KEY POINTS:
Three of the nation's most experienced dairy sector leaders, Fonterra directors Greg Gent, Earl Rattray and Jim van der Poel, are set to "retire" from the giant cooperative's board.
Each year three farmer-elected directors are required to stand down.
None of the three required to step aside this
year have to tell the election's returning officer whether they intend to stand again before nominations open on September 8.
Nominations will not be publicly announced until October 10.
Fonterra farmers are receiving record incomes as a spin-off of soaring commodity prices, and any incumbent directors who chose to stand would normally be regarded as certainty to be re-elected.
But this year, those sitting directors who decide to stand again may face a risk of being dumped by farmers wanting to protest the board's proposal for a capital restructuring which would have placed all the farmer-owned cooperative's assets in a corporate arm to be partially "floated".
In February, Fonterra abandoned the first step in that process: a farmer vote scheduled for May on splitting into a milk-supply co-operative and an operational subsidiary. It acknowledged the move would be defeated.
Some farmers expressed concern that the proposal meant directors could dilute their initial 65 per cent stake in the listed subsidiary to just above 50 per cent, without further consulting farmers.
But most were concerned that the outside investment would create a tension between achieving the lowest possible price milk to boost margins and dividends, and their own ambition to receive the highest possible milk price.
Now the three directors who have draw the short straw for "retirement" will have to face their shareholders in the wake of publicity over protests by hundreds of Irish dairy farmers at the Tralee headquarters of Kerry Group - where a cooperative was also floated.
In 1986 the co-operative transferred all business to a publicly listed company in return for an 80 per cent ownership stake. But since then K erry has slipped badly from paying the top farmgate price for milk in Ireland.
In New Zealand, farmers voting in previous elections for Fonterra board directors have dumped at least three incumbents, with at least two of them being targeted specifically in protests over Fonterra's performance.
Richard Booth, of Whangarei, and Marise James, of Inglewood, were voted out in 2003 as "a clear signal that farmers are dissatisfied with Fonterra's performance", according to farmer lobbyists at the time.
In addition to the three board seats, farmers will vote for two members of the directors' remuneration committee, and 12 members of the Shareholders' Council, where people are also retiring by rotation.
Directors' remuneration committee member Murray Holdaway is eligible for re-election, but Tom Lees, who was also scheduled to retire by rotation, resigned from the committee and cannot stand.
As well as elections in the 12 wards where shareholder councillors are retiring, there will be elections in at least two other wards: ward 6, where Peter West, was appointed to fill a casual vacancy, and ward 27.
Nominations for all the elections close at noon on September 26.
- NZPA
