Fonterra director takes dirty dairy rap

LOWER PAYOUT: BNZ economist Doug Steel said the payout chop was no big surprise.
LOWER PAYOUT: BNZ economist Doug Steel said the payout chop was no big surprise.

A company owned by a leading Fonterra director has been convicted of unlawful effluent discharge.

Colin Armer's company Armer Farms (NI) entered a guilty plea in Tauranga District Court last month to a charge of unlawful discharge of dairy effluent at a Maketu farm in October 2010. The sentence will be delivered on Friday.

Mr Armer, one of 13 directors of Fonterra and widely tipped to be its next chairman, said the pollution that triggered the prosecution came from a split pipe and lasted only for about 24 hours.

He has been a Fonterra director since 2006 and chairs the supplier relations committee. He said the conviction against his company would probably have some effect on his role as a Fonterra director, and "I can't hide from that at all".

He and his wife, Dale, have extensive dairy farm interests throughout New Zealand and own 60 per cent of Dairy Holdings, which oversees 58 farms and 44,000 cows in the South Island.

The charges against his company had been set down for trial this week, but the company changed its plea on May 31.

Mr Armer was not on the farm when the offence occurred.

"I'm a director of about 90 farming companies with about 450 staff in total across the group, and we take environmental stuff very, very seriously," he said.

"The manager on this particular farm has had a splendid record for the last 12 years until the accident happened."

Asked whether he felt he should have been prosecuted, Mr Armer said: "That's the law. I, of course, have a different view."

He had been farming for 30 years and this was the first prosecution of any of his companies, he said.

Armer Farms (NI) had been the subject of an abatement notice in 2003 and the council had taken this into account.

"Look, it was an accident," he said. "The manager has a brilliant record. It's unfortunate as it undoes a lot of the good work we've been doing from an environmental perspective."

The maximum penalty for the conviction is a fine up to $600,000.

The conviction comes just weeks after The Dominion Post revealed that the country's 17 regional councils and unitary authorities had made 151 prosecutions for dairy effluent discharges involving more than 300 charges against 198 companies or individuals in the past four years.

Fish & Game chief executive Bryce Johnson said it was "not a good look" for a Fonterra director to be prosecuted for dirty dairying.

"This should surely serve to sheet home the need for Fonterra, and indeed all dairy companies, to stop procrastinating around the much-needed transition to mandatory, environmentally sustainable best on-farm practice as a condition of supply," Mr Johnson said.

A Fonterra spokesman, when asked whether the conviction would affect Mr Armer's position, and what action the co-operative would take, said: "Everyone at Fonterra takes the care of the environment seriously, and this includes our directors.

"Mr Armer advised of a one-off breach on one of his farms some time ago. He also advised of general controls he has in place and actions taken to fix the problem.

"Like all Fonterra suppliers, Mr Armer's farms are now subject to an annual check through our Every Farm Every Year programme, which aims to ensure these type of incidents are minimised or don't occur."

Bay of Plenty Regional Council would not comment until after Friday's sentencing.