Sanlu scandal tarnishes Fonterra


Fonterra has been ranked sixth in an international ranking of companies most crticised for their impacts on the environment, health and communities.

The list, compiled by Swiss-owned RepRisk, a consulting firm that analyses companies’ exposure to controversial issues and news, was headed by Sanlu Group, the Chinese joint venture in which Fonterra held a 43 percent stake.

Big Chinese rival Inner Mongolia Yili Industrial Group Co took second, and Fonterra was ranked sixth most vilified in the September “top 10” list issued by RepRisk.

. . . Fonterra spokesman Graeme McMillan said it was surprising that the company was featured in a ranking based on media coverage of high-profile news events.

“Our research tells us that people have differentiated quite clearly between the large number of Chinese dairy companies involved and Fonterra,” he said.

“The basis of this ranking seems to be purely media coverage and we have no further information about the criteria that has been applied.

“All along we have taken responsibility for our involvement as a shareholder in Sanlu.

“But what’s disappointing is to see Fonterra listed separately and when there has been no question over the quality and integrity of our products and supply chain, made with milk sourced outside China.

“This incident was isolated to companies sourcing local raw milk in China, which was deliberately adulterated by third party suppliers in a criminal act.”

RepRisk had not contacted Fonterra to confirm the basic facts before publishing its report, he said.

This ranking isn’t about facts, it’s about perception and rival companies will do all they can to play this up.

Fonterra requires strict quality standards from the pasture to the end of production in New Zealand. This ranking, undeserved though it may be, shows why it is essential that it requires the same high standards in any businesses in which it has an investment in other parts of the world.

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