Nearly 50 years after Yvon Chouinard founded outdoor apparel maker Patagonia, he's relinquishing control for the good of the planet. The company, valued at $3 billion, is now in the hands of two entities—Patagonia Purpose Trust and the Holdfast Collective. The Chouinard family has transferred all of its ownership to these organizations, which will ensure that Patagonia's values continue to be upheld.
Chouinard, his wife, and two adult children put their voting shares of Patagonia, which represents 2% of the overall stock, into the Patagonia Purpose Trust. The special trust has a legal structure in place that guarantees the company's vision will never deviate from Chouinard's intent—that a for-profit business can give back to the planet.
The Holdfast Collective, which inherited the Chouinard family's nonvoting shares, is a non-profit that will use the money it receives from Patagonia to combat climate change. Any annual profits from Patagonia that aren't reinvested into the company will be distributed to the Holdfast Collective as a dividend. The non-profit will then use these funds—which are roughly $100 million per year—to protect nature and biodiversity, support thriving communities, and fight the environmental crisis.
Chouinard, who is now 83 years old, is an American rock climber and surfer who first dabbled in business in the late 1950s. He began making climbing equipment and selling it out of his car to support himself. After realizing that the steel spikes he was selling were damaging rocks at Yosemite, he forwent big profits and changed to a more environmentally friendly aluminum model.
He founded Patagonia in 1973 and committed the company to be a resource for environmental activism. This included committing part of the company's profits to environmental causes and paying employees who were involved with local environmental projects. With this current move, Chouinard is simply continuing the vision he set out with and creating a path for it to continue long after he is gone.
“I first met Yvon when he was around 24 and today, he is almost 84,” shared Kristine McDivitt Tompkins, who sits on the Patagonia board of directors. “In all those years, his vision has never wavered. He wanted to do things his own way and on his own terms.
“And while he is in good health now, he wanted to have a plan in place for the future of the company and the future of the planet. I believe this plan that he and his family helped create is tectonic. It will make the company more competitive and its employees around the world will forever be empowered by purpose.”
For Chouinard, this new phase for Patagonia is his way to keeping his commitment to the planet. And in doing so, he hopes to set an example for other business owners. “It’s been a half-century since we began our experiment in responsible business,” he states. “If we have any hope of a thriving planet 50 years from now, it demands all of us doing all we can with the resources we have.
“As the business leader I never wanted to be, I am doing my part. Instead of extracting value from nature and transforming it into wealth, we are using the wealth Patagonia creates to protect the source. We’re making Earth our only shareholder. I am dead serious about saving this planet.”