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ORGANIC FEDERATION OF AUSTRALIA _OFA_ Powered By Docstoc
					                                                          Phone +61 1300 657 435
                                                          PO Box 166 Oakleigh South
                                                          Vic 3167 Australia
                                                          www.ofa.org
                                                          Email: info@ofa.org.au




            ORGANIC FEDERATION OF AUSTRALIA (OFA)
                 DISCUSSION DOCUMENT No. 1

            “Proposals for Changes to the OFA Organisation”

                    Final Report from the Working Group
                        appointed subsequent to the
                    Organic Industry Roundtable Meeting
                           Sydney August 16 2004


                                    Released April 2005




Industry Working Group April 2005
OFA Restructure April 2005                                                                2




           ORGANIC FEDERATION OF AUSTRALIA (OFA)
                DISCUSSION DOCUMENT No. 1

         “Proposals for Changes to the OFA Organisation”

                  Final Report from the Working Group
                      appointed subsequent to the
                  Organic Industry Roundtable Meeting
                         Sydney August 16 2004



Contents of the Report:
Section 1                                                            Pages
Executive Summary:                                                   3-4

Section 2
Main Report:
Introduction                                                         5
Operation of the Industry Working Group                              5
Group’s Overall Objective                                            5
Group’s Immediate Aims                                               5
Key Principles                                                       6
Summary of the Key Proposals for Change                              6
Key Proposal 1                                                       7
Key Proposal 2                                                       8
Key Elements of the Structure                                        8
Determination of the Funding Model                                   10
Key Proposal 3 – Transition Arrangements                             11
Appendix 1 - Background                                              12
Appendix 2 - Additional Detailed Information                         13
Appendix 3 - Diagram of the Proposed Structure                       14
Appendix 4 - Mission and Aims of OFA                                 15
Appendix 5 – Suggested Funding                                       16
Appendix 6 – Suggested Budget                                        17
Appendix 7 – Industry Comments on the Draft Proposal                 18
Appendix 8 – The Charitable Trust                                    19

Completed by the Organic Industry Working Group: April 2005
A. Leu Chair (OFA), G. Devrell (NASAA), J. Gretschmann (TOP), H. Mackay (BAA), C. Starr
(BFA), M. Will (OFC), C. Yates (OGAWA)




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                      ORGANIC FEDERATION OF AUSTRALIA (OFA)
                           DISCUSSION DOCUMENT No.1

                    “Proposals for changes to the OFA Organisation”

           Final Report from the Working Group appointed subsequent to the
                          Organic Industry Roundtable Meeting
                                Sydney August 16 2004.

                               Section 1: Executive Summary

Introduction
The meeting of 16 August resolved that whilst there was a continued need for a peak
organisation, OFA did not currently have the support of a large portion of the organic industry,
and needed to be changed.

The meeting appointed a Working Group, headed by the OFA Chairman, Andre Leu, to
produce an initial discussion document by mid/end November 2004.

That document was sent out to industry in Nov/Dec 2004 for comment. This document is a
final report based on the comments received.

This Executive Summary should be read in conjunction with the more detailed discussion
document, which is attached.

Working Group’s Overall Objective and Immediate Aims.
The intention of the Working Group was to provide a structured, timely, process for proper
consultation to occur, in determining the best way forward to change OFA. The key catalysts
in this process are the discussion papers.

Consultation
The draft document outlining the proposal was sent out widely to the whole of industry and
government in December 2004, allowing 3 months for comments. Significant sectors of the
industry were also contacted by telephone for their responses to the proposal.

The vast majority of respondents were positive, with some queries clarifying specific areas of
the proposal. See Appendix 7 for a summary of responses.

The result of this process is an agreed set of change proposals, which has the backing of the
large majority of the industry.

Underlying Key Principles
The Working Group established a number of key principles, which underpin the principal
proposals for change. In summary they are;
     OFA should represent the whole value chain from “paddock to plate”
     Representation, whilst broad, should be structured into manageable member
       organisations.
     The Board should mirror the organisations’ wide representation, but be also selected
       on skills/experience/qualities criteria.
     Board selection should have independent input.
     Funding should be extended to include a Charitable Trust subsidiary.
     OFA and the member organisations should jointly determine the appropriate funding
       model.
     OFA could extend its operational scope by co-opting its member organisations.
     The new structure would have to be transparent and accountable.
     OFA Directors have to place their responsibilities as a Director ahead of their
       sectional interests.



