Rio Tinto's Sam Walsh questions credit rating groups" relevance Rio Tinto's chief executive has signalled that he is not afraid of a downgrade by credit rating agencies, saying that he will not run the company according to their demands, in spite of possible consequences for borrowing costs at the indebted miner. Sam Walsh said that agencies including Standard & Poor's and Moody's were using yardsticks that were of limited relevance to the miner and its shareholders. His comments came as Rio told investors that it would make a priority next year of paying down debt, which has soared after misguided acquisitions and heavy investment. Mr Walsh acknowledged that he no longer saw Rio's single-A rating, given by Standard & Poor's and Moody's, as sacrosanct. "You have got to be very careful that you manage the business and that Standard & Poor's or Moody's or what-have-you don't end up running the business [by] default," said Mr Walsh in an interview in London. I believe we have done all the things we need to retain an A-rating. But I am not about to be driven by a rating which takes into account things that we and our shareholders don't take into account. The Anglo-Australian miner expects to end the year with $19bn of net debt, down from $22bn in midyear but the same level as at the start of 2013. Its gross debt stood at $29.5bn at midyear. Credit rating agencies" judgments have been increasingly called into question since the financial crisis, when they were viewed as having given overly reassuring ratings to many of the complex debt instruments that were at the heart of the crisis. Rio has long been focused on maintaining its single-A credit rating. S&P put the rating on "negative" outlook in February, citing risks that its debt, including costs for pensions or for mines at the end of their lives, could rise. Mr Walsh said that Rio's investors paid much less attention to these costs. A hundred years from now you may have to do some rehab work . . . should I be driven by that number now? I don't think so," said Mr Walsh. He acknowledged Rio's rating was "clearly an issue" for its borrowing costs. "It is not totally irrelevant but you cannot be driven by what others think you should be doing," he said. Most of world's largest mining groups have been under investor pressure to generate more returns to shareholders, who feel that they did not benefit sufficiently from a long upswing in demand for commodities. Mining groups have been accused of overspending on deals and letting costs escalate. At investor presentations this month, Rio said that it would cut capital spending from more than $17bn last year to below $11bn next year and $8bn in 2015. It has cut more than $2bn from operating costs this year and expects to cut a further $3bn next year. It has also raised $3.3bn from asset sales, although it halted sales of its diamonds and aluminium businesses, saying that offers were less than it wanted. Rating agencies were also criticised this month by the European Securities and Markets Authority, which said that it found shortcomings in their assessment of countries" debt ratings.