Following a damning in-house first review of the performance and relevance of the co-operative’s council, a steering group will present its recommendations during what is likely to be an extensive national roadshow, steering group independent chairman James Buwalda said.
The final report and its recommendations were initially expected ahead of the company’s annual meeting in late August but will now be handed to the council and possibly the Fonterra board in November, he said.
The online review of shareholders, which attracted responses from 1400 dairy farmers and elicited 2600 comments, was overwhelmingly critical of the role of the 25-member council with 60% of respondents rating the council’s key role in representing farmers as less than moderately effective.
More than half of respondents also rated the council’s effectiveness at farmer connection at less than average though Buwalda would not release the full initial review to respect the honesty of farmer feedback.
Buwalda will front up with some of the eight members of the steering committee, including two board directors and regional, council representatives in face-to-face meetings with farmers to present some options to see what the council can do better.
The group might also use online options to touch base with as many shareholders as possible, he said.
The council has 25 regionally representative councillors, who represent a combined 10,000 Fonterra shareholders. Four of them are women.
It meets a minimum of six times a year and has running costs of about $3 million a year. It has cost farmers about $50m since it was established 19 years ago.
Buwalda, a former government official and private consultant, said despite the divergent views, including suggestions to disband the council altogether, the committee was pleased with the high level of initial feedback.
“This will let us go back, look at the key issues and options to address these before we present to farmers.”
Outside of constitutional change, they would almost certainly involve options on how the council interacts with the board. – BusinessDesk