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Summary of Key Change Proposals
    The existing OFA mission statement, aims and activities should be expanded.
    OFA should be significantly restructured.
    There should be appropriate transitional arrangements.

Expansion of the Role
It is proposed that the OFA role be expanded in the following areas;
       Increased emphasis on the raising of funds, including funds from external parties
          through the Trust.
       An increased International focus
       An increase in research and education projects.
       Added value services to members; eg assistance with grants, specific fee-for-service
          projects.

New Structure for OFA
    Membership grouped into five Member Organisations, each headed by an Advisory
       Board.
    OFA voting rights will vest in the member organisations themselves, not individual
       members, who would vote within their respective organisations. Voting in more than
       one organisation will be limited.
    The Member Organisations will cover Producers, Traders and other Intermediaries,
       Consumers, Certifiers, and Individuals/General Organisations.
    Decision making authority will vest in the OFA and Trust Boards
    The Member Organisations will also have rights of representation, nomination, review
       of Directors selection, submitting proposals, receiving reports on progress, removal of
       Directors under certain conditions etc.
    Nominations for the OFA and Trust Boards will come from the Advisory Boards, and
       from the OFA Board (Trust Board only), subject to maximum and minimum rights of
       representation.
    Directors will be normally be elected for three years, with a maximum term of six
       years (nine years for the Chairman)
    There will be a standing Nominations Committee to assess nominees and there will
       also be a published set of criteria for selection.
    Whilst the Trust will be a subsidiary of OFA it will not be consolidated with OFA’s
       results, will be subject to separate audit, and have no common Directors with OFA.

Funding Model
The chosen funding model will be the result of ongoing collaboration between the Advisory
Boards and OFA, subject to agreement on a number of overall guiding principles. The Trust
will garner funds from both the industry and from outside the industry. It will receive modest
annual funding from OFA.

Transitional Arrangements
The Working Group proposes a transitional timetable between November/December 2004
until July 2005 when the first AGM and elections would be held under the new Constitutions.

Other transitional arrangements relate to the workings of the existing OFA Board, the Working
Group itself, and the arrangements relating to the first elections (which will provide for a
staggered election cycle). See Key Proposal 3 for more details.

Review Arrangements
The structure of the OFA should be reviewed after six years (2011) to ensure that it is
relevant to the industry needs at that time.




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OFA Restructure April 2005                                                                     5




                              Organic Federation of Australia Inc
                                 Discussion Document No. 1

                    “Proposals for Changes to the OFA Organisation”

                             Final Report from the Working Group
                                       arising from the
                             Organic Industry Roundtable Meeting
                                    Sydney August 16 2004

                                    Section2: Main Report


Introduction:
The consensus of the industry meeting on 16 August 2004 was that there remained a strong
case for the continuation of an overall industry body for the organic industry in Australia.

There was also consensus that the current OFA required reorganisation if it was to meet the
future needs of the industry.

It was resolved to form a Group, drawn from a broad cross section of the industry and headed
by the current Chairman of the OFA, Andre Leu, to address the issue.

It was further agreed that the Group would first produce a discussion document by mid/end
November, which would then be given wide circulation to encourage feedback and further
debate on the proposed changes to OFA.

The rationale for the meeting, its agenda, and general background on OFA is included as
Appendix 1.


Operation of the Industry Working Group:
A number of teleconferences were held by the Group from August to April, under Andre Leu’s
Chairmanship, with a number of issue papers produced. These, in turn, have been
synthesised into the document set out below.


The current members of the Industry Working Group are;

Andre Leu:                        Chairman: Organic Federation of Australia (OFA)
George Devrell:                   National Association for Sustainable Agriculture
                                  Australia (NASAA)
Joe Gretschmann:                  Tasmanian Organic Producers (TOP)
Hamish Mackay:                    Biodynamic AgriCulture Australia (BAA)
Clinton Starr:                    Biological Farmers of Australia (BFA)
Margaret Will:                    Organic Food Chain (OFC)
Colleen Yates:                    Organic Growers Association, WA (OGAWA)




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Group's Overall Objective
To provide a structured process for determining the necessary changes to OFA such that,
when completed, the large majority of the Australian Organic Industry will support the new
OFA as the future peak body for the industry.

Group’s Immediate Aims
To provide the industry with an iterative discussion process, embodied in the discussion
papers, which, in turn, leads to a set of well considered proposals.

To reach a workable consensus from that process, which will provide the framework for a new
OFA constitution.

