Yvon Chouinard, the Patagonia founder, donated his company worth $3 billion to fight the climate crisis. After Chouinard and his family gave away the ownership of the outdoor clothing retailer, he said he didn’t ever aim to become a businessman and didn’t like to be called a billionaire. That’s why he thought of transferring the ownership of his company to two non-profit organizations to fight climate change.
Solutions to climate change are not easy, and they require united efforts. Patagonia’s founder thinks that efforts to meet environmental challenges are not enough, and fighting the climate crisis requires more money.
What Patagonia Founder said
Chouinard said about donating to the company that he first thought of selling and donating the money. But he feared whether his company’s and the team’s values would remain intact. He thought it would be a disaster to make the establishment public, as public companies, despite having good intentions get pressured to make a short-term profit. Viewing the situation, the Patagonia founder thought of creating his solutions.
After informing the employees about the decision, the company updated its website that its only shareholder is Earth now.
How the idea came
Chouinard said he was a craftsman at first and used to make climbing gear. Then he involved himself in apparel making. Talking about how the thought of doing something for the climate came to his mind, the founder of Patagonia said he witnessed ecological destruction and global warming closely. He realized every human, including himself, was contributing to the crisis. Then only he vowed to change the way of business. He thought of contributing some of the company’s profits to fighting climate challenges. He considered it to be a possible beginning in changing the system.
Chouinard reminded himself and his employees that charity begins at home. So he decided to use eco-friendly materials in making products to sell.
Benefits of the decision
A trust focused on climate, and a group of charitable organizations will now own the company’s stock. The organizations are Holdfast Collective and Patagonia Purpose Trust. The company’s statement said the money not reinvested into Patagonia would be used as dividends in solving the climate crisis. The company will remain a for-profit establishment only to utilize the money to improve the environment.
The total voting stock, two percent of the total, held by the Chouinard family will be dedicated to keeping the Chouniard’s values and purpose intact. The remaining 98 percent will be used to find solutions to climate change and protect biodiversity and the habitat. Holdfast Collective will deal with the process of using the money to fight climate change and other environmental challenges.
About Patagonia
Patagonia now sells outdoor apparel and gear for fishing, camping, and climbing, among other outdoor activities, and it also sells food and beverage products. Though it depends on the business, the company is expected to generate almost $100 million yearly.
One percent of the company’s sales already go to activists yearly, which will continue.
The outdoor clothing retailer company is one of the small numbers of companies worldwide to possess a B-Corp certification. The certificate is very hard to obtain as it requires meeting governance and social and environmental standards strictly formed by B Labs. The company’s food and beverage products are made up of sustainable things, and Patagonia has California benefit certification.
Chouinard’s family will remain on the company’s board, and Ryan Gellert will remain the CEO. Chouinard, his wife, and children, who donated their ownership, will follow the company’s philanthropic strategy.
Conclusion
Yvon Chouinard’s net worth is more than $1 billion, and his company, worth $3 billion, sells over $1 billion, bringing more than $100 million in revenue. But these statistics do not satisfy the Patagonia founder. He thinks what he has done is minor in front of the challenge the climate faces. He said he took fifty years to make such a move, and instead of business, everyone should think of saving the planet using maximum resources.
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