Listen at 3 different speeds

Earth new shareholder for Patagonia - 31st October 2022

Mid-September witnessed the founder of outdoor garments and equipment brand Patagonia donate practically his whole business to combating environmental devastation. "The earth is now our only shareholder," 83-year- old Yvon Chouinard declared, in an open letter.

Transforming a company with hundreds of investors into an organisation dedicated to saving the planet is no mean feat. However, after dismissing the idea of turning Patagonia into a public company, Chouinard said "Truth be told, there were no good options, so we created our own."

Rather than passing on profits to investors, the outdoor apparel brand will now channel dividends to tackle the climate crisis via a non-profit set-up called the "Holdfast Collective". The business will only take out two percent, an amount considered vital to sustain Patagonia's manufacturing operations and its employees. Meanwhile, the Holdfast Collective trust will redistribute Patagonia's earnings to safeguard the earth's ecosystems and biodiversity, assist communities at risk and mitigate the destructive effects of climate change.

The sportswear brand has a long history of involvement in environmental activism. Their well-known poster campaign from 2011 – "Don't buy this jacket" – invited consumers to turn their back on consumerism and Patagonia's also pledged one percent of its profits to diverse environmental causes since the 1980s. This latest move has established the company as a world leader in its vision and commitment to saving the planet.

In Chouinard's letter, he outlined that becoming a businessman was far removed from his ambition of becoming a craftsman. In the years leading up to the founding of Patagonia, the free spirit travelled around in a van, pursuing his passion of daily mountain climbing. Patagonia came into being when Chouinard began fashioning climbing pitons for his companions. Several years later, he was horrified to have been named a billionaire by Forbes magazine, saying it had "pissed him off".

While applauding Chouinard's example in corporate leadership, climate expert Professor Phoebe Bernard told the Guardian that there needs to be rapid investments in ecosystem protection and development of natural carbon-trapping technology. She called Patagonia's move a "powerful step to kickstart our broken civilization and economy to a wiser, kinder and more sustainable future."