Key Principles
The Working Group’s discussions produced a number of underlying principles, and reaffirmed
others from the meeting of 16 August, which determined the basis for a number of the change
proposals.

In summary they are;

       Whole Value Chain:
        OFA should be an umbrella organisation, and a forum for organic industry
        organisations that represents the whole value chain from “paddock to plate”.
       Manageable Representation:
        Whilst it is very important to have broad representation feeding into OFA, there
        should be a grouping of similar interests to make the overall structure manageable.
       Board Criteria:
        The Board members of OFA should, as far as is possible, mirror the broad
        representation of the stakeholders, but the Board is not to be elected solely on a
        representational basis. It should be a meld of representation, and the necessary
        skills/experience/qualities that underpin a professional Board.
       Independence in Board Selection:
         There should be an independent element introduced into the selection of Directors,
        to ensure transparency and maintenance of quality, consistent with best practice.
       Charitable Status:
        There should be a capability within the OFA structure to attract external charitable
        funds, discrete from the main funding model, to provide for education and research
        projects, which benefit the organic industry and the general community.
       Collaboration in the Funding Model:
        The funding model should be collaboratively determined between the member
        organisations that feed into OFA and OFA itself. OFA should provide guidance as to
        the overall principles of the model.
       Co-option
        The OFA should extend the range of its capability by, from time to time, co-opting the
        member organisations to undertake relevant projects/assignments on its behalf.
       Transparency and Accountability
        The new structure should be, as far as is possible, transparent in its decision making
        and accountable to its stakeholders.
       Duties as a Director under Corporations Law.
        Although OFA Directors will be selected by specific interests within the Organic
        Industry, once they become OFA Directors, their prime responsibility, consistent with
        Corporations Law, is to act in the best interests of the entity to which they have been
        appointed, rather than the specific group which nominated them.


Summary of the Key Proposals for Change

As a consequence of its discussions, and in keeping with the principles described above, the
Working Group proposes the following key changes to OFA;




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OFA Restructure April 2005                                                                    7


       A broadening of the mission statement, existing aims and activities of the current
        organisation.
       A completely new structure for OFA which encompasses changes in;
            o The overall structure and legal status of OFA
            o Representation
            o Board Selection
            o Elections for the Board
            o Board Structure and Terms of Appointment
            o Charitable Trust Subsidiary and relationship with the parent.
            o Funding
       Transition arrangements between the existing and new structures

The key points for each of these changes are described in the following section. Additional
detailed information, relating to the structural changes, are contained in Appendix 2

The diagrammatic representation of the new organisation is contained in Appendix 3.


Key Proposal 1: Broadening of the Mission Statement, Existing Aims, and Activities
In summary, the Mission Statement, Major Aims, and Activities of OFA are currently;

Mission Statement
    Negotiate Organic Industry issues with Government
    Promote the Organic Industry to the Community
    Promotion of Organics to the broader Agricultural Industry

Major Aims and Activities
    Encouraging Conversion
    Facilitating R&D
    Communicating the Benefits to the Community
    Developing Industry Policy
    Supporting and Promoting Environmental Sustainability
    Encouraging a Professional Image

A more detailed exposition of the OFA mission and aims are included in Appendix 4

The proposal for expansion of the mission, aims and activities centres on;

       Increase in Fund Raising Activities
        An overall greater focus on fund raising activity, with new fund raising activities
        focused on the Government, the industry (under a broader funding model), and from
        charitable and philanthropic donations that are outside the industry (with tax
        deductibility).
       Increase in International Focus
        Overall, the current mission, aims and objectives are primarily domestically oriented.
        Whilst the operating businesses within the industry will lead the commercial issues in
        terms of imports/exports, OFA should have a significant role in international policy
        development with the organic organisations of other countries, and acting for the
        industry on issues such as the labelling on imports etc. and other international issues
        where it is more efficient and effective to have a single focussed representative.

       Increase in Research and Education Projects
        Through a charitable trust model, and greater fund raising activities, OFA could
        undertake a greater range of research and education projects, which would have
        wide community and industry appeal.

       Provision of Assistance with Grants, and Specific Fee-for-Service Projects.
        Subject to resources and funding, OFA would provide a specific service to assist
        members in gaining grants from Government, and other funding entities. Again



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OFA Restructure April 2005                                                                      8


        subject to resources and funding, OFA would provide members with a fee for service
        capability for specific projects, deemed valuable to its members.

