Wednesday, April 24, 2024

Low morale in agribusiness big risk to a bright future

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Morale in the New Zealand agribusiness sector has fallen significantly during the past year, KPMG Agribusiness Agenda lead author Ian Proudfoot says.
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The 12th and latest annual report on the pulse of the sector was the most difficult to write.

“We could sense anger during our conversations with business leaders, particularly in relation to the labour shortages the sector faces,” the KPMG authors said.

“At times it felt as though we were talking to leaders who were primarily focused on finding the strength to fight another day, rather than the energised leaders of previous years.”

Proudfoot and co-author Jack Keeys are gravely concerned about the dichotomy between these fatigued executives and the extraordinary opportunities for producers of sustainable, healthy food.

“The world is looking for safe, provenanced, evidenced-based food that has attributes that are valuable to consumers,” they said.

They called it a global food renaissance, driven by consumers and governments responding to the food resilience challenges highlighted by the pandemic.

The country’s reputation should position us as desirable partners to many innovations, but we have to act now to leverage that reputation.

But leaders in the agribusiness sector are overloaded with the practicalities thrown up by covid-19; keeping people safe, shipping products around the world, finding sufficiently skilled people and connecting with business partners across borders.

The pace of regulatory change is also weighing heavily on executives, with impacts on farming systems, as well as operations, ownership rights and economics of businesses across the sector.

Government departments, local councils, industry bodies, processors and customers are all issuing their own rules and interpretations, and there needs to be a joining up of these requirements.

“The point was made that it is the breadth of change that is stretching many organisations, given that each new rule brings new compliance and reporting requirements and often requires changes to core systems,” they said.

The Government should ensure work is coordinated across agencies so that consultation occurs, and regulations are drafted in a way that reduces the burden placed on executive time.

The authors say the depth of executive talent is lacking and therefore the much-needed connections to participate in the food renaissance.

“As we start to unlock, it is critical our leaders have the time to reinvest in key networks and relationships,” they said.

“Without taking this time there is a risk we are not engaged in key initiatives for our future, simply because we are out of sight and out of mind.”

Video calling works well, but face-to-face meetings provide greater insights and more productive business relationships.

The challenge to boards of directors and governors of organisations was to govern with a growth mindset.

“We must resource industry leadership to change the momentum of morale in the sector and orientate focus towards the future,” they said.

“We cannot afford to miss opportunities to step into and leverage the great, big, beautiful tomorrow that the global agri-food renaissance is creating.”

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