Patagonia is a brand synonymous with integrity. Millions of people love not only its high-quality athletic wear, but also the way the company consistently puts its money behind its principles—whether through donating a $10 million tax cut to help the environment or providing on-site childcare and other supportive policies for employees who are also parents.
Yvon Chouinard, founder of Patagonia, continues to prioritize impact over profit, as he recently announced that he’ll be giving away his multimillion dollar company. Not selling it. Not making public. Donating it.
The decision, Chouinard wrote in a statement, was made in order to put more money into addressing climate change while keeping the company’s values intact. Selling wouldn’t guarantee maintenance of those values or ensure that employees would keep their jobs. And going public would have been, as Chouinard put it, a “disaster,” explaining that “even public companies with good intentions are under too much pressure to create short-term gain at the expense of long-term vitality and responsibility.”
With “no good options available … we created our own,” Chouinard wrote.
Going forward, as CNBC explains, the company’s stock will go from privately owned to being owned by the Patagonia Purpose Trust. This trust, overseen by members of the Chouinard family and a few advisors, will receive all of the voting stock—which is a small 2% of the total—as a “permanent legal structure” to protect the business’s purpose.
Meanwhile Holdfast Collective, a nonprofit dedicated to environmental causes, will own the nonvoting stock, amounting to 98%. In other words, all profits not reinvested back into Patagonia will go toward saving the planet.
“Earth is now our only shareholder,” the statement read.
The unconventional business move is nothing unusual for the rock-climber-turned-billionaire with an unwavering commitment to sustainability. In an exclusive interview with The New York Times, Chouinard shared his hope that the announcement will “influence a new form of capitalism.”
In a time when megawealthy business owners seem less likely to donate their shares for the good of humanity and more likely as a tax evasion tactic, this new form of capitalism sounds more attractive than ever. Not only attractive, but possible, as Patagonia has continuously proven that a business can thrive while still being responsible. Now it’s taking it a step further, truly making a better world more attainable.
There is often an unspoken, yet deeply ingrained belief that money—being the root of all evil and all—is what corrupts us. But perhaps it is instead the choices one makes with their power that determines their character. Wealth without consciousness is dangerous. The cost—like exploiting Earth’s finite resources—is great. Luckily purpose-driven leaders like Chouinard use their success to make the world a better place. Hopefully others will follow suit.