During its Annual General Meeting (or AGM) on October 20, 2016, BHP Billiton (BHP) said it takes diversity very seriously. It’s for this reason that it plans to achieve gender balance throughout BHP by 2025. According to BHP, this goal will apply at every level of the company, including the board of directors. Of the 12 board members, three of them are currently women.
Chairman is stepping down
In September 2016, Ken MacKenzie joined the BHP board of directors as director. For ten years, MacKenzie has worked as managing director and chief executive officer of Amcor, a global leader in packaging.
The company also announced that BHP’s current chairman, Jac Nasser, will step down at next year’s shareholder meeting. As the former CEO (chief executive officer) of Ford Motor (F), Nasser is one of the most famous and powerful figures in the mining industry. He said he wanted to leave BHP last year but stayed on due to the Samarco tragedy. BHP’s closest peer, Rio Tinto (RIO), is also expected to replace its chairman in the next few months.
Capital allocation priorities
During its AGM, BHP also outlined its capital allocation priorities, which include the following:
- safe and stable operations
- maintaining balance sheet strength through the cycle
- dividend payment of a minimum of 50.0% of underlying attributable profit as dividends
- surplus cash to be utilized to maximize value and returns
In this volatile commodity price environment, other iron ore companies, including Rio Tinto (RIO), Vale SA (VALE), and Cliffs Natural Resources (CLF), are also working toward productivity improvements and optimizing capital use to maximize returns. These companies are part of the SPDR S&P Metals & Mining ETF (XME).
In the next and final part of this series, let’s look at analyst ratings and recent changes for BHP stock.