Miraka CEO, Karl Gradon, recently spoke to the Farmers Weekly about Miraka and our approach to business. Here is the Farmer Weekly's article by Gerald Piddock: "Kaitiakitanga - the force behind the Miraka marvel"
A small company is taking a holistic approach in its business – and it’s paying off on the global stage.
Miraka chief executive Karl Gradon says Miraka is special and has a strong te ao Māori focus. It values putting an inter-generational approach back into the dairy industry.
A small central North Island milk company is proving it can do big things. Based in Mokai, north of Taupō, Miraka is showing it’s possible to operate with kaitiakitanga (meaning guardianship and protection or sustainability) and te ao Māori values, and punch above its weight on the global stage.
Kaitiakitanga was not a strategy, it was embedded in Miraka values and everything it did, chief executive Karl Gradon says. It is one of Miraka’s key values. It means more than just being sustainable, he told farmers and industry leaders at the Primary Industries of New Zealand Summit in Auckland.
“That’s not the translation, it is much more holistic than sustainability and we are proving we can do this on a global scale.”
The $300 million dairy company based in Mokai just north of Taupō is a key player in the Māori economy, being one of its largest exporters.
It collects milk from 100 local farms within a 120km radius of the factory, which gives it a farm-fresh advantage and results in superior quality products.
Miraka has the power and capacity to process more than 300 million litres of milk into powders and UHT products every year. The range of products has a global reach and it exports to more than 17 countries.
“Miraka” means milk in te reo Māori, and bringing milk to the world and the nutrition that comes with it is at the forefront of everything it does.
“We are proudly Māori and being a pakeha at the helm is quite humbling,” Gradon says.
Gradon has been in the chief executive role since April and says the company has a culture that embraces people, and he is fortunate to be a part of it.
He previously worked at Fonterra in roles in Brazil, North America, France and Singapore.
In these roles he learnt customer insight, which he then took back to Fonterra to make better business decisions.
He shifted back to New Zealand when his children were born so they could be closer to his extended family, and worked for Kerry Group in its Asia-Pacific section.
“What I learnt there was a very close focus on growth in a cash-conservative way.”
He took on a role in the Eastern Bay of Plenty as New Zealand Mānuka Group’s chief executive. Working for that organisation was about taking something unique and compelling and telling a story to win the hearts and minds of consumers with the branding.
He resigned to focus on more governance roles in food organisations, many of which were Māori related.
It was here that he developed a deep appreciation and understanding of the role and potential of the Māori economy in New Zealand.
It is growing disproportionally faster than the rest of the traditional economy and is the future of the country’s economy, he says.
Miraka is a $300 million dairy company based in Mokai just north of Taupō, and a key player in the Māori economy.
When the Miraka job became available he was won over by its strong te ao Māori focus and its values putting an inter-generational approach back into the dairy industry.
“I never thought I would go back into management, but this organisation is special.”
It was a uniquely New Zealand company that had an amazing story about NZ’s cultural heritage and history. It put sustainability at the front of everything that is done, which he says is what consumers value most.
Miraka’s shareholders include the Tuaropaki Kaitiaki Trust, the Wairarapa Moana Incorporation, the Te Awahohonu Forest Trust, the Waipapa 9 Trust, the Hauhungaroa Partnership and the Tauhara Moana Trust.
Vietnamese-based company Vinamilk is a strategic partner.
“It was a ‘truly Māori organisation’ that wanted to take its taonga to the world. The shareholders realised what they had on the whenua was special and did not want to be trapped in selling only commodities,” Gradon says.
“They wanted to tell our story.”
It incentivised its farmer-suppliers with carrots rather than sticks with its on-farm excellence programme Te Ara Miraka, which Gradon says puts it ahead of the curve.
“When organisations are faced with environmental policy change at a government level, we’re already there. We’re able to tweak, not wholesale adapt.”
It offered a 20-cent premium for farmers, giving them a significant top-up on their income.
Milk creation and processing has an extensive recycling system where its milk production waste is recycled in the greenhouse facility close to the factory, and worm farm creation as part of a “closed loop” system it operates.
“It creates a very nice, closed loop system with milk being at the heart of it, steam being at the heart of it and the outcomes of kaitiakitanga and the general enhancement of the whenua and the wai for the benefit of all of our community.
“We are leading the way and the world is catching up and we need to continue to innovate.
“Our factory today – the average over the last three years – is 93% more carbon efficient than our competitors, 92% less than our competitors, 95% of our energy comes from renewable resources, the steam comes across the road from Tuaropaki.”
This is a Māori trust that is one of the largest players in the renewable resources energy industry in the country as well as a shareholder.
Over the past three years, the carbon footprint in its processing facility has reduced by 13%.
“This was independently audited and the accreditation process was being undertaken by Toitū Envirocare so it could be taken to the world,” Gradon says.
“This is not a story, these are facts. These are deeply entrenched values that our organisation has taken to the world stage.
“It’s not a veneer, because those veneers that are here today will be uncovered very quickly in this connected world.
“If you try and tell a story and it’s just not true, this connected world will find you out and the global consumer is looking for a reason to say, ‘Why is your story not genuine?’ Ours is deeply genuine.”
Miraka collects milk from 100 local farms within a 120km radius of the factory, which gives it a farm-fresh advantage and results in superior quality products.
That carbon footprint difference was the equivalent of 7000 fewer cars on the road, he says.
The company had a simple product mix. While at the core it was a whole milk powder company, it also made frozen milk concentrate for the food service markets and UHT milk for the Chinese market.
It was a compelling market for it to be in, considering how the Chinese market was starting to wake up to the importance of renewable energy and its own commitments to carbon neutrality, he says.
“It was also moving further up the value chain by customising its products and processing more A2 milk powder,” Gradon says.
“Ultimately, we’re looking to customise as much as possible our products into the specialised area, but our story and our kaitiakitanga approach is what drives us. It won’t be at a sacrifice to the quality or the sustainability of our products and the impact we have on the environment.”
Its biggest limitation is that it needs more suppliers so it can expand. In July it made public a request for 40 more farmers to add to its current 100 suppliers.
Gradon says there has been an overwhelming response, including from some outside Miraka’s 120km collection area.
“It’s because of the awareness of our farming community,” Gradon says.
“Most farmers want to do the best thing for the environment as well as for their families and when you think about it most farms in New Zealand are owned by families and they want to be able to continue that legacy by handing those farms over to the next generation.”