Rio Tinto Group
 Rio Tinto Group        | |
|---|---|
 | |
| Formation | 1873 |
| Headquarters | London, Melbourne |
| Type | commercial |
| Subgroups | Rio Tinto Alcan |
| Staff | 66,331 |
| Interests | Rothschild family |
| Member of | Friends of Europe |
| British-Australian multinational metals and mining corporation with headquarters in London | |
 | This article may be too long to read and navigate comfortably. (December 2014) |
Rio Tinto Group is a British-Australian multinational metals and mining corporation with headquarters in London, in the United Kingdom, and a management office in Melbourne, Australia. The company was founded in 1873, when a multinational consortium of investors purchased a mine complex on the Rio Tinto river, in Huelva, Spain, from the Spanish government. Since then, the company has grown through a long series of mergers and acquisitions to place itself among the world leaders in the production of many commodities, including aluminium, iron ore, copper, uranium, coal, and diamonds.[1]
The company has operations on six continents but is mainly concentrated in Australia and Canada, and owns gross assets valued at $81 billion through a complex web of wholly and partly owned subsidiaries.[2] Its head office in the United Kingdom is in the City of Westminster, London, while its Australian head office is in the city of Melbourne.[3][4]
Deep politician Lord Alfred Milner was an early chairman of Rio Tinto.[5]
The halting of a company plan to mine lithium in Serbia gave the Australian government a pretext to be uncooperative with Novak Djokovic.
Contents
Formation
The company was founded with the purchase of a mine run by the Spanish government in 1873, at a price later determined to be well below actual value.[6]
The purchasers of the mine were led by Hugh Matheson's Matheson and Company, which ultimately formed a syndicate consisting of Deutsche Bank (56% ownership), Matheson (24%), and railway firm Clark, Punchard and Company (20%). At an auction held by the Spanish government for sale of the mine on 14 February 1873, the group won with a bid GB£3,680,000 (ESP 92,800,000). The bid also specified that Spain permanently relinquish any right to claim royalties on the mine's production. Following purchase of the mine, the syndicate launched the Rio Tinto Company, registering it on 29 March 1873.[7] At the end of the 1880s, control of the firm was passed to the Rothschild family, who greatly increased the scale of its mining operations.[8]
From 1877 to 1891, the Rio Tinto Mine was the world's leading producer of copper.[9]
From 1870 through 1925, the company was inwardly focused on fully exploiting the Rio Tinto Mine, with little attention paid to expansion or exploration activities outside of Spain. The company enjoyed strong financial success until 1914, cooperating with other pyrite producers to control market prices. However, World War I and its aftermath effectively eliminated the United States as a viable market for European pyrites, leading to a decline in the firm's prominence.[7]
The company's failure to diversify during this period led to the slow decline of the company among the ranks of international mining firms. However, this changed in 1925, when Sir Auckland Geddes succeeded Lord Alfred Milner as chairman. Geddes and the new management team he installed focused on diversification of the company's investments and operations and reformation of marketing strategy. Geddes led the company into a series of joint ventures with customers in the development of new technologies, as well as exploration and development of new mines outside of Spain.[7]
Perhaps most significant was the company's investment in copper mines in Rhodesia, which it eventually consolidated into the Rhokana Corporation.[7] These and later efforts at diversification eventually allowed the company to divest from the Rio Tinto mine in Spain. By the 1950s, Franco's nationalistic government had made it increasingly difficult to exploit Spanish resources for the profit of foreigners.[7] Rio Tinto Company, supported by its international investments, was able to divest two-thirds of its Spanish operations in 1954 and the remainder over the following years.[10]
Major mergers and acquisitions
Early acquisitions
The company's first major acquisition occurred in 1929, when the company issued stock for the purpose of raising 2.5 million pounds to invest in Rhodesian copper mining companies, which was fully invested by the end of 1930. The Rio Tinto company consolidated its holdings of these various firms under the Rhokana Corporation by forcing the various companies to merge.[7]