The consequence of an increase in fund raising activities, which encompass
groups/individuals outside the industry, means that there must be separation within the new
structure to provide transparency, stakeholder confidence, and separate accountability.

Key Proposal 2: The Proposed New Structure for OFA

Purpose and Function
The new OFA is not to be a replacement for, or to compete with, the many other organic
organisations in Australia. Its key role is to supplement, represent, support, and assist all
organisations within the industry, and provide a focus and forum for the industry both within
Australia and, where appropriate, internationally as well.

Overall Description of the Structure (also see Appendix 3)
    OFA would be changed from its present legal status to an incorporated not-for-profit
        company, limited by guarantee.
    It will also establish a Charitable Trust as a subsidiary, which would not be
        consolidated, and would maintain a separate Board. (see Appendix 8)
    Representation will come from five Membership Organisations each headed by an
        Advisory Board, which together would represent the broad spectrum of the organic
        industry.
    The Advisory Boards will represent the following Member Organisations;
             o Producers
             o Traders and other Intermediaries
             o Consumers
             o Certifiers
             o Individuals and other Organizational Supporters
    Authority will vest in the OFA Board, subject to certain constitutional constraints, and
        the normal constraints of Corporations Law etc.
    The Advisory Boards would have certain rights as to OFA Board representation, and
        will have the sole right to nominate the candidates for the OFA Board, and some of
        the positions on the Trustee Board. They will also have some other rights in terms of
        the OFA Board relating to such issues as the removal of Directors etc.
    The rights of certain Member Organisations will be different from others in some
        respects, and the OFA Constitution will provide sufficient flexibility for this to be
        reviewed and changed over time, if necessary.
    The OFA Board will have a standing Nominations Committee that will include at least
        one external independent party to vet the nominations on behalf of the OFA Board.
    The Funding Model is to be determined jointly by the Advisory Boards and the OFA
        Board, but is to be sufficient to provide proper long term funding for the organisation
        to meet its mission and aims. Overall funding will also include the non consolidated
        funds raised through the Trust.

Key Elements of the Structure

Membership of OFA
Membership of OFA will be open to all individuals, incorporated organisations, and other
entities. Each member will choose the Member Organisation that is most appropriate to their
circumstances. It is possible to be a member of more than one Member Organisation
(however see restriction on membership below).
However the only voting members of OFA itself will be the five Member Organisations,
headed up by their respective Advisory Boards.

Membership Organisations, Advisory Boards, and OFA.
The interface and relationship between OFA and the Member Organisations, headed by their
Advisory Boards, will be set out in the OFA Constitution eg it will only be possible to vote
within a Member Organisation on an OFA issue if the individual/entity is a current member of
OFA etc.


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However, it will be up to the Advisory Boards to determine how they wish their Member
Organisations to be structured and operate internally; eg elections, voting procedures,
financial status etc. These rules of conduct should, however, be created in conjunction with
OFA board, to ensure that there is a consistency of objectives between the entities, and that
the rules are in compliance with the OFA Constitution.

Restriction on Membership
The OFA Constitution will specify that no member can vote in more than two Member
Organisations, although they can be a member of more than two organisations. They must
nominate which Member Organisations they intend to vote in.

The OFA Board
It is proposed that;
      o The main OFA Board is to consist of nine Directors, including the Chairman.
      o The OFA Board would select the Chairman
      o The normal term for a Director would be three years, and a maximum of six years.
      o The normal term for a Chairman would be three years, and a maximum of nine years.
      o The five Member Organisations, through their Advisory Boards would have the
          following nomination rights, and minimum/maximum representational rights;

        Member Organisation              Nomination       Minimum        Maximum
                                                                     Representation

        Certifiers                               3               2              3
        Producers                                3               1              3
        Traders and Intermediaries               3               1              3
        Consumers                                3               1              3
        Individuals/General Org.                 2               1              1
    o   All persons nominated as an OFA Director has to be vetted by the OFA Nominations
        Committee, which will consist of the Chairman of OFA, plus two other Directors, and
        an independent party.
    o   An Advisory Board may choose to nominate either a member of their own Advisory
        Board, or another member from their organisation, for the OFA Board.

The Subsidiary Trustee Board for the Charitable Trust
It is proposed that;
      o The Charitable Trust will have a separate Constitution, which is consistent with trust
          law and also consistent with the OFA Constitution. There will be no common
          Directors between the OFA Board and the Trustee Board.
      o There will be five Trustees appointed to the Trust, including the Chairman.
      o Three Trustees will be nominated by the Advisory Boards and vetted by the
          Nominations Committee of the OFA Board, for approval by the OFA Board.
      o Two Trustees will be nominated by the OFA Board.
      o The Trustee Board will nominate its own Chairman
      o The terms of service for the Trustees will be the same as for the OFA Board.
      o No Member Organisation, through its Advisory Board, may nominate more than one
          Trustee.

