Has Patagonia defined a new gold standard for business responsibility?
By Graeme Auld and Janina Grabs
Patagonia’s founder Yvon Chouinard made headlines recently with the decision to give his family’s $3 billion company, and its future profits, to the fight against climate change. In his words, “Earth is now the company’s only shareholder.”
Climate policy advocates celebrated the decision. Each year, $100 million in company profits will go to the Holdfast Collective, a U.S. nonprofit working for climate action and policy advocacy. Its legal status as a 501(c)(4) social welfare organization allows it to directly lobby on U.S. climate policy.
Patagonia has always been a pathbreaker. Since 1985, the outdoor clothing company has donated one per cent of its sales to environmental causes. In 2002, it helped found the business alliance 1% for the Planet to inspire other companies to follow suit.
Patagonia has also shared product innovations, like its plant-based neoprene, with its competitors in hopes of accelerating more sustainable practices. Other initiatives include its certification as a B Corporation, certifying Patagonia as a company that is committed to the common good, and its used apparel marketplace Worn Wear.