Agribusiness & Trade: Has offshore investment swamped our dairy sector? (NZ Herald)

Agribusiness & Trade: Has offshore investment swamped our dairy sector? (NZ Herald)

The allure of New Zealand’s dairy industry has not gone unnoticed on the global stage. The country’s reputation for high-quality dairy products and well-established supply chains has seen international investors increasingly drawn to the sector.

A recent report from market research firm Coriolis on the New Zealand dairy industry lays out the investment landscape in New Zealand dairy processing. The industry has attracted foreign investment from across the globe. China, Japan, Singapore, France, the Netherlands, the UK and Germany are all significant sources of investment.

Coriolis managing director Tim Morris says the “smart money” can see New Zealand is winning in dairy.

“New Zealand is really good at dairy and the rest of the world have realised it,” he says. “Since deregulation of the industry, we have had wave after wave of global firms show up because they know they need to have a position here.”

Despite the presence of multinationals in New Zealand, the report shows that most of the capital committed to the sector remains domestic, both into co-operative processors and through private capital.

In total, the industry is made up of investment from five private equity firms, 14 global multinationals, seven state-owned enterprises, three local co-operatives, three locally listed firms, two Māori investor groups and hundreds of private family interests.

The report lays out five key objectives that are driving strategic investment activity in the New Zealand dairy industry.

1. Strengthening existing market positions
In 2019, Westland Milk Products was bought by Chinese dairy giant Inner Mongolia Yili Industrial Group Co Ltd (Yili) for $588 million. Since then, Yili has supported further investments to strengthen the West Coast dairy company’s position.

In 2021, Westland announced it would invest $40m to double its consumer butter manufacturing capacity. The following year it acquired Hamilton-based foodservice butter processor Canary Foods.

Last year, Westland announced a $70m investment to construct a new lactoferrin plant at its Hokitika facility. Supported by parent company Yili, this investment will more than treble production capacity of the multifunctional protein. Lactoferrin has growing international demand across a variety of nutritional categories because of its reported health benefits.

Increased competition as more players enter the market is driving a shift higher up the value chain, with focus shifting to producing higher-margin, value-added products rather than just raw milk.

Morris notes that this more developed competitive framework is a marked change from the past. “This shift necessitates a strategic approach to investment and operations, ensuring that New Zealand’s dairy industry remains competitive on the global stage,” he says.

One such approach is the diversification of product categories into high-value niches such as infant formula (particularly specialty formulas designed for the dietary management of special infant feeding needs), protein supplements, and functional foods that can offer health benefits beyond basic nutrition.

New Zealand produces numerous innovative dairy-derived nutraceuticals. For example, New Image’s Symbiotics brand sells a goat milk drink with phosphatidylserine to support awareness and cognition.

These products not only command higher prices but also cater to growing consumer demands for health and wellness.

2. Arriving to take a position in New Zealand
In the past five years, multinational companies including Lactalis (from France), Froneri (UK), Olam (Singapore), Wilmar (Singapore) and Imanaka (Japan) have entered the New Zealand dairy industry.

The arrival of new players is transforming the sector, with more companies eyeing New Zealand’s milk supply.

One notable entrant stirring up the sector is Singapore-based food and agribusiness conglomerate Olam. It has established a new milk processing and exporting operation in Waikato under the name Olam Food Ingredients (Ofi).

Ofi is challenging Fonterra by offering farmers a premium milk price to entice them away from the co-operative.

Despite this increased competition, the Coriolis report highlights that total milk production in New Zealand peaked in 2015 after a long period of growth but has stalled over the past 8-9 years.

Morris explains that this is due to the balance between milk price paid to farmers and their production costs. With input costs rising faster than milk prices, there has been little incentive to boost production.

3. Seeking new growth platforms
Companies are moving into more attractive areas of the industry. Notable examples include:

Nestle Health Science, a global leader in nutrition, bought The Better Health Company in 2022, which included the supplements brand GO Healthy. Nestle Health Science described the acquisition as a strategic fit, enhancing its global portfolio of active lifestyle and health and wellness brands.
In 2020, New Zealand’s largest seafood company, Sanford, acquired a 50% stake in Two Islands. This merger leverages marine collagen, a by-product of Sanford’s certified sustainable hoki fishery, which is used in Two Islands’ range of beauty and wellbeing products.

