In a remarkable gesture of corporate responsibility, Yvon Chouinard, the owner of multi-billion dollar clothing firm Patagonia has given the company away to help fight climate change.
The label amassed a cult following due to sustainability moves like guaranteeing its clothes for life and offering reasonably priced repairs.
It is famous for an advert titled "Don't buy this jacket" asking shoppers to consider costs to the environment.
Founded in 1973, Patagonia's sales were worth around $1.5bn this year. Now, mountaineering and responsible business legend Yvon Chouinard has announced that he and his family have donated their shares to two new entities: Patagonia Purpose Trust and the Holdfast Collective. The charitable trust, which holds 2 per cent of the company and all of its voting rights, will guard the organisation’s mission. The Holdfast Collective meanwhile, which will hold the remaining 98 per cent of the stock, is a not-for-profit that is dedicated to preserving nature and battling the environmental crisis.
Every dollar of profit that is not reinvested back into Patagonia will be distributed as dividends to these new entities and then used to protect nature and biodiversity, the company says. It expects to pay out roughly $100m (£87m) annually.
“Earth is now our only shareholder,” announced Chouinard, who began the $3bn company by selling hand-made climbing gear while living out of his car.
Chouinard told the New York Times he was moved to act, in part, by his listing in Forbes as a billionaire. “I never wanted to be a businessman,” he said.
“Instead of ‘going public,’ you could say we’re ‘going purpose’. 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, which is a certified B Corp, has for decades given away 1 percent of sales to grassroots environmental activists.