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Open letter to Farmlands shareholders regarding Groundswell

From Farmlands Chairman Rob Hewett and Farmlands Acting CEO Kevin Cooney

 

Dear shareholders.

We appreciate that that there have been some strong feelings amongst you about Farmlands choosing not to have a visible presence in the recent Groundswell protests around the country. Our people – from the Board of Directors to the team in your local branch understand fully and empathise strongly with the purpose of Groundswell. However, despite that, some of our staff have unfortunately been subjected to expressions of frustration, anger and in a few isolated cases, abuse.

We do not under any circumstance condone poor treatment of our people for a decision made by our Board and Leadership Team. Your regional support teams are passionate local people who are highly committed to supporting you and your businesses through thick and thin, particularly as you navigate the uncertainty arising from the very issues driving the Groundswell movement.

Moreover, as a Board and Leadership Team, we are more than happy to engage with you on these matters. A number of us have had many one-on-one conversations with individual shareholders over the past three to four weeks. Most of these have been constructive and sensibly resolved through understanding each other's position.

We are taking this opportunity to set out and clarify why we have chosen the path that is best for us – particularly in terms of our ability to fight for the issues with key stakeholders like Government as and when they arise in support of sensible outcomes for the primary sector.

Earlier this year, Farmlands allowed Groundswell to use our facilities to host their initial get-together at Southern Field Days. Organisers approached us directly with our local team more than happy to accommodate the request.

Following the recent protest, one criticism was that Farmlands isn't supporting shareholders.

Stepping back from the protest itself, Farmlands supports shareholders every day in multiple ways. Apart from our day-to-day work supporting on-farm needs, there are also the multiple regional events and activities that we get behind too. With respect to the issues driving the protest itself, we choose to "support" through the channels and relationships with Government and industry bodies we have built over years. Change on the scale we are dealing with as an industry does require multiple tactics and approaches. A national protest while highly visible is just one of these. Ultimately, our strength as an industry must come from working together through these multiple approaches, co-ordinated into driving more workable outcomes for all parties.

As a major player and stakeholder in the industry, our view (in common with the larger agri companies generally) is that each stakeholder must play to its strengths. In choosing not to have our brand at the protest we are choosing instead to "protest" as we do best which is behind the scenes using our relationship capital.

That capital is an important asset. Like a reputation, it's hard-won but easily damaged. We put it to work on behalf of shareholders on the big issues we feel we can influence. Further, as a nationally visible member of New Zealand's food value chain, we must ensure we don't put our brand in situations that might compromise our ability to advocate on behalf of shareholder issues when we most need it. This is also why we are a strictly apolitical organisation. We don't, and can't be seen to, take sides.

We get the urgency of the issues and that visible support is valued at this time. But that must be weighed against potential for reputation damage. We don't control people's behaviours in protests. We also don't control what the media will portray. With media attention often drawn to negative stories and imagery, rightly or wrongly, any inadvertent or intentional association of our brand with views or behaviours contrary to our values is at best not a good look, and at worst potentially damaging to our business. We are naïve if we are not mindful of the lasting damage social media can do to brands.

Our job is a simple one: to deliver on the job shareholders require of us as best we can. Doing anything else that puts our ability to do this well is not acceptable. Despite the fact our farmer and grower customers own us, our Board and management team are charged with managing the company's reputation and business in the best interests of the co-operative. That means ensuring that our co-operative can continue to do what it was set up to do – to support you with competitive solutions now and into the future.

Our people live on farms and orchards or grew up on them. They live in and contribute substantially to our regional communities. Like you they are passionate about our sector and concerned that any change is ultimately for the good. Many of our staff participated in Groundswell protests in their own capacities, encouraged by us as an organisation.

While these are not easy issues, nor easy decisions to make, we can say we do take into account and balance your concerns with doing the right thing for the long-term ability of the co-operative to do its job including operating effectively in its critical relationship channels.

We believe that working together through a balanced multi-layered approach to tackling these issues is the most effective way to get sustained change, and in that vein we will continue to do our bit using our relationship capital strengths on your behalf.

Thank you for taking the time to read this.

 

Rob Hewett
Chairman
Farmlands Co-operative Society Limited

 

Kevin Cooney
Acting Chief Executive
Farmlands Co-operative Society Limited