Fonterrra chairman John Wilson comfortably re-elected

Fonterrra chairman John Wilson comfortably re-elected despite fallout from low milk prices

By Fiona Rotherham

Nov. 23 (BusinessDesk) - Fonterra Cooperative Group shareholders have re-elected chairman John Wilson to the board despite speculation there has been a campaign to remove him from office after he and the dairy giant came in for criticism by its farmer suppliers who’re struggling with low milk prices.

Incumbents Wilson and Nicola Shadbolt have been re-elected to the board while Blue Read was voted out in favour of newcomer Te Awamutu farmer Ashley Waugh.

Wilson said the result, which saw him re-elected with an increased share of the vote from last year, was humbling.

“We all know it’s very tight on the farm with low dairy prices at the moment and it’s very humbling to have received such strong support,” he said.

He wouldn’t comment on whether there had been a campaign to see him removed and he also refused comment on a proposal that will be voted on at this Wednesday annual meeting in Waitoa to reduce the board by four members to nine.

Since farmers expressed disappointment with the first-half result, the company’s earnings improved for the full year and Wilson said last week that the Auckland-based cooperative was on track to achieve record earnings before interest and tax in the 2016 financial year. It raised its forecast available payout range for this season by 5 cents per share to a range of 35 cents to 40 cents though the farmgate milk price of $4.60kg/MS may still be under threat as milk prices have continued to decline at recent GlobalDairyTrade auctions.

While welcoming Waugh to the board, Wilson said it was a shame to see Read voted off after three years on the board because he had made a “huge” contribution during that time, and in his previous leadership roles within the cooperative.

“When you’ve got strong board candidates and other candidates standing it’s very common in the cooperative over time to get change as has happened this time,” he said.

Waugh is an experienced company director and is currently chair of Moa Group and a director of Seeka Kiwifruit Industries and Australian-based The Heat Group.

The other two unsuccessful candidates were Greg Maughan from Marton and Murray Beach from Marlborough who at last year’s AGM lost a motion that all Fonterra investment spending and New Zealand development projects be put on hold until farmer payouts hit a minimum of $7 per kilogram of milk solids.

Returning Officer Warwick Lampp has posted the results of elections for the Fonterra board of directors, the directors’ remuneration committee and Shareholder’s Council on the NZX but refused to reveal voter numbers which he said were only supplied to shareholders.

The voter turnout for the elections was significantly up on last year which Wilson said reflected the efforts of the Shareholders’ Council in the regions and farmers wanting to have a say on the running of the cooperative.

Newly elected Shareholders’ Councillors Andrew Hardie and Sue Brown will join incumbents Wilson James and Kevin Turnbull on the council.

Shareholders’ Council chairman Duncan Coull said 65 percent of farms, representing 73 percent of milksolids cast their votes. He said it was great to see shareholders, as owners of Fonterra, come out in numbers to decide the direction in which the cooperative will travel.

“My view is that the health of our co-op is dependent on our shareholders and their willingness to participate in the decision-making processes and based on the participation rates in this election, I would suggest that our co-op is in very good shape,” Coull said.

All successful candidates will take office at the close of the company’s annual meeting.

(BusinessDesk)

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