Date: Nov 23, 2018
BHP chief financial officer Peter Beaven has called for improved investment strategies in the mining industry to help aid medium- and long-term growth for companies.
The CFO addressed investors at an analysis briefing in Melbourne yesterday, where he discussed BHP’s capital allocation framework and elaborated on his beliefs regarding the current state of mining investment, which included some critical commentary on the industry’s trend towards a cautious approach.
Beaven suggested that mining could work to increase value with a return to countercylical investment trends (i.e. increased investment during down periods) as opposed to the current industry trend towards procyclical investment.
“Our industry is volatile and asset prices follow this volatility, so while this can be a major value risk, this volatility also creates value opportunities,” he said.
“So we must invest in the right commodities and the right assets, but critically at the right time; countercyclical investing is when value creation is maximised.”
