Rio Tinto chief executive Jean-Sébastien Jacques is to step down amid the fallout from the company’s destruction of the Juukan Gorge aboriginal heritage site in Western Australia.
Two other senior executives — iron ore boss Chris Salisbury and head of corporate relations Simone Niven — will also leave the company following stakeholder pressure for greater individual and corporate accountability for the incident.
On 24 May, the Anglo-Australian miner blasted two ancient cave shelters in the Pilbara region, linked to the Puutu Kunti Kurrama and Pinikura native people, as it carried out an expansion of its Brockman 4 iron ore mine.
Despite having the necessary permits to undertake the action, the firm has been criticised for not revising its plans following the discovery of new historical artefacts at the shelter, which showed evidence of human habitation dating back 46,000 years.
Rio Tinto chief executive leaves amid calls for accountability
Rio Tinto has been battling against the huge reputational damage caused by the incident, with both investor and aboriginal groups demanding a response.
It has since issued an apology for the incident, and is facing a parliamentary inquiry in which it has admitted “missed opportunities” to avert the demolition of the cultural heritage site.
Last month, the company said the three executives would be docked a combined five million dollars from their bonus payments following an internal review, but the plan was criticised for not delivering sufficient accountability.
“Significant stakeholders have expressed concerns about executive accountability for the failings identified,” the firm said in a statement.
Rio Tinto chairman Simon Thompson added: “What happened at Juukan was wrong and we are determined to ensure that the destruction of a heritage site of such exceptional archaeological and cultural significance never occurs again at a Rio Tinto operation.
“We are also determined to regain the trust of the Puutu Kunti Kurrama and Pinikura people and other traditional owners.
“We have listened to our stakeholders’ concerns that a lack of individual accountability undermines the group’s ability to rebuild that trust and to move forward to implement the changes identified in the board review.”
Jacques, who has led the mining giant since 2016, will remain in his role until 31 March 2021, unless a successor is appointed before that time. A process is now underway to select a new chief executive.
Salisbury will leave the company with immediate effect, to be replaced by Ivan Vella, who is the current managing director of rail, port and core services for the group’s iron ore business.
Simone Niven is to step down at the end of this year, with a new social performance team established to “strengthen oversight of communities and heritage practices”.
Investors welcome the decision
Investor groups, which have been instrumental in turning up the heat on Rio Tinto over the Juukan Gorge incident, were quick to welcome the move.
Ian Silk, chief executive of Australia’s largest superannuation fund, Australian Super, said his group is “satisfied that appropriate responsibility has now been taken” by the miner’s executive team.
“Rio can now work with traditional owners to guarantee that its processes are appropriate for the protection of culturally-important sites, and that it has the right internal accountabilities,” he added.
CEO of the Australian Council of Superannuation Investors (ACSI) Louise Davidson said appropriate steps had now been taken, despite a “drawn out process”, to ensure executive accountability for the “systemic failures” leading to the cave destruction.
She said: “Investors will continue to engage with Rio Tinto to understand how the company will manage this transition period. We will also be looking closely at the separation arrangements, with the expectation that any exit won’t provide a windfall for executives on their departure.”
The mining firm has said all three departing executives will retain their “long-term incentive awards”, although the short-term bonus penalties previously announced will continue to apply.
James Fitzgerald, legal counsel and strategy lead at the Australasian Centre for Corporate Responsibility (ACCR), took aim at the “dishonest malaise of the Rio Tinto board and senior management” in the months after the incident.
Internal documents released to the parliamentary inquiry last week show lawyers had been consulted just days prior to the blast on the possibility injunctions being made against the demolition – casting doubt over the extent to which company executives were unaware of the cultural importance of the heritage site.
During questioning by the committee in August, Jacques had claimed he did not understand the significance of the Juukan caves until after they had been destroyed.
“Investors have stepped up in this instance and demonstrated that they will not accept corporate misinformation and the absolute disrespect to cultural sites that has become Rio’s modus operandi,” Fitzgerald said.
“This is just the first step on a long path towards restoring Rio Tinto’s good practice and reputation in its relationships with indigenous peoples.”
