The “Bill Gates of Switzerland” is the way Stephan Schmidheiny was defined by the Forbes magazine as soon  the Italian Prosecutor, Raffaele Guariniello, from  Turin, indicted him of: 1) wilful and permanent environmental disaster as well as 2) wilful negligence in implementing health and safety regulations (prevention measures). The sentence is expected on February 13, 2012. 

The billionaire Stephan Schmidheiny, one of the heirs of the Eternit asbestos-cement empire,  has  used his website in three languages to defend himself, as well as his father and his grandfather,  from the accusation of having allowed the use of asbestos for almost a hundred years throughout the world. 

Asbestos is a mineral fiber which  was recognized as a human carcinogen many decades ago, and it has been known to be the cause of the greatest occupational and environmental health catastrophe in modern history.

A Shocking Discovery: “The controversy over the potentially harmful effects of asbestos dust was a shock to me in many respects. I myself had been dangerously exposed to asbestos fibers during my training period in Brazil. I frequently helped load asbestos bags and pour the fibers into the mixer, breathing in deeply all the while due to the exertion the work entailed. At the end of a hard day's work, I would often be covered in white dust.” 

Stephan Schmidheiny, as quoted in http://www.stephanschmidheiny.net/business-career/?lid=1

A Private Life Removed From Public Scrutiny: “The Schmidheiny family had always led a private life, removed from public scrutiny. Suddenly, I found myself on the front page of the newspapers, linked to the harmful effects of asbestos, the very effects from which I was trying to protect society, my employees, and the [Eternit] group. This was very hard not only for me, but also for my family and friends.” 

Stephan Schmidheiny, as quoted in http://www.stephanschmidheiny.net/business-career/?lid=1

Stephan Schmidheiny's attorneys are fighting to save him from a possible prison sentence of 20 years in  an Italian prison. Schmidheiny, one of two  defendants, justified his actions with a remarkable set of rationalizations available in his website. 

“I assumed that I could not determine by myself the actual risk level involved in the manufacture of asbestos-cement products. Our advisors believed that the scientific studies purporting to establish the harmful effects of asbestos  were rife with contradictions.  I personally felt that the lack of a clear scientific and technical consensus on asbestos and the inherent unpredictability of its effects rendered impossible any reliable planning and risk evaluation. And aside from being worried about risks to the health of my colleagues and myself, I reached the conclusion that this was not a very promising business to be in.”

“At the same time, I made a radical decision: even though I did not have the faintest idea of how this change was to be implemented.  I publicly announced that the  group  would cease to manufacture products containing asbestos (much earlier than the ban eventually imposed by the European Union). I clearly remember the words of one of the plant's technical managers following my announcement: 'Young Schmidheiny is mad! He expects to manufacture Eternit products without asbestos. It's like trying to come up with dry water.'”

Schmidheiny Ponders Deeply the Relationship Between Business and Society: “I took the decision to get out of asbestos  based on the human and environmental problems associated with the mineral. But it also seemed to me that in an age of increasing transparency - and increasing concerns about health risks - it would be impossible to develop and maintain a successful business based on asbestos. This insight caused me to begin to ponder deeply the relationships between business and society. It was painful period, but it was invaluable preparation for my later being thrown into a position of leadership on business/society issues. We went through some extremely difficult periods. But, as time went on, I grew more and more convinced that I had made the right decision.”

Stephan Schmidheiny, as quoted in http://www.stephanschmidheiny.net/business-career/?lid=1

Neither Government Nor Industry Recognized the Problem: “In retrospect, and taking into account our present knowledge of the man tragic victims of asbestos, I am glad that I remained steadfast in my decision to put an en to asbestos use, despite the uncertainty  and resistance from the industry, my own group, and many of my employees. As we know now, the illnesses caused by asbestos only manifest themselves many years and even decades after exposure to the fibers.  This is a profoundly deplorable situation, particularly since neither governments nor the industry recognized the problem's implications and for a long time failed to take the necessary protective measures.”

Stephan Schmidheiny, as quoted in http://www.stephanschmidheiny.net/business-career/?lid=1

The Brazilian weekly magazine Época analyzed the problem as follows: “The asbestos scandal was the key in pushing Schmidheiny to change his business practices and to become a propagandist of conscious administration, as a manner of to pay for  his sins.” 

