Eternit / Exit from Asbestos, Reflection and Legal Disputes

In 1972, Stephan Schmidheiny started his business career at Eternit. In 1976, at the age of 29, he was named CEO of the Swiss Eternit Group. According to his brother Thomas Schmidheiny, their father Max Schmidheiny decided to divide his industrial empire into two halves: asbestos for Stephan, cement for Thomas.^[5] As a result of this split of activities, Stephan Schmidheiny inherited Eternit.

According to his official biography,^[6] he ended the company's use of asbestos in 1986. Five years before in 1981, Schmidheiny, then chairman, announced Eternit's intention to dispense entirely with its involvement in asbestos production and distribution, far ahead of the 2005 European-wide asbestos ban. Subsequently, Eternit worked to develop and fund research to develop new fiber blends to replace asbestos. In 1984, a majority of Eternit products were manufactured asbestos free.

Since 2009, due to his involvement in his family's industrial dynasty and despite his efforts to exit from asbestos, Stephan Schmidheiny has been involved in trials in Italy, one for environmental disaster and another for voluntary manslaughter, both connected to the employ of asbestos in the factories of Eternit.^[5] In the first trial Stephan Schmidheiny was sentenced to 16 years imprisonment on February 13, 2012.^[7] On June 3, 2013, the judgment given in February was not only confirmed, but also increased to 18 years imprisonment for environmental damage by the Turin Appeal Court,^[8] In November 2014, it was ruled that the statute of limitations had passed.^[9][10] In 2014, Schmidheiny was acquitted of the charges for alleged negligent behavior in Italy. In 2015, a second trial called "Eternit Bis" began,^[11] Stephan Schmidheiny defended against the accusation of voluntary manslaughter. On November 29, 2016, the allegations raised in Eternit Bis were dismissed by the court in Turin and the case closed. Some legal proceedings regarding negligent homicide are still possible, e.g. in Vercelli, Reggio Emilia, Naples as well as in Turin ^[12]

Schmidheiny has emphasized that his involvement with the Eternit group was long before the health risks of asbestos were understood, and long before production was prohibited in Italy; this ban did not happen until 1992. He admitted in an interview in 2015^[13] that the strain from the legal proceedings in Italy had deeply affected him. Later, however, he felt the proceedings had become absurd, especially after an Italian judge compared him to Hitler and his actions comparable with "the final solution". Beyond the aforementioned legal proceedings, Stephan Schmidheiny set up funds for victims of asbestos-related diseases in South Africa and Italy, as these countries had no successor company to Eternit, which could bear the financial consequences of asbestos exposure.^[14]

Sentenced for aggravated Manslaughter

In May 2019, Stephan Schmidheiny, the former majority shareholder in Italian asbestos company Eternit Genova, has been sentenced to four years in prison by a Turin court for the death of two workers.^[15]

The ruling marks the latest twist in a decade-long battle between Schmidheiny, the Italian government, former Eternit workers and residents of towns near the company's asbestos plants. Prosecutor Gianfranco Colace said the ruling was the "first step" in setting a precedent on deaths from cancer and pulmonary diseases, which can take years to develop after contact with asbestos fibers.^[16]

In 2023 he was convicted to 12 years in prison on aggravated manslaughter for deaths of 392 people in Casale Monferrato.^[3]

Other engagements

While Schmidheiny withdrew from asbestos production and Eternit, he invested in new industrial segments, building up a multinational conglomerate of shareholdings by adding enterprises in the areas of forestry, banking, consumer goods, power generation, as well as electronic and optical equipment. He also joined the boards of directors of leading companies such as ABB Asea Brown Boveri, Nestlé, Swatch, and UBS AG.

In 1985 Schmidheiny supported Nicolas Hayek in his bid for the Swiss watch holding company Société de Microélectronique et d'Horlogerie(SMH), which resulted in the rescue of the Swiss watch industry. Later from this valuable alliance, the present day Swatch Group was formed.^[17]

In 1987, as an anchor shareholder in Brown, Boveri & Cie (BBC), Schmidheiny co-organized a merger of BBC with ASEA of Sweden. This led to the creation of the newly positioned, market leader in its segment, ASEA Brown Boveri, today known as ABB Group.^{[citation needed]}

In 1987, he took over two-thirds of the capital of Landis + Gyr from the family shareholders, as they could provide no successor for leadership. In doing so, Schmidheiny was aware that major changes were necessary, as the company was not doing well. Schmidheiny restructured the company. In 1995, the company was taken over by the Swiss company Elektrowatt.^{[citation needed]}

Rio Summit 1992

In 1990 Schmidheiny was appointed chief adviser for business and industry to the secretary general of the United Nations Conference on Environment and Development (UNCED), better known as the Rio de Janeiro Earth Summit of 1992. The conference took place in 1992, with 172 governments participating.

As chief advisor to this conference, Schmidheiny created a forum in which leading businessmen from all parts of the world developed a business perspective on environment and development challenges. This forum later became the World Business Council for Sustainable Development (WBCSD), an organization that today counts the world's 160 most important companies as its members. Schmidheiny was elected honorary chairman, in recognition of his pioneering role in the phase-out of production of building materials containing asbestos.

Following his involvement in the Rio Summit, Schmidheiny authored the book Change of Course: Global Business Prospects for Development and the Environment,^[23] published by MIT Press in 1992. His book offers an extensive analysis of how businesses can make sustainable development their focus, his book has been translated into fifteen languages.^[24] He also contributed to Financing Change: The Financial Community, Eco-efficiency, and Sustainable Development ^[25] also published by MIT Press.

AVINA Foundation

In the 1990s Schmidheiny established the Fundación AVINA ,^[26] which contributes to sustainable development in Latin America by encouraging productive alliances among social and business leaders and today is a leading player in that field.

Schmidheiny's foundation pioneered a South American microfinance system similar to that of Muhammad Yunus whose widely praised system benefits the citizens of Bangladesh. Stephan Schmidheiny's charitable activities in South America have meant a donation of over one billion US dollars to the region.^[27]

After the creation of VIVA Trust in 2003, Schmidheiny retired from all of his executive functions, including his positions in GrupoNueva ^[28] and AVINA.

Other philanthropy

In 1993, Schmidheiny in memory of his late brother Alexander, who died in 1992, founded the Alexander Schmidheiny Foundation ^[29] with the inheritance from his brother's estate. This Foundation is active in the St. Gallen Rhine Valley.^{[citation needed]}

Schmidheiny supports arts and culture through a series of initiatives. He has developed and expanded the art collection of his deceased brother Alexander, the Daros Collection. The Daros Collection, based in Zurich is a substantial collection of North American and European art from the second half of the 20th century.^[30]

Stephan is a contributor to the Zurich Chamber Orchestra and other important cultural institutions.^{[citation needed]}

In Gstaad, he and his wife Victoria are seeking to build a new cultural center called Les Arts Gstaad.^[31]

On Schmidheiny's website^[32] is possible to find a specific section about his "philanthropic activities" and another about his engagement for "ecological efficience".^{[citation needed]}

According to information from Fundacion MarViva, Schmidheiny has played a foundational role in starting this organization that bridges scientific research with public activism for the promotion of marine habitat near and in the Costa Rica Thermal Dome, with an organizational presence in Costa Rica, Panama, and Columbia.^[33]