The council unanimously supported the notice of motion filed by councillor Ian Pottinger which demanded accountability from Great South’s executive and wants its chairman Ian Collier to front up with answers in the public arena.
Great South, a council-controlled organisation, initially established New Zealand Functional Foods (NZFF) with plans to develop an oat milk factory in Southland. But the factory will now be built in Canterbury.
NZFF is now 51% owned by Stephen Tindall’s K1W1 company while Great South holds 49%.
Mayor Nobby Clark said the communication around the issue had been "very poor" which had created a "whole lot of questions marks" for the council and public.
Great South needed to explain its position, why it chose to notify the councils when it did and what the impacts of staying involved with NZFF would be.
He also wanted more specifics including when the decision was made, how Mr Collier voted as a board member and how well Great South was positioned if additional capital investors came on board.
"There are some real tough questions around that, and I expect answers to those."
Cr Trish Boyle said she did not like the way council had been "sideswiped by the communication".
Cr Ria Bond said the most disappointing aspect was how the sudden "backtrack" came — only weeks after Great South’s chief executive had advised council of how well the factory project was developing.
Mr Clark said it may need to be a public-excluded meeting because NZFF was amid sensitive commercial negotiations with additional capital investors.
Great South would have to decide if it stayed as a part owner of the company or leave, he said.
Cr Pottinger said Great South was a joint council-owned entity which needed to be held accountable for breaching its "no surprises" policy and "public accountability" policy set out in its statement of intent.
A public-excluded meeting was not necessary to answer that question.
The public deserved proper transparency from the council-funded entity.
Cr Lesley Soper believed the council gave the then-Venture Southland economic development agency the mandate to operate as a more independent commercially-focused organisation many years ago, so any discussions should only be held at a public-excluded meeting on September 26.
"I just would not like the public to believe that there is going to be a fully public grilling of the board of Great South ... that may not be the reality."
While the motion had the full support from council, Cr Tom Campbell urged caution until they heard Mr Collier’s explanation.
The Otago Daily Times attempted to contact Mr Collier, who lives in Wairarapa, for comment and to confirm he will be attending the meeting on September 26, but he could not be contacted.
