Prudential 2012 Annual Report Download - page 5

Prudential Financial, Inc. 2012 Annual Report 3
Individual Annuities account values were approximately $135
billion at year-end 2012, up from approximately $114 billion
in 2011. We continue to manage our annuities business
prudently, especially given the persistency of low interest
rates, adapting our products to improve our return prospects
and risk profile, while maintaining our value proposition.
In our Asset Management segment, we recorded $30 billion
of institutional and retail net flows for the year. The Asset
Management segment’s assets under management totaled
$827 million at year-end 2012, compared to $718 million
in 2011.
In Group Insurance, sales totaled $439 million for the year,
representing a decrease of $196 million from 2011. Our
priority in 2012 was to refocus our Group Insurance operation
on businesses where we see long-term opportunity. We are
taking significant actions to enhance the prospect for improved
returns for this operation.
Sales in our Individual Life Insurance operation reached
$412 million for 2012, up 48 percent over 2011. This
increase reflects our improved competitive position and
expanded distribution through third-party distributors,
including banks and wirehouses. As we integrate the Hartford
operation into our existing individual life insurance business,
we look forward to continued progress in the future.
Deploying capital to support our long-term objectives
In 2012, we continued to benefit from our long history of
effective capital management. Our commitment to maintaining
robust capital and liquidity positions helps insulate the
company against volatility and preserve our ability to pursue
new opportunities for expansion.
Our execution of significant transactions provided
opportunities to effectively deploy our capital, which remains
integral to achieving our financial goals. We remain committed
to balancing investments in our businesses with our goal
of delivering additional value to our shareholders through
dividends and repurchases. In November, we declared a cash
dividend of $1.60 per share, representing the largest dividend
in our history and an increase of 10 percent over 2011. We
also announced our intention to pay quarterly dividends,
starting in 2013. In addition, we continued to repurchase
stock throughout 2012. During the year, the company
acquired 11.5 million shares of its Common Stock at a total
cost of $650 million.
Our responsibility as a corporate citizen
As a multinational institution, we understand that we have
responsibilities to a wide variety of stakeholders, including
our shareholders; customers; employees; state, federal and
international regulators; and our neighbors in the communities
in which we operate. To truly abide by our values and meet our
objectives as a company, we must fulfill our obligations to all
of them.
We also recognize the importance of appropriate and
meaningful regulation of our industry and our company.
To that end, we have continued to participate in productive
discussions regarding the improvement of insurance regulation
with federal, state and international regulatory authorities and
other industry partners. We believe that by working together,
we can help regulatory authorities develop an effective
regulatory structure that is suitable for our industry.
Adherence to a strong program of corporate governance and
a commitment to social responsibility are other important
aspects of how we meet our obligations to stakeholders. We are
proud of the recognition we have received for our sustainability
efforts in areas including shareholder engagement, corporate
social responsibility and diversity. Our commitment in these
areas speaks directly to our culture as a company, which is an
important point of competitive differentiation and supports our
emphasis on ethics and integrity.
Prudential employees around the world have embraced the
company’s dedication to corporate social responsibility, which
has endured since our founding in 1875. In October, more
than 20,000 volunteers, including employees, friends, family
members and clients, in the United States and 10 other
countries took part in our 18th annual Global Volunteer Day.
We also continued to provide support to communities where
we operate in a variety of other ways, including grants of more
than $27 million through The Prudential Foundation and other
philanthropic activities.
Our commitment to talent and diversity
Our focus on talent and promoting diversity and inclusion
is another key aspect of our culture and our strength as a
company. Prudential’s people—their skills, character and
integrity—are what really set us apart in the marketplace.
They determine how we operate, execute and innovate.
That’s one reason why we are fully committed to embracing
diversity and inclusion in every aspect of our operations. We
recognize that diversity and inclusion are inextricably linked
to our ability to achieve our goals, both our aspirations to be
an employer of choice and to lead in the markets in which
we operate.
As an employer we must create a culture of support and
collaboration for individuals of all backgrounds, where
employees feel empowered to bring their best ideas. That type
of environment will help us attract and retain top talent, and
better leverage employees’ skills. It will also help us connect
more deeply with diverse markets around the world and
develop products and services that better meet the needs of
multicultural customer segments.
In 2012 we continued our program of research into diverse
market segments with the release of our sixth biennial study
on the financial behavior of women. We also launched a new
study that examined the financial experience of lesbian, gay,
bisexual and transgender Americans. Together with our recent