4. Investing in increasing sustainability
Companies are investing in sustainability to align with changing customer, consumer and government requirements. Examples include:

Talley’s Group, New Zealand’s second-largest food company, acquired Nature’s Flame, a producer of wood pellet biofuel from Norwegian pulp and paper company Norske Skog. This renewable fuel, derived from timber processing waste streams, is being used to reduce the company’s carbon footprint by replacing coal in some dairy plants.
Fonterra recently announced a $790m plan to decarbonise its operations. The plan includes exploring technologies to phase out coal and transition to renewable energy across its manufacturing sites.

5. Divesting non-core businesses
Fonterra’s recent announcement that it is considering full or partial divestment options for some or all of its global consumer business, which includes well-known brands such as Anchor, as well as its integrated businesses Fonterra Oceania and Fonterra Sri Lanka.

This strategic move will allow the co-operative to focus on being a business-to-business dairy nutrition provider, working closely with customers through its high-performing ingredients and foodservice channels.

Fonterra says this refocus will strengthen its role in the dairy nutrition value chain, leveraging its strength in producing world-class, innovative ingredients for customers to take to consumers.

Another example of divestment was seen from Synlait, which last year announced its plans to sell off its household dairy brands Dairyworks and Talbot Forest Cheese in order to pay down debt. At the time, Synlait said this move would allow it to focus solely on its value-added, advanced nutrition and foodservice businesses.

6. Dairy remains an attractive investment
Morris is clear that the dairy market will remain an attractive investment into the future and doesn’t mince his words on the potential for “alternative milk” to supersede the industry.

“It is easy for people to convince themselves that because their daughter is vegan, or friends of theirs have started to drink oat milk, that everywhere on Earth is suddenly just like them.

“It’s just not true.

“Silicon Valley venture capitalists will try to convince you that we are at peak cow or peak milk or some other such nonsense. Any minute now, mothers everywhere will be feeding their children massive amounts of vat-grown sludge instead of real, natural, healthy milk and dairy products.

“There is no actual evidence anywhere for this common fantasy. Veganism is trending down, fake food start-ups are failing, while milk consumption is heading only one way, up.”

The data supports increasing consumption.

Dairy currently ranks as the third-largest food source by volume, following grains and vegetables, with the average person consuming around 90kg of milk and dairy products annually — equivalent to 117kg of raw milk.

Total global milk consumption is growing. Global raw milk production grew by 169 million tonnes (or 22%) in the last decade, or roughly 17 million tonnes yearly — a figure that equates to a “new New Zealand” (20.7 million tonnes) worth of dairy production every 1.2 years.

In 2022, the global dairy industry produced 930 million tonnes of milk worth an estimated $840 billion — that is at least twice as large as the total revenue of tech giant Apple for the last financial year, and 11,000 times more volume than lithium.

Sunlight of Spain, climate of Bordeaux, and water …

New Zealand is the world’s largest dairy exporter by value, commanding 14% of global trade and a market share that is trending up over the long term.

New Zealand has a robust dairy supply chain, with 4.7 million cows spread across over 10,000 dairy farms. It is the leading dairy supplier for many countries, particularly in Asia, capturing 55% of the China market, 50% of Thailand, 42% of Indonesia, 40% of Malaysia and 61% of Nigeria.

“New Zealand is the size of Italy with the population of Singapore,” says Morris. “It has the sunlight of Spain, the climate of Bordeaux, and abundant water — both on a per-person and a per-square-kilometre basis.”

New Zealand has almost 50 large raw milk intake sites and, depending on definition, 600-700 dairy companies. Extending further into the supply chain, New Zealand also has a farmer-owned dairy genetics firm, two farmer-owned fertiliser firms and three farmer-owned farm supplies firms.

“All of this comes together to make New Zealand the most competitive dairy producer and exporter on the planet,” says Morris.

Capital Markets Report: How artificial intelligence is being used to detect fraud, find sharemarket patterns and act as virtual assistants

Capital Markets Report: How artificial intelligence is being used to detect fraud, find sharemarket patterns and act as virtual assistants

The pace of artificial intelligence (AI) innovation has been remarkable, as has been the speed with which businesses are adopting it.

AI’s impact is evident in virtually every sector, including capital markets and financial services, where it is being used in data analysis and decision-making, customer experience, and operational efficiency.

