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Current as of 25/04/17 06:20PM NZST

Fonterra head says 'Sorry, NZ'

By Steve Deane

Steve Deane observes CEO Theo Spierings - just back from China - fronting the media.

A mural behind the boardroom table in Fonterra's downtown Auckland headquarters displays the names of dozens of places where the global dairy giant has a significant presence. At the bottom, in miniature lettering, sit Pahiatua and Brightwater. Top and centre, in the largest type of all, is Guangdong Province, China.

It was perhaps an unfortunate backdrop for a press conference during which Fonterra chief Theo Spierings attempted to reassure New Zealanders worried they might have fed their children contaminated milk powder that they were prominent in the company's thoughts.

"I do understand the anxiety and distress this issue has caused," the 49-year-old Dutchman said. "Like I said in China, I do apologise to consumers and the public for the anxiety and the discomfort this has caused."

The apology came less than a minute into Mr Spierings' 50-minute address - but not before he had reassured the massed media ranks that he had promised the Chinese he wouldn't leave their country until the "situation was stable".

The nod to hurt Kiwi feelings without admitting any wrongdoing would have gone down a treat with the company's lawyers. How well the apology played with the anxious and distressed is hard to say. It seems unlikely Mr Spierings won too many hearts and minds.

The depth of emotion was hard to read in the man who earns $5 million-plus a year running NZ's largest company, although his clipped delivery and Dutch accent may have contributed to that.

Mr Spierings dodged questions about his own performance, suggesting it would be up to the board whether he resigned.

For the most part he remained relentlessly on message. Whenever possible, he avoided naming other companies, instead opting for the term "nutritional customers". It was the fact that they had turned 18 tonnes of potentially contaminated whey protein into 2200 tonnes of multiple products that had made gathering and promptly publicising all relevant information difficult.

Mistakes had been made because Fonterra took the responsible option of going public as soon as it realised there was a potential food safety issue, but before it had all the answers. It was "unfortunate some statements were made that were not correct", Mr Spierings said.

However, "if there is a food safety issue, we decide to disclose immediately. Where there is a food safety risk we go out, whether we have all the information or not". The company - and the public - now had all the information.

But that didn't include how Fonterra made such a colossal error in its production process. "We know what happened, but we do not know why ... "

He repeatedly used the terms "minute" and "one in millions" to describe the level of risk to consumers, but for those hoping for an answer as to when the health threat will have passed, there wasn't one.

Mr Spierings said that when Fonterra made its initial disclosure, it did not have much information because the product was still "captured" in the supply chains of its customers. "We don't have direct access to the supply chains of our customers, so that required full co-operation."

The good news was that all potentially contaminated products were off the shelves. "All stocks are contained. There is little or no more risk for consumers."

- NZ Herald

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