Knockback to farmers' resolution 'an affront'
The Fonterra Shareholders Council's reason for not supporting a farmer resolution at next month's annual meeting is an "affront to farmers' democratic rights", say the remit's promoters.
Fonterra shareholders Lachlan McKenzie and Ann Jones said the council, a 34-member farmer-elected watchdog of Fonterra's performance, had made a "hasty" decision in not supporting their resolution aimed at maintaining the current number of farmer directors on the Fonterra board, and "enshrining into our constitution what is normal good practice within co-ops".
The resolution, which will still be put to the vote at Fonterra's annual meeting next month in Hamilton, seeks to write into the dairy giant's constitution that there should be a minimum of nine farmer directors and that only farmer directors can elect the chairman, who must be a farmer.
McKenzie and Jones drew up the resolution with legal oversight after the Waikato Times revealed last month that one option being considered in a governance review under way at Fonterra was to reduce farmer directors to eight and increase non-farmer appointed directors to five.
Council chairman Ian Brown said the main reason for not supporting the resolution was because it would pre-empt the outcome of the review.
The pair said their resolution simply sought to ensure continued 100 per cent farmer control and ownership of Fonterra, as promised by Fonterra leaders in shepherding in Fonterra's debut on the sharemarket with a listed unit trust this month under share trading among farmers (TAF).
McKenzie questioned how the council could claim a "careful review" of the remit when no one had contacted him and Jones or their lawyer for further dialogue.
"The SHC suggestion that the resolution . . . is pre-emptive or could cause practical difficulties was misleading and an affront to the democratic rights given to shareholders within Fonterra's constitution and the Companies Act.
"It does not pre-empt, prejudge or prejudice any review."
- © Fairfax NZ News
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