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Stephan Schmidheiny was born on October 29, 1947. He and his siblings, Thomas, Alexander, and Marietta, were raised by their parents Max and Adda Schmidheiny-Scherrer in Heerbrugg, Switzerland. His father and uncle, Ernst II, expanded the family business at the international level through Holderbank and Swiss Eternit.

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Stephan Schmidheiny, against his father’s wishes that he study engineering in order to continue the family business, attended law school at the University of Zurich, Switzerland, where he obtained a PhD in Law in 1972.

Prior to completing his degree, he would occasionally have jobs in the family company. In 1969, at age 22, he worked at one of Swiss Eternit Group’s companies in Brazil, carrying bags of asbestos and dumping them into the mixer.

He remained connected to the Group by temporarily working as the secretary to one of the company’s a high-level executives, accompanying him on his travels to monitor their international operations. He later joined the Sales, Planning and Information Systems division in one of the companies in South Africa.

In 1974, after five years of getting to know the company’s activities in the field, Stephan formally joined Eternit AG in Niederurnen, Switzerland, as Head of Sales. A year later he was appointed General Manager and delegate to the Administrative Council of that same plant.

In 1976, his father handed over the general management of the Swiss Eternit Group (SEG), making Stephan, at 29, the head of a conglomerate with investments in more than 20 countries around the world.

Due to the nascent debate in Europe and North America on the possible health risks resulting from asbestos processing, one of the first things Schmidheiny did was implement an innovative system in all of Eternit’s plants. The objectives of the program, called “New Technology,” were to minimize the risks associated with the mineral by installing new equipment and filters to reduce the concentration of fibers in the air as much as possible, and create training programs for the employees. At the same time, he started research on producing asbestos-free products.

When it came to banning the use of asbestos in different parts of the world, Stephan Schmidheiny was ahead of his time: in 1981 he announced that the companies associated with the Swiss Eternit Group would gradually discontinue making products with the mineral. True to his word, by 1984 the asbestos in several Eternit products had been replaced by a cellulose pulp-based component.

That same year, his father decided to distribute the family inheritance. He gave the Swiss Eternit Group (SEG) to Stephan, while his brother Thomas received the Holderbank cement company (which later became Holcim).

Stephan Schmidheiny Diversifies His Business Ventures

“Many of these investments required vision and the ability to take risks. Since money markets are much more interested in short-term deals and are reluctant to take risks, I was able to take advantage of some unexpected and highly profitable opportunities.”

Towards the end of the 1970s and anticipating his companies’ possible lack of competitiveness in the industry due to the high costs of the necessary innovations made to reduce the risks of processing asbestos, as well as the investments needed to ensure its being replaced as raw material, Schmidheiny began diversifying his investments and held positions on several boards of directors of renowned European companies—he actively participated in the restructuring of several of them. Such is the case of Union Bank of Switzerland (later UBS), which he was a part of from 1978 to 1996, and that of the Brown, Boveri & Cie. firm (later Asea Brown Boveri), where he remained from 1981 to 1997. In 1981 he also acquired the Distral Group which specialized in newspaper stands.

In 1998, Schmidheiny established the Latin American holding, Grupo Nueva, which incorporates his investments in Latin American companies, all of them managed according to three areas of complementary responsibility: financial, social, and environmental. His first business venture in the region was investing in the Chilean company, Terranova, which merged with Masisa in 2005, becoming one of the largest forestry companies in Latin America.

During that same period, he invested in Amanco, a company that makes plastic pipes, which would later be divided into the Amanco and Plycem Company. Both companies were sold in 2007 to Mexican firms, Mexichem and Mexalit Industrial, respectively.

In 1985, Schmidheiny acquired a third of the SMH group, at that time the largest watch manufacturer in Switzerland which, due to the aggression of the Japanese market, was in deep crisis. As a member of the Executive Board of Directors, he actively participated in its restructuring, which resulted in what is now the successful Swatch Group. The sale of his shares in Swatch generated a significant amount of his current fortune.

