Rinehart’s mistake is a habit of taking her eye off the ball, which in sport can have unfortunate consequences such as missing it completely, or being whacked in the head.
Mining, which is the industry which provides Rinehart with her multi-billion dollar fortune, might not seem to have much to do with sport but it does if you apply the rule of focussing on what’s important.
In ball sports, it’s the ball. In mining, it’s the business – and an ability to shut out unimportant matters which consume time and money.
Over the past three years, as Rinehart’s fortune from iron ore exploded from a mere billion dollars or so to estimates as high as $20 billion. Seemingly, she could do no wrong, banking cheques from the Hamersley Iron royalty inherited from her late father, the legendary Lang Hancock, sharing in half the cash flows from the Hope Downs mine and planning her own mine at Roy Hill.
It looked to be a perfect structure. Unstoppable cash from a royalty for which little ongoing effort is required except checking the banking, a junior partner role at Hope Downs where Rio Tinto does the mining and marketing, and a more hands-on role at Roy Hill.
If the iron ore price had remained at a record high, and if legal distractions had not surfaced in an unexpected place, and if the world’s banking system had not turned wobbly, and if China had not suffered a hard economic landing, then Rinehart would be steaming ahead with the Roy Hill and other developments.
But, as everyone in mining knows, the industry has hit a series of speed bumps which have upset expansion and new-mine plans.
Rinehart has not said anything about her plans for the $10 billion Roy Hill mine, which might cause an outsider to believe that it has been slowed, but it would not be surprising if that was the case given the overall air of caution in the iron ore industry.
It becomes even more likely when the “Rinehart-specific” issues are layered over the top of the general industry problems, including a fresh outbreak of legal action involving the third generation of the Wright family.
Action in the Supreme Court of WA launched by Leonie Baldock, granddaughter of the late Peter Wright, the man who formed the formidable “Hanwright’” team with Hancock, was unexpected and is yet to be tested.
However, if successful this latest legal challenge, which seeks a substantial share of Rinehart’s fortune, has the potential to severely dent her plans, including the ability to fund future mines, and convince banks that they should join her in the project.
Did Rinehart see the Wright-family danger coming? That’s the question Dryblower was posing when he wondered whether she had played much sport, and learned the skill of keeping your eye on the ball to score runs, or avoid being hit.
It’s a question that can be asked of another issue involving Rinehart. How much of her time has been spent on matters outside the business of running an iron ore development company?
Whether it has been crusading against new taxes, opposing the new religion of global warming, investing in newspaper and television companies, advising Australians to change their lifestyles, or becoming embroiled in a legal dispute with three of her four children, there is only so much time in a day for anyone, even a super-rich one like Rinehart.
Perhaps it is possible for Rinehart to do it all, though Dryblower suspects she must be wondering why she got so heavily involved in the media business and political campaigning, and how family squabbles have ended up in multiple court cases.
In good times when the money is flowing freely no one questions the time spent on sideshows. It’s only when tough times arrive that the problems surface, along with regret.
Rinehart, undoubtedly, has the personal strength of character to ride out the current crop of problems, but there is also no doubt that some of the pressures she should now be feeling could have been avoided if she had kept her eye on the business ball.
This article first appeared in ILN's sister publication MiningNews.net.
