Oscar González Rocha
SOUTHERN COPPER CORP/About Oscar González Rocha
Oscar González Rocha, 87, is SCCO’s President (since December 1999) and Chief Executive Officer (since October 21, 2004). He is a civil engineer (UNAM) with 40+ years in mining and has led SCCO’s Mexico and Peru operations; he has been a director of SCCO since 1999 and currently sits on the Corporate Governance, Compensation, and Executive Committees . In addition to SCCO, he is CEO/director of ASARCO LLC (since August 2010), and President/CEO of Americas Mining Corporation (since 2015), and a director of Grupo México (since 2002) . Company performance indicators disclosed in Pay vs. Performance show SCCO TSR of 52.3% (2020), -0.3% (2021), 3.5% (2022), 49.1% (2023), and 11.2% (2024), with net income of $1,570.4m (2020), $3,397.1m (2021), $2,638.5m (2022), $2,425.2m (2023), and $3,376.8m (2024) .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Minera México, S.A. de C.V. | President, General Director and COO | Dec 1999 – Oct 20, 2004 | Led major operating platform pre-dating SCCO CEO term; broad operating oversight . |
| Mexicana de Cobre, S.A. de C.V. | General Director | 1986 – 1999 | Led key Mexican copper operations . |
| Buenavista del Cobre (formerly Mexicana de Cananea, S.A. de C.V.) | General Director | 1990 – 1999 | Directed one of Mexico’s largest copper assets . |
| SCCO | President | Since Dec 1999 | Senior leadership through cycles; crisis management cited by board biography . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| ASARCO LLC | CEO and Director | Since Aug 2010 | Integrated U.S. copper producer, SCCO affiliate . |
| Americas Mining Corporation (AMC) | President & CEO | Since 2015 | Grupo México holding company over SCCO . |
| Grupo México | Director | Since 2002 | Parent of SCCO; significant governance linkage . |
| Recognitions | Copper Man of the Year; American & Mexican Mining Halls of Fame | 2015–2017 | Industry recognition for contributions . |
Fixed Compensation
| Metric (USD) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary | $426,399 | $436,857 | $435,718 |
| Bonus (cash) | $173,387 | $98,874 | $48,413 |
| All Other Compensation | $621,168 | $635,385 | $724,246 |
| Total Compensation | $1,220,954 | $1,171,116 | $1,208,377 |
Breakdown of 2024 “All Other Compensation” (selected items):
- Peruvian mandated profit sharing: $328,882 .
- Peruvian legal holiday/Labor Day/Miners’ Day bonuses: $101,557 .
- CTS (severance accrual deposit): $57,926 .
- Vacation bonus & travel: $36,310 .
- “Quinquenio” (5% per five years of service): $87,144 .
- Corporate residence, medical, club: $42,000 .
- Affiliate director fees (Coimolache): $25,200 .
Compensation design notes:
- Salaries/bonuses are set with reference to Peru/Mexico market data; no external comp consultant was retained 2021–2024; CEO base salary is below reported S&P 500 CEO median per company’s benchmarking discussion .
- Say‑on‑Pay support: 99.40% approval in 2024 .
Performance Compensation
| Incentive type | Metric(s) | Weighting | Target | Actual/Payout | Vesting |
|---|---|---|---|---|---|
| Annual cash bonus (discretionary) | Company/individual factors (production, safety, environmental responsiveness), financial condition, capex plan, liquidity | Discretionary; no pre-set weights | No pre-set targets | 2024 payout: $48,413 | Current cash; no vesting . |
| Long-term incentives | None (no equity awards since 2000; plan expired 2006) | n/a | n/a | n/a | n/a . |
Additional governance of incentives:
- Company adopted a Dodd-Frank compliant clawback policy in 2023; however, it states it does not utilize financial performance-based measures to compensate executive officers .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| SCCO beneficial ownership | 134,539 shares as of Mar 27, 2025; <0.5% of outstanding . |
| Director Stock Award Plan holdings (12/31/2024) | 1,212 SCCO shares under Directors’ plan ledger . |
| Options/awards | No options or equity awards outstanding; none granted since 2000; plan expired Jan 1, 2006 . |
| Hedging/pledging | Hedging strongly discouraged; any hedging/monetization requires pre-clearance; no explicit pledging disclosure in proxy . |
| Ownership in Grupo México | 3,932,096 Grupo México shares (<0.5% of GMEXICO) as of 12/31/2024, indicating alignment with parent . |
Implications:
- With no SCCO equity grants or option overhang, there is minimal vesting-driven selling pressure risk; ownership stake in SCCO is small relative to outstanding shares .
Employment Terms
| Term | Detail |
|---|---|
| Employment agreement | One-year expatriate agreement under Peruvian law; renewable; CEO may resign with 30 days’ notice; termination for serious offenses per law . |
| Severance | Per Peruvian law only; no corporate severance plan; no change-of-control agreements for Peruvian NEOs . |
| Pension | Covered by Peru’s AFP (mandatory private pension) via salary deductions; not under SCCO defined benefit plans . |
| Other benefits | Company housing in Peru mining camps required by law; corporate residence in Lima; car/driver as business necessity per local practice . |
Board Governance
| Attribute | Detail |
|---|---|
| Board service | Director since 1999; CEO and President; committee memberships: Corporate Governance, Compensation, Executive . |
| Independence | Executive director; not listed among independent or special independent directors . |
| Board leadership | Chairman (Germán Larrea) and CEO roles separated; SCCO is a controlled company under NYSE rules (Grupo México owns 88.9%) . |
| Compensation Committee composition (2024) | Chairman (Larrea), CEO (González Rocha), director (Contreras), one independent (Castillo); CEO does not participate in discussions of his own pay per disclosure . |
| Director compensation (employee-director) | Receives no director cash fees or stock under Directors’ plan; 2025 plan amendment targets only non-employee directors . |
| Attendance | Board met four times in 2023 with 100% attendance; in 2024 each member attended ≥75% of aggregate board/committee meetings; CEO chaired 2024 annual meeting . |
| Executive sessions | Non-management directors hold executive sessions each regular board meeting . |
Director Compensation (context for governance quality)
- Non-employee directors receive $20,000 annual cash plus meeting fees ($13,000 in-person board; $6,000 committee; $1,000 telephonic) and quarterly stock grants of 400 shares, with a proposed additional 200 shares annually contingent on full attendance (subject to stockholder approval) .
