MELBOURNE/LONDON, May 22 (Reuters) - Rio Tinto (RIO.AX), opens new tab CEO Jakob Stausholm, who in his 4-1/2 year tenure oversaw a big bet on lithium and a cultural overhaul at a firm strongly criticised for workplace toxicity, is to step down, the miner said on Thursday in a surprise to investors.
In a statement to the market, the company said only that Stausholm will step down later this year once a succession process, already underway, concludes. It gave no further details.
The world's largest iron ore miner named Stausholm as its top boss in late 2020 while grappling with legal, public and investor angst over the destruction of Australia's ancient Juukan Gorge rock shelters, which led to the ousting of its former CEO.
One of Stausholm's early moves was commissioning a report on workplace culture at the firm, which in 2022 outlined widespread incidents of bullying, harassment and racism.
During his tenure the group also pledged a strong pivot towards addressing climate change, committing to achieving an "impeccable ESG" performance.
"This news comes as a big surprise, and in our view was not expected," Berenberg analyst Richard Hatch said. "No clear reason for his departure has been given by the company other than to state that now is 'a natural moment' to appoint a successor – but it does not feel that natural to us."
Under Stausholm Rio has taken a big bet on battery metal lithium, with its Rincon project in Argentina, $6.7 billion acquisition of U.S.-based Arcadium Lithium and $900 million investment in Codelco's Maricunga lithium project.
"We had expected Mr Stausholm to remain with the company and drive the integration of the lithium business, so his exit comes as a surprise," Hatch said.
Stausholm - one of a number of candidates considered for the role in 2020, including BAE Systems CEO Charles Woodburn and Newmont boss and former Rio executive Tom Palmer - will continue at the helm until a new CEO is appointed.
Internal contenders are expected to include Chief Commercial Officer Bold Baatar, head of iron ore Simon Trott and aluminium boss Jerome Pecresse.
Investors said they expected Rio to mount an external search, but it may have to compete for candidates with BHP (BHP.AX), opens new tab, whose CEO Mike Henry is widely expected to step down in the next year.
The global steel and construction sectors are racing to decarbonize and use a greener type of furnace.
"He's done a good job on the soft issues," said analyst Glyn Lawcock at Barrenjoey in Sydney, including repairing relationships after Juukan Gorge and advancing the company's Oyu Tolgoi copper project in Mongolia.
Under Stausholm's tenure, Rio Tinto's London share price fell around 15%, despite reaching an all-time high in 2024, while total shareholder returns stood at 30% on earnings. The Australian share price rose 6.5% over the period.
"Jakob has stabilised the company and has built up a very good internal team, he's reset the culture and he's got the company on a growth path with the lithium acquisitions. So he's going at a pretty good time, and Rio can now have an orderly succession," George Cheveley, portfolio manager at Rio shareholder Ninety One, said.
But there has also been controversy. Sources and documents seen by Reuters showed earlier this year that accidents at the company's giant Simandou iron ore project in West Africa had killed more than a dozen workers between June 2023 and November 2024.
Stausholm had also faced a push by activist investor Palliser Capital and more than 100 other shareholders to review its model of listing in both London and Sydney, a campaign rejected by shareholders in May.
Reporting by Melanie Burton, Clara Denina, Rishav Chatterjee; Writing by Jan Harvey; Editing by Savio D'Souza, Jan Harvey, Veronica Brown and Jason Neely

Published Date:2025-05-23