Rio Tinto boss Sam Walsh is passing the baton to the head of the global miner’s copper and coal business amid a downturn in commodity markets and massive cost cutting efforts.
After three years at the helm of the world’s second-largest iron ore miner, and after initiating a multi-billion dollar cost cutting program, Mr Walsh will retire in July.
The 66-year-old will be replaced by 44-year-old Jean-Sebastien Jacques, who has been on Rio Tinto’s executive committee for three years.
Chairman Jan du Plessis said the appointment was the culmination of a comprehensive and deliberate executive succession process, with the board deciding Mr Jacques was the right person to lead Rio Tinto in an increasingly complex environment.
“Jean-Sebastien is a very experienced executive with a demonstrated track record and brings a unique blend of strategic and operational expertise,” Ms du Plessis said.
“He has run complex operations and projects across five commodities and five continents.”
Over the past three years, Mr Walsh and his team have removed more than $6 billion in costs and returned more than $13 billion to shareholders in a volatile economic environment, Mr du Plessis said.
Rio posted a $US866 million ($A1.22 billion) loss in 2015 amid a collapse in iron ore, copper and aluminium prices.
The challenging conditions have forced the group to end its generous dividend policy, and outline further cuts in capital expenditure and operating costs.
Mr Jacques said he and Mr Walsh would take every opportunity over the next few months to meet and listen to shareholders, customers, employees and stakeholders.
“Now is the right time to pass the reins on to Jean-Sebastien,” Mr Walsh said.
A former West Australian iron ore boss at Rio, Mr Walsh will receive a $1.4 million base salary for the remainder of his contractual notice period, around $1.8 million in long-service leave, $1 million for unused annual leave as well as short-term bonuses based on his performance.
He earned $9.13 million in 2015, down from $10.4 million in 2014.