Recent analysis from McKinsey suggests generative AI could have a significant impact on the banking industry, generating value from increased productivity of 2.8 to 4.7 per cent of the industry’s annual revenues, or an additional US$200 billion ($325b) to US$340b.

In the financial industry, AI is able to rapidly process and extract insights from enormous amounts of data.

It can bring together information from a variety of sources, such as real-time trading data, social media, economic indicators, and geopolitical events.

The analysis of unstructured and complex data was previously time-consuming.

However, machine learning – a key component of AI – is now being used to rapidly identify market patterns. This allows for live insights, which can be critical in financial markets.

Fraud detection
The threat of fraud is a constant concern in the financial sector, requiring detection and prevention abilities to protect both firms and their clients.

Given AI’s ability to identify patterns and anomalies in data, it can process vast amounts of transactions and spot potential fraud with greater speed and accuracy. The ability to process data in real-time is critical in mitigating losses and preventing fraudulent transactions from being completed.

Since AI systems can learn and adapt continuously from historical data, fraud detection capabilities are able to improve over time, identifying new fraudulent tactics as they emerge. This also helps to prevent false positives of legitimate transactions, minimising customer inconvenience.

Later this year, Mastercard will launch its generative AI model that will help banks improve their assessment of transactions. Mastercard says its AI enhancement, which assesses the relationships between multiple entities surrounding a transaction to determine its risk, will boost fraud detection rates on average by 20 per cent and as high as 300 per cent in some instances.

“The precision of the solution – achieved by scanning potential points of sale in real time – has been shown in our own analysis to not only increase accuracy, but also reduce the number of false positives by more than 85 per cent,” says Mastercard’s president of cyber and intelligence, Ajay Bhalla.

Virtual assistance
AI-powered virtual assistants provide the ability to offer 24/7 support, handling inquiries with levels of efficiency that were previously impossible.

This is being used to a varying extent by different organisations in the finance sector, but the highly regulated nature of the industry necessitates cautious implementation.

Speaking at a recent AI summit, Promiti Dutta, Citi’s head of analytics acknowledged the potential of AI and large language models, but noted they can be problematic when precision is the goal.

“Things can go wrong very quickly, and there’s still a lot to be learned,” she said. “In an industry where every single customer interaction really matters, and everything we do has to build trust with customers, we can’t afford anything going wrong with any interaction.”

Dutta said that while a customer might forgive an online shop suggesting a pair of shoes in the wrong colour, the stakes are higher in the financial services.

“If we tell you to get a loan product that you don’t necessarily want or need, you lose a little bit of interest in us because you think ‘Oh, my bank really doesn’t understand who I am’.”

She says that Citi is starting conservatively, and making sure there is always a human in the loop for anything assisted to learn what it is doing – and what it is not doing.

Less risky is the use of virtual assistance internally within firms. Last year, investment bank Morgan Stanley launched its own AI assistant to enhance the efficiency and effectiveness of its financial advisers and support staff.

The assistant, developed in collaboration with ChatGPT founder Open AI, provides access to the firm’s internal knowledge database of around 100,000 research reports and documents. It allows users to find and tailor information for clients almost instantaneously.

Morgan Stanley co-president Andy Saperstein told staff that generative AI will “revolutionise client interactions, bring new efficiencies to adviser practices, and ultimately help free up time to do what you do best: serve your clients”.

As well as enhancing client interactions, AI is transforming operational management within these institutions.

Automation of routine tasks, including account management, credit checks and report generation, allows employees to focus on more strategic tasks requiring human insight. This shift not only has the potential to reduce cost, but also enhance efficiency.

Regulatory compliance
In such a highly regulated sector, AI is helping to automate regulatory compliance processes and ensure adherence to rules and regulations. AI-powered systems can also help to eliminate manual errors and reduce the risk of non-compliance.

One example is Citigroup’s response to United States federal regulators’ new capital rules. The investment bank used AI to dissect a 1089-page document to analyse the text and articulate the implications of the changes for the bank’s leadership.

Looking ahead, regulation of AI itself is an area to watch. The financial sector must prepare for a wave of legislation, codes of conduct and guidelines – some of which is already occurring. While the benefits of AI are evident, it has the potential to exacerbate existing risks and introduce new ones.

Firms will have to consider AI within existing compliance frameworks to ensure that as they embrace the advantages of AI, they remain vigilant of its possible pitfalls.