A little later in the same article the magazine pointed out: “Schmidheiny made a public announcement that he would stop producing asbestos-containing products in the early 90’s only when he had sold the Eternit to a French company, Saint-Gobain, along with all of its employee lawsuits.”

Forbes magazine, however, offered another explanation by Schmidheiny for his 180-degree turnaround in company policy: “My company was heading toward bankruptcy as a consequence of the combined effects of asbestos-related problems and a major slump in construction markets.  Thus I built my group virtually from scratch,” he writes.  He opines that going through the wrenching process of selling off a firm started by his grandfather made it easier for him 'to give away a substantial part of my wealth at a relatively young age.'”

Schmidheiny's decision to “pull out” of the asbestos business in the beginning of the 1990s, in Brazil, was neither “accidental” nor “humanitarian” as suggested by the quotations above. His decision actually  coincided  with the publication of his 1992 book  Changing Course: A Global Business Perspective on Development and the Environment, which argued that there was no conflict between “eco-efficiency” and profitability for global enterprises. Curiously, perhaps, the asbestos issue goes unmentioned in Schmidheiny's book, which neglects to mention that its author became a billionaire through his family's world-wide asbestos-cement empire. 

This decision to “pull out” also hides other coincidence: In preparation for the UN's Earth Summit in Rio de Janeiro in 1992, Maurice Strong, Secretary-General of the UN Conference on Environment and Development (UNCED)  invited Schmidheiny, his industry and  trade  advisor, to come up with a business perspective on the environment.

At Strong's request, Schmidheiny  convened a group of around 50 prominent business leaders who went on to organize the Business Council for Sustainable Development (BCSD), which in 1995 was renamed the World Business Council for Sustainable Development (WBCSD). In 2000, Schmidheiny was nominated “honorary president” of the WBCSD. Later in this article will show how Schmidheiny's “withdrawal from asbestos” was part of a carefully articulated  “greenwashing” strategy promoted by his public relations advisors. 

In the early 1990s Schmidheiny began to promote himself as a new-style “green” business  person by highlighting of new concepts such as “eco-efficiency,” “social responsibility,” and “sustainable development”, which corresponded with his books and his  chairmanship of the WBCSD, which became by some entrepreneurs as significant turning points in their business thinking on environmental questions.

Nevertheless, many companies, despite their participation in the WBCSD, showed zero interest in re-orienting their practices to comply with the attractive new clever models of environmental progress. A perfect example of this environmental fakery was Eternit itself, as its history in Brazil makes clear.   

In Brazil, Eternit systematically has refused to pay decent compensations as a result of the illnesses and deaths of workers or their family members caused by their exposure to asbestos at Eternit's giant plant in Osasco. Nor is there any record that Eternit have ever recognized its responsibility on the asbestos-related cases and the environmental disaster caused by their activities in despite endlessly repeating the speech about their social responsibility, eco-efficiency and sustainable development policies.

The proof of Eternit's (ir)responsible behaviour  in Brazil, was the fact that in 1987 the physician in charge of occupational health for Eternit admitted during an official inspection by the GIA—Interinstitutional Group on Asbestos of the Federal Ministry of Labor and Employment at the Osasco plant, that he knew of six cases of asbestosrelated diseases. Furthermore, it became clear that none of these cases were reported to either the relevant Brazilian health or social security agencies  - as required by law-, due to a decision of Eternit's headquarters office in Switzerland.

In 1996 this same physician, now retired, confessed that he had dealt with many such cases which never were informed to the victims. The order which came directly from Switzerland was that the cases of workers who showed signs of asbestos diseases  would claim individually by their own lawyers at the Justice. Such were the policies of “social responsibility” at Eternit in Brazil!

Before the inspections promoted by the Ministry of  Labor  and Employment inspectors, a book review by Daniel Berman and Ingrid Hoppe of Werner Catrina's book Der Eternit-Report from 1985 had already mentioned the fact that “the Eternit company doctor had already discovered three cases of asbestosis, but he admitted that 32 other workers were suspected of suffering from pulmonary fibrosis. This physician denied the existence of cases of mesothelioma and lung cancer, and argued that it was unlikely that such cases would occur because of the high turnover of workers at the factory, which had the effect of limiting long period of exposure to asbestos dust.

