Garry Reymer, who is calling for radical change to the Fonterra Shareholders Council to better serve the interests of Fonterra’s 10,000-or-so farmer-owners, including giving the council unused election votes, said farmer understanding of the company’s latest financial results and its strategy is generally poor.
But big meetings with the company of 150 plus farmers just fuelled frustration, he said.
«It’s not a forum where you can have a discussion. But cowshed meetings or shed meetings where you can sit down and have a good debate and go over the information would be. When we had smaller dairy companies directors used to do those meetings and farmers felt like they were informed.
«We are leaving our farmers behind and we can’t afford to do that or we are going to lose this co-operative.»
Reymer’s call comes as council chairman Ian Brown revealed that farmer concern about feeling disconnected from Fonterra was the third-most-discussed topic at small meetings he’s had in the past two weeks with farmers. The No 1 concern was the low milk price and second, Fonterra’s ability to be profitable.
Brown said councillors already held small localised meetings with farmers and had a lot of interaction in their own election wards.
Reymer said councillors were supposed to be farmer representatives and he wanted their role «back in the regions where they should be».
«We want someone back among farmers with the ability to hold and call a meeting and have the knowledge and skill-set to report and discuss [company business] in detail in a really good, meaningful discussion in a local hall or shed.»
People on the 37-member council needed to be skilled up and gain more respect as their communication role became more vital, he said.
«I’m not asking them to be directors but they need a lot more numbers, specially when there is a half-year or full-year financial report, so they can hold a meeting and hold it with confidence and answer questions as a director would.
«They do have a responsibility. They are our representatives and the conduit between the board and farmers.»
Reymer said he would be happy if councillors were paid more for having greater skills and knowledge.
«So be it. I wouldn’t be a councillor for what they are paid. We need this to feel connected and part of the business and so farmers can ring up their councillor and get a competent answer. If we pay them better for that, it’s a positive.»
Reymer, who is working with influential Waikato farmer George Moss to write a discussion paper on reforming the council, also wants to see weak councillors challenged.
«If you think a councillor isn’t good enough you start challenging them. Because we are calling for council to pick up some of the unused [election] votes we need someone there we can trust and respect. Then we start getting that buy-in [by farmers] and that lifts the game.
«We’d get a better quality councillor who can question the board and have that information and report back in the regions where they should be.»
Reymer said farmers «categorically» did not understand the reasons for Fonterra’s poor half-year financial result.
«And I suppose in some regards they do not understand the strategy well enough.»
Brown said he agreed with Reymer’s concept of small meetings, but they were already going on.
He said councillors did have knowledge of the Fonterra business and had plenty of discussion time with the board and management «to understand the numbers». They also had access to upskilling training.
Brown conceded, however, that not all councillors had his level of knowledge of the business.
Reymer said Fonterra farmer-elected directors should spend more time gaining an understanding of Fonterra’s markets so they could knowledgeably question senior management on international investments and strategy.
«They shouldn’t be spending too much time in the shareholder base, though I’m not saying they can ignore it. That day-to-day representation role, making sure farmers are up to speed and understand the numbers and [company] direction has got to become the role of the farmer representative, which is the councillor.»
Reymer said Brown was «giving us room» to prepare a discussion paper on proposed council reform to present to the council. He declined to say when the paper would be ready.
Source: Stuff
