Rio Tinto legally blew up ancient caves, and now the CEO has resigned - here's why

Rio Tinto legally blew up ancient caves, and now the CEO has resigned – here’s why

Rio Tinto, the world’s second-largest mining and mining company, said on Friday that its chief executive, Jean-Sébastien Jacques, will resign “by mutual agreement“Bowing to months of shareholder pressure after the company blew up two ancient shelters in Western Australia. Two other senior executives will also leave the company.

• Rio Tinto RIO,
+ 4.16%
set fire in May to an ancient habitat in the Juukan Gorge with traces of 46,000 years of life. He did it legally, but against the strong opposition of the traditional Aboriginal owners. The blast gave the company access to high-quality ores worth $ 135 million.

• The initial reaction of the board, which found in a previous review that no individual error had been committed and only reduced the short-term bonuses of some executives, had created unrest among activist shareholders, indigenous people and environmentalists.

• French-born Jacques, who became CEO in 2016, will remain until a successor is found, but by the end of March 2021 at the latest.

Shares of Rio Tinto rose 1.8% in midday trading against a stable London market, as measured by the FTSE 100 UKX,
+ 0.45%
index finger.

The prospects: Jacques’s departure shows the growing power of activist investors or pension funds that require companies to comply with cultural, social and environmental standards and start looking beyond their strict bottom line. Large mining groups, often operating in any part of the world on land belonging to indigenous peoples, are a natural target for such activism. Rio Tinto’s belated response, however, may mean that board problems with demanding shareholders are far from over.

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