He did admit, however, that Eternit only began to carry out appropriate medical examinations and keep accurate medical records as from 1978, and for this reason the  total number of cases which have occurred from 1939 through 1978, would always remain unknown."

Corporate responsibility or greenwashing?
When we read Schmidheiny's admirable autobiography we find ourselves beginning to wonder where we might find the “growing transparency” he writes about, particularly when it comes to Eternit. The official transcript of the hearings of the Special Committee of the Federal House of Deputies, which was debating the Bill No. 2186/96 regarding “the gradual substitution of the production and sale of products which contain asbestos” in Brazil, proves that the “transparency” for Eternit is an illusion. 

On May 8, 2001, at the hearings on Bill No. 2186/96, President Élio Martins of Eternit S/A, explained the ownership structure of his company in the following terms: 

“Eternit is a publicly owned Brazilian company, whose shares are traded on the stock market of São Paulo (BOVESPA). There is no single owner who has complete control of the firm. The main shareholders are as follows: 

1. DINAMO - Fundo de Investimentos em Ações: 25.17%; 2. Fundo de Pensão do Banco Central (Brazilian “Federal Reserve” 's pension fund) - Previdência Privada- CENTRUS (owned by employees of the bank): 17.49%; 3. Saint Gobain (Brasilit):  9.11%; 4. Fundo de Participação Social do BNDES - Banco Nacional de Desenvolvimento Econômico e Social (National Bank of Social and Economic Development) which is a correspondent of InterAmerican Development Bank (IDB): 8.41%; 5. AMINDUS HOLDING AG: 6.81%; 6. Empreendimentos e Partipações HOLPAR: 4.31%.”

In carrying out a more detailed search of the origins of AMINDUS HOLDING AG, we run into 
its ties with businesses which form part of the business empire of Stephan Schmidheiny, such as Nueva AG, Amanco AG located in the Swiss canton of Glarus. From Schmidheiny's own personal webpage at  http://www.stephanschmidheiny.net/gruponueva, we come  across the following confirmation: 

“When in 1994 Stephan Schmidheiny decided to sell his Swiss-based businesses and concentrate his activities in Latin America, he founded GrupoNueva, which covered all his entrepreneurial activities in the region. Its divisions, Amanco, Masisa and The Plycem Company were the leaders.” 

A little further on we read the following:

“Amanco and The Plycem Company divisions were sold in March and December 2007, respectively. Today, GrupoNueva controls Masisa, and is a private holding company with leadership positions throughout the Americas that generates value for its shareholders and society.”

From everything we have been able to unravel about this  increasingly imaginative collection of businesses and anecdotes, everything seems to indicate that Schmidheiny had secret involvement with the asbestos business in Brazil through at least 2001, according to the testimony of Élio Martins, the president of Eternit even though according to his official propaganda line he had publicly denied he his involvement after the early 1990s.

It is becoming quite clear that Schmidheiny's selfproclaimed “heroic withdrawal from asbestos” is just one more of the self-serving legends regarding this wealthy entrepreneur.

When confronted about this contradictory statement by the President of Eternit, that Schmidheiny had continued to participate in the asbestos business in Brazil for over a decade after he had claimed he had left it forever, Peter Schuermann, Schmidheiny's spokesperson, responded as follows to the editor of SonntagsBlick on December 30, 2004: 

“It is correct that Stephan Schmidheiny as I had wanted, sold the Brazilian shares in Eternit in 1988; neither he nor one of his holdings held or hold his stocks since that time in what he once held in Brazilian interests.  Over the decades there were a number of companies that held the name “Amindus.” In the proceedings made available to me there is no evidence that this is the Amindus Holding in Glarus that you are thinking of; there is only mention of an Amindus Holding and an Amindus Holding AG.”

The same spokesman, Peter Schuermann, gave the same kind of negative answer to the Italian authorities about  Schmidheiny's participation in the plant of Eternit in Casale Monferrato published at HESA News that he "was never the owner of the Italian factory, but the biggest shareholder of the Swiss Eternit Group for just a few years. Before, Italian owners steered the company and afterward Belgians".

