Mining Giant Rio Tinto Issues Sudden Statement on Senior Management Change: CEO to Step Down Later This Year

On Thursday (May 22) local time, global mining giant Rio Tinto announced on its official website that its CEO, Jakob Stausholm (also known as Shi Daocheng in Chinese), would step down later this year.

Rio Tinto stated that it had initiated the process of selecting a successor. During this period, Stausholm would continue to serve as CEO and a member of the board. The decision caught the market by surprise as there were no prior indications, and the press release did not mention the reason for Stausholm's departure.

In the press release, Stausholm wrote, "I am deeply honored to have led Rio Tinto, one of the world's outstanding mining and materials companies. I would like to thank all the dedicated and talented employees across the company who have collectively enhanced operational performance and project enforcement.

"We have built on Rio Tinto's historical strengths to achieve profitable, stable growth and significant shareholder value. I am confident that the company will continue to thrive in the future."

Stausholm has been leading the mining company, which has a market capitalization of approximately £80 billion, as CEO since January 2021.

In 2020, Rio Tinto destroyed the Aboriginal heritage site at Juukan Gorge in the Pilbara region of Western Australia, sparking strong protests from investors. This led to Stausholm taking on the heavy responsibility of reshaping the company's image early in his tenure.

After being promoted to CEO, Stausholm pushed for stronger relationships with Aboriginal communities in Australia while increasing investment in renewable energy, committed to the decarbonization transformation of the mining business.

During his tenure, he also drove Rio Tinto's aggressive expansion into the lithium resources business, opening up new growth avenues for the company. Last year, Rio Tinto acquired Arcadium Lithium for $6.7 billion.

At the same time, Stausholm also led the company in vigorously expanding its iron ore business, covering both Africa and Australia. In 2022, it acquired its Canadian partner's stake for $3.3 billion, gaining full control of its copper mine project in Mongolia.

Rio Tinto Chairman Dominic Barton (also known as Bao Damin in Chinese) said that Stausholm had formulated a "compelling growth strategy" and that "now is the right time to appoint Jakob's successor as we look to the next phase."

Jakob Stausholm

According to an internal email seen by the media, Stausholm indicated that a successor would be announced before the company releases its Q3 production data in mid-October.

Sources familiar with the matter revealed that potential internal candidates include Simon Trott, the current head of the iron ore business who has been with the company for over 20 years, and Bold Baatar, the current chief commercial officer who joined Rio Tinto in 2013.

A shareholder holding a small stake in the company said that given that Rio Tinto had just announced an investment of nearly $1 billion in a lithium resource project in Chile two days ago, the departure of Jakob Stausholm "seems a bit sudden" and "unexpected."

Jakob Stausholm's resignation comes at a time when global mining companies are facing pressure from investors to create more value from their vast global operations. It is understood that Rio Tinto had preliminary contact with Glencore last year regarding a potential merger, which, if realized, would significantly expand its business scale.

In addition, Rio Tinto, headquartered in the UK, has also been under pressure from activist investors to relocate its primary listing to Australia. At a recent shareholders' meeting, a proposal to further explore this plan was rejected, despite being suggested. Jakob Stausholm himself also opposed the proposal.