We’re constantly reminded that there’s a ton of wealth in the world — billionaires who have enough money to fix big problems , but oftentimes choose not to.
One such billionaire is putting his money where his mouth is. Yvon Chouinard, who founded the Patagonia outdoor apparel brand, isn’t just making a big donation. He’s giving away the whole company and using the proceeds to fight the climate crisis.
Patagonia’s been around since 1973.
Founded nearly half a century ago by rock climber and outdoorsman Yvon Chouinard, Patagonia has slowly morphed from a niche manufacturer of high-end apparel into an internationally-recognized brand with storefronts and factories around the world.
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The company is known for supporting progressive causes.
Since 1985, Patagonia has been donating one percent of its total sales to various environmental groups. They also made headlines in 2017 by donating all of the $10 million received in tax cuts to environmental groups.
Now, the founder is taking his biggest step yet.
Thanks to the runaway success of the company he founded, Yvon Chouinard is a billionaire. The 83-year-old has donated to environmental causes in the past, but he announced this week he’ll be doing something even more drastic.
He’s giving away the company.
Normally, an owner who wants to divest will either sell the company or take it public, putting it in the hands of shareholders. Chouinard is choosing another option: giving the company away to be operated by a private trust that will fight the climate crisis.
It’s an unprecedented use of corporate wealth.
“Each year, the money we make after reinvesting in the business will be distributed as a dividend to help fight the crisis,” Chouinard wrote in an open letter . “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.”
It’ll be known as the Patagonia Purpose Trust.
For consumers, not much will change — they’ll still be able to get Patagonia’s signature outdoor apparel. But the corporate structure of the company will be reimagined to convert profits into meaningful change.
It’s a move we’ve never seen before.
We’ve seen billionaires make big-time donations before and even pledge to give away some of their wealth. But it’s rare to see a profitable company literally turning over its ownership in an effort to make the world a better place.
The move was applauded on social media.
While Patagonia is still a for-profit company, they’ll be converting those profits into funding to help fight the climate crisis. It’s a massive investment in the planet, and one that’ll likely make the brand even more popular with outdoorsy types.
What do you think?
Patagonia does operate factories and, as such, contributes to emissions. But, on the flip side, they’re far more committed than most companies to the health of the planet.
Let us know what you think of this story in the comments section.