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Combined Annual Report and Sustainability Report 2018

Cooperative

With around 7,000 dairy farmers and cooperative members of Deutsches Milchkontor eG and DOC Kaas B.A. and a total volume of milk processed totalling 8.0 billion kilos (including purchased milk and milk swaps), the DMK Group is one of the largest dairy companies in Europe organised on the cooperative system. In total, the cooperative’s dairy farmers delivered 5.3 billion kilos of raw milk.

A long tradition

The cooperative model in Germany looks back on a tradition of more than 200 years’ standing. At DMK, the cooperative organisation stands for self-management, community, mutual support and continuity. The cooperative is upheld by its members’ efforts and their shared readiness to accept flexibility and change. In the year under review, DMK continued to pursue the goal of taking this tradition into the future – not least by steadily developing member relationships and giving them a modern design. In addition, the focus lay once more on intensive dialogue within the cooperative and on improving communication, which is particularly important in times of change and of volatile markets.

Intensive work by the executive bodies

The cooperative’s organisation comprises a number of executive bodies which also deliberated and agreed on different topics in the course of the year under review.

Annual Assembly of representatives

  • Six preparatory Annual Assemblies from 4 to 11 June 2018
  • Annual Assembly on 20 June 2018 with resolutions on the annual financial statements and profit, presentation of candidates followed by election of the employer-side Supervisory Board members, intense discussion of the direction taken by the limited company
  • Four representatives’ letters after the Advisory Board meetings to inform the representatives of the main substance.

Board of Management

  • 17 meetings including a two-day closed meeting
  • Board member Reiner Lübben retired on the grounds of age
  • Norbert Trecksler, previously Chairman of the Young Dairy Farmers Working Group (AJKM), appointed by the Supervisory Board as a Board member
  • Dirk Schröder reappointed to the Board of Management and its deputy Chairmanship
  • Topics: Changes in membership due to resignations and the resulting impending loss of milk in the cooperative and the limited company, volume management models in the event of market crises, acquisition of new members, improvements made in communication with members and representatives by providing interim information such as representatives’ letters or surveys, redrafting of Milk Delivery Regulations as of 1 January 2019

Supervisory Board

  • Five meetings
  • Constituted officially at the first meeting after the 2018 Annual Assembly with Heinz Korte elected as Chairman and Dr Herbert Grimberg as Deputy for a further period. The first official action of the executive body was to re-elect Dirk Schröder as Deputy to Chairman of the Board of Management Thomas Stürtz.
  • Topics: critical and intense discussion of the realignment of the DMK Group, particularly factory closures and toll manufacturing contracts, redrafting of the Milk Delivery Regulations as of 1 January 2019

Advisory Board

  • Four meetings including two-day closed meeting
  • Realignment of the DMK Group intensely discussed
  • Redrafting of the Milk Delivery Regulations as of 1 January 2019 intensely discussed and a resolution passed
  • HR proposals developed on the succession to a Board membership and the new composition of DMK eG’s Supervisory Board.

Ongoing dialogue with cooperative members

In the spring of 2018, the corporate management and elected officers presented the status of the realignment to the dairy farmers at ten Regional Assemblies and discussed the results with them. Thomas Stürtz, Chairman of the cooperative, Heinz Korte, Chairman of the Supervisory Board, and Dr Klaus Hein, Managing Director of DMK eG, were present to answer members’ questions about the company’s course and about topics such as the milk price and the trend in the milk volume.

In the autumn of 2018, regional members of the Board of Management, Supervisory Board members and Regional Managers met the members at a total of 70 District Assemblies in the DMK eG collection area. These smaller groups held lively discussions, for example on the current trend in the dairy markets, the changes in membership due to resignations, milk volume planning and the topics of tie-stall housing and GMO-free milk.

In the course of the year, DMK also carried out two online surveys. In the first of these, the company asked the representatives about how satisfied they were with the way the Annual Assemblies went. The second was conducted as a supplement to the regular survey in order to gain a detailed overview of the availability of feed after the drought and to analyse the milk volumes. The results showed that around 50 percent of respondents expected a major gap in feed and therefore financial losses.

In addition, DMK reorganised the key account staff in the year under review and increased the size of this function in individual regions. As the interface between the company and the farmers, key account staff are enabled by the new set-up to ensure better regional contacts with the dairy farmers.

Regular and transparent communication

Against the background of MOVE, DMK also focused on its communication with the members of the cooperative and set itself the goal of using it to strengthen the we-feeling of dairy farmers and employees and basically to make it even more regular, transparent and diverse. The quarterly members’ magazine “Milchwelt” provides dairy farmers with detailed information about the company and its brands and products. In order to further improve the sense of community among dairy farmers and employees, DMK is opting here for a new publications concept for the new corporate culture of transparency and increased sharing of information and opinions: From March 2019 onwards, the company will no longer give employees and dairy farmers information in the separate publications “Inside DMK” and “Milchwelt” (“Milk World”), but will publish a shared digital and printed “Milchwelt” instead.

The monthly publication "Milchwelt kompakt" ("Milk World compact") will continue to provide current market information, while "DMKMilchpreisinfo" ("DMK Milk Price Info”), also published monthly, offers forecasts for the following month. In addition, the online portal "webmelker.de" ("web milker.de") forms the virtual interface between the company and dairy farmers as a work and information platform. DMK deploys Regional Managers and consultants as contacts for the dairy farmers in all dairy farming regions in order to share ideas and information directly.

 

Milchwelt Magazin

4 x per year
Print magazine

Milchwelt kompakt

12 x per year
print newsletter

DMK Markt-/ Milchpreisinfo

12 x per year + special newsletters
(as required)
Distributed by e-mail/ fax

Webmelker.de

24/7 online
Extranet with secure log-in

Regional Managers and consultants

Contacts in all regions

Regional general meetings

In 9 regions in the year 2018

Committed young dairy farmers

The company created the “Young Dairy Farmers’ Working Group” (AJKM) as long ago as 2001. Its members are appointed by the District Assemblies for five years. In the period under review, this body consisted of 67 committed farmers and represented the interests of young farmers on a voluntary basis. Farmers aged between 18 and 34 meet in the AJKM to hold discussions, share experiences and undertake further training – sometimes with a view to a possible future position in the executive bodies. DMK supports the young farmers by this means and familiarises them with the company, the cooperative and current dairy industry topics.

As important regional multipliers, the members of the AKJM form a key interface between young farmers, the elected officers and the company.

Heinz Korte, Chairman of the Supervisory Board of the DMK Group

In 2018, AKJM members closely considered the current developments within the DMK Group and the innovations in the Milkmaster Programme and passed on ideas from their work. CEO Ingo Müller reported to the AKJM on the current situation in the company and on the dairy market at a meeting in December. In previous meetings, managers from the business units gave the young farmers insights into their units’ market developments and the direction they were taking. Two members of the Board of the AKJM spent two days answering consumers’ questions about modern and sustainable dairy farming at the stand run by the German Raiffeisen association (DRV) at the International Green Week in Berlin. Meetings of the German cooperative dairy industry interest group (IGM) were also held for the first time in 2018. The group was founded in the previous year. For example, “Junge IGM” (*Young IGM”) met in October in Edewecht for an exchange of experiences with representatives of different cooperative dairy companies. The annual study trip took the Working Group to Mecklenburg-Vorpommern for two days in January 2018. The Working Group took advantage of the event to share experiences and obtain information at large dairy farms in the north east.  The programme also included a factory tour at Altentreptow and a visit to the Mecklenburg-Vorpommern research institution in Dummerstorf.

More chapter topics

Dairy farming