ENGINEERING SUCCESS - Doug Rathbone
Article I Rosie O’Keeffe
Doug Rathbone AM is a well-known and highly respected industry entrepreneur. His career achievements span more than four decades and include leading crop protection giant Nufarm from a small domestic business to become a globally significant player. His business knowledge has been instrumental in other positions, including as current Chair of the Delta Agribusiness board and Chair of family-owned company Rathbone Wine Group. He highlights his interest in agriculture and continued investments in the industry.
Doug Rathbone’s business philosophy, or as he describes, “winning formula”, is to take opportunities to grow the portfolio and the geography, while ensuring the team is well engaged and rewarded.
He believes as an independent, Delta Agribusiness has cemented its place as an important part of the Australian agricultural landscape. It was Doug’s support for the company’s continued development and expansion that enticed him to initially accept a position on the board of directors in 2017, and role of Chairman in 2018, which he still holds today.
“Independents are the backbone of the industry; they need to be supported and encouraged. I had been alert for some time to the entrepreneurship and ‘steady as a rock’ position Delta Ag had, creating new opportunities… There is a real strength in their ideas such as the finance offering and the development of Four Seasons products, and it’s terrific to experience expansion into Victoria, Western Australia, and now South Australia,” Doug says.
“After several drought years and the COVID-19 pandemic, I believe currently we are in unique circumstances, the current position of agriculture is the best we’ve seen right across the country. Delta Ag is continuing to take positive opportunities in this climate, with a very strong outlook over the next few years.”
Doug also believes that despite changing market and seasonal conditions, farming is about taking calculated risks and also celebrating your wins.
“Farmers certainly have an attitude that ‘things can be done’ and an ambition towards growth. Even though the cost of land is higher than it has ever been, there is still amalgamation of farms, growers who feel confident enough to take on more production capacity, and a lot of enterprises and organisations such as the CSIRO are investing strongly in research into further ways of maximising yield improvements, through new technologies and product improvements.
“I do think that any difficulties or restrictions that exist will one way or another be addressed through advancements in technology. On looking back, we’ve even come a long way in one generation.”
Whilst Doug, who formally trained as a chemical engineer, is most known for his leadership of Nufarm as it grew from a $10 million business, into one with international involvement and sales of $2.7 billion, he reminisces many anecdotes from his national service in Papua New Guinea in the early 1970s.
It was when Doug was working as a maths and science teacher that he was first conscripted to the army, and after delaying his initial call up to complete his studies and experience with an industrial manufacturer BFGoodrich, he entered the army in January 1971.
He completed recruit training and then infantry training at Singleton in the Hunter Valley.
He was then selected to join the Army Education Corp as part of a program that sent 300 Australian National Service Teachers (between 1966 and 1973) to Papua New Guinea to educate Pacific Island Regiment soldiers. He was posted to Port Moresby and later his wife Ann joined him… “It was a fascinating time of our lives and an important development time for me… We were involved in a number of ventures while there, including setting up an air charter business.”
Doug’s Nufarm tenure began in 1974 when he returned from National Service and made a decision to continue in industry, rather than teaching. Then owner Max Fremder offered Doug a 6 per cent share of the company and Doug’s role included engineering and construction of 24D herbicide plant.
In 1982 Max Fremder decided to sell the company, they sold 65 per cent of the shares to New Zealand Farmers Fertiliser (Later became known as FERNZ) with Doug acquiring the balance. In 1987 FERNZ was permitted under Closer Economic Relations (CER) between Australia and New Zealand to acquire 100 per cent of NUFARM, Doug swapping his NUFARM shares for shares in the public company. Doug continued to lead NUFARM during this period as a subsidiary of FERNZ.
NUFARM had enjoyed a lot of growth and expansion of its manufacturing footprint, with expansion in Asia, UK, France, Australia, USA, Canada and Brazil.
There were manufacturing facilities in 14 countries and sales in more than 100 countries.
“We had a great leadership team of six people through most of the expansion, and the very strong backing of FERNZ. In 1997 FERNZ sold the New Zealand fertilizer business and we used those funds to acquire a French business, which was the biggest and best acquisition of NUFARM. We had already acquired and were operating a 24D Herbicide plant in Austria and had MCPA Herbicide in the UK, before moving to the USA, Canada and then eventually Brazil.”
In 2000 the public company migrated to Australia and adopted the name NUFARM, where Doug continued as Managing Director/CEO.
“We were constantly in battle with the larger scale international companies, but we just needed to find ways to grow into being a part of the world market. We responded to the threats by finding ways of supplying product to the US market from our Australian plant at Laverton,” Doug says.
“The underlining thing I think too was that there is always the chance people want to do business with the people within the business, not just the most well-known brand.”
One of the many interesting ‘agricultural’ anecdotes Doug mentions from his time was an animal health sheep/shearing invention the CSIRO was working on, called biological wool harvesting.
