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BHP’s incoming CEO a much needed breeze of fresh air for the mining industry

BHP CEO Mike Henry. (Image: Screenshot from Sky News Australia | YouTube.)

Less than 24 hours after BHP (ASX, LON, NYSE: BHP) named Canadian Mike Henry as the company’s new chief executive and executive director, praise from different industry actors and analysts keeps flowing in.

“Ethical,” “thoughtful,” “gender-equality champion,” are just some of the adjectives thrown at Henry, 53, who will assume the top position at the world’s biggest miner in January 1, 2020, replacing Andrew Mackenzie. 

An industry veteran with 30 years of experience in the sector, including 16 at BHP, Henry represents a much needed breeze of fresh air in the mining industry.

Beyond advocating for “performance and improvement,” which he told reporters Thursday was his main focus, Henry is expected to steer BHP towards becoming the company the world truly needs now — environmentally sound, gender-inclusive, local communities-respectful and supportive kind of miner.

“If our communities don’t trust us or don’t feel they benefit from our presence, we eventually lose our ability to operate there — and rightly so”

Mike Henry, BHP’s next chief executive and executive director.

“Social value is not an elective for this company,” Henry — who is also a former chief marketing officer —  declared following the announcement of his new role.

“At BHP we know that if our communities don’t trust us or don’t feel they benefit from our presence, we eventually lose our ability to operate there — and rightly so,” he said last year at an industry forum.

It sounds too good to be true. It also seems like a lot of pressure and expectations for just one person. The key, analysts say, would be for Henry to surround himself by the right people.

The upcoming chief has already said he’d be touring BHP’s global operations for the rest of the year before setting out proposals for “strategy shifts” and “possible changes to the team of top executives.”

“As a concept, this is what shareholders want — efficiencies and improvements,” said Craig Evans, a Sydney-based portfolio manager at Tribeca Investments Partners Pty. “It’s going to be a big focus for everybody, and it would be good to see how he thinks that can be implemented.”

“He leads by example,” a former colleague who worked with Henry for several years said. “He doesn’t play games and for a guy in that position, he has his ego totally in check,” the source, who asked not to be named, added.

Henry’s first big test, perhaps, will be to see whether he yields to shareholders’ pressure and withdraws BHP’s membership from groups that have questioned climate change science. Those organizations include the Minerals Council of Australia, where he is vice chairman.

Investment bank RBC Capital Markets, however, doesn’t see a revolution in the making.

“Considering [he] has been a member of the executive leadership team since 2011 we would expect that, in the near term at least, BHP’s focus on disciplined capital allocation will remain largely unchanged,” RBC’s Tyler Broda said.

Henry, a guitar-player with two adult daughters, joined BHP from Mitsubishi in 2003 and has spent the past three years at the helm of the company’s Australian business.

(With files from Bloomberg, Reuters)