A Greenpeace report alleges that Fonterra's sole supplier of Palm Kernel Expeller is sourcing from major palm oil producers known for unethical practices including deforestation and human rights abuses, which undermines the company's sustainability and ethical commitments.

Greenpeace's submission opposing the Regulatory Standards Bill warns that companies like Fonterra could exploit the new regulatory framework by using an unelected board to demand public payouts when environmental protections are enforced, suggesting a regulatory capture that puts corporate profits before public interest.

Fonterra's political influence is captured in a lobbying profile by OpenSecrets, which details data on their lobbying expenditures over specific periods as derived from Senate records. This exposure highlights the company's active engagement in influencing policymaking processes.

A Supreme Court case in New Zealand has reinstated a public nuisance claim alleging that Fonterra's eight dairy factories continue burning coal—emitting over 520,000 tonnes annually—to generate energy. This practice is claimed to contribute significantly to greenhouse gas emissions, exacerbating climate change impacts on public health, customary lands, and the broader environment.

Fonterra Brands (New Zealand) Ltd was involved in an employment dispute case (NZERA 197) where the court ruled that employees must follow lawful and reasonable instructions. The ruling highlights concerns over rigid labor practices that may limit workers’ agency and negotiation power.

Greenpeace reported that Fonterra, along with other agribusiness leaders, contributed to a pattern of predatory delay tactics that stalled the introduction of meaningful agricultural emissions pricing. This move, which prioritized short-term industry profits and lobby interests over urgent climate action, reflects broader ethical concerns regarding corporate responsibility in the climate crisis.

Following an altercation related to workplace absence during a period of illness, Fonterra dismissed veteran employee Waite, a decision later adjudged as unjustifiable. The company was ordered to pay almost $40,000 in damages after internal practices regarding sick leave and absence were called into question.

An investigative report by Greenpeace on September 19, 2018, details that Fonterra's sole supplier of Palm Kernel Expeller, Wilmar, sources from producers implicated in extensive deforestation and human rights abuses in Indonesia, undermining Fonterra's 2016 commitment to responsible palm oil sourcing.