Shareholders’ leader sparks strife over cuts
The new chairman of the Fonterra Shareholders Council has stirred a reaction in his ranks by taking a knife to the farmer watchdog’s proposed budget next year of nearly $4 million.
Simon Couper, who toppled Blue Read for the top job in July, said he would take a considerably reduced budget proposal to next month’s annual meeting of Fonterra.
The farmer-elected, 35-member council’s budget last year was $3.3m. Mr Couper said the proposed budget for 2010-11 was ‘‘close to $4 million. It has got out of hand,’’ he said.
He declined to elaborate on his budget proposal until it has been voted on by shareholders.
The council’s job is to monitor the financial performance of Fonterra on behalf of the co-operative’s 10,500 farmer-owners.
Mr Couper said the council could hardly complain about Fonterra’s efficiency with farmer money if did not follow suit with its own farmer-based funding.
But his cost-cutting efforts have got him in hot water with other council members, sparking a protest over the way staff redundancies have been handled and criticism that councillors were not consulted properly.
The council’s governance and ethics committee has lost two chairmen in quick succession. Philip Palmer stepped down recently and his successor, Desiree Read, resigned soon after being appointed.
Both resignations are understood to be related to the new leadership’s changes. Neither would comment, saying Mr Couper was the council’s only spokesman.
Mr Couper said people made decisions for many reasons and he could not control that.
There have been three redundancies at the council’s office in Fonterra’s Auckland headquarters that of a strategic manager, communications manager and council manager and dairy industry administrator.
Taranaki councillor Shona Glentworth has written to council leaders and councillors expressing ‘‘extreme’’ concern about the way the office review was handled.
Her letter said the process did not appear to have followed good business practice and was marked by lack of consultation and communication with councillors about the need for change. ‘‘Based on this example, the council should be concerned about the leadership team’s approach and should look at processes which ensure accountability to the wider council.’’
Mr Couper said there was no unrest within the council and then contradicted that, saying people always reacted to change.