Revamped Fonterra to be ‘more capital-efficient’
Fonterra chair Peter McBride says the divestment of Mainland Group is their last significant asset sale and signals the end of structural changes.
This month the co-op issued its annual call for candidates in its farmer director elections. Nominations opened July 17.
Fonterra’s board has four independent directors and seven farmer directors elected from within its shareholder base. Each year it seeks to fill as many as three of the farmer seats through its unique election process.
Paterson explains that the Independent Selection Panel (ISP) she chairs with John Spencer, and Tony Carter, is designed to serve both the aspiring director candidates, and the voting shareholders.
“The ISP provides candidates with a rigorous and totally independent assessment of their skills and experience against the attributes and skills required by the board in any year.
“Just as importantly, we then provide Fonterra’s shareholders with independent and comprehensive information about the recommended candidates to help them decide who they vote for.”
The panel’s search brief, which is sent to all shareholders, includes an assessment of the aggregated skills of the existing board members and the skills that the co-op is looking to build around the board table. This year’s brief has a focus on candidates with relevant strong governance experience and a global mind-set or experience – particularly in the consumer space.
Paterson believes that within its wider shareholder base, Fonterra has experienced governors with strong skill sets that fit the bill.
“In my experience, it’s important to first assess candidates on their personal attributes such as sound judgement, integrity, and in a Fonterra context, empathy with the cooperative. Once satisfied from that perspective, you then look for skills that complement the board’s existing skill set.
“For Fonterra, this year that means seeking out candidates with a level of strong governance experience appropriate for the board of an organisation of Fonterra’s international scale and complexity.
“We’re also specifically looking for people with a deep understanding of financial and risk management, international issues, on the ground experience in the cooperative’s key or emerging markets, and experience in retail or consumer goods companies with significant global brands.”
Paterson says that while it’s important that any director of Fonterra has an understanding and affinity with dairy farming, the ‘farmer director’ positions were open to anyone with an eligible ownership interest in a supplying shareholder, not just those directly working the farm.
