Sacked Rio mine chief hits back in ‘bribery’ row

One of Rio Tinto’s most senior executives today warned he will “take the strongest possible legal action” against the FTSE 100 miner after it sacked him over an alleged $10.5 million (£8.4 million) African bribery scandal.

Rio suspended Alan Davies, chief executive of energy and minerals, last week on the day of Donald Trump’s election as US president, two months after becoming “aware” of 2011 emails relating to multi-million-dollar payments to a consultant for advice on its Simandou iron ore project in Guinea.

Last night, the miner announced it had sacked Davies (pictured) and Debra Valentine, director of legal and regulatory affairs, who had stood down before her planned retirement, claiming its internal investigation showed the pair had failed to “maintain the standards expected of them”.

She could not be reached for comment.

The move came after chief executive Jean-Sébastien Jacques admitted in an internal memo that “people across Rio Tinto are still shell-shocked” and said the firm will “fully co-operate with the authorities, [whose] investigations may take several years”.

Those authorities are the UK’s Serious Fraud Office and the US Department of Justice.

But Davies, a respected executive with almost two decades of experience at Rio, hit back, saying that the firm had “no grounds” to fire him, and that he had not been privy to Rio’s internal investigation report, nor seen any evidence of the reasons for his termination.

He added: “Rio Tinto has made no effort to abide by due process or to respect my rights as an employee and it has given me no opportunity to answer any allegations.

“This treatment… is totally at variance with the values and behaviours of the company to which I have devoted my professional life. I have been left with no option but to take the strongest possible legal action.”

Davies, who is also a non-executive director at Rolls-Royce and was paid more than £2 million by Rio last year, only took the helm of its energy and mineral group in July, when he was promoted by Jacques.

Davies had at one time been seen as one of the internal contenders to become chief executive.

An email exchange discussing the payment shows Rio’s former chief executive Tom Albanese plus Sam Walsh, then head of iron ore, knew about the payment, according to Bloomberg. Both declined to comment.

Rio, the world’s second-largest miner, had long pursued plans to develop Simandou, which it named “one of the world’s largest untapped high-grade iron ore resources”, but Jacques last month decided to sell its stake in the $20 billion project to China’s Chinalco for up to $1.3 billion, due to the collapse in the iron ore price.

A spokesman for Davies told the Standard he was being advised by employment law specialists.