RIO Tinto’s incoming CEO should embrace major acquisitions while driving cost reductions, said Reuters citing sources familiar with the selection criteria favoured by the Anglo-Australian miners board, led by chairman Dominic Barton.
The world’s largest iron ore producer is finalising its leadership search after current CEO Jakob Stausholm’s unexpected departure announcement in May, concluding his four-and-a-half-year tenure. Board presentations from final candidates occurred in London this week, with an appointment potentially coming by month’s end, said Reuters.
Leading internal contenders include iron ore division head Simon Trott, chief commercial officer Bold Baatar, aluminium chief Jerome Pecresse, and technical officer Mark Davies. External possibilities reportedly include Newmont’s Tom Palmer, former Oz Minerals leader Andrew Cole, and Sandfire Resources’ Brendan Harris, the newswire said.
Barton has discussed potential “big ticket M&A” opportunities with major mining companies. Glencore approached Rio last year about asset combinations, though talks stalled under Stausholm’s leadership. Analysts suggest Teck Resources could offer better strategic alignment.
The new leader faces significant challenges balancing fiscal discipline with copper expansion plans, driven by energy transition demands.
Rio’s costs surged 46.5% between 2020-2024, outpacing rivals BHP and Anglo American. The company requires $30-35bn in capital investment over the next decade, including $8-9bn for Chilean lithium projects secured in May.
Each internal candidate faces specific limitations, said Reuters. Trott has overseen Rio remaining Australia’s highest-cost iron ore producer since 2021, but amid declining ore quality while production guidance has been in the lower range due to weather impacts.
Baatar’s copper division leadership is complicated by ongoing government tensions in Mongolia, where delayed mining license transfers recently forced operational plan changes despite a 2022 reset including $2.4bn debt forgiveness.
Pecresse, while delivering 61% aluminium division profit growth, joined only in October 2023 from GE’s struggling renewable energy unit. Davies lacks experience running major operational divisions compared to other candidates.
Cultural issues around safety and workplace conduct remain persistent concerns requiring fresh leadership perspective, the newswire said.
