Rio Tinto may need to tap outsider for new chief
Reuters
Published Sep 11, 2020 02:42AM ET
By Sonali Paul
MELBOURNE (Reuters) - Four years after mining giant Rio Tinto (NYSE:RIO) swept out its veteran managers to make way for a new generation of business heads, its leadership team has come unstuck.
The world's biggest iron ore miner is looking for a new chief and iron ore boss after they allowed the blasting of ancient Aboriginal rock shelters to expand a mine in Western Australia against the wishes of the traditional owners.
Investors and analysts saw no clear internal candidates and said following the damage done to the company's reputation, it was likely Rio would tap an outsider to replace Frenchman Jean-Sébastien Jacques.
"Clearly from the comments of the chairman they want to reset the culture, which would imply an external candidate would be more likely than an internal one," said Macquarie analyst Hayden Bairstow.
Chairman Simon Thompson said on Friday the company was determined to "re-establish our reputation as a leader in communities and heritage management".
Potential external candidates that analysts and investors pointed to included Anglo American (AX:AAL) CEO Mark Cutifani, Orica (AX:ORI) CEO Alberto Calderon, former Fortescue Metals Group (AX:FMG) boss Nev Power, and ex-Shell Australia chair Zoe Yujnovich, who previously ran Rio's Canadian iron ore business.
"Zoe has the relevant mining background, international management experience, government relationships, acute sensitivity to indigenous and remote community engagement, and strong Australian roots," said one analyst, who declined to be named as he does not cover Rio.
If the company wants to overhaul its culture, it might be tough to turn to former Rio executives, although several were seen as potential candidates: Newcrest Mining (AX:NCM) Chief Executive Sandeep Biswas, Aurizon
However analysts said the company may want to look beyond mining expertise to set a new vision for the company.
"You don't need to be able to do a mine plan for an iron ore pit to run Rio Tinto. Look at (former travel industry executive) Elizabeth Gaines' success at Fortescue," Bairstow said.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.