In 1986, he joined the Administrative Council for Landis & Gyr, and a year later became majority shareholder. In 1995, he sold his shares to Elektrowatt and resigned from the Board in 1996.

In 1989, he acquired the German company Wild-Leitz, which he later merged with Cambridge Instruments, creating Leica Microsystems.

Due to his business endeavors, the International Management Institute (IMI) of Geneva elected Schmidheiny as its President in 1986. As such, he identified other entities that also specialized in forming executive committees, prompting its merger, in 1989, with IMEDE. This is how the International Institute for Management Development (IMD) was formed in Lausanne, Switzerland. Today it is one of the worldwide leaders in the field of business management education.

Together with Canadian businessman Frank Tilley, he created the IMD Global Family Business Center, and at the same time promoted what is known today as the “Stephan Schmidheiny Chair of Entrepreneurship and Finance,” dedicated to training and research in the field of sustainable business. He resigned from his position with IMD in 1992.

The Beginning of Schmidheiny’s Recognition as the World Leader in Sustainability

"Business will play a vital role in the future health of this planet. As business leaders, we are committed to sustainable development, to meeting the needs of the present without compromising the welfare of future generations."

This is how the group headed by Schmidheiny began to acquire fame at the end of the 1980s, given the diversification they achieved and his successful investment in businesses that were in crisis, but were later able to generate value and profitability.

Recognition of his endeavors came through several invitations to give seminars and talks about his experiences in business and about sustainability.

Because of his reputation as a pioneer in the area of sustainability, the Secretary General of the United Nations Conference on Environment and Development (UNCED), Maurice Strong, appointed Schmidheiny as Principal Advisor for Business and Industry in 1990, in preparation of the United Nations’ Earth Summit to be held in Rio de Janeiro, Brazil, in 1992.

In order to take on this challenge, Stephan Schmidheiny created the Business Council for Sustainable Development (BCSD), where he brought together close to 50 executives from diverse industries and regions to discuss how to change corporate behavior at the social and environmental levels in a positive way. Among them were representatives from companies such as Chevron, DuPont, Mitsubishi, Nissan, Shell, and Volkswagen.

The BCSD’s first meeting was held in 1991 in The Hague, Holland, where they coined the phrase “eco-efficiency” to define a company’s contribution to sustainable development. The prefix “eco” combines two concepts: economy and environmental protection, which together mean adding a higher value to goods and services by using less resources and producing less waste and contamination.

His book, Changing Course – A Global Business Perspective on Development and the Environment, resulted from this meeting. The following year, Schmidheiny presented his recommendations and conclusions to the Earth Summit. The book, edited by the MIT Press, became a best-seller and has been translated into 15 languages.

The BCSD decided to continue its work beyond the Earth Summit and, in 1995, joined the International Chamber of Commerce (ICC), becoming the World Business Council for Sustainable Development (WBCSD). It currently has more than 200 members—companies from all types of industries and from all continents—which share better practices and commit to progress towards sustainable development. The Council named Schmidheiny Honorary Chairman in 2000.

Schmidheiny’s Literature and Honors Related to Sustainability

“The title ‘Changing Course’ was carefully selected. Although our basic goal was to promote a long-term vision, we were also aiming at immediate action to achieve profound changes.”

Starting in the 1990s, Stephan Schmidheiny collaborated on several publications. In 1991, along with Peruvian Hernando de Soto, he wrote The New Rules of the Game: Towards Sustainable Development in Latin America. Three years later he published, along with co-authors Walter Seifreitz and Bruno Fritsh, Towards a Society of Ecologically Sustainable Growth: Physical Foundations, Economic Transitions, and Political Constraints.

In 1996, together with the World Business Council for Sustainable Development, and Argentine businessman, Federico Zorraquín, he wrote Financing Change: The Financial Community, Eco-efficiency, and Sustainable Development. That same year, he collaborated with Rolf Gerling on Sustainable Development: The Financial Markets in a Paradigm Shift.

