Rio extends Walsh's contract

Rio Tinto chief executive officer Sam Walsh and chief financial officer Chris Lynch have both had their contracts with the mining giant extended to open-ended tenures.

“Given his performance and his enthusiasm to continue in the role, the decision to extend (Sam Walsh’s) tenure has been an easy one for the board,” Rio chairman Jan du Plessis said.

Mr Walsh’s contract was due to expire at the end of 2015, while Mr Lynch’s contract was up in the end of February 2017.

In a statement, Rio said the two executives would move to a rolling contract with no end date and a 12-month notice period.

The changes to their contracts are still subject to shareholder approval.

Mr Walsh and Mr Lynch’s remuneration will remain unchanged.

Rio Tinto has recently been facing criticism for contributing to an over-supplied iron ore market.

In May, shareholders voted in favour of a pay rise in line with inflation for Mr Walsh, who received a $US10 million-plus package in 2013.

Earlier in the month, Premier Colin Barnett accused Rio and BHP Billiton in parliament of colluding and damaging the economy by producing more product into a declining, soft market.

Last week, Mr Walsh told a conference in Sydney he did not know where Mr Barnett was coming from as the government had approved its plans.

He also said the industry was cyclical and would recover as demand would continue to remain strong through the urbanisation of developing countries.

Mr Barnett has since downplayed his verbal attack on the two mining giants.

Rio’s share price closed 2.19 per cent lower at $59.87 per share.