Coronavirus: How Fonterra is battling the risk

Fonterra's emergency management regime has helped keep its 20,600 global employees free of Covid-19, so far. Photo / File

New Zealand's biggest company, Fonterra, says it's preparing for multiple coronavirus scenarios and so far, its emergency management regime has helped keep its 20,600 global employees free of Covid-19.

This includes the big dairy cooperative's 700 staff in China, origin of the virus.

Fonterra activated its incident management procedures at the end of January, said group manager preparedness and response Karen Smyth.

It had quickly sent its non-critical office staff in China home to work and put its China farms with their Chinese staff into lockdown, she said.

"They (staff) actually stayed on the farms to continue operations which we recognised was initially quite tough for them, but as the situation developed in China, they were quite glad to be on those isolated farms."

The seven farms have been released from lockdown.

Smyth said Fonterra had a "very robust" incident management system ready to react to major events. It provided for regular communication with its international offices and manufacturing sites.

"We have significant experience in dealing with these types of complex issues so our incident management structure is really set up and well-capable of responding to these types of events.

"In conjunction with this we have specific continuity planning for our sites and offices in place, but we are reviewing them in light of this (Covid-19).

"We're also doing some scenario planning to prepare for multiple scenarios in case the situation does escalate and to understand what we would do.

"We also have appropriate communications with our people so they know what they need to do to prevent or to minimise any spread of infection.

"We are also reviewing our business continuity plan - it is always in place but we are reviewing it as regards this particular event. We're also working with our customers..."

Actions had included reducing and minimising staff international travel, Smyth said.

Fonterra was always aware of the risk of pandemics and was prepared for them, she said.

The $20 billion revenue company (FY19) has 48 manufacturing sites around the world, including 29 in New Zealand and six in Australia.

Fonterra has 700 staff in China, where Covid-19 originated. Photo / Bloomberg

In New Zealand it employs 11,700 people - 9000 of whom work in dairy product manufacturing.

Asked if manufacturing operations may have to close because of Covid-19, Smyth said it was possible.

"We have clear processes and plans in place should we have staff infections. Our guidance to them has been to ring the Ministry of Health healthline first then contact us, and in that case we will follow Ministry of Health guidelines and would be led by them as to what activities we need to undertake.

"That said, we are undertaking scenario planning to investigate what to do should we be in a worst case scenario, so that we are prepared for multiple scenarios."

Security in Fonterra manufacturing plants is already extremely tight and strictly controlled for food safety reasons. Keeping the virus out would be a priority, Smyth said.

Asked if staff could be screened for sickness upon arriving at work if the virus spread escalates, she said Fonterra had prepared for that situation but would be led by advice from the ministry.

The company also had the capability to set up special incident teams around the country, she said.

While the coronavirus is new, Fonterra had senior staff in China during the SARS (severe acute respiratory syndrome) outbreak which originated in China in 2002 and had learnt from them about procedures and contingency planning, Smyth said.

Senior staff in China had reacted quickly in the coronavirus outbreak, she said.

"They quickly put in place work-from-home guidelines and policies and were very strict in ensuring employees adhered to them and the same with the China farms.

"They reacted really quickly in what was a really difficult situation."

Smyth said Fonterra wasn't seeing a lot of anxiety about Covid-19 among staff.

"I think our communications strategy is working. Our principal aim is to keep them informed and keep a balance as regards what they need to consider to keep themselves safe."