Thin vote sanctions Fonterra changes

By PHILIPPA STEVENSON agriculture writer

A rejigged Fonterra board of nine farmers and four commercial directors is likely by the end of the year, after the change was endorsed yesterday by less than a fifth of the company's shareholders.

Fonterra chairman John Roadley was disappointed by the turnout at yesterday's seven video-linked meetings, but pleased by the results.

He said he expected the search for a fourth appointed director would begin immediately, but was unsure when an election would be held to cut the farmer seats from 10 to nine.

That could be anytime before the December 16 deadline unless a director retired in the meantime.

The heat went on the make-up of Fonterra's board when director Mike Smith suddenly quit in January, only four months after the company was launched.

He said then that he feared the company's performance would be below par and there was no urgency among the other directors to effect change.

The board's composition and the range of directors' skills became the issues following his resignation, and a month later Roadley proposed the changes that were endorsed yesterday.

Only 19 per cent of Fonterra's 13,030 shareholders, or around 2500, went to the meetings or voted by proxy.

Those who did gave a 78 per cent vote for the cut to farmer directors, and 79 per cent supported having another appointed director.

The resolutions required a 75 per cent vote to be passed.

A farmer who attended the Palmerston North meeting said just 100 people turned up but some had driven two hours to do so.

Given the philosophical nature of the resolutions a vote of more than three-quarters support was reasonably decisive, he said.

Roadley said meetings about constitutional matters generally got around a 30 per cent turnout, so 19 per cent was lower than expected.

He had been disappointed that only 56 per cent of shareholders voted in the recent director elections.

But a lot of the heat had gone out of the issue as directors had talked with shareholders, he said.

"After considerable debate throughout the company and a lot of work on our governance at the board level, it is pleasing that we can now move forward with a settled governance structure that will provide a greater depth of skills to the co-operative."

Last month, Fonterra recruited former Telstra chairman David Hoare to fill the vacancy left by Smith's departure.

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