Mark Cutifani worked shifts at a local coal mine to support himself while studying at the University of Wollongong, near Sydney. Pleasantly startled by his good grades, a professor told the undergraduate: “You must be smarter than you look.”
After a 38-year career, the Australian is now the first mining engineer to put his boots under the chief executive’s desk – metaphorically, at least – at Anglo American, one of the world’s largest mining groups. “I don’t actually carry a pair of boots with me,” he says. The metal toecaps are too much trouble at airports. “But I’ve still got a lot of the old operator in me.”
Mr Cutifani has earned a reputation as one of mining’s footloose fixers. His rise, through eight companies, has not been effortless or uninterrupted. He has dealt with financial strife and political turmoil. At a memorial service for striking miners shot by South African police two years ago, he felt fear. But at Anglo American Mr Cutifani may have found his last – and biggest – challenge.
Anglo has had a privileged place at the heart of the business establishment, in the UK and previously in South Africa, for almost 100 years. But by common consent the group, which produces everything from coal and iron ore to platinum and diamonds, has underperformed its rivals for years. Its returns are anaemic and its huge presence in South Africa – where restructuring its old, underground mines is laden with social and political problems – is another reason for investors to stay clear.
Mr Cutifani says that just “getting the basics right” could double the earnings of the group; four-fifths of its 63 mines are not run well enough, he estimates. He says most people in the group recognise the need for a shake-up. “The bad news is that they don’t want all the changes . . . in some cases it may be uncomfortable.”
In a symbol of his willingness to reform, Mr Cutifani had barely walked through the doors last year when he sold the corporate jet. But the crewcut miner, son of Italian and Irish parents, is not the first outsider to try to pep up Anglo: he follows Cynthia Carroll , an American geologist who was the first woman to run one of the big diversified miners. She left last year amid cost overruns.
Can Mr Cutifani do any better? Sir John Parker, chairman, has said it is the right time for someone with strong operational experience to take charge. Mr Cutifani has detailed changes at individual mines; brought in Tony O’Neill, a trusted former colleague, as group technical director; and reshuffled the team running each commodity. Mr Cutifani makes clear, with a vivid metaphor, that he wants them to deliver results.
“I am not in their underpants,” says Mr Cutifani, “but I want to see an accounting on a monthly basis, a quarterly basis, and annually, of the progress on what [they have] committed to . . . my job is not to run the operations, my job is to run the corporation.”
Mr Cutifani thinks about 10 per cent of Anglo’s mines – “between five and eight” – may have to be shed. But he says it is up to teams at those mines to prove him wrong. “No one is written off. Everyone is given the opportunity,” he says.
What he looks for, he says, are those who can give the extra 1 per cent that make the difference – something he says José Mourinho, the Chelsea football club manager, gets from his players.
A talented student and sportsman, Mr Cutifani exploited opportunities at a young age. At 26 he was a manager at Coalcliff, the mine in which he worked as a student. Before he was 30 he switched companies and became general manager of a gold mining complex in Kalgoorlie, his first turnround project, which needed “someone who was not constrained by what was done in the past”.
By his mid-thirties he had his first leadership role, at Sons of Gwalia, another Australian gold miner. Here his career stumbled: the company was hugely exposed to gold price hedges taken out before his arrival. Mr Cutifani also admits problems with a bad acquisition. When he left Gwalia, it was for a lesser role at Inco, a Canadian nickel miner. Within 18 months Gwalia was in administration.
Mr Cutifani says his career was set back five years but he calls Gwalia his most important job. “It was so difficult and the issues were so tough to deal through,” he says. “It was tremendous learning in terms of the financial side and the corporate side that I would not otherwise have got in a bigger organisation.”
Five years ago, when Mr Cutifani became chief executive at AngloGold Ashanti – where he improved its safety record dramatically and again had to solve a hedging problem – he had amassed international experience and was better prepared. “At 35 I was thinking too hard about being CEO . . . at 45 I recognised the pitfalls of coming in too early or without the right grounding. It was probably 50 when I got to the point where you are ready for the work.”
At AngloGold Mr Cutifani also became president of South Africa’s mining chamber. After the Marikana massacre of striking Lonmin miners in 2012 he felt a duty to go the memorial event for the 34 miners killed – a day of raw emotion and high tension. “Everyone said: ‘You’re a white guy, you’re the chamber of mines – you may not return.’ I said, if I as the leader am not prepared to go and stand there – then I am not worthy of being called leader.”
But he adds: “It was a scary place. There were guys coming up from the back with knobkerries [clubs] . . . it had the potential to get ugly . . . They’re the sort of things you have to do to demonstrate leadership.”
With experience in mining just about every commodity, and his connections in South Africa, Mr Cutifani acknowledges he was an obvious choice for Anglo. While he had other offers, “it was the one that I think I was the best fit for”, he says. “I have always been a Mr Fixit.”
Five years ago Anglo rejected a merger with rival Xstrata, before its suitor was itself snapped up by Glencore. In the mining industry it is widely assumed that Ivan Glasenberg, Glencore’s acquisitive and entrepreneurial CEO, is looking at whether to try to take over Anglo and break it up.
“I don’t worry about Ivan or anybody else,” says Mr Cutifani, adding that the focus is on profit growth instead. “Then if anyone is thinking about Anglo American they’re going to have to pay a lot more than is on the books today – and so they should, because we’ve got a lot of value.
“If somebody comes knocking on the door we’ll have a good chat, but our job is to make sure they pay full price.”
• Culled from FT
