The man who started Patagonia has given his business to Planet Earth.
In a letter, Yvon Chouinard said that the ongoing climate crisis made him want to give almost all of the company's profits to groups that work to protect the environment.
"You could say that we're "going purpose" instead of "going public." "Earth is now our only shareholder," Chouinard wrote in the title of the statement.
"We won't take value from nature and turn it into money for investors. Instead, we'll use the money Patagonia makes to protect the source of all wealth."
The $3 billion company will keep making activewear and gear and running as a business for profit. Patagonia will use profits as needed to reinvest in the business and pay employees, but everything else will go to its new owners, Holdfast Collective and Patagonia Purpose Trust.
Holdfast Collective, a nonprofit that works to protect biodiversity and nature, owns 98% of Patagonia. All of the company's nonvoting stock will be used to invest in projects that protect the environment.
The Patagonia Purpose Trust, which was just made, will own the last 2% of the company. It will be in charge of the company's voting stock, which means it has the right to vote on important company decisions and the appointment of board members. The trust was set up to protect the mission of the company, which is to save the planet.
Denis Hayes, who was in charge of the first Earth Day and later became CEO of the Seattle-based Bullitt Foundation, which cares about the environment, liked the decision.
Hayes told NBC, "The idea of putting this together in a new way and being bold and experimental is exactly the kind of new idea we need to try."
Chouinard wrote in his letter that he had never planned to become a businessman. He even told The New York Times that he hates money.
“I was in Forbes magazine listed as a billionaire, which really, really pissed me off,” he told the paper. “I don’t have $1 billion in the bank. I don’t drive Lexuses.”
Chouinard became well-known as a rock climber in the 1960s, but he also tried his hand at ice climbing, kayaking, surfing, and other outdoor sports.
He started Patagonia in 1973, and almost from the start, he made sure that the company cared about the environment. Chouinard started 1% for the Planet in 2002. Patagonia was the first business to give 1% of its annual sales to help the environment. Chouinard said that Patagonia will keep giving the percentage to grassroots groups even after the ownership changes.
“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,” Chouinard said.
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