisms used to reinforce our desired culture. Our culture definition captures characteristics we wish to preserve, such as prudent, long-term risk management, and our bold aspirations for the future in empowering performance excellence.

Our future-of-work includes enhancing the strength of our hybrid-work model while ensuring growth and mentoring of our talent. We discussed management's strategy to provide state-of-the-art physical workspaces as well as flexibility and choice to work where one can best meet Client and business needs. We reviewed data-based assessments to ensure our hybrid approach is supporting our ability to achieve our business, productivity, and talent goals.

In 2023, the Committee provided oversight on compensation design in support of the Dialogue acquisition, with consideration to practices in the health technology sector. Given the growth and evolution of SLC Management, the Committee met with an external expert to understand unique practices to attract, motivate, and retain talent in the alternative asset management industry. Compensation strategy and design for SLC Management was reviewed to ensure alignment to business strategy and market practice.

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Looking Ahead to 2024

In 2023, we introduced annual and long-term incentive plan changes to reinforce our strategic focus on Clients, capital management, and sustainability. In particular, we embedded strategic sustainability aspirational goals into our Sun Share plan performance factor. This includes advancing sustainable investing, building resilience to climate change, specifically reducing greenhouse gas emissions in our operations, and operating as a trusted and responsible business, specifically increasing gender and racial diversity at senior management levels. Throughout the year, we monitored market trends and reviewed our plans. We are maintaining a consistent AIP and Sun Share design for 2024, as we believe the changes introduced in 2023 continue to reflect our business strategy and incent performance in alignment with our Purpose and culture.

In 2024, we will undertake a review of share ownership requirements (SOR). Our current SOR require our CEO and NEOs to have minimum ownership of 10x and 5x salary, respectively. In 2016, we introduced a unique personal actions requirement focused on long-term holding of common shares and deferred share units and excluding ownership achieved through Sun Share grants. We strongly believe in ensuring our senior leaders are aligned with investor experience of short, mid and long-term performance, as well as creating a longer-term ownership mindset for senior leaders. We will review market trends and best practices and explore opportunities to further strengthen our approach.

Once again, we appreciate your feedback and invite you to contact us at [email protected].

Sincerely,

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Compensation discussion and analysis

2023 compensation decisions and approvals

We evaluate our business performance to assess whether our targets set at the beginning of the year remain appropriate, whether external perceptions of our performance are consistent with the calculated results from our formulae, and the extent to which delivered results could represent one-off events. When determining 2023 AIP payouts, unique circumstances in each business group were considered and negative discretion was applied to ensure final AIP outcomes aligned with the overall performance of each business. Use of discretion is described on page 80.

Mr. Strain's salary is not changing for 2024, while his long-term incentive grant and AIP target have increased. The other NEOs have received increases to their total target compensation for 2024. LTI awards are forward looking and recognize the critical role our executives play in providing leadership, managing risk and driving achievement of our ambitious goals for Clients and shareholders. The final payout of these awards depends on the long-term value delivered to stakeholders.

As disclosed in last year's management information circular, 2023 salaries, AIP targets, and LTI grants were approved and executed in February 2023. 2023 actual incentive outcomes reflect a range of business and individual performance, in alignment with our compensation principles. We describe annual incentive plan business results on page 114.

The table below summarizes the 2023 compensation decisions for the individuals who are our NEOs for 2023. We describe the plans, payouts and new grants in more detail starting on page 81.

In December 2023, we announced Mr. Singh will become the new President of Sun Life Asia in 2024.

Summaries of performance for each NEO that formed the basis for compensation decisions start on page 96.

The value of the 2021 Sun Share awards paid in 2024 reflects the change in share price, accumulated dividends and application of the 89% performance factor. See page 89 for details about the performance factor for Sun Share awards (the "performance factor"). Below-target payouts on long-term incentives granted in 2021 were based on Sun Life's absolute and relative total shareholder retucompared to a peer group of Canadian banks and North American insurers over the performance period.