AI driving global stock markets skyward
The recent surge in AI has translated to impressive gains on global stock markets, which saw their strongest first-quarter performance in the past five years. Investors have shown an insatiable appetite for technology stocks, fuelled by the potential of AI to revolutionise industries worldwide.

At the forefront of this market rally is Nvidia, a leading chip designer whose role in the deployment of AI technologies has been crucial. Its market value soared by more than US$1 trillion in just the first three months of this year.

Recent analysis from Goldman Sachs suggests that Nvidia represents the first phase of the AI boom. It says the next phase will involve infrastructure companies that are essential to the development of AI: semiconductor firms, cloud providers, data centres, security software and utilities companies.

The third phase, it projects, will benefit those companies that can enhance their revenues from the adoption and monetisation of AI technologies.

“Software and IT services seem best positioned for this phase of the AI adoption cycle, with many companies describing how their tools will enable other companies to utilise AI,” Goldman Sachs says.

The fourth phase will favour those companies that achieve significant productivity improvement through the adoption and integration of sophisticated AI.

“Software and services and commercial and professional services have the largest potential earnings boost from widespread AI adoption via labour productivity,” Goldman Sachs says. “These three industries have a combination of a high share of their wage bill exposed to AI automation and relatively high labour costs.”

Project Auckland: Panel discussion on ‘Accelerating Auckland’ (video)

Tim McCready moderates a panel discussion themed “Accelerating Auckland” with CEO of the EMA Brett O’Riley, Deputy Mayor of Auckland Desley Simpson, and Vice-Chancellor of the University of Auckland Dawn Freshwater. The panel discussion was held at the launch of the NZ Herald’s 2024 Project Auckland report following a speech from the Minister for Auckland Hon Simeon Brown.

Silver Fern Farms’ Rob Hewett wins Chairperson of the year at Deloitte Top 200 awards (NZ Herald)

Silver Fern Farms’ Rob Hewett wins Chairperson of the year at Deloitte Top 200 awards (NZ Herald)

Rob Hewett, a prominent figure in New Zealand’s agribusiness sector, has been honoured as the 2023 Chairperson of the Year at the Deloitte Top 200 awards, celebrating his impressive leadership roles and the business success he has overseen.

Hewett is co-chair of Silver Fern Farms, a leading producer and global marketer of grass-fed red meat, owned in equal partnership by Silver Fern Farms Co-operative (a farmer co-operative that he also chairs) and Shanghai Maling Aquarius.

He is also chair of Farmlands Cooperative, Pioneer Energy, Woolworks, Fern Energy and Haulage.

Hewett has directorships at Pulse Energy and T&G Global.

Additionally, he actively manages a carbon-positive farm and participates in a think-tank for agricultural innovation.

Xero, Tourism Holdings, Grant Webster, Sir Richard Taylor, NZME among Deloitte Top 200 winners (NZ Herald)

Xero, Tourism Holdings, Grant Webster, Sir Richard Taylor, NZME among Deloitte Top 200 winners (NZ Herald)

Cloud accounting heavyweight Xero has been recognised as the Company of the Year in the 2023 Deloitte Top 200 Awards for its transformative year marked by significant milestones.

Winners in the prestigious Deloitte Top 200 Awards were revealed tonight at Auckland’s Viaduct Events Centre. Now in its 34th year, the highly anticipated black-tie dinner event saw close to 900 business leaders gather to celebrate the best of New Zealand business.

This year, the awards recognise outstanding agility, resilience and results despite the pressures that business leaders have faced. Notably, they have navigated through the persistent cost-of-living crisis, inflationary pressures, geopolitical complexities, global unrest, and the severe weather events earlier this year.

After a difficult year in 2022, Xero completed a significant restructuring and saw strong revenue, subscriber, and share price growth. Founder Rod Drury formally stepped down from the board of directors after 17 years, and Sukhinder Singh Cassidy has taken on the role of chief executive.

Last month, Xero delivered a strong bottom-line result for the half-year to September 30, reporting a revenue rise of 21 per cent to $799.5 million and net profit increasing to $54.1m, compared to a net loss of $16.1m in the first half of the previous financial year.

The panel of high-profile judges, convened by NZME business editorial director Fran O’Sullivan, note Xero’s outstanding performance.

