Newcrest’s Sandeep Biswas to exit, CEO search begins

The country’s largest goldminer says its chief financial officer Sherry Duhe will act in the role held by Sandeep Biswas since 2014.

Sandeep Biswas will remain with Newcrest in an ‘advisory capacity’ until his formal retirement in mid-March 2023. Picture: Stuart McEvoy

Newcrest Mining boss Sandeep Biswas is departing the company, with the abrupt move triggering a search for a new leader for Australia’s biggest gold miner.

Newcrest announced the decision early on Monday, saying chief financial officer Sherry Duhe would step into the role of interim chief executive officer, effective immediately.

Investors delivered Newcrest a first strike over its remuneration report in November, with more than 36 per cent of shares voted against its pay structure after proxy advisers raised concerns about generous bonus payments for Mr Biswas based on free cash flow generated from the company’s operations – which fell – even if capital spending programs were excluded from its results.

Mr Biswas will remain with Newcrest in an advisory capacity until his retirement in mid-March 2023, the company said. Early this year, Mr Biswas apologised for an “autocratic” style, promising a reset of his approach after almost nine years at the company.

Newcrest chair Peter Tomsett told reporters on Monday that the timing of the decision had no relationship to any previous cultural problems at Newcrest, saying he and the board had been satisfied the long-term Newcrest boss had adjusted his leadership style in line with his promises.

“We‘ve been having discussions with Sandeep about the future for some time now. As part of that we instigated some months ago (corporate recruitment firm) Russell Reynolds to start an external search, which will also evolve into looking at internal candidates,” he said.

“We had a scheduled board meeting just last week and had discussions with Sandeep and we just decided that now was the time. I don‘t think there’s anything untoward about it – the operations are going well, there’s no underlying issues that we are concerned about, but we just felt it was time to move on to our next chapter,” Mr Tomsett added.

Ms Duhe – who joined Newcrest from Woodside this year – was “well placed” to serve as its interim chief executive, he said.

“Sherry’s business acumen, strategic insights, track record of creating value and her focus on ensuring Newcrest is a great place to work means she is well placed to serve as Interim CEO.”

Newcrest also announced the departure of its Australasian chief operating officer Phil Stephenson from the end of the year, with Americas COO Craig Jones to assume control of all of operations on an interim basis.

Mr Biswas did not join the Newcrest chair and Ms Duhe at the company’s press conference on Monday, but Mr Tomsett said there was no disagreement about the timing of the decision.

“Sandeep I think is at home in Brisbane, packing his bags to go on holiday, which was what he was planning to do,” he said.

Despite the recent airing of complaints about his management style, Mr Biswas is credited with rescuing Newcrest from the parlous situation the company faced when he joined in 2014.

The gold major was still reeling from the combined impact of falling gold prices and the company’s ill-fated $10.5bn scrip acquisition of Lihir Gold in 2010.

The massive gold deposit on Lihir, an island off the coast of Papua New Guinea, was supposed to become a 1.3 million ounce a year gold producer within a few years of Newcrest’s acquisition of the deposit.

But when he joined Newcrest, the company was locked in a series of disputes with landowners, which regularly stopped work at the project, and had failed to get to grips with the complex refractory ore at the mine, which are notoriously difficult to process.

By 2014 Newcrest had written off about $6bn of Lihir’s acquisition cost and the company faced serious concerns it could not meet the hefty repayments on its $4.1bn worth of debts early in Mr Biswas’ tenure. The outgoing Newcrest boss won the plaudits of analysts and the market for refocusing the company on generating cash from its operations, and ultimately repairing the balance sheet.

But the big pay packet his work commanded was a regular source of unrest among shareholders. The gold major also saw a rebellion in 2014, with almost 45 per cent of votes cast against the remuneration report after concerns that the $2.3 million fixed component of Mr Biswas’ pay packet bigger than that offered to BHP and Rio Tinto bosses.

Originally published as Newcrest’s Sandeep Biswas to exit, CEO search begins