Rio chief executive officer Sam Walsh attended a pre-G8 Summit event hosted by UK Prime Minister David Cameron and Deputy PM Nick Clegg in London on Saturday that focused on trade, tax and transparency.
The company called for businesses to be more transparent about their tax affairs and stressed the importance of governments taking further steps that encourage growth in the developing world and tackled poverty.
Walsh said Rio supported the UK government’s call for a global push on responsible trade and investment, to help fuel development and the fight against poverty.
“As a founder member of the Extractive Industries Transparency Initiative and a company that publishes a breakdown of the global taxes we pay every year, we are fully supportive of the efforts to spread this kind of good practice more broadly,” he said.
“This should be pursued in a sensible way, with a clear and consistent global standard for extractive industry tax reporting that keeps the focus on fighting corruption and the burden on business manageable.”
Rio reports its annual tax payments, with last year’s totalling $11.6 billion.
The company was awarded PwC’s Building Public Trust award for the Best Tax Reporting in the FTSE 100 in 2011, and was deemed the second most transparent major company (behind Statoil) in Transparency International’s July 2012 report on corporate reporting.
“It’s also important to recognise that transparency in tax affairs is not an end in itself,” Walsh said.
“Building the capability of governments to collect and spend tax revenues effectively, as well as maintaining a positive investment climate are both critical for growth.
“This is an area in which governments in both the developed and developing world, businesses and NGOs can work together to bring real and lasting change.”
Rio has been involved in assisting Mongolia, Guinea and Colombia with capacity building for tax administrations by holding in-country workshops and in the case of Guinea, helping its customs authority to develop a modern clearance process.
The company is in discussions with the Mongolian and Guinea governments over its two major growth projects – the Oyu Tolgoi copper-gold project in Mongolia and the Simandou iron ore project in Guinea.
Walsh will hold talks with the Guinea government this week after Mining Minister Mohamed Lamine Fofana was reported as saying last week that Simandou would not meet its 2015 start-up date and capital costs may have doubled to $20 billion.
In Mongolia, Rio has itself set a June 30 deadline for first shipments from Oyu Tolgoi, but must finalise government discussions over the investment agreement first.
Reuters reported last week that it had received an invitation to a June 14 shipping ceremony, but that was later deferred with a source telling the newswire government clearance still hadn’t been received.
Meanwhile, Rio has priced $3 billion of fixed and floating rate bonds.
The offering comprises $1 billion of three-year and $1.25 billion of 5.5-year fixed rate, and $250 million two-year and $500 million three-year floating rate SEC-registered debt securities.
BNP Paribas Securities, JP Morgan Securities, Morgan Stanley & Co, Credit Suisse (USA) and RBS Securities acted as joint bookrunners.
Rio shares were unchanged at $A53.98 in early trade.