Interface between the OFA Board and the Advisory Boards
    o Ultimate authority vests in the OFA Board
    o However, the Advisory Boards have a number of general rights, in addition to their
        nomination and representational rights, namely;
            o The right to bring issues to the attention of the OFA Board and ask that they
               be considered and responded to in a timely manner.
            o The ability to question OFA Directors on Director selection decisions, but not
               to overturn them.
            o The right to receive regular reports from OFA Board as to their operations,
               progress and financial results.




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            o   The right to remove OFA Directors and Trustees of the Trust Board, provided
                that all Member Organisations support such a proposal, as well as a majority
                of the remaining OFA Board.
            o The right to affirm the sitting fees of OFA Board Members and the
                honorarium of the Chairman.
            o The right to form subcommittees
    o   The Advisory Boards can also be co-opted as subcommittees of the OFA Board, and
        can be asked by the OFA Board to undertake specific tasks on its behalf, and with its
        delegated authority. In such situations, however, the ultimate responsibility lies with
        the OFA Board.
    o   The OFA Board can form subcommittees to deal with issues that affect several
        Advisory Boards. Examples would be subcommittees that deal with R&D,
        Promotion/Marketing, Education, Environmental management etc.

Criteria for the Selection of the OFA Board of Directors
It is proposed that;
      o The OFA Board will publish a written set of criteria for the selection of Directors to all
          Advisory Boards, to assist in their nomination process.
      o The emphasis in the criteria will be on achieving the necessary balance of
          skills/experience/qualities necessary to successfully fulfil OFA’s mission.
      o The express intention of the process is to establish a highly qualified and highly
          respected Board.

Board Fees and Expenses
It is proposed that;
      o Each Board member, in both Boards, will receive nominal sitting fees and the two
          Chairmen will receive an honorarium, determined by a vote of the Advisory Boards,
          on the recommendation of the OFA Board.
      o Reasonable expenses of travel, accommodation etc. will be reimbursed to Board
          members, acting directly on OFA and Trust Business.

Determination of the Funding Model OFA:

Some of the principles that can be established and initial proposals on funding are contained
in Appendix 5.

Some underlying principles are;
   o There would be an initial membership joining fee and an annual renewal fee.
   o The size of the fees would vary between Member Organisations, determined by the
      size of the member and the capacity to pay.
   o There would have to be both fee minima and fee maxima to ensure some degree of
      equity between members.
   o Some of the fee income would have to be allocated to deal with the costs of running
      the Member Organisations and the Advisory Boards. This is assumed to be modest,
      and that most of the funding would be directed to OFA.
   o Firm funding proposals will be put forward by the Working Group, which will be
      consistent with OFA’s budgetary requirements. However the final determination of
      funding formulae will be the responsibility of the Member Organisations and their
      Advisory Boards.

Charitable Trust :
At inception it is proposed that OFA will provide the Trust with some modest funding to
commence its role, and that this will be added to each year. No conditions can attach to that
funding.

However the main source of funding for the Trust will come from its own efforts to raise
monies from charitable and philanthropic sources, as well as other green/environmental
sources.

These will be subject to separate audit.



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Key Proposal 3: The Proposed Transition Arrangements

Timetable for the Proposed Transition
 Widespread Industry Consultation:                         Dec. 2004 – end February 2005
 Review of Industry Submissions:                           1 March - 21 March 2005
 Release of Final Document                                 April 2005
 Drafting of the New Constitutions:                        April-May 2005
 Register new company limited by guarantee:                June 2005
 Mail out nomination forms to members to nominate
   for the Advisory Boards and OFA Board.
 Appoint nominations committee:                            June 2005
 Special Meeting: to adopt New Constitutions AGM
    & Elections under the New Constitutions:                July 2005

Status of the Existing OFA Membership, Funds and Property
The new Constitution will ensure that all existing OFA members are to have automatic
membership of the new entity. All OFA funds and property will be transferred to the new entity

Status of the Working Group and the Existing OFA Board
It is proposed that;
o The Working Group will continue to oversee the change process, with some additional
      resources being added on a needs basis (eg. legal drafting resources, financial modelling
      etc.). Members of the existing Working Group will re-affirm to the Chairman their
      agreement to continue to be involved and be an active participant.
o Existing Directors would be entitled to stand for election in the new OFA provided they
      participate in the new process for the nomination and selection of OFA/Trust Directors, as
      will be set out in the new Constitutions.

