The Local Authority Pension Fund Forum (LAPFF) has dubbed Rio Tinto’s decision to cut the bonuses of three senior executives following the destruction of a historical site in Australia “a good first step”.

A review by the mining giant determined that Rio Tinto chief executive, Jean-Sebastien Jacques, chairman, Simon Thompson, and corporate relations group executive, Simone Niven, will each lose out on bonuses of more than £0.5m.

The LAPFF said it particularly welcomed the review’s acknowledgment that the destruction of the Juukan Gorge caves should never have happened and that the company needed to rectify some corporate governance failings and operational processes that led to the demolition of the site.

Failings identified by the mining giant included a lack of linked-up decision-making, failure to escalate issues to senior staff and poor communication with community groups.

The Juukan Gorge caves are situated in the Pilbara region of Western Australia and are one of the oldest historical sites in the country, with evidence of human habitation stretching back for 46,000 years.

Though Rio Tinto had obtained legal authority for the blasts which destroyed the caves, the review found that the company had not properly engaged with the site’s traditional owners, the Puutu Kunti Kurrama people.

In early August, the LAPFF joined Australian investors in raising concerns over Rio Tinto’s testimony in an Australian government inquiry into the incident, noting that senior executives had failed to read critical archaeological reports about the Juukan Gorge caves.

At the time, the organisation clarified that at least 42 LAPFF members held around two percent of Rio Tinto shares.

LAPFF chair, Councillor Doug McMurdo, said: “The reduction of the bonuses for the CEO and other senior executives is a proper and appropriate first step. The forum will continue to liaise with both Rio Tinto and community representatives to monitor how the company’s response develops based on the review findings and the on-going Parliamentary inquiry into the cave destruction.

“I would hope to see a proportionate response from Rio Tinto based on the full set of evidence that emerges. I am deeply saddened that this irreparable damage has been caused as a result of what I can only describe as poor corporate governance.”

Rio Tinto chairman, Simon Thompson, commented: “While the review provides a clear framework for change, it is important to emphasise that this is the start of a process, not the end.

“We will implement important new measures and governance to ensure we do not repeat what happened at Juukan Gorge and we will continue our work to rebuild trust with the Puutu Kunti Kurrama and Pinikura people.”

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