Because of Fonterra’s size, some shareholders feel isolated and less connected than in the past. Historically shareholders were part of smaller regional co-ops and had tight relationships with directors and management. They could pop down to their director’s place for a cup of tea and a face-to-face talk. In today’s digital era communication has become less personal, leading to disengagement and widening the disconnect between co-op, Shareholders’ Council and farmer.
Ross Wallis: people engage at different levels for different reasons.
People often have a preconceived idea of what engagement should look like. However, all groups of people, particularly dairy farmers, who are very diverse, engage at different levels for different reasons. Wallis conducted a qualitative survey in his Hamilton ward to get a picture of what engagement looked like, the level of disconnect among farmers and what farmers wanted out of their council.
“Once you start talking to farmers, some that you felt were disengaged or disconnected actually aren’t. Just because they don’t go to meetings and prefer to read the material sent out to them instead doesn’t mean they are any less engaged than a person who attends all the meetings. It may just be that they are happy with that level of engagement.”
For the FSC, engagement has to do with connecting with farmers on a level that will add value to them by way of strong representation, as well as effective monitoring or efficient dissemination of relevant information that will benefit the shareholder in their decision-making for their farming operations Wallis says.
He says it’s important to him to have a strong co-op to ensure the future of New Zealand dairying.
“If we don’t have a strong co-op then dairy farmers are going to suffer. At the end of the day the corporate milk processors really take the price they pay their farmers for milk from the Fonterra benchmark, so if Fonterra becomes less efficient, there’s a flow-on effect to farmers outside Fonterra as well.”
From his experiences on the FSC, Wallis says, with an increasing disconnect between farmer and council it’s become apparent that better communication is paramount to ensuring happy farmers and a strong co-op.
“We’ve been going back to basics and going round farms in different areas, chuck on the barbecue, put up a blank white board and don’t have an agenda, it’s just an open discussion for farmers to voice their concerns, questions and opinions. Quite often in meetings with agendas there’s one person up there talking and it doesn’t make for an inviting environment for farmers to freely ask questions. We have been getting a good turn-out to these sorts of events.”
Wallis believes a lot of the disconnect between farmers and the FSC comes from farmers not seeing what goes on behind the scenes and so better communication and more transparency is needed.
“Most people I talk to understand what the council is all about, but don’t really know if the council is effective, which has led some to say that the council should just be scrapped all together.”
For Wallis it’s about getting back to basics and having simple conversations with farmers that might shift their thought process from “Gee, the council, what a waste of time” to “Yep, it’s a great thing for us to have”.
However, with the introduction of Trading Among Farmers restricting the disclosure of some information, open communication has its limits.
“I think we really have to understand where the disclosure line is. If Fonterra comes to us and says ‘We can’t because of disclosure’, if we don’t know where that line is, it could come across as a bit of a fob off.”
In the past, information came directly from Fonterra or the council to its farmers. However, now the media are often the middle-man in information exchanges.
“Some farmers prefer to get that sort of information from Fonterra or the council instead of the media, it makes them feel less informed and less a part of things.”
The Farm Source model launched in 2014 was designed to try to capture some of what co-ops used to be in the regions. Each region has a regional head enabling decision-making, so decisions that used to take months by the time they reached head offices now take days.
The old saying “perception is reality” rings true for Fonterra and the FSC. Wallis says although the Farm Source model will help address some of the connectedness and engagement issues, the reality is perceptions need to change as well.
In a recent survey conducted by Fonterra, 84% of New Zealanders didn’t know Fonterra was a co-op owned by its 10,500 farmers, but thought it was a large-scale corporate taking advantage of its farmers.
“From a council point of view, the benefit is that everyone on the council is involved in farming, and most are day-to-day farmers themselves, so we are going through all the same issues as the people we are representing.”
Wallis says that as the co-op expands, the council’s job becomes more important.
“The only way we can go some way in tackling the issue of connectedness is to have active engagement, and the only way this can be done is by using the networks we have set up, getting feet on the ground and staying connected with our farmers.”
Wallis’ survey confirmed his initial feelings on his ward’s engagement and level of connectedness.
“The results were as expected with a general lack of engagement and feeling of connectedness, but there are also some who are quite happy and feel connected also. There are people who are wanting to see the council have more teeth, but this comes back to farmers not seeing what goes on behind the scenes, they just see what comes out like the milk cooling, but they don’t see or hear that the council had been involved in that issue for some time.”
One of the biggest findings for Wallis was a reminder that farmers needed to be at the forefront of his mind and that it’s not the council’s job to pass on Fonterra information.
“We don’t get any more information than the farmers do, but we do have the chance to have more in-depth discussions to gain a better understanding, so it’s my job to listen and help the farmers understand the information they get.”
Wallis outlined some recommendations for the council, based on the findings from his survey. There was a recurring theme of better communication.
“There is a real need for leadership in the industry at the moment, and the council has to lead this and bring confidence to its farmers and to keep a strong vision going forward for what the co-op’s going to look like in 20-30 years’ time for the next generation of farmers.”
Wallis is the owner-operator of his 300-cow farm in Raglan, and his family has been in the area since 1836 with his brother running the family farm. He says the Kellogg programme was an opportunity to keep challenging himself.
“I put my hand up for the council role because I felt unchallenged on the farm, so we either sold and went to something bigger, which we didn’t want, or I had to find something else to challenge me. The council has been good for that.”
The leadership course has given him the confidence to step-up into his council role and take on leadership in his ward.
“One thing I got out of all this was that life’s short, and you really have to put your best foot forward every day.”