Philanthropy or Greenwashing?     
Regarding to Schmidheiny's philanthropic initiatives, we surfed the internet for some examples from Schmidheiny's website, which ended up sounding like exaggerated self-praise by a modern-day Don Quixote, jousting with windmills in an abandoned desert:

“For quite some time I had been thinking about presenting my different facets: I am a businessman, a citizen, a father, a hiker, an art collector, and a philanthropist.  And every day I do my best to ensure that each and every one of my roles is based on the same vision, on the same values and convictions.” 

“I have devoted an important part of my wealth and time to promoting a new form of philanthropy. As a businessman, I tried to create social and economic prosperity and, at the same time, to protect and regenerate the environment.  As a philanthropist, my desire was to spur positive social change, particularly helping the neediest, and safeguard opportunities, as best I could, for future generations.”

Brazilian magazine Época celebrated Schmidheiny's generosity in the following terms:

“He donated US$2.2 billions.  The Swiss magnate handed over control of his companies to a philanthropic foundation in Latin America named VIVA SERVICE. The donation of his business conglomerate didn't leave him poor by a long shot. After announcing the creation of Viva [VIVA Service represents the link between enterprise  – GrupoNueva  - and social activity  – Avina Foundation to fund the social and environmental activities in Latin America. The name comes from the first syllables of Vision and Values] he left the world of business with a personal fortune of more than US$1 billion. Along with the presidents of the companies which comprise GrupoNueva, the former sent out a new business card, without a phone number which read: 'Stephan Schmidheiny, helicopter pilot and diver.'

From then till the present, the multimillionaire divides his time between his Swiss properties, a house on the Spanish vacation island of Majorca, and ranches in Argentina and Costa Rica. Just before he retired, he also founded the Mar Viva Foundation - in partnership with Greenpeace - in order to protect the Chile's Galapagos archipelago. 'I grew up on my family's properties, taking long walks in the mountains. With my father I spent vacations in the Mediterranean, where I learned to dive,” he explained.  'With these experiences under my belt I began to become concerned about environmental problems.'”

Forbes has compared Schmidheiny to Bill Gates and Warren Buffet, and while the magazine calls him press-shy, Schmidheiny agreed to an exchange of e-mails with Forbes journalist Tatiana Serafin in which he describes himself as follows:

“I think I am more typical of the self-made entrepreneur.” “That may be so,” writes Serafin, “but he is also the fourth generation of a Swiss industrial dynasty. He says he considered becoming a missionary but instead studied law and worked around the globe for his family's Eternit Group, which was founded in 1903 and which manufactured a line of construction products that had begun in 1903 with asbestos-reinforced cement”.

The Social Debt
So despite all the money spread around by the Avina Foundation, which likes to boast how it has “financed social and environmental projects in 12 Latin American countries” to the tune of US$280 million, including support for 130 projects in Brazil alone according to Época, however,  Avina never donated a penny to associations of Brazilian asbestos victims. For proof of this statement, allow us to quote a message we received from Geraldinho Vieira, the representative of the Avina Foundation in Brazil, dated April 16, 2004: 

“We received your application for support for the publicity campaign to educate the public regarding the eradication of the use of asbestos and for the creation of a centre specialized in the treatment of victims of that referred raw material. I must inform you that such project doesn't fit into the goals and objectives of the Avina Foundation.”

Even Época magazine, which printed at least one piece praising Avina's founder, considered it impossible to ignore the environmental liabilities and the poisonous legacy which the Eternit group has left in Brazil and wrote:

“Those left behind to run the factory, were workers like João Francisco Grabenweger. At 77 years of age, 38 of them devoted to Eternit, Grabenweger can barely draw enough breath to walk.  In exchange for lungs ruined by asbestos, he earns $1,280 U.S. dollars a month in retirement income. A resident of the state of São Paulo, descendant of Austrian family, he remembers the young Stephan Schmidheiny, who would chat with him in German. ’His major sin was not had closed the plant to nobody else had contact with the asbestos”, regrets Grabenweger.’”

