On Sept. 21, Patagonia founder Yvon Chouinard announced that he is giving away his company to combat climate change. Founded in 1973 and valued at $3 billion, Patagonia is now being transferred to a trust and a nonprofit organization. Through a letter posted on the company’s website, Chouinard writes his new plans for the company. “Earth is now our only shareholder,” said Chouinard. “100% of the company’s voting stock transfers to the Patagonia Trust, created to protect the company’s values, and 100% of the nonvoting stock had been given to the Holdfast Collective, a nonprofit dedicated to fighting the environmental crisis and defending nature.”
This decision to donate the company was made by Chouinard in response to the growing concern for our planet. Patagonia’s missions and values focus on addressing climate issues, and Chouinard wants to elevate the company’s mission by using its wealth as a dividend to help fight the crisis. The entire nonvoting stock (98 percent of the entire stock) is owned by Holdfast Collective, and each year Patagonia’s profits that are not reinvested back into the business will be distributed as a dividend to Holdfast Collective. If the company continues to be successful, it is estimated that it will pay out an annual dividend of $100 million.
Patagonia is now “going purpose” and “using the wealth they create to protect the source of all wealth,” said the letter Chouinard wrote. Patagonia’s actions prior to this new chapter “was not enough,” wrote Chouinard. The company gave away 1% of sales each year and became a certified B Corp and a California benefit corporation, which writes the company’s values into a corporate charter to ensure that they would be preserved. Chouinard wants to take an extra step toward maintaining the purpose of Patagonia by putting more money into the environmental crisis. To highlight the company’s new direction, Patagonia tweeted, “We’re closed today to celebrate this new plan to save our one and only home. We’ll be back online tomorrow.”
Chouinard’s main focus is oriented around preserving the integrity and mission of Patagonia and to continue responding to environmental issues by altering the company based on what is beneficial for the Earth. To end the letter, Chouinard wrote, “Despite its immensity, the Earth’s resources are not infinite, and it’s clear we’ve exceeded its limits. But it’s also resilient. We can save our planet if we commit to it.”
