Southern Dairy Hub Simplifying Their Operating And Governance Model

The Southern Dairy Hub (SDH) is reorganising its governance structure to become more efficient and improve the operations of the Hub – which will ultimately better serve the interests of southern dairy farmers.

Simon Flood, SDH Chair, said “the Hub is celebrating its sixth anniversary in June, and it’s an opportune time to take the Hub to the next level. This is a natural evolution, where the original structure, established six years ago, was ready for improvement to provide better management of the business”.

The new structure, which comes into effect on 1 June 2024, has the operations of the Hub and ownership of all Hub assets under one entity and one Board (previously two entities and two Boards).

The SDRF (Southern Dairy Research Farm), which was owned by the SDDT (Southern Dairy Development Trust), and the SDH Boards will be consolidated into one Board.

“The Hub’s governance structure will be simplified, by removing duplication and overlap. There will be one Board, one set of meetings, set of accounts. As a new Chair, 18-months ago, I wanted to remove unnecessary complexity and create an operating unit where all shareholders were directly involved. Working closely with AgResearch, DairyNZ and SDDT, we have put in place a plan to simplify the family structure to reduce complexity in the governance and management of the Hub,” Simon said.

General Manager, Andrea Dixon, continues in her role.

“Already, in the short time she’s been at the Hub, she’s made a great contribution, building strong relationships and establishing processes that will stand us in good stead. In the last two years, and with Andrea’s support, we have really stepped up the communication and engagement from the Hub to our southern dairy farmer community and we look forward to continuing to build that relationship,” said Simon.

Simon believes the exciting research underway at the Hub will make a huge difference to the way southern farmers farm, helping them to make informed and data-led decisions.

“I want to thank all the parties involved in the process, and especially those who represented SDRF, as well as our owners, DairyNZ and AgResearch, for their support to the Hub in our aim to constantly improve for our southern farmers”, said Simon.

From 31 May, SDRF will cease to exist as an operating entity and from 1 June 2024, SDH are acquiring the assets of SDRF. That will result in everything moving to the SDH operating entity owned by DairyNZ, AgResearch (37.5% each) SDDT (24.99% stake). SDH will take over ownership of SDDT assets, which include the herd, tractors and other farm operating equipment. These were sold for market value (valuations completed by independent third-party valuer).

The farm is owned by SDH already (including the milk shed). All the Hub’s existing employees, as at 31 May 2024, will transfer to the new entity (known as the Southern Dairy Hub) with no changes to their contracts.

The two Boards, SDH and SDRF will consolidate into one.

The new Board is made up of two independent members, Simon Flood as the Board Chair, and Luke MacPherson, and three appointed members: Michael Farmer as the SDDT representative, Mark Todd (DairyNZ), David Williams (AgResearch- interim appointment).

AgResearch chief executive Sue Bidrose says the Hub has been a good example of partnership between industry and research.

“We know the science that has been done at the Hub has made a real difference to farming practices in the south, and this sort of impact is what drives AgResearch’s scientists.”

DairyNZ chief executive Campbell Parker says the Hub is helping address some of the challenges and opportunities for the future of dairy farming in Southland. “As a credible, science-first organisation, we are proud to support the Hub as it continues its work in ensuring profitability and sustainability go hand in hand.”

Simon adds that “I strongly believe that this will improve the communications and engagement between the Hub and its shareholders and stakeholders for the benefit of everyone.”

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