“Part of finding a suitable long-term alternative to traditional shearing was to inject the sheep with an epidermal growth factor. We found a fermentation company in Japan, which also produced soy sauce, who could produce the product we needed to inject the sheep. The wool would then fall off the follicle in the sheep and this made a tapered piece of wool rather than the blunt right angle from shearing. Shearers wouldn’t be needed and with a shortage of this labour, it seemed like a practical solution. The challenge we faced was that the wool started to fall off in the paddock over a number of days. We then spoke to a hair spray company to supply hair spray to spray the sheep to hold the wool in place to then scrape off, but when the sheep rubbed together, they stuck together, and there was wool left in the middle. Knowing this wasn’t as successful as we thought, we got coats made in an old factory at Holsworthy and this is what we have ended up doing. The process is still in use today, but it only applies to highly specialised Merinos in sheep located in sheds. If the sheep are housed in sheds, it’s a great idea, but certainly one that is a specialised practice,” Doug says.
“This was too small for us to continue with, we sold the business and moved on… you need to know when to let things go.”
It is Doug’s involvement in his family’s acclaimed business Rathbone Wine Group that has brought him some of his most special and proud moments.
Since Doug’s son Darren, who had studied chemical engineering, initially indicated interest in building a winery on a small property, it was in 1995 the historic Yering Station in the Yarra Valley began the family’s formal interest in viticulture.
“Because Nufarm would always be a public company, I knew I would exit from my position there eventually, so it was the perfect time to start a family business. I felt value-added agriculture was a good start, and with Yering, we knew we had the branding with the property and it gave us a market position even in the early years,” Doug says.
“Everything really starts in the vineyard though, there is so much technology in that and Darren and his team are very strong in ensuring the viticulture process provides us with the most premium product to meet the high end of the industry.
“It was certainly a big learning step for me. You’re competing with a lot of brands… No one ever wanted to know what year the Round-Up was made, or who made it. Consumers of our wines wanted to know where the grapes came from, what the conditions were that year… It’s certainly wonderful, it’s lovely, but it was a new marketing focus I needed to develop.”
Rathbone Wine Group has achieved national and international award-winning premium wine brands showcasing its three vineyards Yering Station, Mount Langi Ghiran and Xanadu.
It was receiving the highest and most prestigious industry honour in 2018 – the coveted Jimmy Watson Trophy – for its 2016 Xanadu Cabernet Sauvignon that was a particularly proud moment for the Rathbone family, as at that time, all three of Doug and Ann’s sons, Darren, Brad and Matthew were involved in the business.
Doug reminisces the moment Matthew proudly held the Jimmy Watson Trophy, a special moment with Matthew having endured a long battle with cancer throughout his life, sadly passing away at the age of 43 the following year.
“It was a real strength for us all to be involved. Matthew was a really strong winemaker, he had a fantastic palette and it was a real passion for him too,” Doug recalls.
It was in 1979 when Matthew was just three years of age, he was diagnosed with a non-Hodgkin lymphoma. This was cured through chemotherapy and surgery, and he was the first successful bone marrow transplant recipient in Australia, also receiving radiation in his spine.
However, Doug recalls that treatment led to a brain tumour diagnosis when he was 14 years of age. He sadly passed away in 2019 at the age of 43.
Doug and his wife Ann have been involved in initiatives and numerous fundraising activities to assist in research and alleviating childhood cancers and even established the Children’s Cancer Foundation in 1998. The Rathbone family were also instrumental in launching the Foundation’s Capital Appeal in 2002 which raised $22 million to refurbish the Children’s Cancer Centre at The Royal Children’s Hospital and construct a linked research laboratory two years later. Doug is also still the president of the children’s cancer charity My Room.
“Since we built the new ward at the children’s hospital, we haven’t lost any children to secondary infections. When Matthew was diagnosed, I think the cure rate for paediatric cancer was 20 per cent, after much research the cure rate is up to 90 per cent,” Doug says.
“To stay passionate in business it’s important to have involvement in other things and being a part of these cancer charities is what we have chosen to do.”
Doug is proud of the accolades the wines have achieved and that each of the brands are representative of the local regions and climates, from the Yering Station’s “Scarlett” pinot noir, “Langi” shiraz, and Xanadu Reserves and Yering Reserves.
Whilst Australia is still their biggest market, the company exports to more than 40 countries. The tariffs China has placed on the wine industry have been challenging, however, Doug says it has only affected a small section of their brands.
“Like any agricultural pursuits, (the industry) is up and down, but the more premium end seems to be strong globally. Bulk product is experiencing some difficulty, but it’s still ok. The wine and spirits industry, and beer, continues to be strong and related to population size too,” Doug says.
On asking Doug whether he has a preferred label of his own wines, he chuckles it is like asking his favourite child… however, does offer some comment on his own palette.
“The chardonnays out of Yering and Xanadu, and the Langi shiraz are special, but there was a cellar door wine, not one of our main promotional wines, but a Graciano only produced in warm years out of our Western Australian operation, it’s a Spanish grape, it was terrific in 2012.
“I think there are a lot of different wine varieties to be enjoyed and I am certainly proud of all the different labels we consistently produce from all the wineries.”