Expert Says Fonterra Backing Current Strategy With New CEO Appointment
The appointment of Richard Allen as Fonterra's new chief executive signals execution, not strategy, according to agribusiness expert Dr Nic Lees.
One of the co-op's biggest achievements is the 11% reduction in greenhouse gas emissions from coal in a single year, primarily through the conversion to renewable wood pellets at its Te Awamutu site.
Chief operating officer Fraser Whineray says this is a great sept towards delivering its 2030 target and the goal of getting out of coal by 2037.
"Having committed to get out of coal by 2037 from the nine remaining sites, Te Awamutu provided material GHG reductions and further confidence to undertake out next project at our Stirling cheese site in the South Island.
"Stirling will become our first 100% renewable thermal energy site.
"We are already one of the most carbon efficient producers of dairy nutrition in the world, and there is more to be done."
He says its important Fonterra continues to make progress in its operations to complement the significant innovation and change by farmer owners.
One of the ways we're supporting their on-farm activity is through The Co-operative Difference, he adds. This season The Co-operative Difference payment for milk comes into effect. In addition to valuing milk quality, it rewards farmers for on-farm demonstration of care for the environment, animals, people and community.
For the 20-21 season, there was a 25% increase in farms achieving the top and the midpoint targets, with around a third of farmer owners recognised in the overall programme. 53% of farmers in New Zealand also have tailored Farm Environment Plans, up from 34% last year.
"We are on track to meet our target of 100% by 2025 and these are provided free of charge to all Fonterra farmers," says Whineray.
"Considering our people goals, whilst there has been improvement towards our diversity targets there is room for improvement when it comes to women and ethnic minorities in senior leadership positions."
Fonterra's gender pay gap has narrowed across all job categories. In New Zealand the co-op is now down to 3.8% on a median basis, compared to the national average of 9.5%.
It has also recently extended its parental leave in New Zealand so employees will now have their government parental leave cover topped up to 100% of base salary or wages for 26 weeks.
On its sustainability scorecard, Whineray says transparently reporting across a range of sustainability metrics is very important for the co-operative.
Progress Results
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Fonterra has delivered a good sustainability scorecard. |
Environment
- Finalists in this year's Sustainable Network Awards, for a project at Maungaturoto where, for the first time, Fonterra is using a natural wetland process to help recyle water for reuse at the site.
- Awarded the Low Carbon Future Award at the New Zealand Excellence Awards for the Te Awamutu conversion.
- New Zealand on-farm GHG footprint increased slightly partly due to the increased proportion of PKE in supplementary feed.
- 94% of packaging on products sold in Australia are now made from recycle-ready materials.
- Continued to invest in R&D to find on-farm methane mitigation solutions, including a seaweed trial, the Kowbucha project and partnership with DSM which look to limit methane production from cows.
- Since the Living Water partnership with the Deparment of Conservation began, Fonterra has carried out 36 trials for tools and solutions, with nine of these being further developed for wider use.
- Delivered 48% of the 128 partnership actions in the first three years of its sustainable catchments programme.
People
- 13 new apprentices joined in January as part of its commitment to recruit an extra 44 apprentices by the end of 2022.
- In the past year, New Zealand employees increased their on-the-job training and reskilling hours by 28.1%, well on the way to doubling by 2025 in support of the Aotearoa New Zealand Skill Pledge.
- Served more than 180,000 breakfasts a week through The KickStart Breakfast programme, a partnership with Sanitarium and the Government to provide milk and Weet-Bix, which is now in 1,300 schools.
- 84% of everyday and advanced nutrition products now meet independently endorsed nutrition guidelines.
