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Rio Tinto’s new chief executive has restructured the miner’s leadership and operations to bring a “more disciplined approach”, two days after taking the helm.
Simon Trott, a Rio veteran who took over after the surprise exit of Jakob Stausholm, has reorganised the company’s business into three main units by merging its aluminium and lithium operations into one division.
Trott has also consolidated Rio’s iron ore assets, which were previously spread across different subsidiaries, into one unit, while copper will remain as the third standalone line.
Rio has been under pressure to cut costs, and Trott said the moves would help the company have a “sharper focus on the greatest opportunities we have”.
Smaller operations — including a borates business, that supplies the detergent industry, and titanium — have been put under strategic review for a potential sale.
Rio said the reorganisation was aimed at improving shareholder returns by better focusing its operations and looking for opportunities to achieve synergies between different business lines, such as the processing of aluminium and lithium.
In an internal email seen by the Financial Times, Trott said there were “clear opportunities to do better”, adding that the moves would create a leaner organisation.
“We are a company with a proud history and strong foundations. It’s now time to unlock the full potential of our assets and our people,” he said.
Rio and its rivals, BHP and Fortescue, are all grappling with slower growth in demand from Chinese steel mills, which has sent iron ore prices lower over the past two years.
Under Stausholm, the previous chief executive, Rio invested heavily in lithium, including the $6.7bn purchase of Arcadium Lithium.
Rio’s head of minerals, Sinead Kaufman, who had been a contender for the chief executive role, will leave the company in October. Kellie Parker, Rio’s chief executive of Australia, who has led the company’s efforts to restore its reputation after the destruction of a sacred indigenous site in 2020, will also depart.
Matthew Holcz has been named head of the iron ore unit previously run by Trott that includes assets in Western Australia, Canada and Guinea. One of Trott’s first tasks will be to travel to Guinea after a worker died at the Simandou iron ore mine following an accident last week.
Jerome Pecresse, another internal candidate for the chief’s job, will continue to lead the aluminium operation but will also be in charge of the company’s lithium development — a key growth driver for the business — which had previously been in Kaufman’s unit.
