Bay of Plenty Business News November/December 2018

BAY OF PLENTY BUSINESS NEWS November/December 2018
3
Kiwifruit to milk for Bay’s McBride
Zespri’s retiring chairman Peter McBride has made the step
from one large primary producer to another with his election in
November to the Fonterra board to fill one of three vacancies.
By RICHARD RENNIE
Bruce Cameron
His election at the AGM
sent a resounding message
from farmer shareholders
about their level of
dissatisfaction with the previous
board.
McBride’s appointment
accompanied that of former
director Leonie Guiney, who
had been muzzled by Fonterra
directors after missing out on
being re-elected last year.
One director position
remained unfilled as remaining
candidates did not reach
the required 50 percent level
of support.
Tauranga-based McBride
announced in October his
decision to step down from
his five-year chairmanship in
February 2019.
He will be replaced by deputy
chairman Bruce Cameron,
a long-time kiwifruit grower
who has been a director of
Zespri since 2010.
McBride’s departure from
Zespri marks the end of a
17-year stint on the kiwifruit
marketing group’s board,
and he played an instrumental
role in the industry’s
re-establishment in the
post-Psa environment.
Describing that period to
Bay of Plenty Business News
as the start of a “very long
dark tunnel,” he and then-chief
executive Lain Jager were able
to convince growers to commit
$25 million of their own
cash to match the government
dollar for dollar to get the
industry back on its feet after
the outbreak.
Eighteen months after the
November 2010 outbreak,
Jager and McBride presented
bankers with a road map
to financial recovery for the
industry, with the Gold 3 kiwifruit
variety being the centrepiece
as an alternative more
Psa-tolerant variety to the devastated
Hort16a species.
“Really the risk was asymmetrical,”
said McBride. “It
was a far greater risk to do
nothing, than to do what we
presented, despite it being
unproven.”
From that point the industry’s
fortunes have taken an
almost unbroken upswing.
Orchard gate returns have
doubled, orchards are selling
for $1.1 million per ha, and
overseas markets are clamouring
for a fruit variety more popular
than the one it replaced.
But the Psa outbreak
was closely followed by the
Chinese importing scandal that
We have
demonstrated
time and again the
cohesiveness of our
[kiwifruit] industry
and our ability to
act in its common
interest.
– Peter McBride
resulted in a Zespri staff member
being imprisoned in China,
Zespri repaying thousands in
forgone customs, and being
subjected to a Serious Fraud
Office inquiry in New Zealand
over possible tax evasion. That
investigation did not find evidence
of such activity.
Zespri moved to become
the “importer of record” for
China, removing the rights
from its China-based importer
and taking complete control
over the distribution chain.
McBride said the entire episode
taught Zespri some valuable
lessons, particularly about
not compromising on values,
and learning to send clear,
sometimes blunt, messages to
the market about the intention
to retain those values.
Zespri has been committed
to a “one company, one
culture” philosophy, built on
integrity in supplier-distributer
relationships.
Peter McBride
“Our kiwifruit industry has
stepped through a number of
challenges, but we have demonstrated
time and again the cohesiveness
of our industry and
our ability to act in its common
interest,” said McBride.
Dairying background
McBride’s move to Fonterra
is one he is well-equipped to
make. He began his career as
a sharemilker with his wife
Linda, before moving from
South Waikato to Te Puke
and converting a dairy unit to
one of the country’s first Gold
kiwifruit orchards in 1999.
He is also chief executive of
Trinity Lands, a large dairying
and orchard enterprise based
largely in South Waikato.
In stepping up to his new
role at Fonterra, McBride has
acknowledged it is still early
days for him to get under the
hood of the country’s largest
company.
However, he maintained the
co-operative needed to have a
better base understanding of
what its key strategy is, and the
reasons why it exists.
He noted how quickly the
co-operative has dropped its
“Velocity” and “Volume” components
from its “3V” strategy
launched by previous chief
executive Theo Spierings.
McBride said one of his
early tasks on the board would
be to work on rebuilding
farmer shareholder trust in
Fonterra, which has been eroded
over recent years.
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