Vale Board Member Resigns Over Political Influence in CEO Search

Mariana Durao
·1-min read

(Bloomberg) -- The succession turmoil at Vale SA, the world’s second-largest iron ore producer, has now resulted in the resignation of a board member amid allegations of manipulation and “nefarious political influence” in the company’s search for a new chief executive officer.

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José Luciano Duarte Penido offered his resignation from the board in a letter dated March 11 that was seen by Bloomberg News and addressed to Chairman Daniel Stieler.

“In my opinion, the current succession process of Vale’s CEO has been conducted in a manipulated manner, does not serve the best interest of the company, and suffers evident and nefarious political influence,” Penido said in the letter.

Vale declined to comment on the letter. Penido didn’t respond to a request for comment.

Read More: Vale CEO to Keep Job Through 2024 as Miner Seeks Successor

The company last week confirmed current CEO Eduardo Bartolomeo will retain his job through December while it continues to search for a successor. The board decision was not unanimous, with two directors in opposition, people familiar with the matter said.

The move came after weeks of drama over the selection of Vale’s next leader, which included mounting pressure from the Brazilian government to intervene in the process. The wrangling has put a spotlight on the government’s influence in the mining sector, even though the metals producer was privatized in 1997.

Penido, a former board member at companies including pulp producer Fibria Celulose SA and Banco Santander SA, also cited conflict of interests and personal agendas of some board members in his letter. He also said the CEO search process included “biased leaks to the press.”

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