Half a century after founding Patagonia’s outdoor clothing maker, Yvonne Chouinard, an eccentric rock climber turned reluctant billionaire, is ditching the company.
Instead of selling the company or going public, Chouinard, his wife and two adult children transferred their ownership of Patagonia, valued at about $3 billion (€3 billion), to a specially designed trust and non-profit organization. It was created to preserve the company’s independence and ensure that all of its profits – $100 million annually – are used to combat climate change and protect underutilized lands around the world.
“Hopefully this will affect a new form of capitalism that does not end up with a few rich and a group of the poor,” said Mr. Chouinard (83) in an exclusive interview.
“If we have any hope of a thriving planet—let alone a thriving business—50 years from now, it will require all of us to do the best we can with the resources we have,” he said. “This is another way we’ve found to do our part.”
Patagonia will continue to operate as a private, for-profit company based in Ventura, California, selling more than $1 billion worth of jackets, hats, and ski pants each year. But the Chouinards, who controlled Patagonia until last month, no longer own the company.
In August, the family permanently transferred all of the company’s voting stock, equal to 2 percent of the total stock, to a newly created entity known as the Patagonia Purpose Fund. The trust, which will be supervised by family members and their closest advisors, aims to ensure that Patagonia fulfills its obligation to run a socially responsible business and to relinquish its profits.
Chouinards then donated the other 98 percent of Patagonia, its common stock, to a newly founded nonprofit called Holdfast Collective, which would now be the recipient of all of the company’s profits and use the money to combat climate change.
By giving away the bulk of their assets during their lifetime, the Chouinards – Yvonne, his wife Malinda and their two children, Fletcher and Claire, who are in their forties – have established themselves as among the most charitable families in the United States.
For Mr. Chouinard, it provided a satisfactory solution to the question of succession planning.
“I didn’t know what to do with the company because I never wanted one,” he said from his home in Jackson, Wyoming. I didn’t want to become a businessman.
“Now I could die tomorrow and the company will continue to do the right thing for the next 50 years, and I shouldn’t exist.”
The company’s statement said the structure was designed to avoid selling the company or going public, which could have meant a change in its values.
“Instead of ‘advertising to the public,’ you could say we are ‘goal-oriented,’” Mr. Chouinard said. “Instead of extracting value from nature and turning it into wealth for investors, we will use the wealth that Patagonia creates to protect the source of all wealth. Mr. Chouinard and Patagonia have long been pioneers in Environmental Activism and Employee Benefits During its nearly 50 years in operation, Ventura, California has been known for its extensive employee benefits, including on-site nurseries and afternoons on good surf days.
In the 1980s, the company began donating 1 percent of its sales to environmental groups, a program formally drafted in 2001 as a “1% for Planet Planner.” The program resulted in $140 million in donations to conserve and restore the natural environment, according to the company.
Patagonia was one of the first companies to become b-Corp, undergoing certification as meeting certain environmental and social standards, and recently changing its mission to say, “We are working to save our planet.”
Chouinard, the famously eccentric entrepreneur who got his start designing metal rock-climbing ponds (or nails to go into crevices while climbing) and lived out of his truck at climbing destinations for many years, said he was terrified of being seen as a billionaire. New York times.
“I was in Forbes listed as a billionaire, which really pissed me off,” he said. “I don’t have a billion dollars in the bank. I don’t drive a Lexus.”
The Chouinards are at the forefront of giving, philanthropy, and trust experts for The New York Times.
“This family is very far away when you consider that most billionaires give away only a small portion of their net worth each year,” David Callahan, founder of Inside Philanthropy told the newspaper. – New York times / guardian