Initial Nominations Committee:
Because the OFA Board will obviously not be appointed before the initial nominations and
selection process, the following transitional arrangements are proposed:
 The Initial Nominations Committee will comprise of two respected members of the organic
     industry, one independent party with senior human resources experience at Director
     selection level, and one experienced and senior Board Director from an organisation not
     connected with the organic industry.

   IWG members are to send a list of names of suitable people for the nominations
    committee to the Chair. It is important to identify which one of the three criteria they
    represent.

   The Chair will put these names to key industry stakeholder organisations to develop a
    consensus on the final four people who will be on the nominations committee. It is
    important that these people are suitable to the whole industry so that the process of
    selecting the first board of the new OFA is seen as fair and transparent. We need to avoid
    any suggestions of favoritism or stacking.

Transition to first board
Nominations for the advisory boards should be called in June, possibly June 1. As this is the
first election under the new system it is important that the new board is in place at the first
AGM. It is proposed that the candidates nominating for the various Advisory Boards indicate if
they wish to nominate for the OFA Board of directors.

The selection criteria for being on the Board of directors will be sent out with the nomination
forms. Those nominating for the board of directors will have to supply a CV based on the
selection criteria as well as two letters of reference from industry organisations. They will also
have to be financial members of the OFA.

The nominations committee will then select the initial board based their skills and suitability.
These people will take up their roles as board members at the initial AGM subject to them
being elected to their respective Advisory boards. In the event that potential board candidates


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OFA Restructure April 2005                                                                       12


do not get elected to their advisory boards, the nominations committee will select the next
suitable candidates that have been elected.

The initial Chair, Secretary and Treasurer will be appointed on the day. These people will
have been selected as part of the initial selection criteria. Afterwards the board can vote to
decide on the executive positions.

Initial Terms for the First Boards of OFA and the Trust
Notwithstanding the normal terms for both Boards, it is recommended that the initial Boards’
terms be staggered to ensure that there is an election process, which only requires a part of
the Board to stand at any one election.

The following formula is proposed for the initial Boards;

Board                            Initial Term of 2 Years Initial Term of 3 Years

Chairpersons OFA, Trust                                            2
OFA Directors                    4                                 4
Trust Directors                  2                                 2

The only condition relates to the OFA Board, where no Member Organisation can have more
than one elected Director in the initial 2 years group.

All subsequent elections will be for a term of three years which ensures that approximately
50% of the Board comes up for election on each occasion there is an election.

The election cycle will therefore be;
2005, 2007, 2008, 2010, 2011, 2013 etc.

Review Arrangements
The structure of the OFA should be reviewed after six years (2011) to ensure that it is
relevant to the industry needs at that time.



APPENDIX 1: BACKGROUND TO OFA, THE ORGANIC ROUNDTABLE,
                      AND THE WORKING GROUP.



Background to the Working Group’s Brief

The Organic Federation of Australia (OFA) was formed in 1998, after widespread industry
consultation, as the national peak body for the Australian Organic Industry. It is currently
structured as a representative national organic body that includes all sectors of the industry
such as horticulture, broadacre agriculture, meat production, wholesalers, exporters,
consumers, certifiers, processors, IFOAM, inspectors, education and research.

However, by 2003 it did not have the support of significant sectors of the organic industry.
The Board of the OFA consequently began a process of contacting industry and Government
to consider changes that would be necessary to obtain the support of the majority of the
industry.

This process resulted in an Organic Industry Roundtable in Sydney on August 16th 2004. The
meeting was hosted by Senator Troeth, then Parliamentary Secretary to the Minister for
Agriculture, Fisheries and Forestry, the Department of Agriculture, Forestry and Fisheries
(DAFF) and the Rural Industries Research and Development Corporation (RIRDC). The
objective was to develop a vision for the future of the organic industry.




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OFA Restructure April 2005                                                                  13


The meeting was attended by more than 30 representatives of the major organic industry
organisations and Government departments. The roundtable meeting discussed a range of
important industry matters.

The most significant outcome of the Organic Industry Roundtable was an agreement for the
continued need for an industry united behind a national organisation.