On December 19, 2003 the same João  Francisco  Grabenweger wrote a letter to Schmidheiny in German in which he told his former  “workmate” at the Eternit in Osasco about his pain and anguish. Following are some of the most gut-wrenching passages from Grabenweger's letter: 

“Do you remember, sir, the time you spent as a trainee in your Osasco factory in Brazil where you worked in the departments, and did the work of both ordinary labourers and foreman?  At that time I was assigned by factory management to work together with you throughout the factory, because I was fluent in German. I am descended from Austrians and my name is João Francisco Grabenweger. I don't know whether you still remember this humble worker with whom you used to talk about your passion for underwater diving, mostly in the Mediterranean Sea. I went with you, personally, to the Butantã Institute, which is world-famous for its collection of lives snakes for its production of antivenom serum against snakebites and other vaccines.   

My life as a worker at Eternit's Osasco plant began in 1951 and I worked there until 1989.  I think I must be the only survivor of that period, even though my lungs are damaged by a progressive and irreversible asbestosis, with diffuse bilateral pleural thickening and bilateral plaques in the diaphragm. 

I am one of a group of 1,200 former Eternit employees who are asbestos victims.  We are gathered together in the Brazilian Association of People Exposed to Asbestos (ABREA), who, with a great display of courage and dedication struggle both in Brazil and internationally for the banning of asbestos and for the right to compensation for asbestos victims.  

Allow me to ask you a question, sir, did you every see any articles about the victims from the Nazi concentration camps? Those who survived are receiving very substantial monetary compensation with all possible rights which can possibly exist. When we former employees worked at Eternit we were kept completely ignorant about the fact that we worked in an asbestos concentration camp. 

Being good workers, we helped out to the best of our ability, with total pride and dedication, in building up the asbestos-cement empire of the Schmidheiny Family. And, then what did we get from “Mother Eternit?”  What we got was a bomb with a delayed action fuse which had been implanted in our chests.  

Perhaps you are unaware, sir, but we victims of Osasco, those of us who are still alive, constitute a sort of job guarantee or those who defend the existing Eternit company against its former employees, humiliating us on a daily basis with ridiculously small offers which they call “compensation,” which are especially insulting to those of us with white hair and failing health.

I sincerely hope that I will soon receive a reply from you as soon as possible, because it always seemed to me that lots of what took place in the factories were not informed to you and your family, and also  because you seemed like a very caring and respectful person, which has been confirmed for me by the Época Magazine article written by Alex Mansur, and so I beg of you, in the name of the asbestos victims of Osasco, to help us secure the justice which have dreamed of for those who gave their life for you, sir, and for your family and your business.”

João Grabenweger died four years later, on January 16, 2008, without every having received an answer to his appeal to Schmidheiny, his former co-worker, a letter he had waited for until the last day of his life. 

Turin:  Iustitia Quae Sera Tamen… (Justice, Even Justice Delayed….)
The Turin trial of Stephan Schmidheiny constitutes a great hope of the Ban Asbestos Network and ABREA. The decision of the criminal court in Turin is scheduled to be announced on February 13, 2012, and which  all the asbestos victims, families and supporters hope will sentence the responsible parties for what the Italian court has called the greatest “wilful and permanent environmental disaster” of all times and for the crime of “wilful negligence in implementing health and safety regulations”.  

Regarding the possibility of a possible prison sentence, which is becoming more and likely, the Swiss asbestos magnate “expressed his indignation over the prosecutor's investigation  of his actions two decades ago. Schmidheiny made the following remarks, which were published in the Wall Street Journal on December 9, 2002:

“I promise you I will never go to an Italian prison.”: “Once in a while, I have to look myself in the mirror. I can very well look this guy in the eyes and feel good about what I have done. Of course, nobody is perfect, and from hindsight, you always know more and you should have done more.”

Stephan Schmidheiny, as quoted in  http://www/forbes.com/forbes/2009/1005/creative-giving-philanthropy-billgates-of-switzerland/html

(By Fernanda Giannasi*, text sent by e-mail, 05/01/2012)

* Fernanda Giannasi - Civil engineer and post-graduated in Health and Safety Engineering. Labor Inspector of the Brazilian Federal Ministry of Labor and Employment since 1983. Coordinator of GIA — Interinstitutional Group  on Asbestos from 1985-1990. Currently is the General Manager of the State Program on Asbestos of the  Regional Superintendence of Labor and Employment of the State of São Paulo. Coordinator of the Virtual Citizens' Network for the Banning of Asbestos in Latin America, and founder of ABREA, the Brazilian Association of People Exposed to Asbestos.

