Chief dairy role looks shaky for Norgate

By PHILIPPA STEVENSON agriculture editor

Fonterra chief executive Craig Norgate's future with the company is uncertain after it confirmed yesterday that his position would be up for grabs at the end of his two-year contract in July.

Norgate was on annual leave and unavailable for comment yesterday but chairman Henry van der Heyden said his board had "complete confidence" in Norgate, who had been asked to re-apply for the job.

Norgate, 37, who previously headed Fonterra forerunner Kiwi Dairies, was appointed in June last year.

But when Kiwi and its former fierce rival New Zealand Dairy Group merged four months later in October, their agreement included a clause for a worldwide search for a chief executive at the end of Norgate's fixed term contract.

Norgate was said to be the best candidate for the job at the time but it was widely acknowledged that selection was from a field limited by the attractiveness to Northern Hemisphere executives of a job with a yet-to-be established co-operative.

This time, a global search for the head of the world's fourth largest dairy company is thought more likely to attract high-calibre candidates.

Van der Heyden said he did not believe the move would be interpreted in any way other than that the company was honouring the merger agreement.

"I'd be surprised if this has come as a surprise to anyone."

The chairman said he enjoyed working with Norgate and that he had a good working relationship with him.

He would not comment on whether a potential change in chief executive after only two years of the company's existence caused the board any concern.

"We're a long way off that. We're just starting the process," he said.

But even Norgate lent weight to speculation that two years in the job would be enough in an interview with the Herald in August.

Reporter Warren Gamble wrote that he got the impression Norgate would not be unhappy if his ever-steepening working curve which had taken him from Hawera to sealing billion-dollar deals in Brazil flattened out next year.

"The day after our interview I email him with that impression. He replies he is sanguine about what will happen when his reputed $2-million-a-year contract comes up for renewal next July.

"We'll have achieved all I initially set out to by the time my initial two years is up," he says. "While there's clearly another journey to follow that, I've also got other goals in life."

Chris Moller was a candidate for the job last year and was Fonterra deputy chief executive until he quit in a dispute over the company's direction in October.

This week he took another high-profile role as NZ Rugby Union chief executive and is not about to back out for his old team.

Asked who might be up for the job he was categorical. "It won't be me."

Sources suggested that David Pilkington, another candidate last time who is still with the company as managing director of its consumer goods arm, NZ Milk, could put his hand up again.

Norgate's $2 million take-home pay is a top salary here but one that is cut considerably by the exchange rate if viewed from the Northern Hemisphere, but the New Zealand lifestyle could be a big compensation to some candidates.

A second vacancy for a chief executive was also declared yesterday when Sam Robinson, the chairman of the country's biggest meat company, Richmond, said at the annual meeting that it, too, was in the market.

Former dairy industry troubleshooter Graeme Milne has been Richmond's acting chief since John Loughlin stood down in October.

Robinson said he expected an appointment would be made within weeks.