Patagonia Founder Gives Away $3 Billion Company to Fight Climate Crisis
“We’re making Earth our only shareholder”, announces Patagonia’s founder, as its radical new initiative will now see profits for the brand spent on protecting the planet.
Patagonia’s founder Yvon Chouinard. Credit: Campbell Brewer.
The billionaire founder of sportswear brand Patagonia has given away the entire company to a charitable trust that fights climate change.
“We’re making Earth our only shareholder”, Patagonia founder Yvon Chouinard said of the company’s radical new business structure. “I am dead serious about saving this planet.”
Under the new ownership model, any profit that is not reinvested back into Patagonia will be distributed as dividends to protect the planet. The move is expected to generate roughly $100 million each year for environmental causes.
Chouinard explained the need for a drastic change to our current system in order to tackle the climate crisis. “If we have any hope of a thriving planet 50 years from now, it demands all of us doing all we can with the resources we have”, he said in a statement.
Known for its higher-end outdoor clothing, Patagonia describes its new business approach as “going purpose” instead of “going public” and hopes to demonstrate how a for-profit business can use capitalism to work for the planet.
“Instead of extracting value from nature and transforming it into wealth, we are using the wealth Patagonia creates to protect the source”, 83-year-old Chouinard added.
Two new entities now own the entire clothing company. The Patagonia Purpose Trust, led by the Chouinard family, holds all the voting stock of the company (two percent of the total stock) and will protect the brand’s purpose to fight against the climate crisis. And then US charity The Holdfast Collective will own all of the nonvoting stock (98 percent of the total stock), and will use every dollar received by Patagonia to solely tackle environmental issues.
Yvon Chouinard founded Patagonia back in 1973, with the sportswear company now estimated to be worth nearly $3 billion. With the huge company now owned by a charitable trust and an environmental non-profit, Patagonia’s radical new business direction could inspire a new wave of more conscious business decisions that help protect the planet.
“We've been talking about a new form of conscious capitalism for years, led by leaders like Whole Foods Market founder John Mackey, but this is a very significant signal to industry towards that direction,” Lewis Perkins, president of the Apparel Impact Institute, told Vogue Business. “It will be interesting to learn more about the philanthropic strategy of the Holdfast Collective as they become one of the largest climate-focused grantmakers in our country, if not the world.”
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