Business In News
Patagonia Founder Yvon Chouinard has transferred all ownership of the company to two new entities, the Patagonia Purpose Trust and the Holdfast Collective. The new structure will distribute every dollar not reinvested into the company as “dividends to protect the planet,” according to a press release.
The Patagonia Purpose Trust now owns all the voting stock of the retailer, which totals 2% of all Patagonia stock. The organization was created to provide a more permanent legal structure to enshrine Patagonia’s purpose and values. The company will “help ensure that there is never deviation from the intent of the founder and to facilitate what the company continues to do best: demonstrate as a for-profit business that capitalism can work for the planet.”
The Holdfast Collective will control all nonvoting stock and use every dollar received to “protect nature and biodiversity, support thriving communities and fight the environmental crisis.” Profits not reinvested in Patagonia will be distributed as a dividend to the Holdfast Collective to fund its actions. Patagonia expects the annual dividend to total approximately $100 million, depending on the health of the business.
Patagonia itself will remain a B Corp and continue to give 1% of annual sales to grassroots organizations. Ryan Gellert will remain CEO and the Chouinard family will continue to sit on Patagonia’s board, which also will remain unchanged. The Chouinard family also will guide the Patagonia Purpose Trust and guide the philanthropic work performed by the Holdfast Collective.
“It’s been a half-century since we began our experiment in responsible business,” said Chouinard in a statement. “If we have any hope of a thriving planet 50 years from now, it demands all of us doing all we can with the resources we have. As the business leader I never wanted to be, I am doing my part. Instead of extracting value from nature and transforming it into wealth, we are using the wealth Patagonia creates to protect the source. We’re making Earth our only shareholder. I am dead serious about saving this planet.”
Patagonia has put environmental stewardship at the forefront of its mission since its founding in 1973. Its most recent efforts include seemingly minor changes that add up to major carbon reductions, such as using QR codes to reduce the number of product tags per item and developing on-garment digital tracking to better understand the product lifestyle and make further adjustments.