Patagonia founder Yvon Chouinard and his family donated the company to environmental trust and non-profit organizations.
The company will continue to be an active producer of clothing, camping gear and other goods – but all profits will go to organizations fighting the climate crisis and pursuing other environmental goals.
This move is a bold new step for a company that has played a leading role as an activist for years, especially in environmental issues.
“Instead of extracting value from nature and turning it into wealth for investors,” wrote Mr. Chouinard in a public letter, “we will use the wealth that Patagonia creates to protect the source of all wealth.”
Voting shareholders will go to the Patagonia Purpose Trust, which will “protect the company’s values.” Non-voting shares will go to Holdfast Collective, a non-profit organization that will allocate the company’s profits to environmental protection activities every year.
In deciding what to do with the company, Mr. Chouinard wrote that neither selling the company and passing on its profits nor going public seemed like a good way to ensure the company continued its active role.
“In fact, there were no good options available,” he said. “So we made our own.”
Mr. Chouinard, a former mountaineer, founded Patagonia almost 50 years ago. Since then, the Ventura, California-based company has grown into a multi-billion dollar corporation selling advertising material to outdoor enthusiasts.
In recent years, especially under Trump, the company’s active role has become much more visible.
In 2018, the company said it would donate all the money it earned from tax cuts signed by then-President Trump to environmental goals. In 2017, Patagonia entered a lawsuit in an attempt to stop the federal government from reducing the national Bears Ears and Grand Staircase-Escalante memorials in Utah.
Holdfast Collective, a new nonprofit that will monetize the company’s profits, is a 501 (c) (4) type of nonprofit that can make political donations. As a result, the Chouinard family did not receive any tax credit for donating to the group, he reports New York Times.
This is a landmark story, more to follow