Whatever was said to chairman Henry van der Heyden and chief executive Theo Spierings in China, Indonesia and Singapore was enough to convince them there was no other way but a second vote on TAF (trading among farmers). Remember, only two months ago they rubbished the very idea.
Fonterra says concerns raised by key Asian customers and joint venture partners have been the tipping point for a second vote. It claims the controversial share trading plan is now spilling into international media and hurting the co-op’s reputation.
Let’s also not forget Prime Minister John Key was with Spierings in Singapore and Indonesia. Key may well have taken the Dutchman aside and whispered his preference for another vote. After all, TAF cannot go ahead without DIRA reforms being pursued by the Government in Parliament.
There’s no doubt opposition to TAF is growing. More farmers are questioning the co-op’s ‘trust us, we will give you details later’ approach. However, it’s unlikely they have the numbers to block TAF.
Fonterra hopes to end shareholder dissent by having another vote. It will also be hoping another ‘yes’ vote puts TAF back on track and heals the Fonterra family wounds.
The co-op has only itself to blame. It has been slow to arrest growing shareholder dissent about TAF, choosing to work on details of the scheme behind closed doors and either ignoring and/or dismissing critics as scaremongers.
Unfortunately, this public vacuum has given TAF opponents an almost unencumbered platform to float conspiracy theories and undermine farmer/shareholder confidence that they will retain 100% ownership and control of Fonterra.
In 2010, 80% of shareholders voted on the original TAF proposal – 90% in support. But a lot has changed since that first vote. Farmers have become more sceptical of the board’s promise to retain 100% ownership and control. The Fonterra Shareholders Council is split, causing more rancour among the farmer base.
Before the second vote on June 25, Fonterra will present TAF in its final shape. Farmers will know exactly what they are voting for. The board hopes another yes vote will kill the anti-TAF crusade by a vocal minority.
