CEO of commodities giant BHP: Global economic outlook ‘stronger than we were expecting’


Mike Henry stepped into his role as CEO of Australia-based BHP, the world’s largest publicly listed mining company, just a few weeks before the coronavirus pandemic triggered lockdowns across the globe.

Henry is a proponent for health and safety, strong value and a low environmental footprint. His goals for BHP met the headwind of Covid-19 as it cast an uncertain outlook across the commodities market.

Henry told CNBC’s David Faber that when the virus began to spread, there was a strong push to ensure that people across the company were kept safe and that operations were running properly. He wanted to make sure the company could continue to support small businesses in local communities.

“At the end of the day, the world economy runs on commodities,” Henry said during his sit down for the “Evolve: The Faber Interview” series. “There was a real sense of purpose in the company to run safely and reliably right throughout Covid.”

As one of the world’s top commodities producers, Henry said he sees continued economic recovery over the course of this year as vaccines are deployed more widely. “We are seeing global growth for this year as being slightly stronger than we were expecting six months ago,” he said.

Henry also touched on the sharp spike in rates in the bond market last week, coupled with concern about inflation and its impact on BHP’s core commodities. He acknowledged that high prices for a few materials and the Covid crisis have had an impact on supply, specifically in iron ore, copper, oil and nickel. But he said he has a healthy outlook for demand. “We do believe that’s going to provide a measure of price support for commodities.”

With the world beginning to start to reopen as coronavirus vaccines become more available, Henry told Faber he expects that a large majority of BHP’s 80,000 employees will take the opportunity to become inoculated when vaccines are available, especially its mining workers.

While some companies looked to its employee base to cut costs due to financial fallout from Covid, BHP found itself hiring. “We felt that the right thing to do was bring some extra people in,” Henry said. “My belief is you need a workforce that’s predominantly permanent employees,” he added, “We will continue on with that program.”

As for a being back in the workplace, Henry said he sees a staggered return with only some of its corporate offices at 50% capacity for in-person work.

Like most oil and gas companies, BHP is making advancements in its commitment to lower its carbon footprint due to its exposure in the industry. Last September, Henry announced a target of a 30% reduction in BHP’s operational emissions by 2030 with the goal of being net zero on operational emissions by 2050.

Henry said companies need to implement tangible ways on how they’re running their business if change is going to happen. “In speaking out, we have to make sure we’re taking action,” he said, “Speaking out without action lacks credibility.”

For example, BHP is researching ways to reach its goal of lower emissions by investing in everything from directly capturing carbon from the air to green steelmaking.

“We’re a company that at the end of the day depends on the health of the global economy,” he said. “Climate change is an issue that must be addressed.”

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