• Change of culture needed

    The right leadership will help SA shed its culture of violence, says Mandi Smallhorne.

  • 10 tips to find bargains

    Susan Erasmus gives advice on how bargain hunters can get the most bang for their buck.

  • Inside Labour

    Labour's bitter breaches need to be seen in historical context, says Terry Bell.

Loading...
See More

No easy fix for Anglo

Oct 28 2012 13:52 Reuters

Related Articles

Carroll had to go - shareholders

Mixed reponses to Anglo resignation

Anglo CEO Cynthia Carroll to step down

I believe in SA, says Anglo CEO

Cynthia Carroll chairs De Beers

Strikers aim to shut down all NWest mines

 
London - Cynthia Carroll is riding into the sunset. Anglo American and its chief executive are parting ways. Missteps early in her tenure hurt Carroll, but she did deliver needed cultural change. A new broom is unlikely to have an easier time. Anglo’s biggest problems are largely beyond the control of management.

Carroll always seemed an odd choice to run Anglo. Plucked from relative obscurity by then-chairperson Mark Moody-Stuart, the Harvard MBA-toting American had a jarring effect when she took the helm in 2007. She was not South African and she lacked experience in mining.

The latter may have contributed to some early missteps. The 2008 decision to invest $5.5bn in the Minas Rio iron ore project in Brazil made strategic sense on paper, but seemingly endless permitting problems have turned the project into a wasteful boondoggle. 

Of course, Carroll isn’t the only big mining executive to stumble - her peers at Rio Tinto and Xstrata have both suffered blow-ups. And Carroll was backed by her board of directors.

Carroll also delivered needed cultural change, particularly in safety. Workers were dying at a rate of more than 40 a year when Carroll arrived. That has fallen by more than half. The focus on safety was right, even if it contributed to heavy management turnover in the group’s platinum business. 

It was also ultimately profit-enhancing, since South African authorities have started shutting mines for days after serious accidents.

Still, returns to shareholders matter - and on that measure Carroll struggled. Including reinvested dividends, Anglo American has recorded total shareholder returns of negative 15% during her tenure. Of the big four miners, only Xstrata has fared worse over the period.

Carroll cannot be blamed for the main causes of that underperformance - red tape in Brazil and a heavy footprint in strife-hit South Africa. 

Anglo’s biggest challenges don’t have easy fixes. The outgoing boss may have reached the limit of what an industry outsider with a Harvard MBA could achieve. But her eventual successor is unlikely to have an easier time.
anglo american  |  cynthia carroll

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

Brought to you by BizNews

More from BizNews

We're talking about:

SMALL BUSINESS

Johannesburg has been selected to host the Global Entrepreneurship Congress in 2017. "[The congress] will ensure that small business development remains firmly on the national agenda and the radar screen of all stakeholders, the Small Business Development minister said.
 
 

Top 10 richest musicians of all time

Check out the gallery to find out who they are!

 
 

Luxury living

10 of the most expensive things that will leave your jaw hanging!
Seven of the most expensive children's toys ever made
5 millionaires turned murderers
The youngest billionaires in the world and how they made it

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

How do you see your boss? He/sheis:

Previous results · Suggest a vote

Loading...