Rio Tinto has named its finance director Jacob Stousholm as its next chief executive as Anglo-Australian miners seek to restore its reputation after an international attack on the destruction of a sacred indigenous site.
The promotion of Mr Stausholm, a Danish national who joined Rio in 2018 from shipping company AP Moller Marsk, will surprise many investors and analysts who hoped to choose a candidate from outside the company.
Rio began looking for a new chief executive in September following the resignation of Jean-Sebastian Jack, following investors’ reactions to the demolition of 446,000-year-old indigenous rock shelters aimed at expanding mining in Western Australia.
Canberra called on Rio to choose an Australian as its next chief executive, while investors called on the firm to focus more on such a country.
Several external candidates associated with the job, including Anglo-American chief Mark Kutifani, Newmont Corporate Tom Palmer and NewCrust Gold leader Sandeep Biswas, have resigned.
Mr. Stushlum’s career has included the Royal Dutch Shell, where he has worked for various roles and facilities group ISS for over 20 years.
He will head 93 billion companies listed in London and Sydney on January 1 and will receive a base salary of 1.15 million.
Rio Chairman Simon Thompson said Mr Stushlum’s combination of strategic and commercial skills, strong values and collaborative leadership style were “ideal qualities for our next chief executive”.
This is a significant contrast to Mr. Jack, who was known for his strict charging management style and single-minded attitude towards running the world’s largest mining company.
While Mr Jack has never been accepted by the Australian media or investment community, Mr Staosom will also face a challenge.
Mr Stushlam, who said restoring trust with indigenous groups and other stakeholders was “a top priority for the organization”, said Rio’s reputation needed to be worked hard.
He also needs to clear up the growing turmoil in Mongolia, where Rio’s most important growth project, the u 6.75 billion Woo Tolgoi copper mine, has been delayed and costly due to disputes with the country’s government and the agency’s minority partners. .
Also, Rio has faced a number of regulatory issues, including an investigation into the payment of consultants who helped secure the company’s rights to the iron ore mines in Guinea.
Another focus will be on maintaining strong ties with Rio’s largest customers in China amid growing trade tensions between Canberra and Beijing.
But there is no need to worry about Mr. Staosolam’s financial position in Rio. Thanks to the increase in the price of iron ore, the company has a rock-solid balance sheet and is projected to generate about 10 10 billion in additional cash this year.
During Mr. Jacques’ four-year tenure, Rio handed out nearly বিল 40 billion in cash to shareholders through dividends and share buybacks, avoided big deals, and ran out of coal in a timely manner.
Peter O’Connor, an analyst at Sydney-based broker Shaw & Partners, said the recruitment was unexpected and probably reflected the lack of a strong slate of internal candidates with operational experience and the failure to persuade high-caliber external candidates to accept the position.
Most of the internal candidates who could fit in Mr. Jack’s shoes left the company during his tenure, including Alan Davis, the former head of Rio’s Department of Energy and Minerals.
“Jacob Stousholm was very good in his current role as CFO and has been involved with the investment community here since his first trip,” Mr. O’Connor said.
“He also has a very broad knowledge of business, as he can answer detailed questions in a few minutes. But did I see him as the natural man to run the world’s second largest mining company? Probably not. More financial than operating his CV ”
Mr O’Connor added that Rio had probably not deliberately resisted Australian Treasurer Josh Friedenberg’s request for an Australian appointment and was more likely to lack adequate candidates.
“Is this a worrying sign of how the organization is set up and how tragic the role is?” Dr. O’Connor.
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