The search for a top person
Fonterra is a very large exporter in New Zealand, where the local market amounts amounts to around 4.7 million people and the local cows produce around 21.5 million metric tons of milk annually. I am not much of a maths whiz and even I can figure out that there is not any way the domestic market can absorb that much milk.
Thus, as a large co-operative, the Kiwi firm has to head into the global marketplace every so often and get a new CEO, as well as selling its many products overseas. Theo Spierings has been at the helm since 2011, and he acknowledged recently to the New Zealand Herald that there have been hits and misses during his tenure. The investment in China’s infant formula company Beingmate and a write-off from a legal settlement with Danone were not the highlights.
Also, during his time there, the A2 Milk company has also set up in Fonterra’s backyard, so to speak, and is now New Zealand’s biggest listed company. It will be something to see A2 and Fonterra go head to head in Europe and the US. The latter has turned around its businesses in these markets, with some savvy buys, such as A-ware. Through Fonterra Ventures, the co-operative is also investing in firms such as foodspring in Germany, which produces a range of products for the modern lifestyle, including whey protein shakes.
The challenge is always keeping up with the pace of change in dairy, and the next seven years promise to be as eventful as Spierings’ tenure was. It will be interesting to see who comes on board and takes this industry giant into the 2020s.