We're committed to the highest standards of corporate governance and leadership.
We focus on governance in a way that promotes:
- The interests of our Shareholders
- Transparency – giving our Shareholders and other stakeholders the information they need to assess our performance
- Effective risk management – ensuring Fonterra meets its business objectives and legal requirements
- A good balance between the roles and functions of our Board and management team
- Communication with important stakeholders – including shareholders, employees, customers, farmers, governments, and the communities within which we work.
Fonterra Shareholders' Council
The Fonterra Shareholders' Council is an elected national body of farmer shareholders. One of its key roles is to represent the views of all Fonterra Shareholders as suppliers, owners and investors.
Our Board of Directors has up to 13 members – nine elected from our Shareholder base and four appointed by the Board and approved by our Shareholders at the Annual Meeting.
The Appointed Directors are selected to ensure our Board has the appropriate skills and competencies to lead our organisation effectively. The perspectives and experience they bring to the Board complement the industry knowledge and other expertise provided by our Elected Directors.
As the Elected Directors must have a shareholding interest, they will have a supplier relationship with Fonterra and generally will not be classified as independent under best practice definitions.
The Appointed Directors generally meet the NZX criteria for independence and are expected by Fonterra to maintain independence for the length of their term. All Directors comply with the legislative requirements for disclosing interests and with Fonterra's in-house Securities Code of Conduct which regulates both Directors and management in their personal dealings with Fonterra securities and those of related companies. Fonterra does not have executive Directors.
The board's role
- Our Board is responsible for leadership, direction and oversight of Fonterra. It is accountable to our Shareholders for the overall performance of the Co-operative. Specific functions of the Board include:
- Review of the dividend policy and declaration of the interim and final dividend.
- Declaration of the Farmgate Milk Price and Distributable Profit.
- Declaration of the actual Co-operative share price from the commencement of each season (the Fair Value Share price).
- Reviewing and approving the Group strategy and business plans.
- Appointing the CEO and reviewing the CEO's performance.
- Delegating authority to management, and monitoring the exercise of that authority.
- Engaging in the development of the strategic plan and setting the strategy for the Group and for the major business units within the Group.
- Approving significant acquisitions and disposals outside management's delegated authorities.
- Overseeing the Board Committees and the areas covered by each of those Committees.
Our Board of Directors has adopted a written charter setting out its roles, responsibilities, and obligations and the way it will operate. The Board has also adopted a written charter for each of the Board Committees.