Setting another example of environmental leadership, the billionaire owner of Patagonia is giving the whole company to fight the Earth’s climate devastation, he announced on Wednesday.
Patagonia Founder Yvon Chouinard, Who Turned His Passion For Climbing Into One Of The World’s Most Successful Sportswear Brands, Turns The Whole Company Over To A Trust, Not-For-Profit Structure unique, designed to inject all of the company’s profits into saving the planet.
“At this time, Earth is our sole shareholder,” the company announced. “ALL proceeds, in perpetuity, will go towards our mission to ‘save our planet’.”
Chouinard, 83, has worked with his wife and two children as well as teams of corporate lawyers to create a structure that will allow Patagonia to continue to operate as a for-profit company whose profits will benefit environmental efforts.
“If we have any hope of a prosperous planet — let alone a prosperous business — in 50 years, it will take all of us doing what we can with the resources we have,” Chouinard said in a statement. . “It’s another way we’ve found to do our part.”
The de Chouinard family has donated 2% of all shares and decision-making powers to a trust, which will oversee the company’s mission and values. The remaining 98% of the company’s stock will go to a non-profit organization called Holdfast Collective, which “will use every dollar received to fight the environmental crisis, protect nature and biodiversity, and support thriving communities, as quickly as possible. “, according to the statement.
Each year, the money Patagonia earns after reinvesting in the company will be donated to the nonprofit to help tackle the environmental crisis.
The structure, the statement said, was designed to avoid selling the company or going public, which could have meant a change in its values.
“Instead of ‘going public,’ you could say we ‘owe a goal,'” Chouinard said. “Instead of extracting value from nature and turning it into wealth for investors, we will use the wealth created by Patagonia to protect the source of all wealth.”
Patagonia’s new leadership is designed to set an example that refutes the old axiom of shareholder capitalism that corporate goals other than profit will only confuse investors, wrote Patagonia Chairman Charles Conn in an op-ed piece published Wednesday in Fortune magazine.
“Instead of exploiting natural resources to generate revenue for shareholders, we are subverting shareholder capitalism by making the Earth our sole shareholder,” he wrote.
Chouinard and Patagonia have long been pioneers in environmental activism and employee benefits. In its nearly 50 years in business, the Ventura, Calif.-based company is known for its many employee perks, including on-site child care and afternoons off on good surf days.
In the 1980s, the company began donating 1% of its turnover to environmental groups, a program formalized in 2001 under the name “1% for the Planet Scheme”. The program has generated $140 million in donations for the preservation and restoration of the natural environment, according to the company.
Patagonia was one of the first companies to become a b-Corp, undergoing certification as meeting certain environmental and social standards, and recently changed its mission by stating, “We are in business to save our planet.”
Chouinard, the famously eccentric entrepreneur who started his business making metal climbing pitons (or spikes to wedge into cracks when climbing) and lived in his van at climbing destinations for many years, was horrified to be considered a billionaire, he told The New York Times.
“I was in Forbes magazine listed as a billionaire, which really, really pissed me off,” he said. “I don’t have $1 billion in the bank. I don’t drive a Lexus.
The Chouinard family is at the forefront of charitable giving, philanthropy and trust experts tell the New York Time.
“This family is an exception when you consider that most billionaires donate only a tiny fraction of their net worth each year,” David Callahan, founder of the Inside Philanthropy website, told the newspaper.