By rights, Sam Walsh should be miserable.
The company he leads, Rio Tinto – the world’s second-largest mining conglomerate – has lost $31 billion in sharemarket value since the middle of 2014. The iron ore that Rio ships by the megaton from northwest Australia has plummeted in value as the company’s main customer, China, struggles through an ominous economic slowdown. The huge open-cut coalmines Rio operates in Australia are up for sale amid predictions that coal is in long-term decline.
In August, Walsh announced that Rio’s net earnings had fallen off a cliff, dropping 80 per cent. Yet the portly 66-year-old looked positively chipper a few weeks before Christmas as he took to the stage at the business school of the University of Melbourne, his alma mater, to address a gathering of students and old corporate confreres.
Looking dapper in a charcoal suit with a patterned tie and matching pocket handkerchief, he launched smoothly into what has become his set speech, taking in the history of Rio from its roots in 19th-century Spain to its current globe-bestriding presence in 40 countries where it digs iron ore, coal, uranium, diamonds and other minerals from the ground.
He spoke of the environmental award the company recently received for reducing its greenhouse gas emissions; he mentioned the $260 million Rio spent last year on community and social projects; he spoke of its initiatives as the single biggest private employer of Aboriginal people in Australia.
“I had a conversation with the Archbishop of Canterbury recently,” he remarked in his mellifluous, calming voice. “He’s been doing work with the banks and he said to me, ‘Sam, you’re a company with high ethics and strong values – how can we actually spread this into some of the rogue banks?’” Walsh offered his audience a hangdog smile. “We just believe in it,” he averred. “We believe we will be a better business if we’re a company that takes the high moral ground.”
One could be forgiven for forgetting that Rio Tinto is the fourth-biggest climate-polluter in Australia, according to the Australian Conservation Foundation; or that four of its executives in China were jailed for accepting bribes six years ago; or that its mines have sparked hostile opposition and legal action from communities as far-flung as West Papua, Quebec and the Hunter Valley in NSW. Before Walsh’s appearance at Melbourne University, one of his staff had half-jokingly worried that placard-wielding protestors might assail him at the door.
Not a bit of it: the students on hand offered nothing but admiration, and even when the fearsome indigenous academic Professor Marcia Langton collared Walsh afterwards for a chat, she was soon smiling and playfully punching him on the arm. Langton was keen to enlist Walsh’s support for the blighted Cape York community of Aurukun, which is 40km from a $1.9 billion bauxite mine Rio is planning. Walsh obligingly offered to take up the subject with her later.
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