Fonterra's management and structure blamed for massive financial loss

Author
Newstalk ZB,
Section
Audio,
Publish Date
Tuesday, 13 August 2019, 1:36PM

Fonterra's financial woes are being blamed on the way the cooperative was set up.

It's expecting a loss of up to $675 million this financial year, after massive write-downs of its assets.

Regional Economic Development Minister, Shane Jones, says Fonterra's management and board are to blame.

However, agricultural commentator Allan Barber told Kate Hawkesby they have inherited a situation that was avoidable many years ago.

He says overseas marketing of the product should've been part of a separate vehicle.

β€œThe present board and management have inherited a difficult situation because of decisions made under the previous leadership.”

Barber says international companies like Danone and Nestle were set up to be food marketers.

β€œ Fonterra was set up to be a milk processor that wanted to be a food marketer as well, but they have founds has it's far too expensive.”

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