Patagonia CEO Yvon Chouinard announced on Wednesday that the sale of his entire company to a trust as well as a charity.
Patagonia CEO Yvon Chouinard, who previously stated his displeasure with the accumulation of wealth, is now giving his company away.
The company’s outdoor clothing line will be in the control of a trust and an organization that is not for profit. The future profits will go to combat climate change The company announced the announcement on Wednesday.
“It’s been a quarter-century since we started our journey in sustainable business.” Chouinard, 84 stated. “If there is any chance of a prosperous planet in fifty years from now, it’s up to us all to do our best with the resources available to us. Being the business leader I did not want to be I am taking my role.”
He continued, “Instead of extracting value from nature and turning this into wealth we’re making use of the wealth Patagonia creates to help protect the nature that is the source. This is making Earth our sole shareholder. I’m committed to saving the planet.”
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The Patagonia Purpose Trust will control the voting shares that the business owns (2 percent) and the Holdfast Collective, a climate change non-profit, will own the entire non-voting shares (98 percent).
Chouinard who is currently a board member stated in an announcement that while trying to combat climate change, he came to realize that the company was contributing to the problem. So , he was considering what to do about the company.
Another option is to sell the business and then donate the proceeds However, Chouinard stated that he was worried the new owners could not share the same values or employ the same workforce. Another option is to transform into an entity that is publicly traded.
“What an utter disaster that could be,” he said. “Even companies that are publicly traded with good intentions are often under excessive pressure to produce quick-term profits without regard to longevity and accountability.”
This company is going to contribute 1percent of its profits to local environmental groups and its leadership won’t change.