Rio Tinto Chairman to Step Down Over Destruction of Ancient Caves
By Rhiannon Hoyle
SYDNEY-- Rio Tinto PLC said its chairman would step down because
of its destruction of two ancient rock shelters in Australia last
year, bowing to demands from some investors for greater
accountability for the incident.
Rio Tinto said Simon Thompson won't seek reelection next year,
tying the decision to the May demolition of the Juukan Gorge
shelters that contained a trove of artifacts indicating they had
been occupied by humans more than 46,000 years ago. He will become
the fourth senior leader to leave the world's second-largest mining
company because of the incident, after Jean-Sébastien Jacques was
removed as chief executive and two other executives were forced
"I am ultimately accountable for the failings that led to this
tragic event," Mr. Thompson said.
The destruction of the Juukan Gorge caves illustrates how
environmental and cultural issues have taken center stage in an
industry that is fighting to change investors' perceptions that
mining is problematic. Some investors and lawmakers have demanded
companies change how they deal with traditional owners of land
where their operations are located, and empower those groups to
raise issues and complaints.
Rio Tinto initially hoped to contain the fallout from the
incident by withholding bonuses for executives including Mr.
Jacques, but that prompted an outcry from shareholders who sought a
In a review of the event released Aug. 24, Rio Tinto found that
no single individual or error was responsible for the destruction
of the rock shelters. Many investors were unhappy with the
conclusions of Rio Tinto's inquiry. Australian lawmakers criticized
the company's decision-making and one prominent Aboriginal leader
called the review a whitewash.
"As Mr. Thompson has said, he is 'ultimately accountable' for
the failings that led to the Juukan Gorge incident, and as a result
his resignation is an appropriate acknowledgment of that governance
failure, " said Ian Silk, chief executive of AustralianSuper, a
large pension fund.
Mr. Thompson has been on the board since 2014 and chairman since
2018. He will remain as Rio Tinto's chairman until the annual
meetings of shareholders next year, but could leave sooner if a
replacement is found.
Another director, Michael L'Estrange, who led the internal
review of the incident, will also leave the board, the miner said.
It cited health reasons for his departure, saying Mr. L'Estrange
had decided to reduce his workload after a significant surgery in
February. He will step down this May following the annual
"Today's announcement means the board can be renewed," said
Louise Davidson, chief executive of Australian Council of
Superannuation Investors, which represents a group of pension funds
on environmental, social and governance issues. "In particular,
investors would like to see the board increase its connection with
Australian operations and communities, as well as an increase in
ACSI has 37 members that manage assets worth more than 1
trillion Australian dollars, equivalent to $782 billion.
Mr. Thompson said the Juukan Gorge destruction was a clear
breach of company values, overshadowing the company's handling of
other issues such as the Covid-19 pandemic and climate-change
Rio Tinto's new chief executive, Jakob Stausholm, has already
overseen some missteps in rebuilding ties with indigenous
When recently reshuffling his top ranks, Mr. Stausholm chose an
executive seasoned in China relations, Simon Trott, to lead Rio
Tinto's important and very profitable iron-ore business. The
reshuffle wasn't communicated beforehand to the traditional owners
of the Juukan Gorge, the Puutu Kunti Kurrama and Pinikura people,
or PKKP, who felt it was another sign of disrespect.
The PKKP and Rio Tinto later said they would continue to work on
"Of course, it demonstrated that our rebuild of the relationship
is still young and fragile," Mr. Stausholm said in an interview
with The Wall Street Journal last month.
The PKKP didn't comment on Mr. Thompson's decision to step
Write to Rhiannon Hoyle at firstname.lastname@example.org
(END) Dow Jones Newswires
March 02, 2021 23:31 ET (04:31 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
Rio Tinto (NYSE:RIO)
Historical Stock Chart
From Jun 2021 to Jul 2021
Rio Tinto (NYSE:RIO)
Historical Stock Chart
From Jul 2020 to Jul 2021