Rio Tinto announces a £2.82 million cut on executive’s short-term bonuses

In an announcement on Monday, Rio Tinto (LON: RIO) said its CEO and two senior executives will see financial penalties as it slashed their short-term bonuses. The company, however, refrained from leadership overhaul attributed to the review of Rio’s mine expansion in Western Australia that ruined two historically significant ancient caves.In the last week of July, Rio Tinto reported £2.56 billion of net profit in the first six months of the current fiscal year. Following the profit statement, the company’s board declared £1.20 of interim dividend per share.Rio slashes CEO’s long-term incentive planRio announced a £2.82 million cut on short-term bonuses that will affect its CEO Jean-Sebastian Jacques, and two senior executives, Chris Salisbury and Simone Niven this year. The world’s largest miner also said that Jacques will see an additional £1 million cut on his long-term incentive plan. The CEO received £5.8 million in 2019.Destruction of mines in Western Australia state resulted in a probe from the Australian government last month and fuelled public outrage. The financial penalties that Rio declared on Monday were less aggressive than management change that its investors had originally demanded.After leading the review, Michael L’Estrange commented on Rio’s decision on Monday and expressed confidence that it matched community expectations. Pressure from investors for higher accountability, however, will remain high on the Anglo-Australian miner.The two caves that were destroyed were under PKKP’s ownership. According to Jacques comment during the government enquiry, PKKP was not informed about the miner’s plans. Rio said that terms of its agreement with the PKKP in 2011 are now under review.The London-based firm also said last month that it will invest £152.40 million in Siberia to progress Jadar Lithium project. Rio Tinto’s performance in the stock marketRio Tinto was reported more than 1% up in premarket trading on Monday. On market open, the stock jumped another 1.5% to hit a per-share price of $48.11 that translates to an over 60% recovery since March when it printed a year to date low of £29.68 per share as COVID disrupted operations. Compared to its price at the start of the year, Rio is now more than 5% up in the stock market.Rio’s performance in the stock market was reported largely upbeat last year with an annual gain of roughly 20%. At the time of writing, it is valued at £59.82 billion and has a price to earnings ratio of 14.25.The post Rio Tinto announces a £2.82 million cut on executive’s short-term bonuses appeared first on Invezz