Rio Tinto's investment in Rhodesian copper mines did much to support the company through troubled times at its Spanish Rio Tinto operations spanning the Spanish Civil War, World War II, and Franco's nationalistic policies. In 1950s the political situation made it increasingly difficult for mostly British and French owners to extract profits from Spanish operations, and the company decided to dispose of the mines from which it took its name.[7] Thus, in 1954 Rio Tinto Company sold two thirds of its stake in the Rio Tinto mines, disposing of the rest over the following years.[10] The sale of the mines financed extensive exploration activities over the following decade.[11]
Stock structure and ownership
Rio Tinto Group is structured as a dual-listed company, with listings on both the London Stock Exchange[12] and the [[Australian Securities Exchange][13] The dual-listed company structure grants shareholders of the two companies the same proportional economic interests and ownership rights in the consolidated Rio Tinto Group, in such a way as to be equivalent to all shareholders of the two companies actually being shareholders in a single, unified entity. This structure was implemented in order to avoid adverse tax consequences and regulatory burdens. In order to eliminate currency exchange issues, the company's accounts are kept, and dividends paid, in United States dollars.[11]
As of mid-February 2009, shareholders were geographically distributed 42% in the United Kingdom, 18% in North America, 16% in Australia, 14% in Asia, and 10% in continental Europe.[2]
Environment
Rio Tinto Group has been widely criticised by environmentalist groups for its mining activities. Opposition to the company focuses on its mining methods due to environmental degradation, the company's coal operations for their contribution to global warming, and uranium operations for environmental and nuclear technology concerns.
Perhaps the most significant environmental criticism to date has come from the Government of Norway, which divested itself from Rio Tinto shares and banned further investment due to environmental concerns. Claims of severe environmental damages related to Rio Tinto's engagement in the Grasberg mine in Indonesia led the Government Pension Fund of Norway to exclude Rio Tinto from its investment portfolio. The fund, which is said to be the world's second-largest pension fund, sold shares in the company valued at Template:NOK (US$ 855 million) to avoid contributing to environmental damages caused by the company.[14]
Exclusion of a company from the Fund reflects our unwillingness to run an unacceptable risk of contributing to grossly unethical conduct. The Council on Ethics has concluded that Rio Tinto is directly involved, through its participation in the Grasberg mine in Indonesia, in the severe environmental damage caused by that mining operation.[15]
Rio Tinto disputes the claims of environmental damage at the Grasberg mine, and states that the company has long maintained an excellent record on environmental issues.[16]
Labour and human rights
Safety and labour rights concerns have been raised against Rio Tinto by unions and political action groups, in particular the Construction, Forestry, Mining and Energy Union (CFMEU). The CFMEU ran a campaign against the company after it tried to de-unionise its workforce after the introduction of the Howard Government's Workplace Relations Act 1996.
Activist groups have also expressed concern regarding Rio Tinto's operations in Papua New Guinea, which they allege were one catalyst of the Bougainville separatist crisis. The British anti-poverty charity War on Want has also criticised Rio Tinto for its complicity in the serious human rights violations which have been occurred near the mines it operates in Indonesia and Papua New Guinea.[17] The 2001 British documentary The Coconut Revolution tells the story of the eventual success of the local indigenous peoples in overcoming the plans of the company and the New Papuan army.
On 31 January 2010, Rio Tinto locked out nearly 600 workers from a mine in Boron, California, USA.[18] The workers, represented by the local International Longshore and Warehouse Union, had rejected a contract proposal, claiming it would scrap their seniority system and allow the company to hire more nonunion employees.
