Patagonia, the American outdoor apparel company, is now fully owned by a non-profit dedicated to fighting the environmental crisis and defending nature, after founder Yvon Chouinard and his family transferred all their shares to the new set-up.
The move represents the largest donation by a family in proportion to their net worth ever, valued at $3 billion (€3 billion).
Mr Chouinard has long been known for his disregard for business norms, and his lifelong love for the environment.
In a letter posted to the company’s website, he wrote: “I never wanted to be a businessman. I started as a craftsman, making climbing gear for my friends and myself, then got into apparel.”
He said that the impact of industry on climate change led him to lead the company towards green practices, sourcing sustainable materials, donating one per cent of sales to climate-related causes every year, and changed the company’s purpose in 2018, which now reads: “We’re in business to save our home planet.”
However, he said that is “not enough”: “We needed to find a way to put more money into fighting the crisis while keeping the company’s values intact.”
After reviewing the options available, Patagonia is now “going purpose”.
“Instead of extracting value from nature and transforming it into wealth for investors, we’ll use the wealth Patagonia creates to protect the source of all wealth.”
All of the company’s voting stock has been irrevocably transferred to the Patagonia Purpose Trust, created to protect the company’s values, and 100 per cent of the nonvoting stock has been given to the Holdfast Collective, a non-profit dedicated to fighting the environmental crisis and defending nature.
The funding will come from Patagonia, with the profits left after reinvesting in the business distributed as a dividend to help fight the crisis.
“It’s been nearly 50 years since we began our experiment in responsible business, and we are just getting started,” the statement read. “If we have any hope of a thriving planet—much less a thriving business – 50 years from now, it is going to take all of us doing what we can with the resources we have.”
It concluded: “Despite its immensity, the Earth’s resources are not infinite, and it’s clear we’ve exceeded its limits. But it’s also resilient. We can save our planet if we commit to it.”
A tax advisor who worked on the deal clarified, in a statement to the New York Times, that the deal was structured in such a way that Mr Chouinard and his family will not receive any tax benefit whatsoever related to their donation, adding that his wife and adult children, who sit on the board of Holdfast Collective, were fully on board with the decision to give away the family fortune.
Patagonia founder Yvon Chouinard / Photo by Patagonia.com – Campbell Brewer
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