By Malcolm Maiden
There have been enough problems at Newcrest to justify the changes at the top that the goldminer has announced.
Departing chairman Don Mercer was chairman in 2010 when Newcrest paid almost $10 billion for Lihir Gold. It was a very big capital deployment, and it has not worked out as planned.
Departing chief executive Greg Robinson has been a Newcrest director since November 2006. He became CEO in July 2011, after the Lihir acquisition, but was finance director when the deal occurred.
Both were in their current roles in June, when Newcrest announced big write-downs and came under scrutiny on two levels - for not foreshadowing the write-downs adequately, but also for conducting briefings with analysts shortly before the write-downs were announced.
Mercer says he signalled his intention to retire with Newcrest's board last year. Peter Hay and Philip Aiken joined the board after that as part of the succession planning, and it is Hay who will take the chairman's gavel when Mercer retires at the end of the year.
Rio aluminium executive Sandeep Biswas will join Newcrest chief operating officer on January 1 and Newcrest says he is expected to replace Robinson as chief executive in the second half of next year.
As chairman Hay will steer the group's medium-term governance response to the problems that have emerged.
An internal review commissioned by Newcrest and carried out by former ASX chairman Maurice Newman found no sign that analysts had been selectively briefed about the write-downs.
It did observe however that analyst briefings are almost by definition risky, and said the default disclosure route for companies should be the broadest possible platform - the ASX's announcements service. The review of Newcrest's disclosure drama that ASIC is conducting will be more grist for the mill.
Hay was only appointed to Newcrest's board in August, but he is highly regarded. He has a heavyweight non-executive portfolio including a directorship of ANZ. He has also been chairman of Australian advisory board of Newcrest's corporate adviser, Lazard, but has stood down from that position as part of his move into the chairman's role at Newcrest.
Robinson's replacement as CEO, former Rio Tinto aluminium executive Sandeep Biswas, is less known, but takes over a group that is still a globally important gold producer.
One of his key jobs will be to iron out operational problems at Lihir, and he will be doing so as pressure on the gold price probably continues.
The precious metal has attracted some "flight to quality" support this month on fears that the political brawl in Washington could lead to a US debt default.
If a default is avoided as most expect however, the focus will again be on the US economic recovery and tightening monetary policy. Gold's post-global crisis role as a safe-haven quasi-"currency" is undermined in that environment.