Fonterra slashes forecast milk price, again
Fonterra has slashed another 50c off its milk price forecast as global milk flows shows no sign of easing.
Reymer believes that the governance and representation as well as capital structure are interconnected, and both are important to the survival of the co-op.
"If we go back first for a bit of history, it was common to have a dairy co-op in almost every small rural centre. When that was the case, the farmers all knew the board personally. They saw them at the footy club, church, school or wherever. They all had active discussions and farmers felt involved and connected. As the mergers took place, this was held together by better transport to larger centres and more regional co-ops with 'ward' director, so somene with a close connection to your region.
"Fonterra now has no wards, and four of the eleven directors are not even farmers (appointed by the board) and Fonterra wants to reduce the size of its board.
"To make it worse, from a farmer representation point of view only, the definition of 'farmer director' is very loose and if you are a trustee of a farming company you qualify as a farmer director; this can make that director no different from an appointed director."
