Stephan Schmidheiny understood entrepreneurship as an active process of shaping. Rather than investing in established, well-running businesses, he preferred to engage with companies in considerable need of change and restructuring – often in situations of upheaval that called for entrepreneurial risk-taking. Characteristic of his approach was the conversion of sole industrial holdings into stakes in publicly listed companies, and the exchange of building-materials interests for high technology.
As a major shareholder and board member, he accompanied strategic realignments, restructurings and steps of innovation at companies that went on to become internationally successful names – among them the electrical-engineering group ABB (from the merger of BBC and ASEA), the optics manufacturer Leica (which emerged from Wild Leitz) and today's Swatch Group (from SMH). His instinct for industrial transformation and long-term value creation earned him the label of corporate architect.
The holdings that arose from this activity also formed the economic foundation for his later social and philanthropic engagement.
Saving the Swiss Watch Industry
In the early 1980s, the Swiss watch industry had hit rock bottom due to competition from the Far East; the struggling groups ASUAG and SSIH were in the hands of their creditor banks. In 1985, Stephan Schmidheiny and Nicolas Hayek were among the few willing to invest in the newly formed SMH – today's Swatch Group. Through their jointly held WAT Holding, the two each owned an equal half.
What proved decisive was not capital alone, but trust in an individual and an eye for talent: Stephan Schmidheiny extended to Nicolas G. Hayek, then a management consultant, the confidence – and the necessary means – for him to take over the management and control of the group. This early course-setting laid the foundation for Hayek's entrepreneurial room to manoeuvre.
From 1986 to 1994, Stephan Schmidheiny served as a member of SMH's board of directors, actively helping to shape the far-reaching restructuring and strategic realignment – not as a silent partner, but as a board member who helped steer the course. The involvement proved to be one of his most successful investments. As the group returned to profitability, he gradually reduced his stake, stepped down from the board in 1994, and parted with the position in the years that followed – in keeping with his self-image as a long-term-oriented corporate architect who builds up holdings and relinquishes them at the right moment.
Pioneering Work in Latin America
In 1998, Stephan Schmidheiny created a groundbreaking group of companies in Latin America – GrupoNueva. GrupoNueva and its companies have adhered to the ‘triple bottom line’ philosophy from the outset, simultaneously pursuing social, ecological and economic objectives.
GrupoNueva initially included leading companies in the building materials industry, as well as investments in the forestry sector.
As early as 1982, Stephan Schmidheiny had invested in Terranova, a forestry company in Chile, which he developed into a leading provider of sustainable wood products. In 2005, Terranova and Masisa merged to become one of the largest publicly traded companies in the Latin American forestry sector.
In 2001, Stephan Schmidheiny decided to withdraw gradually from all his business functions and from public life. From then on, he turned his attention to his legacy.
In 2003, Stephan Schmidheiny gifted the shares of GrupoNueva to the non-profit Viva Trust he had founded. The generated dividends provide the funding for the non-profit Fundación Avina, which he also established in Latin America in the 1990s.