Yvon Chouinard, the wealthy founder of Patagonia, has committed to donating his business to fight climate change. “Earth is now our only shareholder,” wrote Chouinard in a letter. “If we have any hope of a thriving planet — much less a business — it is going to take all of us doing what we can with the resources we have. This is what we can do.”
Patagonia will continue to operate as a private, for-profit corporation based in Ventura, California, selling more than $1 billion worth of jackets, hats and ski pants each year. But the Chouinards, who controlled Patagonia until last month, no longer own the company.
In August, the family irrevocably transferred all the company’s voting stock, equivalent to 2% of the overall shares, into a newly established entity known as the Patagonia Purpose Trust.
The trust, which will be overseen by members of the family and their closest advisers, is intended to ensure that Patagonia makes good on its commitment to run a socially responsible business and give away its profits. Because the Chouinards donated their shares to a trust, the family will pay about $17.5 million in taxes on the gift.
The Chouinards then donated the other 98% of Patagonia, its common shares, to a newly established nonprofit organization called the Holdfast Collective, which will now be the recipient of all the company’s profits and use the funds to combat climate change.
Yvon Chouinard’s Rise to Fame
In the 1960s, Chouinard gained notoriety as a rock climber by completing ascents across North American mountain ranges. The father of Chouinard worked as a mechanic, handyman, and plumber. Chouinard began to learn blacksmithing because he was passionate about rock climbing and wanted to manufacture his own tools. He later transformed this hobby into a small business, Chouinard Equipment.
Chouinard founded Patagonia in 1973 as a clothing company that could offer durable gear for outdoor pursuits like rock climbing. With his tools business, Chouinard had already established a reputation in rock climbing, and Patagonia swiftly diversified into other outdoor activities like surfing.
Chouinard’s Passion for Environment
While other businesses are just now learning about corporate responsibility and climate pledges, Chouinard’s firms always put the environment first because of his passion for the environment.
“I never wanted to be a businessman,” said Chouinard in his open letter. “As we began to witness the extent of global warming and ecological destruction, and our own contribution to it, Patagonia committed to using our company to change the way business was done.”
Chouinard’s idea was to lead by example. “If we could do the right thing while making enough to pay the bills, we could influence customers and other businesses, and maybe change the system along the way,” he added.
The idea of being a billionaire always rubbed Chouinard the wrong way. “I was in Forbes magazine listed as a billionaire, which really, really pissed me off. I don’t have $1bn in the bank. I don’t drive Lexuses,” the self-proclaimed craftsman told the NYT.
For many years, Chouinard shown that operating a profitable business doesn’t have to compromise one’s principles or the environment. The mountain climber, crafter, environmentalist, philanthropist, and businessman shows that his convictions are more important to him than money by deciding to donate his riches.