De Beers announced the much-anticipated appointment of its new chief executive officer (CEO) earlier this week, almost a full year after the position was vacated. Ultimately, the length of time taken to make the appointment, and the candidate chosen, indicate a sense of urgency that may have been felt by chairman Nicky Oppenheimer, and fellow shareholders, Anglo American and the Botswana government, to get it right. While former CEO Gareth Penny embarked on a 5-year plan to grow the company, which was subverted to an economic crisis navigation strategy, his heir apparent will be tasked to take a much longer outlook. In accepting the position, Philippe Mellier, a French national, will need to assess the company’s potential in the context of its recent performance and corporate structure. While De Beers hailed a strong year of recovery in 2010, from a broader perspective, it appears to have remained rather stagnant over the past decade. Annual group sales in 2000 were around $6 billion, as they still were ten years later.
The adage “If you don’t move forward, you begin to move backward” may have weighed heavily on the conscience of Oppenheimer’s board.
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