Rio chairman accused of breaking promise over rock cave blasts

Rio Tinto’s attempt to repair its relationship with indigenous groups in Australia has got off to a difficult start after its chairman was accused of breaking a pledge made in the wake of the mining group’s destruction of a sacred Aboriginal site. 

Rio was heavily criticised over last year’s blowing up of the two 46,000-year-old caves at Juukan Gorge to make way for the expansion of an iron ore mine. It cost chief executive Jean-Sébastien Jacques and iron ore boss Chris Salisbury their jobs.

In the wake of the scandal, Rio chairman Simon Thompson promised to work to regain the trust of the site’s traditional owners the Puutu Kunti Kurrama and Pinikura people (PKKP) and other indigenous landowners.

But the PKKP said Rio’s decision, announced last week, to move acting iron ore boss Ivan Vella to a new role in Canada breached a personal assurance given by Mr Thompson after a board meeting in November.

In a letter seen by the Financial Times, PKKP ­Aboriginal Corporation chief executive Grant Wilson said the group had explicitly asked Mr Thompson to clarify who would be responsible for leading the reconciliation.

“Mr Thompson was unequivocal in his response; Ivan Vella was nominated as having full board imprimatur for repairing the relationship from a Rio Tinto perspective,” Mr Wilson wrote. “This responsibility was to have lasted from that meeting through to the conclusion of the repair.”

Mr Thompson declined to comment on a private meeting.

Rio said in a statement that the relationship with traditional owners in Western Australia was “rightly” led by the new chief executive of its iron ore business Simon Trott.

The letter shows the difficulties Rio faces in rebuilding relations with indigenous groups and bodies such as the PKKP Aboriginal Corporation, which represent them.

At the time of the meeting, Rio was looking for a new chief executive, who would have been expected to make changes to senior management.

Mr Wilson said the PKKP was “shocked” to discover last week that Mr Vella was moving to Canada to run Rio’s aluminium business as part of a management reshuffle announced by new chief Jakob Stausholm. Mr Trott, Rio’s head of marketing, was named the boss of its iron ore business, which generates almost all the company’s profits.

“PKKP was hopeful of a new and refreshed approach by Rio Tinto to our relationship, and this is what the chairman and the Rio Tinto board had promised,” the letter said. “Unfortunately, it is clear through this action and the way it has been managed, that Rio continues to conduct its business in the manner that led to the tragedy of Juukan Gorge.”

Rio said it was “encouraged by the progress on the planning for the remediation of the Juukan Gorge area but readily acknowledge we have a lot more work ahead of us”.

“We are confident that ongoing engagement with the PKKP will help maintain the momentum built over recent months.”

In a statement, the PKKP said it had been in contact with Rio Tinto but refused to comment on the “specific nature of any correspondence or discussions”. The letter was first reported by the Australian newspaper.

“This is an elementary and entirely avoidable blunder by Thompson, reasonably interpreted by the PKKP as evidence that Rio still views its relationship with traditional owners as ‘an afterthought,” said shareholder advocacy group the Australasian Centre for Corporate Responsibility.