Wednesday, December 6, 2023

Fonterra AGM remits squashed by the board

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Farmer out to ‘highlight serious disconnect between farmers and the board’.
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Fonterra has stonewalled four remits proposed by Northland dairy farmer Richard Dampney for the co-operative’s annual general meeting in Methven on Thursday, November 9.

The board has strongly recommended that shareholders vote against Dampney’s proposals.

The notice of meeting says the Fonterra Co-operative Council does not support the proposals.

This means even if the required 75% shareholder approval needed for constitutional changes is achieved, his proposals will not be implemented.

Dampney’s remits seek to mandate that:

• The number of appointed directors be reduced by two

• The number of farmer-directors remains at seven

• Former farmer directors can be appointed as independent directors after a five-year stand-down

• The independent assessment panel be abolished.

He will travel to Methven at considerable expense and inconvenience during the seasonal height of milk production, sowing and mating, to speak to the remits.

Dampney realises that they have no hope of being passed and implemented within the Fonterra system and constitution.

“They have stamped on my proposals and done exactly the same to every farmer remit since Fonterra has been formed.

“It is not necessary. We are smart enough to understand what is going on, so let us decide.

“My main point will be to highlight the serious disconnect between farmers and the board.

“Chairman Peter McBride says that two directors being re-elected unopposed is a vote of confidence, but disconnection is the other way of looking at it.”

Dampney said the governance development programme should be bringing forward people willing to stand.

“In the next three years five of the seven farmer directors will have to retire because they will have served nine years – where are the candidates to replace them?”

The board has put forward a remit (Resolution 8) to reduce the number of directors from 11 to nine, being six farmer-directors and three appointees.

Should that remit receive 75% shareholder support, Dampney’s proposals, which follow it on the agenda, will be effectively pointless.

“Resolutions 10 and 11 are inconsistent with Resolution 8 and the usual course is not to put forward inconsistent resolutions at the same meeting,” the notice of meeting says.

“However, the Companies Act provides that all shareholder proposals be presented to shareholders, which has led to this inconsistency.

“Given the Co-operative Council has advised that it does not support these proposals, even if resolutions 10 and 11 are passed, they will not become effective under the company’s constitution.

“Therefore, in the unlikely event that both Resolution 8 and resolutions 10 and 11 are passed, only Resolution 8 would be given effect to.”

Dampney said he wants Fonterra’s treatment of shareholder proposals changed to be respectful and meaningful.

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