Fonterra's van der Heyden resigns from NZX board

Henry van der Heyden. Photo/Paul Estcourt

Fonterra chair Henry van der Heyden has resigned from his seat on the board of stock exchange operator NZX, to avoid 'perceptions of potential conflict of interest."

NZX chairman Andrew Harmos said in an announcement that van der Heyden resigned "to remove any perceptions of potential conflict of interest with his role as Fonterra chairman."

"Neither NZX nor Mr van der Heyden believed any such conflict actually exists," said Harmos. "However, the NZX board understood Mr van der Heyden's desire to erase any such perceptions, especially as Fonterra shareholders considered important matters relating to the Co-operative's future capital structure."

Van der Heyden joined the NZX Board in September 2005 and has been Fonterra chairman since 2002.

"Fonterra and New Zealand dairy farming are the most important things to me professionally. Dairying has long been a cornerstone of the economy and I've spent a large slice of my working life helping to build a sustainable industry for farmers and one that will remain a strong contributor to our economic prosperity," said van der Heyden.

"Over the coming years, Fonterra shareholders will be making decisions on capital structure that will be of vital importance to the Co-operative and indeed to the national economy. I want to ensure that these deliberations are untainted whatsoever by any concerns about the NZX directorship - no matter how misplaced such concerns might be."

He said he'd "thoroughly enjoyed" his time on the NZX Board and was "very sorry to be stepping down".

Federated Farmers said this morning that van der Heyden made the right decision stepping down from the stock exchange board.

President Don Nicolson, says Henry van der Heyden's position on the NZX board did not sit well with some farmers, when the exchange was embarking on a possible whole milk powder futures platform. He said another potential conflict was Fonterra's review of its capital structure.

Nicolson said although Federated Farmers had confidence in van der Heyden, some farmers may have had doubts.

He said NZX's loss was a gain for Fonterra';s supplier-shareholders, as van der Heyden would have more time to devote to the cooperative.

Harmos said van der Heyden had also "helped NZX deepen its understanding of the rural sector, as the company developed strategies to make itself more relevant to agricultural segments of the New Zealand economy."

"Agriculture and agri-related businesses are a pivotal element of our economy. As a company that has 'Advancing New Zealand' as one of our core values, it makes sense for NZX to promote stronger links between the rural sector and our capital markets - and we will continue to do so."

In this context, said Harmos, "it would be unusual if NZX and Fonterra did not have a strong and transparent relationship across a spectrum of business matters - not a relationship that is a source of tension or concern."

- NZ HERALD STAFF/NEWSTALK ZB