19 Nov 2012

Fonterra Shareholders' Council opposes resolution

9:55 am on 19 November 2012

The Fonterra Shareholders' Council, is advising the dairy co-operative's farmer owners to reject a proposal aimed at reinforcing their control of the board and company.

A group of farmers has put forward a resolution calling for a minimum of nine farmer-elected directors on the board and a maximum of four appointed directors.

A spokesman for the group, Lachlan McKenzie, says there is currently no protection in Fonterra's constitution against a reduction in farmer directors, leaving it open to the risk that they could lose control.

The resolutions will be voted on at the AGM in December.

But Shareholders' Council chair Ian Brown says it is asking farmers not to support the proposal, as it would pre-empt a governance and representation review that the council and board are doing.

Mr Brown says a vote in favour of the resolution could cause practical difficulties for Fonterra.