“Xero is an extraordinary Australasian success story and our leading high-tech success unicorn. Its current market capitalisation of over $15 billion makes it the most valuable NZ company, and one of the top 20 companies on the ASX,” they say.

“Xero has maintained strong margins and is keeping a disciplined focus on costs. This resulted in adjusted Ebitda up by 44 per cent in 2023 over 2022 and a share uplift of 44 per cent for the year ended September 30, 2023.”

Grant Webster, CEO of Tourism Holdings, was named Chief Executive Officer of the Year for his exceptional resilience and strategic prowess, particularly during the Covid-19 pandemic.

His leadership was crucial in navigating the world’s largest campervan rental company through a drastic downturn in international travel. By selling assets to protect shareholder value, he achieved record results, showcasing his ability to make tough yet effective decisions.

“Webster’s 15-year tenure as CEO has been defined by steering the company through major crises and positioning Tourism Holdings for future growth,” say the judges. “Tourism Holdings’ strategic expansion, combined with Webster’s adept relationship-building, spurred a remarkable financial recovery: turning a $2.1m loss into a $49.9m profit and a 92 per cent increase in revenue.”

“His legacy is that of a transformative leader who successfully converted challenges into opportunities for innovation and growth.”

The Visionary Leader award is the only one given without finalists. This year, the award went to the creative duo behind Wētā Workshop, Sir Richard Taylor and Tania Rodger. Renowned for their award-winning work on blockbuster films, their influence extends to tourist attractions, a digital game studio, and cultural collaborations in China.

“Sir Richard and Tania’s passion and creativity has brought imaginations to life, inspired millions, and put New Zealand’s creative industry on the world map,” say the judges. “They are New Zealand icons and true visionary leaders.”

Chairperson of the Year has been awarded to Rob Hewett. A prominent figure in New Zealand’s agribusiness sector, Hewett is co-chair of grass-fed red meat producer and marketer Silver Fern Farms and chair of Silver Fern Farms Co-operative. He is also chair of Farmlands Cooperative, Pioneer Energy, Woolworks, Fern Energy and Haulage and has directorships at Pulse Energy and T&G Global.

“Hewett has a very clear vision for the businesses he chairs, he communicates that well and maintains solid relationships with his managing directors,” the judges say.

They recognise that last year was a banner year for Silver Fern Farms and applaud Hewett for playing a significant role in its result, which saw a net profit after tax of $189.3m, representing an 82 per cent increase.

Xero’s chief financial officer, Kirsty Godfrey-Billy, was also recognised last night, taking out the award for Chief Financial Officer of the Year.

The judges say that during Godfrey-Billy’s five years as CFO, Xero New Zealand’s revenue has increased from about $550m to $1.4b – up 250 per cent.

“Godfrey-Billy is respected by the market, board, management and other stakeholders for her financial management over this period of growth, which includes developing and maintaining financing and tax management in multiple countries,” they say.

“During her time as CFO, the company has moved from a start-up approach in which revenue is paramount, to a more mature company, where revenue and profit growth are both important.”

Port of Auckland has been named winner of the Most Improved Performance award, for its remarkable turnaround in profitability and operations.

“By establishing effective strategies, the port has improved its financials, union relationships, health and safety practices, and operational performance,” the judges say. “Its profits and revenue have skyrocketed – with profit up $50.7m on last year and revenue increasing from $265.3m to $320.2m. The port has nearly doubled the dividend it pays to Auckland Council, which really demonstrates its commitment to delivering returns to shareholders.”

Natural health products provider Comvita has been recognised with the Best Growth Strategy award. The judges say its recent transformation programme, focused on sustainability and storytelling, has helped consumers connect with the brand, and secured rapid growth for the company.

“Comvita has seen strong business performance in China, its key growth market, where it has grown its revenue to $100m. It has also increased its e-commerce share of total sales from 23 per cent to 42 per cent.”

Penny Dell, Treasurer at ANZ, has been named Young Executive of the Year. She is the youngest and first woman to hold the role of Treasurer which involves the management of the funding, capital and liquidity of the bank’s $189b balance sheet – a critical, strategic position for New Zealand’s largest bank.

The judges say Dell is performing at a high level within a very large organisation: “She holds a position of great responsibility within the ANZ organisation and is clearly recognised as a valuable asset”.