He later published The Ownership Solution: Toward a Shared Capitalism for the Twenty-First Century, with Jeff Gates, and Walking the Talk: The Business Case for Sustainable Development, with Chad Holliday and Philip Watts.

At the same time he was promoting and supporting the sustainability agenda through several of his published works, Schmidheiny was appointed member of the Board of the World Resources Institute (WRI), a world research organization that works with leaders to put into action good habits for a healthy environment.

That same year, the INCAE Business School in Costa Rica honored him with an Honorary Doctorate Degree. He was given the same honor by Yale University in the United States (1996), Universidad Católica Andres Bello in Caracas, Venezuela, (2001), and Rollins College in the United States (2001).

In addition, the President of Brazil, Fernando Henrique Cardozo, awarded him the National Order of the Southern Cross in 1996.

In 1997, the Secretary General of the Organization for Economic Cooperation and Development (OECD), Donald J. Johnston, appointed a High Level Advisory Group on sustainable development issues and named Stephan Schmidheiny and Jonathan Lash, Chairman of the WRI, as co-chairs. The main recommendation that resulted from the group’s work was to establish the concept of sustainability as the main principle of the OECD for the long-term preservation of human, financial and environmental resources. The report served as the basis of discussion at the Ministerial Council Meeting in 1998.

Although the 1990s were a productive period with regard to publications and awards, they were also a time when he suffered two great losses: the passing of his father in 1991 and his younger brother, Alexander, the following year, from whom he inherited his art collection. In his honor, Stephan created the Alexander Schmidheiny Stiftung foundation, which endorses cultural, social and environmental projects and activities. He also promoted the Daros art collection, started by his brother, in both Europe and Latin America, and created the Daros Art Education Program, aimed at a younger audience, which explores new ways to bring art to all peoples.

In 1996, he decided to form the Alliance for Global Sustainability (AGS) in conjunction with four universities: the Federal Institute of Technology (ETH) in Zurich, Switzerland; the Massachusetts Institute of Technology (MIT), USA; the University of Tokyo; and the Chalmers University of Technology in Gothenburg, Sweden. The Alliance’s objective is to have a multidisciplinary team to find a solution to environmental problems, contributing with content and funding. He presided over the advisory board until 2001.

Schmidheiny’s Interest in Latin America

“Several reasons led me to concentrate Avina's commitment in Latin America. (…)I felt that Latin America had an enormous potential. And I have personal ties to the countries of the region. (…)However, the simplest reasons are that I like the region very much and get along well with the people.”

In 1994, his interest in philanthropic activities, combined with his acute business sense, led him to create a foundation called Avina Stiftung in Switzerland, whose purpose is to promote social and environmental sustainability. Soon after, Avina expanded its activities to Latin America, supporting social and business leaders who promote the sustainable development of the region.

In 1996, he and Roberto Artavia created the Latin American Center for Competitiveness and Sustainable Development (LACCSD) at the INCAE Business School in Costa Rica, dedicated to supporting local governments, the private sector, and non-governmental organizations with research on advancing towards a more sustainable society.

In 2002, he and Erica Knie established MarViva to preserve and promote the sustainable use of the marine and coastal resources of the Eastern Tropical Pacific. MarViva currently operates in Costa Rica, Panama, and Colombia.

The following year, in order to ensure the long-term sustainability of his work in Latin America, Schmidheiny created VIVA Trust to which he donated all his shares in Grupo Nueva. This means that all the profits generated by the holding will provide funding for Avina and other philanthropic efforts.

VIVA Trust is managed by an advisory committee specifically designated and comprised of social and business role models, and is in charge of supervising and guiding Grupo Nueva’s business and philanthropic operations in Latin America.

After its creation, Schmidheiny publicly announced the gradual retirement from his active roles, both in business and philanthropic. He is currently retired.

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