Translator: Daniel Berman

Reviewers: Daniel Berman, Victoria Franzinetti and Mauro Menezes

References:

1. “The Bill Gates of Switzerland. Stephan Schmidheiny has dedicated $1 billion to helping Latin America's poor become entrepreneurs” by  Tatiana Serafin. Forbes Magazine dated October 05, 2009 at http://www.forbes.com/forbes/2009/1005/creative-giving-philanthrophy-bill-gates-of-switzerland.html9

2. Bill Gates was the founder and largest stockholder in Microsoft Co. He is currently retired from business and created the Bill & Melinda Gates Foundation in 2000.

3. ”The Godfather”, a novel by Mario Puzo about a fictional Mafia family.  Academy Award-winning film trilogy based on the novel, directed by Francis Ford Coppola, starring Marlon Brando, Al Pacino, and Robert De Niro.

4. More information about the Eternit trial at http://www.digplanet.com/wiki/Stephan_Schmidheiny and http://asbestosinthedock.ning.com/

5. “He donated US$2.2 billions. The Swiss magnate handed over control of his companies to a philanthropic foundation in Latin America” by Alex Mansur. Época, No. 285, October 30, 2003 at http://revistaepoca.globo.com/Revista/Epoca/0..EDG60937-6014-285.00.htm

6. The term “greenwashing” was added to the Oxford English dictionary in 1999, where it is defined  as “disinformation disseminated by an organization so as to present an environmentally responsible public image.” The word, a combination of green and whitewashing, was coined by suburban New York environmentalist Jay Westerveld in 1986 in an essay about the hotel industry. The term greenwashing is generally used when an organization spends more time and money on advertising that they are “green” or environmentally-friendly than on actually putting into place practices that are environmentally-friendly. Some organizations may do this simply as a matter of public relations.

7. “Changing Course: A Global Business Perspective on Development and the Environment” by Stephan Schmidheiny, MIT Press, Cambridge, Massachusetts, 375 pp., 1992.

8. “Desenvolvimento Sustentável: Discursos e Práticas” (Sustainable Development: Speeches and Practices). Flor do Cerrado, 13/6/2009.   http://cerradoemcrise.blogspot.com/2009/01/desenvolvimento-sustentveldiscursos-e.html

9. “The Earth Brokers: Power, Politics, and Development” by Pratap Chatterjee and Matthias Finger, London and New York, Routledge Press, 1994.

10. “Der Eternit-Report: Stephan Schmidheinys Schweres Erbe” (Eternit: Stephan Schmidheiny's Difficult Inheritance) by Werner Catrina,, Zürich, Switzerland, Orell Fuessli Verlag, 1985, 240 pp. 

11. Câmara dos Deputados (High Chamber of Deputies). Departamento de Taquigrafia, Revisão e Redação. Texto com redação final. Comissão Especial  - PL 2186/96  - Asbesto e Amianto. EVENTO: Audiência Pública N°: 000308/01. DATA: 08/05/01. (Stenography Department, Revision and Composing.  Final Text. Special Commission – Bill 2186/96 – asbestos. Event: Public Hearing N°: 000308/01. Date: 08/05/01). Available at http://www.camara.gov.br/Internet/comissao/index/esp/asbestont080501.pdf

12. HESA NEWS.  “Eternit Italy bosses will stand trial in December” by the ETUI – European Trade Union Institute, source: Associated Press, 22/7/2009. Available at  http://hesa.etuirehs.org/uk/newsevents/newsfiche.asp?pk=1270

13. Warren Buffet is a philanthropist and principal shareholder of Berkshire Hathaway. He has promised to donate 99% of his wealth to philanthropic caused through the Bill & Melinda Gates Foundation. 

14. ”Moral Fiber: Billionaire Activist on Environment Faces His Own Past. An Eco-Efficiency' Advocate, Swiss Magnate Confronts Questions on Asbestos. Mr. Schmidheiny's Conscience” by David Bank. The Wall Street Journal, 12/09/2002. Available at http://www.pitt.edu/~mitnick/EBEweb/MoralBillActivEnWSJ12_9_02.html