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What's Going on in Governance

Les HardestyMountain Area Council Chairman

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DFA Overview

• A farmer-owned cooperative• 9,500 member farms; 17,000

members• 20 percent of U.S. milk

production produced by members

• DFA markets 33 percent of U.S. milk – 63 billion pounds

• $8.1 billion in sales

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DFA Member DemographicsQuartile 1, 2, 3 and 4 (March 2010)

Quartile Farms Avg Cows 1 124 3,588 2 275 1,623 3 982 455 4 8,180 55

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Cheese IngredientsIngredientsContract ManufacturingConsumer Brands

Turlock, Calif. Beaver,

Utah

Zumbrota, Minn.

Monett, Mo. West Middlesex,

Pa.

New Wilmington, Pa.

Hughson, Calif. Fort Morgan,

Colo.

Schulenburg, Texas

Springfield, Mo.

Cabool, Mo.

Winthrop, Minn.

Mechanicsburg, Pa.

Ventura, Calif. Winnsboro,

Texas

Plymouth, Wis.

Adrian, Mich.

Goshen, Ind.

Reading, Pa.

Middlebury Center, Pa.

*While not wholly owned DFA plants, DFA's ingredients business is responsible for the sales and marketing of these plants' products.

Portales, N.M.*

St. Albans, Vt.*

DFA Plants

Houston, Texas

Affiliate Network: Manufacturing

Affiliate Network

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DFA Values

DFA’s Farm Services

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Grassroots

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Our Cooperative is owned and governed by our members.

DFA Areas

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Area Councils• Each area has a council governing body and

delegates• DFA is divided into seven geographic Areas,

ensuring grassroots representation of members• Each Area is governed by an Area Council, which

monitors the marketing of milk and local issues• Members elect representatives to serve on their

Area Councils

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Area Delegates• Within each Area, members elect delegates to

serve as their Area’s voice on issues• Delegates travel each year to DFA’s Annual

Meeting to discuss and vote on a slate of resolutions for the Cooperative

• Delegates also elect the DFA Board• Resolutions guide DFA’s Board and leadership

when making business decisions

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Resolutions• Any DFA member may propose a resolution

through their Area’s resolutions committee• Area resolutions committees vote on proposed

resolutions and submit to the corporate resolutions committee

• Corporate resolutions committee members – made up of representatives from area resolutions committees - vote on proposed resolutions to present to DFA’s voting membership (delegates)

• Resolutions are taken from the floor

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Grassroots Structure

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Resolutions Committee

Area Delegates

Area Councils

Executive Committee

Board of Directors

Northeast

Delegates

Resolutions

Mideast

Delegates

Resolutions

Southeast

Delegates

Resolutions

Central

Delegates

Resolutions

Mountain

Delegates

Resolutions

Southwest

Delegates

Resolutions

Western

Delegates

Resolutions

Leadership

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51 Member Board of Directors

Grassroots

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An active and engaged Board

Board Committees• Standing Committees

– Finance and Budget– Value Added– Fluid Marketing and Public Policy– Government, Member and Public Relations

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Board Committees• Other Committees

– Audit– Legal– Compensation– Retirement– DEPAC– DFA Risk Management– DPI

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Board Committees• Other Committees, continued

– International Dairy Trade Policy– Agri-Max– Membership Credentials– Technology Sub-Committee (of Audit)– Price Stabilization Study

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What the Board Does• Each Area Council elects representatives to serve

on DFA’s Board of Directors• Board members serve two-year terms and are

elected at DFA’s Annual Meeting• DFA’s Board meets throughout the year to discuss

and vote on key business decisions• In addition, business operating decisions like

mergers and acquisitions, capital expenditures and member equity payments require Board approval

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Strategic Planning Process• Board recently completed a strategic planning

process• Every three to four years, DFA’s Board and

management reviews and revises the Cooperative’s Strategic Plan– This plan is a living document and changes with

priorities• This process was recently completed and a

revamped strategic plan was introduced• DFA’s leadership uses the strategic plan as a guide

in making business decisions

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Strategic Mission

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Leaders in Other Organizations

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Leaders in Other Organizations

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Agropur CooperativeAlpenrose Dairy, Inc.Anderson Erickson Dairy CompanyArla Foods, Inc.Arps Dairy, Inc.Arthur Schuman, Inc.Asael Farr & Sons CompanyAurora Organic Dairymore...

Leaders in Other Organizations

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Arla FoodsDairy Farmers of America, Inc.FonterraFrieslandCampinaInternational Dairy FederationNestlémore…

“It is not the strongest species that survive, nor the most intelligent, but the ones who are most

responsive to change.”

Charles Darwin

“Whether you prevail or fail, endure or die, depends more on what you do

to yourself than on what the world does to you.”

Jim Collins

Thank you