Yvon Chouinard, the founder of Patagonia, an American outdoor clothing retailer, is donating the entire company he founded 50 years ago to fight climate change.
All corporate profits will be donated to initiatives and organizations working to combat climate change, protect biodiversity, and preserve wild lands. Along with Mr. Chouinard, his wife and two adult children are donating a portion of their stake in the clothing company to the worthy cause.
The company is worth around $3 billion, according to the New York Times.
With the title “Earth is now our only shareholder,” Mr Chouinard penned a letter explaining his decision. The letter was posted on the Patagonia website on Wednesday.
Explaining the severity of climate change, he wrote, “If we have any hope of a thriving planet—much less a business—it is going to take all of us doing what we can with the resources we have. This is what we can do.”
“There were no good options available. So, we created our own”: Patagonia
He said, “While we’re doing our best to address the environmental crisis, it’s not enough. We needed to find a way to put more money into fighting the crisis while keeping the company’s values intact. One option was to sell Patagonia and donate all the money. But we couldn’t be sure a new owner would maintain our values or keep our team of people around the world employed. Another path was to take the company public. What a disaster that would have been. Even public companies with good intentions are under too much pressure to create short-term gain at the expense of long-term vitality and responsibility,”.
“Truth be told, there were no good options available. So, we created our own,” he added.
The privately held company announced in a statement that the Patagonia Purpose Trust and the Holdfast Collective, two nonprofit organizations dedicated to addressing climate change, will now own stock in the company.
The company added, “Funding for the Collective will come from Patagonia: Each year, excess profits—money we make after reinvesting in the business (including the money we want to save for unforeseen events, like a pandemic)—will be distributed as a dividend to the Collective to be used for its work.”
According to the New York Times, the firm’s current revenue is $100 million, and it plans to donate the entire amount each year.
The company now sells new and used outdoor clothing, equipment for outdoor activities such as camping, fishing, and climbing, as well as food and drinks derived from sustainable sources.