The meeting was unanimous in supporting a national organisation that can act as a conduit to
Government and deal with numerous industry issues on behalf of the entire Organic Industry.
There was also strong consensus that the membership of the OFA requires change to reflect
the current needs of a rapidly changing and growing organic industry.

The meeting invited Andre Leu, the current OFA Chairman, to convene a Working Group to
propose changes to OFA and, in the first instance, produce a discussion paper by mid/end
November 2004.




 APPENDIX 2: ADDITIONAL DETAILED INFORMATION RELATING TO THE PROPOSED
                          STRUCTURAL CHANGES.



Renomination of Existing Directors
   o All Directors, including the Chairman, wishing to renominate, must have their
      continued eligibility reconsidered by the Nominations Committee (with the Chairman
      standing down from the Committee when his/her own eligibility is being considered).
   o The Nominations Committee will also take account of the current views of the
      relevant Advisory Board, as to their continued support for the renominating Director.

Protocol in respect to Vacant Board Seats
   o In the case of any Director standing down, and thus creating a vacancy, prior to the
       expiration of their normal term, their replacement will be nominated by the same
       Advisory Board who originally nominated their predecessor.
   o The relevant Advisory Board can relinquish this right if they have no suitable
       candidate. In that instance the OFA Board would seek a nomination from a specific
       Advisory Board, subject to the rules of maxima and minima.

Transition between the Initial Nominations Committee and the First Board elected
Nominations Committee.
      o One of the first key tasks for the Board elected Nominations Committee will to
          reaffirm or amend, if necessary, the selection criteria for Board Directors.
      o The confirmation and/or amendments will then be advised to the Advisory Boards.




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     APPENDIX 3: DIAGRAMATIC OUTLINE OF THE PROPOSED OFA STRUCTURE




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   APPENDIX 4: DETAILED INFORMATION ON THE MISSION AND AIMS OF OFA AS
                           CURRENTLY SPECIFIED


Detailed Outline of the Activities within each aspect of the Mission.

Negotiating Organic Industry Issues with Government
   o Organic consultative bodies for agriculture, processing and consumer products.
   o Domestic regulation to protect the integrity of organic products with a code of conduct
       through the ACC.
   o Funding for organic industry research and development
   o Audit and industry feedback on Organic Industry Export Consultative Committee
       (OIECC), certification protocols and procedures.
   o Lobby at the point of legislation construction.
   o Clarify certification, assurance logos and their equivalence.
   o Export Regulation
   o Food Irradiation
   o Land and Water Conservation
   o Genetic Engineering
   o Free Trade Agreements
   o Fair Trade practices.
   o Nutrition.

Promotion of the Organic Industry to the Community
    o Developing and coordinating an annual industry theme for members of the OFA to
       work on together.
    o Nationwide “organic week” sponsored by a number of retailers and producers.
    o Sponsoring retail awareness. Retailers acknowledged as a critical service point
       between the consumers and the industry.
    o Developing training and information packages for retail category managers and staff.
    o In store promotional taste testing in mainstream supermarkets.
    o Sponsoring consumer awareness of effecting promotions common to the whole
       organic industry.
    o Community supported agriculture and farmer markets
    o Developing funding pathways with business
    o Social Issues; eg Genetic engineering, etc.

Promotion of Organics to the Agricultural Industry
   o Supporting education and training initiatives in organic agriculture
      Eg; Inform producers and processors about certification issues.




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 APPENDIX 5: SUGGESTED BASES FOR EACH MEMBER ORGANISATIONS’ FUNDING
                               MODEL

The Industry Working Group has modelled several budgets for the OFA that show that the
organisation will be able to adequately fund itself from membership fees. It is intended that
the OFA will be fully self-funded and not reliant on government money.

Several budget options are being finalised and these will be sent out in May/June. Below is a
tentative model for discussion purposes

Groupings of Member Organisations


Producers:
   o Typically, incorporated not-for-profit organisations eg Organic Coalition of Tasmania,
      Biodynamic Agriculture Australia, SASA, OPAQ, TROPO, OGWA , OAA, OBE etc.
   o Could be minimum requirement of 20 members
   o Minimum annual subscription of $200
   o Sliding scale to $500, according to size.

Traders and Intermediaries
    o Typically a commercially oriented enterprise with ABN’s.
    o Similar to producers with annual subscription of $200 with sliding scale up to $500.


Consumers
   o Typically not for profit consumer organisations.
   o Set at minimum of $200 pa.

