David Harvey: The Courts and Climate Change

The Smith v Fonterra case was brought by climate change spokesperson for the Iwi Chairs Forum Michael Smith (Ngāpuhi, Ngāti Kahu) against several major emitters. Smith was attempting to use tort law to address the diffuse, cumulative harms of climate change to his property, culture, and iwi.

John McLean: My last fandango in an official information act fiasco

A case study in the breakdown of public transparency and accountability in New Zealand

This Substack has its genesis a decade ago. From 2015 to 2017, Fonterra deliberately cooked its financial books in order to hide bad investments and artificially inflate its net worth and share price. These shifty shenanigans, in which Fonterra’s auditors PricewaterhouseCoopers were complicit, meant that dairy farmers who purchased their mandatory Fonterra shares over this period did so at inflated prices. More particularly, the book cooking significantly boosted the already astronomical pay of Dutch Fonterra CEO Theo Spierings, whose bonuses were significantly based on Fonterra’s share price,.

Point of Order: NZ’s big dairy company reports a massive profit jump....

.....but the lobby group Greenpeace doesn’t like it

Dairy farmers, or at least those who are also shareholders in the Fonterra dairy co-operative would have received a second dose of good news this week, when the dairy giant reported a massive profit jump.

Eric Crampton: With friends like these, does the Emissions Trading Scheme need enemies?

There is no chance it is deliberate. Deliberateness would require more coordination than government is able to manage these days.

But if the government wanted to undermine the Emissions Trading Scheme, would policy over the past year have looked much different?

The government has made too many decisions that weaken the Scheme, that encourage emitters to ignore the price signals it sends, or that throw the market into chaos.

Point of Order: Buzz from the Beehive - 20/7/23

$90m to help wean Fonterra from coal, an easing of our liquor laws – and a crackdown on those bloody ram-raiders

A question about corporate welfare is answered in the latest batch of statements posted on the government’s official website.

The question is: which corporate giants are being given a funding pick-me-up?

Brian Gaynor: What Fonterra needs — radical reform

When will New Zealand dairy farmers wake up and realise that Fonterra Co-operative Group needs a massive shake-up?

When will farmers grasp that the group’s poor performance has a massive impact on their pockets, with this column estimating that the average NZ dairy farmer has missed out on over $1.5 million of tax-free capital gains over the past nine years?

The most depressing section of Fonterra’s recently released annual report is the historical financial summary on page 62. This shows that the farmgate milk price has fallen 20.4 per cent since 2014, the co-op’s dividend is the same as 2014 and its shares have a dividend yield of only 1.7 per cent.

Frank Newman: Creaming it

A few weeks back Fonterra disclosed that its chief executive received remuneration of $8.3m in the year ended July 2017, making him New Zealand's highest paid chief executive. That payment includes base salary, bonuses and other benefits and works out to be about $4,150 an hour!

By way of comparison, the average hourly rate for a heavy truck driver is in the region of $20 to $25, and the average income in New Zealand is about $30 an hour. The Prime Minister receives about $460,000 a year, or $230 an hour, assuming an average working week which his is not.

Brian Gaynor: Rural co-ops lack market savvy at board table

Fonterra and others won’t become great by focusing on farmers.

A number of recent developments highlight concerns about the corporate governance of rural-based companies. These concerns have led to the requisitioning of special shareholder meetings at Silver Fern Farms (SFF) and Fonterra Co-operative while Murray Goulburn Co-operative shareholders in Australia are also threatening to call an extraordinary meeting.

Brian Gaynor: NZ’s dairy giant deeper in debt

Monday’s announcement of a new $150 million Fonterra retail bond offering has shone the spotlight on the co-operative’s soaring debt levels.

The dairy giant’s total borrowings have swelled from $4.65 billion to $7.56 billion since the end of its July 2011 year while its net positive cash/overdraft position has deteriorated from $762 million to $303 million over the same period.

Stephen Franks: Leave Fonterra to sort itself (or not)

The amalgamation/monolith structure of Fonterra was a mistake. But it is what we have and pulling it to bits now could compound the mistake.

The Fonterra monopoly came from a conjunction of  dairy politics with the instincts of a leftist Clarke Cabinet, at a time when they needed to rebuild trust with business. The Fonterra ‘capture the value chain’ slogans appealed to a Cabinet nurtured on coop=good/big battalions/commanding heights socialism. So they legislatively outflanked the Commerce Commission, relegated official reservations, and created the monolith.