Rio Tinto confirms Peter Cunningham as CFO after Juukan Gorge shake-up
Peter Cunningham has been named Rio Tinto’s permanent CFO, after holding the role on an interim basis since a reshuffle.
Mining company Rio Tinto has named Peter Cunningham as chief financial officer, making permanent a role the company veteran has held on an interim basis since January 1.
Rio Tinto elevated Mr Cunningham to the interim CFO role as part of a broader executive reshuffling that came after the company destroyed the ancient Juukan Gorge rock shelters in northwestern Australia last year.
The London-listed company in December named former CFO Jakob Stausholm as chief executive, succeeding Jean-Sébastien Jacques, who stepped down after about four years amid pushback from investors. Other executives, including the head of the company’s iron-ore business, also resigned.
Rio Tinto, which didn’t break any laws when destroying the site, has apologised. A government inquiry recommended the company compensate the indigenous landowners and found failings in laws designed to protect indigenous heritage. Rio Tinto has said it is working with the landowners on a remedy and is assessing ways to protect the area.
Mr Cunningham, who has worked at Rio Tinto for 28 years, previously served as its corporate controller. He has also served as head of its health, safety, environment and communities division, as well as head of energy and climate strategy, the company said in a press release.
“His detailed knowledge of the company and of the financial and non-financial drivers of our industry will be invaluable as we continue to strengthen Rio Tinto,” Mr Stausholm, the company’s CEO, said in the release.
Mr Cunningham steps into his role amid surging commodity prices as countries around the world are lifting pandemic restrictions and companies are facing supply-chain bottlenecks. Net earnings at Rio Tinto in 2020 were $US9.8 billion, up 22 per cent from the previous year.
Record iron ore prices have bolstered the company’s cash flow in recent months, according to Chris LaFemina, managing director of global metals and mining research at Jefferies Financial Group., an investment bank.
Mr Cunningham in his new role will face questions about how much money the company should invest in the business and return to shareholders, Mr LaFemina said.
Rio Tinto had $US10.4 billion in cash and equivalents as of December 31, up 29 per cent from a year earlier. The company declared $US9 billion in dividends in 2020, up from $US7.2 billion in 2019.
“It is a high-class problem to have, but it’s still a challenge. How do you manage all of this cash flow?” Mr LaFemina said.
In his new role, Mr Cunningham will receive a base salary of £700,000, equivalent to about $US973,000, as well as an annual bonus with a target of the same amount, Rio Tinto said in the release. He will also qualify for a long-term incentive worth up to 400 per cent of his base salary, according to the release.
The company didn’t immediately respond to a request for additional comment.
Dow Jones Newswires