The Fonterra Shareholder Council will not be recommending farmers support a farmer remit attempting to lock in future farmer control of the dairy giant at next month’s annual meeting.
The decision by the 34 member farmer watchdog council is a blow for shareholder and former Federated Farmers dairy chairman Lachlan McKenzie and seconder, South Island farmer Ann Jones, who seek constitutional change to cement farmer director numbers and farmer voting rights on the board of New Zealand’s biggest company.
However the council did not use its power of representation of Fonterra’s 10,500 farmer-shareholders to completely veto the remit attempt, said chairman Ian Brown.
This means the remit will still be presented to the annual meeting at Mystery Creek Events Centre near Hamilton on December 17.
The McKenzie and Jones’ resolution seeks farmer support for the Fonterra constitution to state unequivocally that the board shall have no less than 9 farmer-elected directors, and that only farmer-directors should be able to elect the chairman of Fonterra, who must be a farmer.
Brown said the council was not recommending support for it because it would pre-empt a governance review currently under way by Fonterra directors and shareholder councillors.
Also, he said Fonterra’s constitution already provided for nine farmer directors.
But the main reason for the majority of councillors not supporting the remit was that it was premature given the review.
McKenzie and Jones’ resolution follows the Waikato Times revealing last month that an option in the review was for farmer director numbers to be reduced to eight and independent, non-farmer directors lifted to five.
News of the option further unnerved farmer opponents of Fonterra’s narrowly voted-in share trading among farmers (TAF) scheme, which will see the farmer-owned cooperative debut on the NZX and ASX on November 30 with publicly available dividend-carrying units in Fonterra shares.
McKenzie said the resolution simply seeks to underline what farmers have been promised by Fonterra’s leaders _ that TAF does not threaten farmers continued 100 per cent control and ownership of Fonterra.
Source: Stuff