Patagonia’s founder donates the whole firm to the struggle in opposition to local weather change
Patagonia founder Yvon Chouinard, his wife and two adult children are giving away their ownership of the apparel manufacturer he founded some 50 years ago, dedicating all of the company’s profits to projects and organizations that protect wild lands, biodiversity and fight the climate crisis.
According to the New York Times, the company is valued at about $3 billion.
In a letter about the decision, published on Patagonia’s website Wednesday, Choiunard wrote about “rethinking capitalism,” saying:
“While we are doing our best to address the environmental crisis, it is not enough. We had to find a way to put more money into fighting the crisis while keeping the company’s values intact. One option was to sell Patagonia and donate all the money.” But we couldn’t be sure that a new owner would maintain our values or employ our team of employees around the world.
Another way was to take the company public. What a disaster that would have been. Even well-intentioned public companies are under too much pressure to seek short-term profits at the expense of long-term vitality and responsibility.
To be honest there weren’t any good options. So we created our own.”
The privately held company’s stock will now be owned by a climate-focused trust and a group of nonprofits called the Patagonia Purpose Trust and Holdfast Collective, respectively, the company said in a statement, noting, “Every dollar not reinvested back into Patagonia.” are paid out as dividends to protect the planet.”
The trust will receive all voting stock, representing 2% of the total, and will use it to create a “more permanent legal structure to enshrine Patagonia’s purpose and values.” It is overseen by family members and close advisors.
The Holdfast Collective owns all non-voting shares of Patagonia, which is 98%.
Patagonia expects to generate and donate approximately $100 million annually, dependent on the health of the company. The company now sells new and used outdoor clothing, equipment for outdoor activities such as camping, fishing and climbing, and sustainably sourced food and beverages.
As a certified B-Corp and California Benefit Corporation, Patagonia has donated one percent of its sales to grassroots activists each year and intends to continue to do so. Fewer than 6,000 companies worldwide are certified as B Corp companies. You must meet strict environmental, social and governance standards and benchmarks set by B Labs to earn certification.
Ryan Gellert will continue as Patagonia’s CEO, and the Chouinard family will remain on Patagonia’s board of directors, following the apparel manufacturer’s expanded philanthropic strategy. After notifying employees of the move on Wednesday, the company updated its website to state that “Earth is now our sole shareholder.”