Her time in the job has been through a period of significant market volatility. Dell has been responsible for completing many successful funding and capital transactions that have given her bank a competitive advantage.

NZME’s Te Rito journalism project is the winner of the Diversity & Inclusion Leadership award, a 12-month cadetship programme designed to enhance newsroom diversity, specifically focusing on Māori, Pasifika, ethnic, LGBTQIA+, and disabled voices. This initiative aims to provide entry points into media careers across various platforms, including digital, print, television, radio, and podcasts.

The judges were impressed by the novelty of the concept, the collaboration with other media industry players and the potential diversity and inclusion benefits to the nation. They say the partnership and the continuous learning embedded in the programme have ensured it is sustainable.

Gentailer Contact has received the Sustainability Leadership award for its dedication to spearheading New Zealand’s decarbonisation. It has more than $1.2b worth of renewable generation projects currently under construction, and a significant portfolio of further potential geothermal, wind, solar, and battery investments in the pipeline.

“We are impressed that Contact’s efforts in the space are driven and supported by leadership and filter across the national business,” the judges say. “They have created a galvanising framework for decarbonisation that attracts diverse talent and genuine innovations for sustainability actions.”

The Deloitte Top 200 awards include a special Judges’ Award. This award enables the judges to highlight performance they feel is of importance to the business community.

This year, there was a unanimous decision for John Loughlin to receive this award, who has dedicated his career to New Zealand’s agribusiness and infrastructure sectors.

With a governance career spanning three decades, Loughlin serves on a number of boards across critical industries, including Port of Napier, Toll New Zealand, Augusta Capital, Metlifecare, AgResearch, Prism Group Holdings, Central Lines, Dairy Technology Services, KiwiRail and Hop Revolution.

“Loughlin is an extremely talented and highly regarded director who relishes digging into companies and helping them to reach their full potential,” the judges say. “He particularly excels when providing leadership to industries that are challenged.”

“Loughlin’s often finds himself chair at companies he first joined as a director, which shows just how effective and well-regarded he is around board tables. It’s really no surprise that he’s in high demand for the country’s senior governance roles.”

Deloitte chief executive Mike Horne reflected on the last year and its effect on the business community, “with a cost-of-living crisis, inflation, global unrest, and severe weather events, our communities and our economy have taken a beating, but it’s within this challenging landscape that we’ve seen the most resilient and innovative organisations emerge successful.”

“The businesses recognised on the Top 200 have displayed innovative and thoughtful solutions, including creatively rethinking products and services, that have undoubtedly ensured the long-term survival of their businesses, and it’s what has made them our ‘champions of adaptability.’

Returning in her role as judging convener for the 34th year of the awards, NZME’s Fran O’Sullivan said “the Top 200 gives us an opportunity to celebrate unmatched leadership and team performances from the best in New Zealand business.”

“It takes a lot of business prowess to deliver strong results in challenging times, and even more to be at the forefront of our economy, committed to leading the way.”

Deloitte Top 200 Index

The Deloitte Top 200 Index consists of New Zealand’s largest entities ranked by revenue. These include publicly listed companies, large unlisted entities, NZ subsidiaries and branches of overseas companies and the commercial operations of Māori entities. It also includes producer boards, co-operatives, local authority trading enterprises and state-owned enterprises.

An overview of the Top 200 Index as well as New Zealand’s Top 30 finance companies has been included toward the back of this report — showing revenue, profitability, efficiency and more. These numbers offer an insight into how the biggest companies in New Zealand operate and are accompanied by explanations and insight from the Herald’s team of business reporters.

The high-level view of the Top 200 this year shows total revenues for Top 200 companies increasing by 12.4 per cent. This compares to a 9.8 per cent increase in 2022. Underlying earnings (Ebitda) increased 8.1 per cent, and total profits after tax also increased 4.0 per cent year-on-year.

Year-on-year assets for the Top 30 finance companies have grown 9.3 per cent, with cumulative profits increasing by 11.4 per cent.

ANZ continues to be the largest bank with assets of $201b, ahead of second placed Westpac by $65b. ANZ also outpaces all other banks in terms of profit and equity.

Deloitte Top 200: Contact Energy wins Sustainability Leadership Award (NZ Herald)

Deloitte Top 200: Contact Energy wins Sustainability Leadership Award (NZ Herald)

Contact is dedicated to playing its role in creating a more sustainable future for New Zealand by leading the country’s decarbonisation efforts, and is making significant progress to achieving net-zero carbon by 2030.

