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Jonathan Ovens has been removed from Arla membership and from his board member role at Arla Foods amba.

The moves follow alleged ‘serious failings in corporate governance by Mr Ovens’ in his role as chairman of Emerald Debtco Limited. 

“Today the UKAF board (the farmer governing body of Arla Foods’ UK co-operative) has taken the decision to terminate the membership of Mr Jonathan Ovens, trading as D Mortimer & Sons,” said Johnnie Russell, UKAF chairman, in a statement on Tuesday (12 December 2017).

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“This regrettable step has had to be taken as a last measure in a protracted process to resolve issues of corporate governance within Emerald Debtco Limited and takes place with immediate effect.

“Mr Ovens has been offered a direct contract by UKAF for the supply of milk,” he added.

Emerald Debtco Limited, of which Mr Ovens is currently listed as the secretary, was a company used by the former Arla Farmers Milk Partnership to raise a loan to fund their entry fee into Arla.

HMRC inquiry

Emerald Debtco Limited has ceased trading and is awaiting the conclusion of an HMRC inquiry centring on the correct treatment of taxes and national insurance contributions in relation to payments for expenses made to current and former directors of the company, who also served as directors of AMCO (Arla Milk  Co-operative Limited) from April 2011 to December 2016.

A provision of £141,000 has been made in Emerald Debtco’s most recent accounts (to 31 December 2016) to cover the potential liability arising from the inquiry.

Åke Hantoft, chairman of the Arla Foods amba board, said: “As a consequence of the decision taken by the UKAF Board to terminate the membership of Mr Jonathan Ovens, which the Arla Foods amba board agrees with, Mr Ovens is no longer eligible to serve as a board member of Arla Foods amba and therefore leaves open a position as UK representative on the Arla Foods amba board of directors.”

A statement from Arla Foods amba said that as part of the wider Arla Foods amba co-operative owned by more than 11,000 farmers, the UKAF board must act in the best interests of both its UK farmers and all Arla Foods’ farmer owners across Europe and in accordance with the Arla Foods corporate social responsibility guidelines.

The statement said that serious failings in corporate governance by Mr Ovens in his role as chairman of Emerald Debtco Limited were prejudicial to the interests of the co-operative. It also stated that these actions led to a loss of confidence in Mr Ovens by the Arla Foods amba board.

A replacement will be elected to the Arla Foods amba board and the UKAF board will also discuss filling the position left vacant by the departure of Mr Ovens.