Fonterra reshuffles management team

Jacqueline Chow, currently managing director global brands and nutrition, is stepping into a newly-created role of chief operating officer velocity.

Fonterra Cooperative Group, the world's largest dairy exporter, has changed two senior management roles in a bid to push its value-add strategy harder in the wake of shareholder criticism over its weak half-year financial results and lower forecast dairy payout.

Jacqueline Chow, who is currently managing director global brands and nutrition, is stepping into a newly-created role of chief operating officer velocity, from June 1, where she'll work with the management team to boost performance across the cooperative.

Prior to joining Fonterra in 2013, Jacqueline was Australia and New Zealand general manager for Arnott's, one of Asia Pacific's largest food companies.

Chief executive Theo Spierings said Chow will "lead the next stage in Fonterra's evolution, working across the entire co-operative to push forward the velocity part of our V3 strategy and deliver the best possible performance."

The V3 strategy unveiled in 2012 involves volume, value and velocity: increasing milk production volumes to ensure Fonterra maintains its share of the growing dairy market, driving more value from its milk through higher value products, and doing so at speed.

The other appointment is Johan Priem, currently president Greater China, who will take on the additional role of managing director Asia, Middle East and Africa from August.

That role was previously held by Pascal de Petrini, who resigned a month ago after only two years in the job in order to return to France to work for his former employer, Danone.

Speiring said Priem was well placed to take on the additional role given he has previously held senior leadership positions in that part of the world for other companies.

"Johan will draw on his extensive knowledge, experience and relationships in the region, which includes a number of Fonterra's key strategic markets," he said.

As part of the reshuffle, a senior executive in the global brands and nutrition team, René Dedoncker, will take over Chow's former role in an acting capacity from June.

In March, Auckland-based Fonterra reported a 16 per cent drop in first-half profit to $183 million, reflecting tough conditions in dairy. Sales were down 14 per cent to $9.7 billion.

While it maintained its forecast farmgate return for the season at $4.70 per kilogram of milk solids, it disappointed its 10,600 farmer shareholders by reducing the forecast dividend range by 5 cents to between 20 cents and 30 cents a share.

That led to reports of a number of its shareholders lining up to supply other independent processors and for Fonterra Shareholders' Council chairman Ian Brown to say shareholders "rightfully want to see the strategy provide a return on their investment, especially given the low milk price environment farmers are currently experiencing. A sound strategy is key to adding value long term."