Clothing brand, Patagonia, has always been environmentally conscious, it’s part of the brand’s identity and what attracts many consumers to their products. However, Patagonia’s founder, Yvon Chouinard, has announced that he is taking his commitment to the environment a step further by giving the company away to a trust that will use its profits to fight climate change.
Chouinard is worth an estimated $1.2 billion and instead of taking the company public, or simply selling it, he is transferring his family’s ownership to a trust and non-profit organisation.
In an open letter on Patagonia’s website, Chouinard wrote:
“Each year, the money we make after reinvesting in the business will be distributed as a dividend to help fight the crisis. 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.”
Patagonia’s operations will remain unaffected by this decision and will continue to be a private, for-profit corporation. The main difference is that the Chouinard family will no longer own the company, according to the New York Times who broke the story.
Patagonia Purpose Trust will have all the company’s voting stock while all the non-voting stock will be handed to the Holdfast Collective. The Collective is a non-profit dedicated to protecting the environment. The Chouinard family will still oversee the trust.
As per the Times, Chouinard’s actions will mean that he and his family will get no financial benefit and will actually have to pay a tax bill rather than receive a write-off.
This action compliments the brand well as they already have many environmentally conscious policies and programs in place.
Their environmental responsibility program ensures that 87% of Patagonia fabrics this season are made with recycled materials. All their virgin down is certified to the Advanced Global Traceable Down Standard, and 100% of their virgin cotton is grown organically. This is only a small part of their programs that range from Fair Work practices to material traceability.
This isn’t anything new either as Patagonia has been pledging 1% of their sales to the preservation and restoration of the natural environment since 1985. This “1% for the Planet” is an alliance of business that are committed to protecting the environment. Patagonia argue that business profits and losses are linked to the health of the environment.
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