This long-standing commitment to sustainability from the gentailer, coupled with the actions it has made, made it a stand-out winner for the Deloitte Top 200 Sustainability Leadership Award. The award recognises exemplary governance, leadership, accountability and long-term perspectives from companies as they evolve and adapt their business models to support and drive sustainable development.

The Deloitte Top 200 judges commended Contact for its significant efforts to decommission assets that generate electricity from fossil fuels, signifying a clear shift towards renewable energy sources and a clear intent to help decarbonise New Zealand, despite the absence of an overarching national energy strategy.

“We are impressed that Contact’s efforts in the space are driven and supported by leadership and filter across the national business. They have created a galvanising framework for decarbonisation that attracts diverse talent and genuine innovations for sustainability actions,” said Katie Beith, one of the judges in this award category.

Contact is actively investing in the future of sustainable energy with $1.2 billion in renewable generation currently under construction. This pipeline of projects includes geothermal, solar, wind and grid-scale batteries, which will see it not only reduce its carbon profile but also assist its customers in their decarbonisation efforts.

Contact chief executive Mike Fuge is enthusiastic about what this means for the future of New Zealand. “These investments are key to enabling Aotearoa New Zealand to meet its decarbonisation goals,” he says.

“We expect our generation portfolio to be more than 95 per cent renewable by FY27 and have set the ambitious goal to achieve net-zero emissions from our generation operations by 2035.”

Contact’s efforts have already boosted its renewable energy capacity to more than 80 per cent and led to a remarkable 33 per cent reduction in greenhouse gas emissions from generation since 2018.

Its world-class geothermal development near Taupō, Tauhara, will come on-stream in 2024.

It will be Contact’s sixth geothermal power station in the Taupō area.

Contact now has a pipeline of projects ahead of it in Taupō, including an expansion of its Te Huka geothermal plant and a replacement of the 1950s-era Wairākei geothermal power station.

“The wonderful thing about having a pipeline of projects around Tauhara is we can attract the workforce in for a project, and they get the opportunity to roll off on to the next project,” says Fuge.

The judges say a particularly commendable aspect of Contact’s sustainability efforts is its commitment to meaningful engagement with iwi and hapū, especially at the Tauhara plant, which shows a deep respect for indigenous involvement in sustainable energy projects.

In addition to its geothermal projects, Contact is pursuing other renewable energy projects, including a solar project at Christchurch Airport which will have around 300,000 solar panels on 300 hectares of land adjacent to the airport’s runways.

It is looking to develop a wind farm on the elevated land east of Wyndham in Southland.

This would be Contact’s first wind farm project and, with a plan for about 55 turbines generating as much as 300 megawatts of power, it would be New Zealand’s largest.

US Business Summit 2023: How Brand NZ shows up in the USA and how we can build our value

HOW BRAND NZ SHOWS UP IN THE USA AND HOW WE CAN BUILD OUR VALUE

David Downs, CEO of the New Zealand Story, an ambitious organisation marketing New Zealand to the world presented insights from the latest U.S. research.

Moderator: Tim McCready

—

United States Business Summit 2023 30 November 2023 at Cordis, Auckland. Brought to you by NZ INC. and Auckland Business Chamber.

US Business Summit 2023: Prize draw

PRIZE DRAW

Prize draw: Two return business class flights to New York City courtesy of Air New Zealand and a selection of meats from Silver Fern Farms.

Auckland Business Chamber event director Katy Riddell with Air New Zealand senior manager Mark Kennedy.

—

United States Business Summit 2023 30 November 2023 at Cordis, Auckland. Brought to you by NZ INC. and Auckland Business Chamber.

US Business Summit 2023: Summit close

Tim McCready, Summit MC closes the 2023 US Business Summit. — United States Business Summit 2023 30 November 2023 at Cordis, Auckland. Brought to you by NZ INC. and Auckland Business Chamber.

US Business Summit 2023: Summit Summary

SUMMIT SUMMARY

Summit co-chairs Fran O’Sullivan and Simon Bridges summarise the United States Business Summit with Summit MC Tim McCready.

—

United States Business Summit 2023 30 November 2023 at Cordis, Auckland. Brought to you by NZ INC. and Auckland Business Chamber.