Fonterra shaves 50c off forecast milk price
Fonterra has dropped its forecast milk price mid-point by 50c as a surge in global milk production is putting downward pressure on commodity prices.
Expressing surprise that the co-op only elected two directors last week to fill three board vacancies, McGiven says shareholders are demanding clarification.
“There is still a lot of conjecture around this, hence the dissatisfaction among shareholders who nominated the two outside candidates,” he says.
“I think the farmer message to the board is that they are accountable to us as shareholders.
I don’t know why the other two board nominees were not elected, but I think there is a clear message to the board – and to a certain extent senior management – that they aren’t greater than Fonterra itself, and in the end are accountable to us as shareholders and suppliers.”
McGiven says South Canterbury farmer Leonie Guiney’s message “very much centred around this fact”.
Five candidates contested the board elections; the board backed three candidates through the independent nomination process– sitting director Ashley Waugh and new candidates Peter McBride and Jamie Tuuta.
Among these three candidates, only McBride achieved the 50% ‘yes’ vote threshold.
Guiney and Canterbury farmer John Nicholls self nominated for the election.
Guiney, who was successful, says she is thrilled to be back on the board; she served a three-year term that ended in 2017.
Guiney and McBride took up their board seats at the co-op’s annual general meeting in Lichfield.
The Shareholders Council says another election will be held to elect the third director.
McGiven says farmers are surprised that only two directors were elected and a third one didn’t make the 50% threshold.
But he stopped short of calling for a review of the election process.
“Personally I don’t think the process needs a review and I like the fact that the independent selection panel takes the ‘beauty factor’ out of the mix, but this process needs better transparency and clarification to the shareholders.
“While it appears that [new CEO] Miles Hurrell has identified some of these concerns and started making changes to strategy, the board needs to realise that the culture that it should be setting has evolved away from the values that we as farmers expect from our co-op and [it] has disenfranchised a lot of us as a result.” - Sudesh Kissun
