Landcorp New Zealand chief executive Steven Carden. Photo / NZ Herald
How did Steve Carden, whose curriculum vitae includes a stint at the high-powered US consultancy McKinsey and Co, end up running Landcorp?
Carden, who is soon leave to the state-owned farming giant for NZX-listed winemaker Delegat's, says it was a matter of "falling in love" with agriculture.
Landcorp, which has the brand name Pāmu (to farm) produces dairy, beef, lamb, wool, venison, trees and of all things, sheep and deer milk from a vast estate of 144 farms, covering a million acres (404,000 hectares).
Before joining Pāmu in 2013, Carden was general manager of PGG Wrightson Seeds Australia from 2010 having earlier joined the company as its group manager of business development.
From 2003 to 2008, he worked at McKinsey & Co in New York and Auckland, advising companies throughout North America, Europe and Australia.
Carden was one of the few from the famous US firm get into agriculture.
"I came from an international business background but I have kind of fallen in love with agriculture."
Under Carden, there has been a 300 per cent increase in Pāmu's profit, despite the company reducing its farm portfolio by 20 per cent.
Debt is down and Pāmu's return on assets has lifted.
The eight years at Pāmu has had its highs and lows.
"We had three fatalities in a six-month period - 2015 - relatively soon after I began.
"That was incredibly difficult to deal with as a chief executive - unbelievably difficult - and a real test of the organisation.
"We have worked really, really hard - which has ended up being one of the biggest highs - in trying to build a very strong safety-oriented culture and to look after people in a way that we just weren't before - to ensure that they were not killed on the job or seriously injured."
These days there is awareness around workers' mental health, getting the number of hours worked down, more balance in working conditions and increased pay rates, he says.
'"And just trying to make the experience of farming a more positive one for people who choose to do it."
Carden thinks Pāmu has done well to strongly push the safety message in an industry that has struggled in that area.
There has been a significant push into high-value land uses during his time.
"It's been really tough but I think that it's the only direction that farming can take - that New Zealand agriculture can take."
He says Pāmu has been at the forefront of innovation.
"Everyone is trying to do the premium play in the pastoral sector, but I feel that if we are going to try and extract premiums from our customers and the world, we need to continue investing in it.
"It's been really hard but really satisfying in terms of the progress that we have made - the volume-to-value shift.
"We have done a lot to diversify our business - that's really important around new land issues."
Pāmu has also built its forestry business and it now has horticulture in its portfolio.
"We have those specialty dairy plays going now, like sheepmilk, the organics and deer milk.
"That's been a really big shift for the organisation which, for 130 years, has really only been interested in pastoral farming.
"We are now a more diversified user of land in a way that is probably more reflective of where future consumer demand is likely to go as well."
Pamu's sheer size puts it in the unique position of being able to evaluate different approaches.
It has organic dairy farms that border on its conventional dairy farms, offering a unique "apples with apples" perspective.
"We see that we can almost double our return on [organic] assets and drop our carbon footprint by 30 to 40 per cent and reduce our nitrogen leaching levels by the same amount.
"Those are the win-win stories that we need to be able to find in developing new farm systems that don't put farmers out of business, but at the same time actually regenerate the environment.
"We just need to keep developing those solutions and Pāmu has a clear role in developing those solutions."
Carden says Pāmu has tried to face up to environmental issues.
"We have taken palm kernel out of our system and we have done a huge amount of QE2 covenant planting."
The company has gone big on reducing its stocking numbers, has become involved in organics and has pushed hard to reduce winter grazing.
Carden says that's all about trying to effectively future-proof the business around what he sees as ongoing environmental restrictions.
"That cultural shift, which I think is happening right across the sector, has been a really difficult one to get momentum on but it's been absolutely the right way for the business to go, and the farming staff have really embraced it."
As the country's biggest farm owner, does the sector look to Pāmu to lead the way?
"Being Government-owned, we have all this land from the far north to the far south in all these different sectors, and what is our role fundamentally?
"Is it just to provide a dividend back to the Government every year, or is it to actually act on a commercial basis but to actively drive change and innovation in the sector?
"It's a unique asset that New Zealand has - people don't appreciate how unique it is, globally, to have a large farming company owned by the Crown, across all those sectors.
"We have always really struggled to get a clear sense of what the shareholder really wants from us, and that just provides an opportunity in the future for Pāmu to continue refining its focus on innovation, because there is so much it can do to help build with others the solutions that New Zealand ag needs to make the changes that it has to make."
Pāmu is not your typical landowner.
Some of its land is held in reserve for possible future use in Maori land claim settlements.
"We have an important part to play in the treaty settlement process, particularly for the land that we have in the North Island.
"[We do] our best with our Maori and Iwi partners to make sure that it is returned in a good state.
"We have had a few effective partnerships with Maori to continue managing their land as it makes the transition to ownership.
"That's all been pretty positive, but we are much more than a land bank.
"We have got this big, diversified, quite complex business that we run with scale to actually try out a lot of new things across our portfolios to see what will work - whether its technology or new farming systems, or new animal genetics, to see if we can come up with some solutions.
"That invariably means we have to take some risks in some areas - calculate the risks in proportion to the size of our business.
"What we try does not always work as well as we would like, but we are taking risks.
