FloraHolland Magazine number 11, page 4-5-6, 2012
Important topics for general members' meeting
During the general members' meeting on Thursday, December 6, important topics will be discussed. On these pages we shall consider several in detail.
New administrative structure: keeping up with developments
If a two-thirds majority of the members vote in favour of the relevant proposal in 2013, the board and supervisory board will merge. Six members and three external supervisory directors will supervise the management. The proposed chairman of this new-style supervisory board is Bernard Oosterom. He clarifies several critical points.
"Currently, the board delegates the responsibility to the management, although it retains final responsibility. In the new format, the supervisory board delegates this responsibility. This is in accordance with the articles of association. The management's role does not change, therefore."
"We are a cooperative company thanks to the new structure of members' involvement. In it, the management is entirely responsible for the relationship of FloraHolland with the member as owner and grower. We are recording the current practice in the statutes."
"The supervisory role of the supervisory board is different. Ten years ago supervisory directors could still hide behind the fact that they were distant from the management. That is no longer possible. Not in society, not in listed companies, and even less in a cooperative. The supervisory directors not only supervise, they consider the strategic and financial developments. This could lead to partial overlaps in the activities of board and supervisory board. For that reason, this is a logical step."
"The structure of the general members' meeting will not change. At FloraHolland members have the first and final word. Their first word comes through the FPCs, RACs and advisory councils. Every member can play an active role in them (and should do so). There they influence the product policy and the strategy. In the general members' meeting they have the final word. All members are invited to attend. Every member is welcome to speak. The cooperative as a whole takes decisions to ensure the continuity of FloraHolland.
Members have a one-on-one relationship with FloraHolland. They market products there and frequently use our services and facilities. So they must have something to say about them. At the general members' meeting there should be an open round of AOB. Members must be able to ask questions, receive answers and ask for clarification, but nothing more. If someone wants a discussion about a topic, they should talk to the auction. There is always ample opportunity to do so."
Briët: Logical step
"A logical step." That is what chairman Franswillem Briët of the supervisory board calls the proposals for the new administrative structure. "The market changes. The relationships in the chain change accordingly. Growers and buyers acquire different roles, and the auction must accommodate this. In the FPCs, RACs and advisory councils, the members can influence the operation and strategy of FloraHolland. This gives them influence over the frameworks within which the policy of FloraHolland operates. It is sensible in that situation to have that policy supervised by a supervisory board which knows the field from personal experience (members as supervisory directors), as well as the aspects of conducting business internationally (external supervisory directors). The newly proposed construction seems very sensible to me."
Tom van der Houwen stays on
Tom van der Houwen is eligible for re-election as board member. Recently, it was announced that he would resign according to the existing roster. Other candidates had already been approached. Now a new administrative structure is being prepared for a decision next year. Therefore, the board asked Tom van der Houwen to stay on for another term. This is permitted according to the statutory rules.
Cees van Rijn, aspirant-supervisory director
If the general members' meeting approves, Cees van Rijn will join the supervisory board of FloraHolland. Van Rijn was the financial director of the food company Nutreco until last year. He will bring additional financial expertise onto the supervisory board. We are proud to present the aspirant-supervisory director to you.
From his working experience Van Rijn is familiar with the cooperative company form. "Although I never worked at a cooperative myself, I encoutered them frequently in the sectors I worked in. Since last year I have been a supervisory director at the ForFarmers cooperative (animal feed and trade articles).
I was born and raised in the Bulb region and thus feel an affinity to the floriculture sector and FloraHolland. I worked in the school vacations in the bulb fields. Later I worked in companies with agrarian ties. The mentality of agrarian entrepreneurs is thus familiar.
I haven't yet formed a judgement about FloraHolland. After I am appointed, I shall first go through a substantial induction programme. From the outside I see a successful company with good people. A company that is facing a lot of new developments. Developments for which the cooperative must formulate answers, if it wishes to continue. I am looking forward to the challenge of making a contribution to this."
Clarity about members' rights and obligations
"A good process, concluded with the active contribution of the FPCs, RACs and advisory councils." That is how Floris Olthof, manager of Cooperative, Product & Market (CPM), describes the preparations for the decision-making regarding the rights and obligations of members and non-members. Based on the recommendations of the advisory councils, the board took a decision on this.
The decision consists of two parts:
- elaboration of the TOL-policy (Temporary Exemption Member Obligations);
- extent to which members and non-members can use the cooperative's marketing instruments.
It is proposed that from now on, exemption from the member's obligation is only possible if a buyer cannot be registered. In that case, a TOL-charge of 0.5% will be imposed on top of the basic commission of 1.6% (soon). This creates a level playing field with the Connect flows. It compensates the collective charges of growers who market through FloraHolland.
Members can submit TOL-transactions as soon as they are concluded. The commission and the TOL-charge will be settled directly. Only if direct settlement is not possible can a TOL-transaction be processed up to a maximum of three months after it is concluded.
Non-auction turnover (NAT) is no longer permitted. Any member who does so can be expelled. Registered buyers who purchase NAT will be warned.
The proposal also contains several regulations covering credit installments for the direct trade.
2. Marketing instruments
Members have unrestricted access to the clock auction. Regularity of supply is rewarded with an early auctioning position in the auction group. The advisory councils and FPCs were involved in the concrete elaboration of this principle.
Non-members will in principle no longer be able to auction, unless the working of the marketplace is at issue or legal consequences are anticipated. If this does lead to the auctioning of products from non-members, written annual agreements will be reached with them in advance about assortment and regularity of supply. If there is an excess of supply, FloraHolland will make it transparent and deal with it. The difference in commission between members and non-members will be increased.
Promotion without free riders
The general members' meeting decided about a proposal to enable better product-oriented promotion. This proposal states that members of one product group can be obliged to contribute to a product-specific promotion project. This will only take place if a two-thirds majority of the turnover of the product group approves the decision. This proposal is also supported by a recommendation from the Flowers and Plants Advisory Councils.
The proposal suggests voting on promotion projects during the product day. Each member of the product group must be able to have a say. The advisory councils, FPCs and RACs are also involved. The board wants to leave the amount of any promotion contribution to be set by the product group itself. In addition, the 'promotion project' (product group, activities, budget, promotion contribution, duration) must be clearly specified to prevent misunderstandings. Finally, it must be clearly ascertained who belongs to a product group and who does not.
The proposal is meant to stimulate the creation of a new product-oriented promotion plan. Currently, growers sometimes withdraw from such projects, because they don't want colleagues who have not contributed to profit from the promotion. This will soon no longer be possible.