Rt Hon Winston Peters
New Zealand First Leader
Member of Parliament for Northland

1 OCTOBER 2015

Fonterra's "five million dollar man" not delivering

Theo Spierings is ‘Fonterra’s Five Million Dollar Man’, but he is no hero, with the offer to freeze his pay coming after hundreds of job losses and an 18% pay increase.

“Dairy farmers do not care what Mr Spierings is paid so long as he delivers and that’s really become the issue here,” says New Zealand Leader and Member of Parliament for Northland Rt Hon Winston Peters.

“Mr Spierings is the Stuart Lancaster (English rugby coach) of dairy company CEOs after looking at his performance over four financial years. He talks a very good game about Volume, Value, Velocity, but results on the pitch are the only things which matter.

“Tatua’s recent payout of $7.10 per kilogram of milksolids only highlights this gulf. It is time for Fonterra’s Shareholders’ Council to drop its sycophancy and do its job instead of using the council as an audition for the Fonterra Board.

“With the exception of the record payout year, Fonterra revenues have been static under Mr Spierings. Indeed, the net profit trumpeted last month is substantially less than what Fonterra delivered in 2012; Mr Spierings first year as CEO.

“Of most concern is the gearing ratio that’s gone backwards at a rate of knots under his tenure. Fonterra’s stake in China’s Beingmate isn’t helping, given its shareprice is down about 26% since Mr Spierings called it a ‘game changer’ investment.

“Fonterra has slashed jobs and the payout to its farmers yet Mr Spierings salary increases. Does the board not know that paying a CEO more doesn’t guarantee higher performance?

ENDS

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