I’d have liked to see it go further but dropping board numbers from 13 to 11 is a start.
I also support the broadening of the eligibility rules for directors. It’s a positive step.
I disagree with the statement “there is no solid link between company performance and board numbers”.
As Massey University business lecturer James Lockhart pointed out to Farmers Weekly readers “The sweet spot around decision-making in the board room is around seven, eight or nine”.
He adds “It’s probably closer to seven than it is nine.”
I agree.
I am, however, appalled at the excessively complex document that was on a par with the original discussion paper.
The best communications channel is the shortest and as the late Winston Churchill was quoted “The most educated of men is he who can put the most complex of thoughts into the simplest of language”.
Women didn’t appear on Sir Winston’s radar back then.
My view is that I could have written both documents in a simpler, shorter and more informative way and most of my colleagues could have done the same.
Why the obsession with minutiae and excessive complication is beyond me other than by strict application of the baffle-them-with-bullshit philosophy.
The area I have most difficulty with is the whole pre-selection scenario.
The Fonterra document waxes lyrically with sentences like “Farmers want the best people into governance and representation roles within the co-operative”, and “Want better information on the skills needed on your board”.
That is followed by “Want to see how (candidates) measure up against those requirements” and “You want to focus on the personal attributes of directors as well as their technical skills”.
Then came the king hit. Farmers wanted “clearer direction from the board on its view of director candidates”.
So farmers are incapable of making their own decisions?
I don’t accept that.
Current directors have been appointed largely on recommendations from a stacked interview panel.
It maintains the status quo.
The recommendation document has both an independent selection panel and a nomination panel to vet budding directors.
Farmers aren’t stupid and are totally capable of making their minds up.
They would have to fit an amazing set of criteria as laid out by the board.
It perpetuates the power of the board to maintain, yet again, the status quo.
My opinion is also that the process would make it absolutely impossible for an “average” dairy farmer to be elected to the Fonterra board.
It further begs the question as to what a board is there to do if a board member is going to need all the attributes the document talks about.
I suggest the scenario Fonterra is perpetuating says a board member must be an amalgam of Professor Stephen Hawking, Warren Buffet and Christine Lagarde, with the humility and conscience of the late Mother Teresa and that is rubbish.
How many current directors fit those criteria?
A board is there to make decisions on facts. They give management a direction then assess the advice from management while applying some ideas and experiences of their own.
They have the ability to employ independent, outside expertise.
A Fonterra director doesn’t have to have all the skills I’ve previously mentioned but a strategic vision and the ability to tell when he or she is being fed a line.
Most dairy farmers have that now without the suggested irrelevant and expensive manipulation pushed by the Fonterra board.
There’s an old saying that suggests you shouldn’t have a dog and bark yourself and that is relevant here.
Fonterra has 22 dogs earning more than $1 million so why the call for such a high-powered, minutely vetted board candidate other than to maintain the status quo.
It was your “ordinary” dairy farmer who ran the two co-operatives before Fonterra was formed and “ordinary” dairy farmers who kicked Fonterra into the world.
Perhaps all this bluff and bluster is but another reason the co-operative is losing its way.
It’s promoting excessive complication as against simple performance.
The suggestion that these two groups assess potential board members is absurd.
If Sir Ralph Norris wanted to make himself, yet again, available for the Fonterra board would he have to be interviewed ad nauseum by two separate panels?
If Rob Fyfe decided to offer himself for the Fonterra board would he have to submit to the selection circus?
So, for the record, I totally reject inserting third parties in any board selection process, especially a board appointed and controlled third party.
Farmers aren’t stupid and are totally capable of making their minds up.
Maybe I think more highly of our dairy farmers intellect and abilities than the Fonterra board does.
