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By Melanie Burton
MELBOURNE (Reuters) – At least three Australian institutional investors plead for a global mine BHP Group <BHP.AX> <BHPB.L> consider external candidates to replace Andrew Mackenzie as new CEO, sources with direct knowledge of the question said.
This decision highlights the nascent pressure from investors on the world's largest miner to contemplate radical changes in management to face challenges such as cost reduction, the possible downturn in ore prices. of iron and the restoration of its reputation after the disaster of the dam in Brazil.
"We are quite convinced that we have to be an external candidate … We do not see anyone internally that can significantly improve the status quo," said one of the three sources of 39, institutional investors.
"They are missing just about all the operational goals they have set themselves, both in terms of costs and volumes, and so it is very difficult to accept new project proposals," he said. the manager. The subject has gained ground in talks in Perth and Sydney in recent weeks, said two other investors.
The three investors together hold less than 1% of the capital BHP, according to Refinitiv data. They all refused to be named because of the subject's sensitivity.
Mackenzie has been in his job for almost seven years. BHP hired his last external CEO In 1998, Paul Anderson was asked to reform the company, which he did by taking control of Billiton, an Anglo-South African country.
We do not know immediately so high BHP Investors also share the view that there is a need for the management of the hierarchy to undergo substantial cultural changes to give the minor the necessary reform.
In Norway, the $ 1 trillion ($ 803 billion) sovereign wealth fund, the largest shareholder in BHP Billiton refused to comment. Activist shareholders Elliott Capital and Blackrock also declined to comment. A BHP The spokesman said he did not comment on speculation.
To be sure, BHPThe performance of the US president has improved over the last 12 months, as a result of the change of chairman of the board and rising iron ore prices that could allow Mackenzie to extend his run.
However, in its quarterly production report released last week, the group reported a $ 1 billion productivity loss for fiscal year 2019, resulting from disruptions in its core business.
"Investors believe that it is possible to make a significant cultural change to achieve this. In the long run, a change in direction will be required to achieve this, "said a second institutional investor.
They named Nev Power, which was instrumental in the transformation of Fortescue Metals <FMG.AX> is the world's fourth largest and lowest-cost iron ore producer in less than a decade, or theNCM.AX> Sandeep Biswas as possible candidates.
"Nev is held in high esteem for achieving this goal throughout his career," said the second source.
(Report by Melanie Burton in MELBOURNE; Additional report by Barbara Lewis in LONDON and Gwladys Fouche in OSLO; Edited by Miyoung Kim and Stephen Coates)
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