Fonterra chairman Roadley steps down

By NZPA

Tuesday 20th August 2002

Fonterra's founding chairman John Roadley says he will step down at the company's annual meeting on September 12, and quit as a director by December.

Mr Roadley said today he had made the decision after "deeply considering my own personal position, and what was in the best interests of Fonterra".

He told a press briefing during a break in Fonterra's August board meeting at Auckland today that he had only ever considered his role as chairing the nation's biggest company through its establishment.

The board elected former New Zealand Dairy Group (NZDG) chairman Henry van der Heyden as chairman-elect, rather than Mr Roadley's deputy, Greg Gent, the former chairman of Kiwi Cooperative Dairies. Mr Roadley said there had been only one nomination today.

"Henry's nomination came through -- it was the only nomination," he said.

Mr Van Der Heyden, 45, who also took up the helm of NZDG after the shock resignation of then chairman Doug Leeder in 1999, has a degree in agricultural engineering, and was made a director of NZDG in 1992 and a director of the Dairy Board in 1997.

Mr Roadley said that when he took on the job of heading the dairy board and the company which became Fonterra "...I made it clear that I saw the role as comparatively short term, to steer the business through the high risk and difficult period of establishment".

He had set three goals: to ensure farmer shareholders agreed to the merger; to see the co-operative through the risky transitional first year, and to achieve consensus among the board and management on Fonterra's future business strategy.

"Everything that I set out to do has been done," he said today.

He said he did not want to see Fonterra put through another costly round of elections to determine which of the present 10 farmer directors should be dropped to reduce the number to nine for the appointment of a new independent commercial director, scheduled for December 16. If none of the present farmer directors had quit by then, there would have been a by-election.

"I leave knowing that the core of this business is in very good shape," Mr Roadley said.

But the Waikato Times newspaper reported un-named sources as saying Mr Roadley was forced out because the board had lost confidence in his ability to lead the company after an embarrassing end-of-season financial result and on-going milk collections problems.

The newspaper reported Mr Roadley's days were numbered in May after the balance of power changed on the board -- in terms of the ratio of directors formerly from the legacy companies Kiwi and NZDG -- when director elections saw one extra NZDG farmer elected .

Mr Roadley strongly rejected any suggestion that parochial rivalry between farmers of the two former co-operatives continued to be important.

"There are no party lines," he said. "The board is functioning incredibly well... we're all here to drive Fonterra forward."

A spokeswoman for Fonterra also rejected the claim that Mr Roadley had been forced out.

"It was a surprise to the directors," she said.

Mr Roadley said the timing resulted from the convergence of the board's downsizing, his intentions not to go beyond the company's establishment phase, and the need to have a chairman to take the board forward.

The core of his decision was related to the September-October implementation of the board's "strategy-refreshment", Project Galileo, which would be a good time for a new chairman to take the company forward.

"Now is the exact right time," he said.

The board is expected to announce to farmers in the next two months "new insights" into its global business, after international consultant McKinsey and Co was commissioned to help it formulate its business strategy.

Mr Roadley acknowledged that some farmers were unhappy about Fonterra's performance in collecting milk and providing information to farmers, but said they were simply "peripheral issues, just teething problems that in 18 months we will have forgotten about".

In November last year, Mr Roadley was awarded Melbourne's Monash University Sir John Monash gold medal for his part in setting up the company as chairman of the Dairy Board and the chairman-designate of the industry's mega-co-operative in the lead-up to the official formation of Fonterra last October.

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