Client Advisory Boards explained
FrieslandCampina, the Netherlands
How a bank with cooperative roots
helped another cooperative
COVER STORY RABOBANK'S WAY OF WORKING
20 issue 29 o< RI WORLD
already in place in several regions outside the Netherlands,
both in Wholesale and in Rural Retail operations - were
formed to provide clients with a forum to exchange ideas
and perspectives about issues of significance within the F&A
industry and/or general business
market, and to provide guidance
and feedback to Rabobank on
how best to serve its clients'
needs. The boards provide
Rabobank's senior management
with a unique opportunity to
engage in lively, off-the record
discussions and better under-
stand the critical dynamics of
the complexities of the F&A
sector as well as the local
communities Rabobank serves.
Client Advisory Board members,
meanwhile, have the
opportunity to provide feedback
on Rabobank's strategy and debate with other key opinion
leaders and business executives on market issues. And they
play an important role in engaging with other F&A Thought
Leaders and staying ahead of industry trends.
Involving members is an essential part of Rabobank's
cooperative strategy. In the Netherlands, this structure
enables representatives of member banks to give advice
and feedback on the bank through the Central Delegates
Assembly, the advisory
board for Rabobank
Nederland. Flowever,
because Rabobank's
overseas operations are not
themselves cooperatives
from a legal structure - as
they don't have official
members - some have
chosen to set up their own
regional advisory boards so
that clients can be involved
with the strategy and
direction of their specific
business.
These Client Advisory Boards are composed of sector
experts and senior executives from leading clients as well
as key people from local communities, which allows for a
broader input on important topics. The boards - which are
In 2008, when FrieslandCampina was formed from the
merger of two cooperatives, Friesland Foods and Campina,
one of the world's largest multinational dairy companies
was created. One of the challenges was to replace the
existing member instruments of both merged cooperatives
with attractive new member instruments for the new
cooperative. Both merged companies have had relation-
ships with Rabobank for many years so knew where to look for
help. Rabobank, being a cooperative itself, is familiar with
the issue, has a great deal of experience in this area and is
known for its innovative, tailor-made financing capabilities.
A new member bond, qualifying as equity and tradable
by the cooperative members on an internal market, was
developed. To ensure tradability of these bonds, Rabobank
created a bespoke facility to absorb temporary excess
supply and demand on this market, the Liquidity Facility.
It was agreed that Rabobank would absorb a maximum
of EUR 50 million of member bonds, while preserving
the equity qualification of the member bonds held by
Rabobank.
This facility also encouraged members to confidently
subscribe to the membertronds and, as a result,
contributed to the success of the merger. Recently,
the Liquidity Facility has been ejOended for another
three years. This underlines ho\^5eing innovative and
knowing your customer really can add value and deepen
a relationship. And if you are a cooperativelypurself, that
certainly helps, too.
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