Patagonia, the well-known apparel and gear company, made headlines in September when it announced that founder and owner Yvon Chouinard and his family have transferred ownership of the company, valued at around $3 billion dollars, primarily to a newly established nonprofit dubbed the Holdfast Collective.
The Holdfast Collective will receive an estimated $100 million annually from company profits “to fight the environmental crisis, protect nature and biodiversity, and support thriving communities.” Over time, this will add up to billions of dollars—a meaningful amount dedicated to climate and other environmental conservation imperatives.
Chouinard founded Patagonia in 1973 during his vagabond rock climbing days in Yosemite Valley. A natural designer, he created and produced climbing equipment and later expanded into apparel. According to the New York Times, “The company was an early adopter of everything from organic cotton to on-site child care, and famously discouraged consumers from buying its products, with an advertisement on Black Friday in The New York Times that read, “Don’t Buy This Jacket.” Concern about excessive consumerism from an apparel company was indeed novel.
In a letter announcing the ownership transition, he wrote, “I never wanted to be a businessman. I started as a craftsman, making climbing gear for my friends and myself, then got into apparel. As we began to witness the extent of global warming and ecological destruction, and our own contribution to it, Patagonia committed to using our company to change the way business was done.”
Chouinard was a forward-thinker who saw an ethical imperative in growing his business in a way that would help preserve the natural environment. He also had an innate care for the wellbeing of workers. Patagonia has had a long-term commitment to fair labor practices and safe working conditions.
After decades of business success, at a point when founders had been adequately rewarded, the company will now direct future earnings of the enterprise solely to a common benefit. As socially responsible investors, we’re inspired by his life’s work and aspire to continue leveraging business for good.
“Hopefully,” Chouinard told the Times, “This will influence a new form of capitalism that doesn’t end up with a few rich people and a bunch of poor people.”