"It's a great role for Pāmu to take on for the sector.
"There is no similar organisation out there that can do something like that."
Carden said that culturally there had been a huge change in how Pāmu operates.
"Now, we think about looking after our animals in different ways and now we think about the professionalism we need as a corporate entity.
"We will always have our detractors who hate the idea that the Government owns any farms.
"But I think there are a lot of people who are happy to see us innovate and try out new things - and not be just a big version of what everyone else is doing - because that would be pointless."
Carden inherited a business that was ploughing ahead with dairy conversions.
"We put a hand brake on that and have reduced our exposure.
"The business was becoming increasingly volatile from a financial perspective, with its growing exposure to dairy, and we were facing some very strong environmental challenges.
"The company is now trying to move up the dairy value chain in terms of the money that can be achieved at the farm gate, rather than just getting more animals on to the land, which was unsustainable."
Pāmu has been planting 1000 to 2000 hectares in trees a year over the last five or six years and will continue to do so, probably for the next decade, Carden says.
Planting has helped Pāmu retire some "pretty marginal" pastoral farming land.
He says pressure on methane outputs from ag will continue to build, particularly from markets that don't see New Zealand doing enough or who are looking for opportunities to impose non-tariff trade barriers.
"That's inevitably going to place more pressure on the ag sector to do more to reduce methane, and while there are some genetic and feed options, they'll likely not be ready fast enough to meet our commitments, which means we'll be needing to either do more in offsetting, or reduce stock numbers.
"Undoubtedly, there is a heap of change that the industry is having to confront.
"I can completely understand why many farmers feel overwhelmed by that.
"We feel that we are under pressure to make a lot of changes quite quickly and we are a big company with a lot of resources.
"For a private farmer it is absolutely difficult at the moment but we have seen these changes coming for quite some time and, as an industry, we have not moved fast enough to get on top of them, which means we are trying to catch up now.
"We are having a lot of change put on us reasonably quickly because we have not been evolving an industry fast enough ourselves."
"One thing that Pāmu can do, with its scale, is look ahead five, 10 or 15 years and start to build into its systems some of the changes that we see coming.
"We saw pressure coming in terms of the number of dairy cows that we had across our land - we started early to try and reduce them and change our farm systems.
"The organics business has taken some of the pressure off parts of the country where we had too many cows.
"As a sector what we have got to get better at doing is staying on the front foot and helping to drive change at a steady rate over an extended period, rather than having it forced [on us] over a short period of time. That's what we have fallen into, as a sector."
Carden said farming needed to face the fact that consumers are seeking alternatives.
"Clearly, people are pretty concerned about the environmental footprint of everything, including food.
"But I think that New Zealand is buffered from that to a degree because so much of our food - animal protein - goes to large Asian markets like China where you don't quite get those same consumer signals about those environmental issues.
"I don't think that we have been feeling it to the same degree as European, US producers have been.
"They are getting strong signals from their customers who don't want to consume meat that has been produced as a result of cleared forests or that has degraded waterways.
"They have been adjusting faster than we have in terms of their systems.
"There is going to be an ongoing shift towards plant-based foods.
"There will still be strong demand for animal protein but it will need to be of higher value and quality to compete and attract premiums," said Carden.
"Fundamentally, consumers are going to have to pay more for food if they want farmers to have a sustainable business and the environmental to be protected.
"My own view is that we run the risk of over-estimating the risk of threat that it is in the short term, but probably underestimate how big a threat it is in the long term."
Carden sees the day coming when cellular-based meat production technology will only improve - to the point where people will be unable to differentiate between meat that comes out of New Zealand and the meat that comes from a Petri dish.
"It will be very hard to compete on a costs basis and there will be a pretty compelling environmental story around the synthetic alternative meat product, so that is absolutely a threat to the industry.
"It's a reflection of how Pāmu has been diversifying its land uses to make sure that we are not completely exposed to animal proteins for that reason."
Carden says the next 10 years are going to be interesting.
"By 2030 I would like to think that people will be pleased with the amount of innovation that Pāmu is helping to drive in this sector."
"The ag sector is after solutions and Pamu is a great asset with is big animal genetics business, farm software business - a huge amount of tools to drive those solutions that the ag sector needs."
Despite the challenges, Carden said he was optimistic about the future of agriculture in New Zealand.
"Getting through that transition is going to be a bit painful, because costs are going up with these changes that we are having to make," Carden says.
"That's just inevitable."
Role: Chief Executive Pāmu, joining Delegat Wines in 2022
Age: 48
Family: Lives with partner Lucy and their five (combined) children.
Education: Saint Kentigern College, University of Auckland LLB & BA, Harvard MBA.
Career: A background in agriculture spanning 15 years in New Zealand and Australia, including PGG Wrightson and co-founding NZ vertical farming company, 26 Seasons. Management consultant with McKinsey & Company in New York, and an internet and social entrepreneur in New Zealand (including founding the First Foundation charity). Author of NZ Unleashed.
What was the last movie you saw? No Time to Die.
What was the last book you read? Benjamin Labatut's, When We Cease to Understand the World.
Last overseas holiday? Melbourne for the Boxing day test match.
Volumes were lighter as investors are thinking more about the summer holidays.