LONG-HELD differences of opinion appears to be boiling over in one of the country’s most prominent breed societies, Herefords Australia, with a half million dollar loss last financial year prompting a campaign to oust some directors.
Underlying the turmoil seems to be the breed’s inability to ‘match it’ with Angus.
However, the longstanding polled versus horned battle is also clearly playing a part.
An independent review and audit of the corporate governance of HA, including an assessment of financial budgets and the structure of the board, has been called.
A decision on who will conduct that review is expected by the end of the week.
New chief executive officer Dr Alex Ball, while describing differences of opinion as a ‘normal and healthy thing’ for a breed society, is pushing for a strategic governance model.
He accepted it could be an issue that only stud members made up the board and said that was one of the areas the review would look at.
Agitation has been mounting since the 2016 annual general meeting at Dubbo in June, where questions were raised about the value to members of expenditures that led to the $500,000 loss; why Meat and Livestock Australia co-payments had not been received and whether elections were fair.
Those questions have since been extensively addressed by chairman Pat Pearce, via a letter to members, and by Dr Ball.
MLA co-payments in excess of $300,000 have since been received, with invoices for more to be sent before the end of the year; votes in elections are compiled by independent accountants and expenditures were made on a number of new initiatives.
These included a branded beef program, black baldy trial, the beef information nucleus (BIN) project and marketing activities ‘significantly greater than previous years’, Dr Ball said.
“All are about the long term health of the breed,” he said.
Mr Pearce said all were seen as vehicles to increase the demand for Hereford genetics and raise the profile of the breed.
They could not be expected to provide instant returns, rather they were investments in the future, he said.
However, many members don’t agree, judging by the dozens of signatures collected for a notice of intention to move resolutions for removal of directors at a general meeting.
Spearheading the push for a regime change is retired Sydney solicitor Michael Samios, who owns Coldsteam Poll Hereford Stud at Woodstock.
He says he was invited by a board member to look over HA’s financial results and ‘2016 is shaping up to be a lot worse - an absolute catastrophe.’
“HA is spending more than it is receiving,” he said.
“An extraordinary amount - $297,000 - went on advertising, for example, yet how are Herefords seen in the marketplace compared to Angus and other breeds?
“Members are contributing money which is being spent in areas which will in no shape or form benefit them, which will not produce a return.”
HA has 847 full or life members and a further 500 commercial members. Base membership is $220 a year.
Mr Samios said he had the numbers to force the general meeting but intended to ‘sit on it’ for a short time, convinced the board was about to implode.
He said there was little support for the review, which was seen as more cost to provide answers already known.
“We already know what the problem is - declining membership, spending more than what is coming in and not being able to identify one strategy that has resulted in increased market share and more dollars in the pocket of members at the saleyard,” he said.
Mr Pearce, in his letter to members, referred to the breakaway group as a ‘small section’ of the membership.
He called on members to consider what alternative actions could be taken before committing to ‘something that potentially may bring irreversible damage and division to our breed’.
Other seedstock and commercial producers who spoke with Fairfax Media this week, some with very large numbers of registered breeders, backed Mr Samios and said the number of directors on the board needed to be reduced from 12 to 7, with at least three independents seconded from the industry.
Some also expressed concern about the ‘running down’ of horned cattle by certain board members and pointed to the fact a new organisation, Horned Herefords of Australia, had just been set up in opposition to HA.
The bottom line, they said, was that the Hereford breed had been losing market share for the past 25 years.
In a leaked email to board members after the AGM, Dr Ball said HA was under-resourced.
“The expectations are that Herefords compete with Angus,” it said.
“The reality is that HA has five staff and Angus has 20.”
The email said it was clear important areas such as genomics, Breedplan, commercial data acquisition and brand development were now secondary to the ‘current problems’.
Dr Ball this week qualified that email, which was not intended for the public, by saying the independent review it requested was now underway.
