ICMSA to meet Ornua after €9m pay for top executives revealed
State’s largest dairy co-op publishes details of executive remuneration for the first time
Chief executive Kevin Lane, chairman Aaron Forde and group finance director Donal Buggy at the announcement of Ornua’s results. Photograph: Patrick Bolger
News that Ornua’s nine top executives shared more than €9 million in pay, bonuses and pension contributions over the last two years “couldn’t have come at a worst time”, a dairy farmers’ representative has said.
Pat McCormack, deputy president of the Irish Creamery Milk Suppliers’ Association (ICMSA), said he did not think farmers would “be able to relate to someone who’s on that kind of money”, in the context of current milk prices.
“Ornua, as main marketing body for Irish dairy products, needs to deliver for dairy farmers and ICMSA wants to see the €54.3 million profit made by Ornua last year being used to offer more support for the dairy farmers who supply them.
“The business seems to be going in the right direction but the timing of this announcements is the issue. There are farmers who are milking their cows every day and losing money every day in the context of falling milk prices and six weeks of bad weather,” he said.
ICMSA will meet Ornua representatives in coming weeks to discuss the pay arrangements, which emerged after new accounting rules obliged Ireland’s largest dairy co-op, best known for producing Kerrygold butter, to publish details of executive pay for the first time.
The group’s latest annual report shows total remuneration for senior executives amounted to €4.4 million in 2015, which included €2.3 million in basic salaries and €1.1 million in performance-related bonuses.
This was down from €4.86 million in 2014. As a co-op, Ornua, formerly the Irish Dairy Board, is not obliged to give a breakdown of the individual packages paid to each executive.
Total directors’ fees, spread between 14 individuals, amounted to €509,000 in 2015, up 44 per cent on the €352,000 paid in 2013.
Gone furtherKevin Lane
“We have a strong governance story to tell here,” he said, noting the co-op had independent people examine both executive and director remuneration within the group.
Ornua recently suspended its milk levy as a result of the collapse in dairy prices. The co-op deducts a tariff of 0.14 cent per litre from dairy farmers in return for marketing Irish dairy produce abroad. The levy, equivalent to €350 per farmer, is worth about €6 million annually to the group.
Details of Ornua’s executive pay arrangements came as it published its full-year results, which showed it generated record sales of €2.5 billion last year following the lifting of EU milk quotas. The co-op, however, said a combination of strong supply and demand weakness had led to a fall in global dairy prices.Ornua reported an 18 per cent increase in core earnings (ebitda) for 2015 to €58.8 million. Sales of Kerrygold butter hit a record €740 million.
A spokesman for the Irish Farmers’ Association said the organisation would not be commenting on the Ornua pay issue.