Certifiers
   o Key funding group
   o Suggested $200 per organisation, with a sliding scale up to $500, based on the size
        of the organisation.
   o Additional $10 flat fee per certified client collected on behalf of OFA.

Individuals/General Organisations
    o $200 per organisation
    o $100 per individual not certified organic licence holder
    o $60 per individual if certified organic licence holder.




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APPENDIX 6: SUGGESTED BUDGET
                                                                              Groups
                  Income                                             OFA
                                                                     (80%)     (20%)
                      Group A      20 x $250                  5000    4000      1000
                            B      10 x $350                  3500    2800       700
                            C       2 x $500                  2000    1600       400
                                    5 x $200
                             D      3 x $200                 25600   20480      5120
                                   2500 x $10
                              E    10 x $100                 16000   12800      3200
                                   300 x $50
                                                             52100   41680      7920
                                   Grant Commissions                  1000
                                   $10,000 @ 10% total
                                                                     42680


                  Expenses
                  Chair                  Honorarium       5,000
                                         Travel           5,000      10,000
                  Board                  1 face to face   4,500
                                         meeting
                                         9 x $500 PP



                  Directors Ins.                          3,500
                                         6 Telecon        3,000      11,000
                                         ferences @500
                                         Ea

                  Company fees and                                    2,500
                  audit
                  Publications and E-                                 3,000
                  newsletter
                  Part Time                                          12,000
                  (I day) Secretariat
                  and Office Expense
                  incl Bank charges
                                                                      38500
                  Surplus                                              4180

                                        Assumptions
1.   Residual funds from OFA – Mark 1 Held as reserves




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APPENDIX 7: Industry Comments on the Draft Proposal

The draft discussion document was sent widely to industry stakeholders, including all the
roundtable participants. Summaries were printed in many of the newsletters, magazines,
newspapers and other media that inform the organic industry.

A detailed summary was sent out on the OFA organic update to over 1,500 industry
stakeholders. The full document was posted on the OFA website and the web address was
included in all media.

The draft document was presented to Senator the Hon. Richard Colbeck, Parliamentary
Secretary to the Minister for Agriculture, Fisheries and Forestry. The document was also
presented to the relevant government officers at DAFF and AQIS in Canberra

A PowerPoint presentation was given at the NASAA AGM in Adelaide and the OFA AGM in
Warragul, Victoria.

Numerous comments were received from stakeholders. Where comments were not received,
the Chair phoned key industry representatives to obtain their views on the restructure.

Overall the vast majority of comments were positive and supportive, with several queries.
There was one written negative comment and two verbal negative comments.

The document received positive comments from the two major certifying organisations and all
the state based industry organisations. Feedback from state and federal government
departments was also positive.

The main concern expressed was that there were a lot of positions to be filled and that it was
doubtful that there would be enough people to put up their hands for these positions.

The IWG wanted to ensure that the OFA was inclusive rather than exclusive. It was felt that it
was important to ensure that there were enough positions so that we can involved the whole
value chain from the paddock to the plate. While in the beginning there may be empty seats, it
is important to allow spaces so that as the industry grows, there is scope to accommodate
more representatives.

One of the major problems the IWG had to grapple with is how can we have a system that
encourages as many people as possible to participate and not be too top heavy with an
unmanageable board.

The concerns about a top heavy board have been addressed by a two tiered board system.
The board of directors will be restricted to 9. Their prime responsibility is a role of governance
consistent with Corporations Law.




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APPENDIX 8: The Charitable Trust

The purpose Charitable Trust is to generate funds for research into organic systems.

These will come from:

   tax-deductible donations from charitable and philanthropic sources
   green/environmental sources
   people leaving money in their wills
   some modest, unconditional funding from the OFA

The trust’s board of directors will decide on the funding of appropriate research projects.

The Subsidiary Trustee Board for the Charitable Trust
It is proposed that;
      o The Charitable Trust will have a separate Constitution, which is consistent with trust
          law and also consistent with the OFA Constitution. There will be no common
          Directors between the OFA Board and the Trustee Board.
      o There will be five Trustees appointed to the Trust, including the Chairman.
      o Three Trustees will be nominated by the Advisory Boards and vetted by the
          Nominations Committee of the OFA Board, for approval by the OFA Board.
      o Two Trustees will be nominated by the OFA Board.
      o The Trustee Board will nominate its own Chairman
      o The terms of service for the Trustees will be the same as for the OFA Board.
      o No Member Organisation, through its Advisory Board, may nominate more than one
          Trustee.




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