Earth is now our only shareholder.Yvon Chouinard announcing that Patagonia, who sells more than $1 billion in apparel each year, will transfer ownership to a trust and nonprofit organization to protect the company’s environmental values.
Why It Matters: Patagonia, valued at around $3 billion, was founded nearly 50 years ago as a rock climbing gear company that has since expanded into apparel. In order to pursue a more environmentally friendly model, they have redesigned their business in an unprecedented way for a corporation of their size.
- How it works: The Chouinard family gave 2% of their shares to a newly established trust that will operate the private, for-profit corporation. The other 98% of shares have been donated to a newly established organization that will use company profits to combat climate change.
- Why they are doing it: “We are going to give away the maximum amount of money to people who are actively working on saving this planet,” Chouinard told The New York Times. In his original announcement, he said, “instead of ‘going public,’ you could say we’re ‘going purpose.'”
- Something to Consider: Other companies could adopt a similar model in the future. Chouinard “set a new bar for retailers,” said Paula Rosenblum, co-founder and managing partner at the retail consulting firm RSR (Retail Systems Research). Per The Washington Post, she wrote, “No greenwashing here. He put his money where his mouth was.”
Yvon Chouinard’s Announcement (Patagonia)
An exclusive interview with Yvon Chouinard: Billionaire No More: Patagonia Founder Gives Away the Company (The New York Times)
by Jenna Lee,