On May 24 this year, global mining giant Rio Tinto set off a series of explosions in the Juukan Gorge in Western Australia which destroyed 46,000-year-old rock shelters used by Indigenous Australians.
It's bad enough that in trying to expand an existing mine Rio Tinto destroyed the shelters, but what's worse is that it did so in the full knowledge they were sacred Aboriginal sites and the traditional owners wanted them saved.
The miner didn't tell the traditional owners about the timing of the planned destruction until only a few days before the blasts, by which time the explosives were loaded and the company said it would be too dangerous to remove them.
What's more, when Rio Tinto started planning the expansion of the Brockman 4 iron ore mine in 2012 and 2013, it looked at four different options – three of which would have preserved the ancient rock shelters.
The fourth option gave Rio access to larger amounts of high-grade iron ore at the cost of destroying the rock shelters, and that's the one it chose.
Rio – which last month said it would close New Zealand Aluminium Smelters at Tiwai Point in August 2021 with the loss of 1000 jobs – is a global mining giant which pulled in revenue of US$40 billion last year.
On Friday, Rio's now chief executive Jean-Sebastien Jacques fronted a parliamentary inquiry to answer questions about the decisions leading up to the destruction.
The destruction gave the company access to A$135 million worth of iron ore that would not have been available under alternatives that avoided the sensitive sites, he said.
How much of that would have translated into actual profit isn't clear. It certainly sounds like a big figure but this puts it into perspective: In 2019, Rio Tinto shipped 327.4 million tonnes of iron ore from the Pilbara and the extra iron ore it was able to access was just 8 million tonnes.
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But the miner's decision to put profit ahead of principle might yet backfire.
It is facing a parliamentary inquiry, but more significantly a backlash from investors.
Leading the charge is superannuation fund HESTA.
The fund said Rio faced potential delays in approvals for mining projects, the distrust of Indigenous stakeholders who it needs to negotiate access with and the long and expensive task of rebuilding its reputation.
In its submission to the parliamentary inquiry, HESTA drew a distinction between what is legal – which the destruction was – and what is right.
"We believe our investee companies should adopt and promote a culture which asks whether companies 'should' do something rather than whether they 'can' do something," it said.
"On occasions where companies make decisions and discover a gap between the letter of the law and community expectations, it is investors such as HESTA who bear the costs, which ultimately results in lower returns for our members."
It's true that Rio didn't break the law, but it didn't behave ethically either. For instance, the traditional owners, the Puutu Kunti Kurrama and Pinikura people, were never told there were other options that could have protected the Juukan Gorge site.
HESTA's strident comments reflect an ongoing trend in Australia and globally where investment funds are increasingly holding companies accountable for their environment and social performance. The funds argue that well-run and well-governed companies have better long-term prospects than those which put short-term profits above a sustainable operating model.
The link isn't always immediately apparent, but if we consider a company which earns income by burning fossil fuels in one way or another, that company won't be around in a few years if it doesn't start doing something to change its operations or mitigate the harm it is doing.
It's a particularly potent trend in Australia, where just about every worker is an owner of some of the country's largest companies thanks to the superannuation savings they government requires them to have. HESTA alone has A$52 billion of assets and 860,000 members.
And more and more retail investors want to know that their cash isn't contributing to harm, such as polluting the planet with fossil fuels or underpaying workers.
Jacques has apologised profusely and said the blasts should never have taken place and these sorts of things won't happen again.
But he also told the parliamentary inquiry that no single person was responsible for the decision and there had been no consequences to date. That is undoubtedly true – Rio's evidence before the inquiry reveals a whole series of decisions and failures over several years.
But hiding behind collective responsibility isn't good enough and it calls into question the company's sincerity.