Rio Tinto was also accused of planning and funding the murder of RTI activist Shehla Masood in Bhopal, India. Apparently she was protesting illegal diamond mining done by Rio Tinto in connivance with government officers. The case was however solved and no connection to Rio Tinto was established, though popular opinion still perceives them as the possible culprit.[19][20][21][22]
Greenwashing
Rio Tinto is not, however, universally condemned for its ethical behaviour. The company has won an award for ethical behaviour, the Worldaware Award for Sustainable Development in 1993.[23] The award, although given by an "independent" committee, is sponsored by another multinational corporation (in this case, the sponsor was Tate and Lyle). Rio Tinto has, in turn, sponsored its own WorldAware award, the Rio Tinto Award for Long-term Commitment.[24] The British charity Worldaware ceased to exist in March 2005.[25] These awards, awarded to extractive industries who make some environmental commitments in order to deflect the more general criticisms of their operations, are referred to by corporate watchdog groups as "Greenwashing".[26][27][28]
Related Documents
| Title | Type | Publication date | Author(s) | Description |
|---|---|---|---|---|
| Document:Pan Am Flight 103: It was the Uranium | article | 6 January 2014 | Patrick Haseldine | Following Bernt Carlsson's untimely death in the Lockerbie bombing, the UN Council for Namibia inexplicably dropped the case against Britain's URENCO for illegally importing yellowcake from the Rössing Uranium Mine in Namibia. |
| Document:The Rossing File:The Inside Story of Britain's Secret Contract for Namibian Uranium | pamphlet | 1980 | Alun Roberts | Scandal in the 1970s and 1980s of collusion by successive British governments with the mining conglomerate Rio Tinto to import yellowcake from the Rössing Uranium Mine in Namibia (illegally occupied by apartheid South Africa) in defiance of international law, and leading to the targeting of UN Commissioner for Namibia Bernt Carlsson on Pan Am Flight 103 in December 1988. |
References
- ↑ http://www.riotinto.com/documents/Media/PR712g_Rio_Tinto_announces_underlying_earnings_of__10.3_billion.pdf
- ↑ a b http://www.riotinto.com/documents/investors_databook/March_09_Chartbook.pdf
- ↑ "Contact Us." Rio Tinto Group. Retrieved 9 April 2010.
- ↑ "Suburbs & Postcodes." City of Melbourne. Retrieved 5 April 2010.
- ↑ https://www.cascade.app/studies/riotinto-strategy-study
- ↑ http://www.andalucia.com/province/huelva/riotinto/home.htm
- ↑ a b c d e f g https://archive.org/details/riotintocompanye0000harv
- ↑ The Rio Tinto Company: an economic history of a leading international mining concern, Charles E. Harvey (1981), page 188
- ↑ Stevens, Horace Jared (1908). The Copper Handbook. 8. Horace J. Stevens. p. 1547
- ↑ a b http://www.riotinto.com/whoweare/timeline.asp
- ↑ a b http://www.riotinto.com/documents/Investors/dlcsep06.pdf
- ↑ http://www.londonstockexchange.com/en-gb/pricesnews/prices/system/detailedprices.htm?sym=GB0007188757GBGBXSET10718875RIO
- ↑ http://www.asx.com.au/asx/research
- ↑ http://www.regjeringen.no/en/dep/fin/Press-Center/Press-releases/2008/the-government-pension-fund-divests-its-.html?id=526030&epslanguage=EN-GB
- ↑ http://www.guardian.co.uk/business/2008/sep/09/riotinto.ethicalbusiness
- ↑ http://news.bbc.co.uk/2/hi/business/7608097.stm
- ↑ {http://www.waronwant.org/attachments/Fanning%20the%20Flames.pdf
- ↑ http://www.reuters.com/article/idUSTRE61O0CV20100225
- ↑ http://daily.bhaskar.com/article/MP-BHO-shehla-masood-case-solved-twitterati-slams-congress-2922727.html
- ↑ http://ibnlive.in.com/news/mystery-behind-shehla-masoods-murder-deepens/177484-3.html
- ↑ http://www.outlookindia.com/article.aspx?278128
- ↑ http://articles.timesofindia.indiatimes.com/2011-08-16/india/29891770_1_rti-activist-anna-hazare-gun-shot
- ↑ http://www.worldaware.org.uk/awards/awards1993/riotinto.htm
- ↑ http://www.worldaware.org.uk/awards/awards1999/shell.html
- ↑ http://www.worldaware.org.uk/about/index.html
- ↑ http://www.clientearth.org/media-briefing-rio-tintos-greenwash-challenged-in-first-big-test-of-uks-company-reporting-regulator
- ↑ http://www.dailyutahchronicle.com/opinion/rio-tinto-greenwashing-bad-record-1.847509
- ↑ http://www.corpwatch.org/article.php?id=1348#37
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