Hurrell on pay drop: It’s not about the money

Fonterra chief executive Miles Hurrell took a pay haircut in the 2020 financial year despite his base salary increasing and his steering New Zealand’s biggest company out of the red.

The farmer-owned cooperative’s 2020 annual report shows Hurrell received a total of $2.008 million in the financial year, getting no short or long-term incentive payments or bonuses, in line with what he asked staff earning more than $100,000 to sacrifice as Covid-19 struck.

Hurrell’s pay was also slim pickings compared to predecessor Theo Spierings, who was paid $8m in each of 2016 and 2017, and pocketed $4.6m when he departed in mid-2018 despite Fonterra later recording a net loss of $196m that year, its first loss ever. Spierings was paid a total of $43m in his seven years at Fonterra.

Asked if he felt undervalued given that he had helped turn round Fonterra’s $605m net loss in the 2019 year to a net profit of $659m for 2020, Hurrell said he was not bothered by the big gap in their respective pay packets. “It’s not about the money,” he said.

Hurrell was appointed chief executive in March last year after serving eight months as interim CEO after Spierings’ departure.

Hurrell’s base pay in the 2020 year was $1.95m, plus benefits of $58,500. Last year he was paid a total $2.26m — $1.37m of which was base salary. His benefits payment was $65,914, he received an incentive payment of $219,375 and a special $600,000 payment for taking on the interim CEO job.

The annual report shows a slight increase in the number of Fonterra staff on more than $100,000. In 2020, 6354 staff were in this range compared to 6322 in

2019.

In 2019 the global exporter had

20,685 staff in New Zealand and around the world. In 2020 it has

21,400. Of the 6354 people on more than $100,000, 984 were in Auckland and 3639 in New Zealand regions. Offshore there were 1769. The annual report shows Fonterra’s two top earners in FY20 — who received $2m and $2.43-$2.44m respectively — left the company.