Compensation Structure Analysis
- No pre-set performance metrics, targets, or LTI: SCCO discloses it does not provide long-term incentive compensation and bonuses are discretionary rather than formulaic; this weakens formal pay-for-performance linkage, though qualitative performance factors are considered .
- Cash-heavy and statutory components: Total pay mix is dominated by base salary, statutory profit-sharing (Peru/Mexico), and company benefits; year-to-year variances reflect exchange rates and mandated profit-sharing levels .
- Governance controls: Clawback adopted for compliance, but not used for performance-based pay; hedging discouraged with pre-clearance requirement .
- Benchmarking: Company cites Peru/Mexico market data and notes CEO base below S&P 500 CEO median; no compensation consultant engaged 2021–2024 .
- Shareholder feedback: Say‑on‑Pay approval at 99.40% in 2024 indicates strong investor support despite limited formal performance linkage .
Related Party Transactions (governance risk context)
- Extensive affiliate transactions with Grupo México subsidiaries (shared services, freight, construction, energy), overseen by Audit Committee and a related-party subcommittee; materiality thresholds and approval processes are codified .
- Family employment: Son (Oscar González Barron) employed by ASARCO (CFO) and AMC (Corporate Director), with compensation determined by those companies; SCCO states CEO was not involved in hiring/comp decisions .
- 2024: SCCO notes no purchases/sales with companies tied to executive officers, while continuing customary affiliate dealings and donations to Grupo México foundation .
Performance & Track Record
| Year | TSR (%) | Net Income ($m) |
|---|---|---|
| 2020 | 52.3 | 1,570.4 |
| 2021 | -0.3 | 3,397.1 |
| 2022 | 3.5 | 2,638.5 |
| 2023 | 49.1 | 2,425.2 |
| 2024 | 11.2 | 3,376.8 |
Notes:
- “Compensation Actually Paid” equals SCT totals due to no pension/equity adjustments; underscores lack of equity-linked pay .
- Recognitions include Copper Man of the Year (2015) and Hall of Fame inductions (2016–2017) .
Equity Ownership & Alignment (detail table)
| Measure | Amount |
|---|---|
| SCCO shares beneficially owned (03/27/2025) | 134,539 (<0.5%) . |
| SCCO shares under Directors’ Stock Award ledger (12/31/2024) | 1,212 . |
| Options outstanding | None; no grants since 2000; plan expired 2006 . |
| Hedging policy | Hedging discouraged; pre-clearance required . |
| Pledging | Not disclosed in proxy . |
Employment Terms (detail table)
| Provision | Key terms |
|---|---|
| Contract structure | One-year expatriate contract; renewable; 30-day resignation notice; for-cause termination per Peruvian law . |
| Severance | Statutory Peru only; no company CoC agreements for Peru NEOs . |
| Statutory profit share | 8% of Peru pre-tax profits allocated to employees; capped per employee; CEO received $328,882 in 2024 . |
| Other statutory/company benefits | Holiday and special bonuses; CTS deposits; vacation/travel; quinquenio; corporate residence; car/driver as business necessity . |
Risk Indicators & Red Flags
- Controlled company status (88.9% held indirectly by Grupo México) with exemptions from fully independent committees; CEO serves on Compensation and Corporate Governance committees (mitigated by stated recusal on own pay) .
- Lack of LTI and formulaic performance metrics; discretionary bonuses may weaken direct pay‑for‑performance alignment .
- Extensive related‑party transactions with parent affiliates; oversight framework exists but inherent conflict risk persists .
- Succession consideration: CEO age 87 and long tenure imply transition planning is an ongoing governance priority (fact of age/tenure; company has not disclosed succession plans) .
Say‑on‑Pay & Shareholder Feedback
- 2024 Say‑on‑Pay approval: 99.40%; company cites this as support for current compensation approach .
- Annual frequency maintained per shareholder preference .
Compensation Committee Analysis
- 2024 Compensation Committee included controlling-shareholder representatives (Chairman, CEO) plus one non-independent director and one independent; no external compensation advisor used 2021–2024; salary benchmarking relies on local market data and internal judgments .
- Clawback policy in place (2023) but performance-based measures are not used to determine pay, limiting its practical application .
Investment Implications
- Alignment and selling pressure: No SCCO equity awards or options since 2000 implies negligible vesting overhang and limited forced‑selling risk; CEO’s direct SCCO stake is modest (<0.5%), while he holds shares in parent Grupo México, aligning him with the controlling shareholder .
- Pay‑for‑performance: Cash-heavy, discretionary design with statutory components reduces direct linkage to financial/TSR outcomes; however, shareholder support for Say‑on‑Pay has been strong (99.40%) .
- Governance risk: Controlled company structure, CEO presence on the Compensation Committee, and significant related‑party dealings elevate governance risk; oversight committees and policies are in place but warrant monitoring, especially given family employment ties and affiliate transactions .
- Retention/succession: Base salary appears below large-cap medians per company benchmarking; statutory/profit‑sharing and benefits are meaningful; age/tenure suggests succession planning is a key watch item (no formal disclosure) .