Andrew Michelmore earned his mining spurs in his native Australia and then put in two years working for Russian oligarch and energy-and-metals producer Oleg Deripaska. Now, he sits atop Minmetals Resources as its chief executive and is the most senior foreigner working at a listed mainland-controlled miner. Michelmore is also unusual in Chinese mining circles because of his internationally competitive pay packet. State-owned China Minmetals Corp, the parent of Minmetals Resources, does not disclose executive compensation. But Michelmore's annual compensation - excluding cash bonuses - is 16 times the 1 million yuan (HK$1.22 million) that Xiong Weiping, his counterpart at Aluminium Corp of China (Chalco), took home last year. Minmetals Resources, which, like Chalco, is listed in Hong Kong and Shanghai, grew out of a pool of mining assets in Australia acquired in mid-2009 by China Minmetals, the mainland's largest metals trader. Last year, those assets - mostly zinc, lead, gold and copper - in the Australian states of Queensland, Western Australia and Tasmania, and in Laos were sold to Minmetals Resources. Michelmore has a degree in chemical engineering from the University of Melbourne and holds a Master of Arts in politics, philosophy and economics from Oxford. He spent 12 years at Australian mining and fertiliser company WMC Resources before heading Deripaska's mining and energy group EN+ Group. He later became chief executive of Australian zinc and lead miner Zinifex, which became part of Minmetals Resources. You spent two years working for a Russian oligarch. How different is that from working for a Chinese state-backed enterprise? The difference is in the workforce. The Russian workforce tends to do what they are told. Oleg wanted his people to have a self-driven hunger for improvement. In Minmetals, people do want to do better and compete with other firms. That said, Minmetals is different from other state firms due to its 60 years of operating in the international arena. What's the difference between managing a state-backed miner and an Australian-owned one? It's not that different. Minmetals Resources is managed from Melbourne. We have a board of directors and a corporate charter. Our board meetings are conducted in English. It is just like running a Western company. We are unique in the sense that we can draw on the experience from the original Australia-based managers, as well as the financial strength of China Minmetals Corp. Our parent has a good feeling for long-term demand for metals and has a long-term commitment to the business, as opposed to some companies that just chase short-term gains. How do you balance the interests of independent shareholders and of the biggest shareholder, China Minmetals, which besides wanting to make a profit also aims to improve China's resources security? For China Minmetals Corp, gaining ownership of resources is a natural hedge for [China's] demand. But more than 80 per cent of Minmetals Resources' output does not go to China, and any that does is sold at international prices. There is no special transfer pricing, so all shareholders benefit. Independent shareholders also benefit from low-cost financing thanks to the parent's financial guarantee on Minmetals Resources' debt. So, how much influence does China Minmetals Corp have over Minmetals Resources's operations? Our chairman is vice-president of China Minmetals Corp, so he understands the business. It was clear from day one that China Minmetals Corp wants our assets and management to be run as an international business. They weren't going to run it for us. Minmetals Resources's goal is to quadruple its market capitalisation in five years. Will it one day make a big Chinese takeover in Australia? We follow the best opportunities for ores and projects wherever they are, not just in Australia. We also look at Latin America, Africa and Indonesia, for example. So who set that goal for Minmetals Resources? China Minmetals Corp president Zhou Zhongshu gave us the challenge to become one of the top three mid-tier diversified mining firms [in the world] within five years. We worked out that it means becoming four times our current size. Why did you study social sciences after an engineering degree? Studying politics forces you to write essays and stand up to present your views. It helped me better express myself and to stand in other people's shoes, and appreciate that there are multiple ways to look at issues. How would you describe your leadership style? I'm very open and collaborative. I like to set an example for the rest of the organisation. I want different views and experiences to be raised and discussed to get the best outcome. What do you for fun? I like surfing, golf and tennis. I was in the World Rowing Championships for Australia three times and rowed for Oxford for two years. We won against Cambridge in both years. 1.2% China's foreign direct investment, a modest US$230 billion, was estimated recently to represent just this amount of the global total
