Friday, March 29, 2024

Views consistent on Fonterra review

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Fonterra has received consistent views and ideas from its farmer-shareholders in the initial consultation phase of the governance and representation review. A summary has been sent to farmers ahead of another consultation round before a draft proposal is sent in early April and a special meeting at the end of May for shareholders to vote.
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Those overseeing the process did wonder, however, if farmers would have much of an appetite for change when they were under such financial pressure.

In that respect the timing of the governance and representation review might not be ideal but it had been delayed for the best part of three years.

Others said the structure had not been reviewed since Fonterra’s formation in 2001 and it was a good time to make changes to improve the co-operative.

The review team did not publish any consensus on the size of the board or even whether it should be reduced.

Among what it called “clear points” were a need for better understanding of the respective roles of the board, council and management, knowledge of the skills needed and present in the directors, perhaps some appointed farmer directors to fill skills gaps and non-negotiable farmer control.

The complexity, workload and required skills were all relevant factors in the size of the board, the summary said.

With respect to the council the clear points included more visibility about how it held the board and management to account, how to make sure farmers were heard more and perhaps some participation by sharemilkers, rural professionals and international suppliers.

“We are examining all of the feedback in detail; looking at available best practice and compliance requirements (drawing from the earlier work that was done where it was relevant) and thinking about how our unique requirements impact that,” the review committee said.

The committee has 10 members, five farmer-directors including chairman John Wilson and five from the Shareholders’ Council including chairman Duncan Coull and former chairman Ian Brown.

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