The Canberra pressured Rio Tinto to appoint Australia as the next CEO

The Canberra pressured Rio Tinto to appoint Australia as the next CEO

Canberra has asked Rio Tinto to hire an Australian as its next chief executive because investors and officials are pushing the mining group to focus on a country that produces the bulk of its earnings.

The request from Australian Treasurer Josh Friedenberg follows the Anglo-Australian decision to replace French CEO Jean-Sebastian Jack and two other executives in connection with the demolition of the 446,000-year-old Aboriginal site.

This coincides with the Australian government’s move to protect foreign investment regulations and strategic industries, given concerns about deteriorating relations with China and concerns about the impact of Covid-19 on the supply chain.

“Rio Tinto is proudly one of the largest organizations in the world in Australian history,” Mr Friedenberg said on Monday. “With a large portion of his income coming from Australia, it would be appropriate to see an Australian with a majority on the board as chief executive again.”

“It was a constructive conversation,” said Mr Friedenberg, published by the Australian Financial Review in a phone call with Rio chairman Simon Thompson on Friday.

Bankers and analysts say potential Australian candidates for the job include Sandeep Biswas and Mark Kutifani, chief executives at Neucrist Mining and Anglo American, respectively. Nave Power, a former CEO of Fortesque Metals Group, is also considered Mr. Jack’s successor.

Australian politician and pension fund criticizes the Rio Board’s clear link to the Pilbar Cultural Heritage theme – it contributes 90 per cent of the iron ore after the explosion of the Jukan Gorge.

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Ben Wyatt, treasurer of the Western Australian state government, told the country’s media: “The board has no real understanding of who owns and manages the indigenous groups. “It screams risky, for me, and it’s something I’ve been stunned about over the years.”

Mr Thompson indicated that the appointment of Rio’s chief executive would be based on skills and competencies, not nationality. But the London-based mining team is sensitive to the government and investors claim it has lost contact with Australia’s indigenous community.

About 70 per cent of Rio’s shares are held by investors outside Australia. Its largest shareholder is state-owned Chinese aluminum producer Chinalco, which owns about 15 per cent of the London-listed shares in the mine and does not welcome political interference in the succession process.

“Of course we hope there are strong candidates from Australia,” Mr Thompson told the Financial Times on Friday before Mr Friedenberg’s remarks on Monday. “But it will be more of a question of ensuring that we have someone who has come up with a real awareness, understanding and sense of importance and a sense of importance and significance for solving these indigenous peoples and heritage issues.”

Rio has appointed Australian non-executive director Simon McCain as a senior independent director to dare critics ahead of Mr Jacques’ reign, led by Australian Sam Walsh. It will also establish a new social work program to try to rebuild its relationship with the indigenous community.

The AustralianSuper, which manages 18 182bn (13 132.5bn) in pension money, said Mr McCain’s appointment was the first step in ensuring “the Rior Board is more Australian-centric and more sensitive to the nation and its cultural identity”.

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The 1995 merger between RTZ Corporation of London and CRA Limited of Australia – the deal has sparked outrage that Riote is headquartered in the UK.

Canberra imposed a number of conditions on the deal – another one-third of the directors had to be Australian – and the center of gravity moved to London for the new entity.

When BHP announced plans to merge with London-listed Billiton in 2001, the Canberras were convinced that it would no longer exist, imposing stricter rules on the deal, HQ and CEO must be based in Australia.

Stephen Karchner, director of trade and investment programs at the US Studies Center in Sydney, said Rio had been asked to appoint a new chief executive to Australia, a new development that would be consistent with capturing more protectionist sentiment worldwide.

“It’s very surprising that the government is commenting on the nationality of being appointed to the post of chief executive,” added Martina Linenlui, a professor at McCurry Business School.

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