The Nation Editorial

Fresh Milk

18th October 2015

Fonterra, the owners of the now well-known brand ‘Anchor’, has boldly announced that it is venturing into the fresh milk market. The company didn’t have the best of times after the DCD controversy a couple of years ago. It can be said that the initial reaction did more harm than good to Fonterra. Time will tell if this move will see Fonterra completely dropping powdered milk products, but it still signals a fresh start and one that’s arguably a step in the right direction.

What is important is that that there was a problem and Fonterra has made an effort to win back the confidence of the consumer with a product which, by its very nature, has more trust-value.

The move comes with expected ‘goodness’ rhetoric. It’s ‘fresh’. It’s ‘local’. It will ‘strengthen the local dairy industry’. On the face of it all this could be true. But it is almost as though people are not interested in profit or that New Zealand has enough cows and pasture to give milk to the entire world if that country wanted to. It is as though Fonterra didn’t have any issues with powdered milk.

That said, we welcome this move. With caution, we must add, and that has more to do with the general arrogance and bullish ways of corporate entities than with Fonterra’s track record. Indeed that kind of caution, coupled with vigilance from a public empowered with relevant information, would be of great value to Fonterra as it seeks to reinvent itself in Sri Lanka, especially in these days of ‘good governance’.

That caution, moreover, obtains from a history of both the public and private sectors claiming to ‘up the local’ and then in the very name of the local, disempowering it. Revisiting the history of the Milk Board can show what happened to the dairy farmers of this country and how the local milk industry was destroyed. We are sure that Fonterra would welcome meaningful engagement with the consumers and other watchdogs on corporate activity in light of all this.

Fonterra was slow to respond to the critics. However, it now seems that the company has done a re-think and a deep re-think at that, and come up with a solution that is more open to scrutiny by the public. The public, or rather the informed, organized and articulate sections of the public, is the ultimate anchor of the consumer. Fonterra seems to have realized this and it is a good thing. It is good thing for the entire industry because healthy competition could result in competitive pricing and more importantly better quality.

What the general public should know is that even large corporates with a global presence can be made to change course. In other words, it is not the case that capital has its say regardless but it always has to contend with contestation and adapt. This could be called ‘the negotiation of terms of oppression or extraction’ by cynics and there may be some truth to the assertion. However, the availability of the ‘contestation’ button indicates clearly that it can be pressed, but only by a vigilant, informed, organized and brave community of ‘recipients’.

As for the corporate sector perhaps there’s a lesson to be learnt here.  For too long the naughty boys and girls in the corporate world have had it easy.  Friends in high places and an ad-dependent media have turned them into veritable touch-me-nots.  However, sooner or later the rhetoric of good governance will make people say ‘Not just in the public sector, but the private sector too, not forgetting of course the I/NGO community!’

The country is now demanding change.  The responsible corporate that have at times erred will mend their ways.  Those who are not will be held accountable.
Fonterra is making an effort and we applaud this subject of course to the caveats mentioned above.  Others must follow suit.