With a net worth of US$1.2 billion (AU$1.7 billion) and one of the most universally beloved brands in outdoor apparel, Yvon Chouinard has forged a legacy most fashion entrepreneurs can only dream of. But now, at the still-spry age of 83, the Patagonia founder will give away the keys to the house that Nano Puff jackets built in service of the fight against climate change โ one, overall, that the fashion industry is still losing.
In a statement published earlier today on Patagonia Works, the eponymous brandโs holding company, Chouinard announced that his familyโs ownership stake would be transferred in totality to two newly created entities: the Patagonia Purpose Trust and Holdfast Collective.
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โItโs been a half-century since we began our experiment in responsible business,โ Chouinard writes.
โInstead of extracting value from nature and transforming it into wealth, we are using the wealth Patagonia creates to protect the source. Weโre making Earth our only shareholder.โ
In plain English? Every cent that isnโt reinvested back into Patagonia will now go towards the aforementioned trust and collective.
In practical terms, Patagoniaโs newly minted beneficiaries serve different yet complementary purposes. The Purpose Trust owns all of the companyโs voting stock (2% of the total amount), arming it with a โmore permanent legal structureโ that safeguards Chouinardโs vision of environmentally and socially conscious business.
Meanwhile, the remaining 98% of Patagoniaโs non-voting stock has been transferred into the Holdfast Collective, with all profits not reinvested into the company being paid out as an annual dividend of US$100 million (approximately). Such a distribution will give the collective a robust war chest to work with, as they pursue various remits including biodiversity protection, climate action and engagement with vulnerable communities.
Despite being a major strategic shift, the creation of the collective and trust does not affect Patagoniaโs day-to-day. The news hasnโt been accompanied by any shakeups of the companyโs Board of Directors, and โ from what can be gleaned by observers looking in โ Chouinardโs move has met with seemingly unanimous support.
โCompanies that create the next model of capitalism through deep commitment to purpose will attract more investment, better employees, and deeper customer loyalty,โ says Charles Conn, Patagoniaโs Chair of Board.
โWe want to build a better world, and that future starts with what Yvon is doing now.โ
