A ‘Dirtbag’ Billionaire Just Gave Away His $3 Billion Company – The Real Reason Why Could Change the World
The founder of apparel company Patagonia is giving away the company ownership to use the profits to help tackle a bigger problem than hiking gear — fighting climate change.
The popular clothing company Patagonia has a new owner: planet Earth.
The apparel company’s founder, Yvon Chouinard, and his wife and two children are giving away ownership of the brand — launched in 1973 — to help fight the climate crisis.
The Chouinard family will be dedicating all profits from the company, valued at $3 billion, to projects and organizations that will protect wild land and biodiversity across the planet.
What Apparel Company Patagonia Is Doing to Save the World
In an open letter on the Patagonia website titled, “Earth is now our only shareholder,” the 83-year-old Chouinard says the brand has created a specially developed trust to help combat climate change.
In the letter, Chouinard confesses he “never wanted to be a businessman” and that he began his career as a craftsman, creating “climbing gear for my friends” before getting lost in the business world of apparel.
Well, he seems to be regaining his footing.
The owner went on to say the company began to “witness the extent of global warming and ecological destruction” and that Patagonia was committed to using its resources to change the way business was done.
Through Patagonia’s remarkable new initiative, Chouinard says he hopes that they did the “right thing” while still making enough to pay the bills. “We could influence customers and other businesses, and maybe change the system along the way.”
However, this isn’t Patagonia’s first array to help save the planet.
All of its products use materials that cause less harm to the environment. In 2018, the company changed its goal to: “We’re in business to save our home planet,” and donated 1% of sales each year to projects with similar initiatives to save the world.
Still, Chouinard says it was not enough. He says the company was doing its best to “address the environmental crisis,” but still needed to find a way to put more money into fighting the crisis while keeping the company’s values intact.
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Chouinard says an option was to sell Patagonia and donate all of the money but he couldn’t be sure a new owner would maintain the same values and mindset. He says another path was to take the company public, which could have been “a disaster.”
“Truth be told, there were no good options available. So, we created our own,” he admits.
Chouinard says Patagonia isn’t going public but says they’re “going purpose.” Instead of extracting value from nature and transforming it into wealth for investors, the company is using the wealth Patagonia created to protect the “source of all wealth.”
How Patagonia’s Remarkable New Initiative Works
Obviously, it’s not easy to pull off such a selfless act as a worldwide brand. Here’s how Chouinard says the new world-first initiative will work:
The owner says 100% of the company’s voting stock will transer to the Patagonia Purpose Trust, which was created to “protect the company’s values.” That means 100% of the nonvoting stock has been given to the Holdfast Collective, a nonprofit dedicated to fighting the environmental crisis and defending nature. “Each year, the money we make after reinvesting in the business will be distributed as a dividend to help fight the crisis,” says the apparel company’s open letter.
Chouinard says it’s been nearly 50 years since the company began what calls its “experiment in responsible business,” admitting the brand is “just getting started.” He says if humanity has hope of a thriving planet in the next 50 years, it is going to take all of us doing what we can with the resources we have.
In the conclusion of the letter, the company says despite its immensity, the Earth’s resources are not infinite and it’s clear we’ve exceeded its limits.
“But it’s also resilient,” says Patagonia. “We can save our planet if we commit to it.”