Patagonia Founder Is Giving His Company Away in Pledge to Fight Climate Change

Patagonia founder Yvon Chouinard is giving away the multibillion-dollar outdoor apparel business he founded nearly 50 years ago, with a goal of helping to tackle climate change.

Mr. Chouinard and his family have transferred their ownership of Patagonia to a trust and a nonprofit organisation as opposed to taking the privately held company public or selling it, the 83-year-old founder said in a letter Wednesday, titled “Earth is now our only shareholder.”

“It’s been nearly 50 years since we began our experiment in responsible business, and we are just getting started,” said Mr. Chouinard, a world-class mountain climber who started importing rugby shirts and other apparel in the 1970s for his friends to wear. “If we have any hope of a thriving planet—much less a thriving business—50 years from now, it is going to take all of us doing what we can with the resources we have. This is another way we’ve found to do our part.”

Patagonia, based in Ventura, Calif., didn’t immediately respond to a request for comment.

The company made a name for itself selling fleece jackets, board shorts and plaid shirts. The fleece vests in particular have developed a cult following from people who work in finance, while the company’s environmental- and social-conscious practices have earned dedicated buyers in other consumer spheres. Patagonia had annual revenue of $1 billion from 2017 to 2020.

Patagonia will remain a for-profit business under the new arrangement and will continue to be run by chief executive Ryan Gellert, Mr. Chouinard said. The company will also continue donating 1% of its sales to environmental nonprofit groups, he said.

The trust, called the Patagonia Purpose Trust, owns 2% of the company and all of the voting stock. It will be tasked with protecting Patagonia’s existing values and independence, Mr. Chouinard said. The nonprofit organisation, called the Holdfast Collective, owns 98% of the company and all the nonvoting stock, which doesn’t give it decision-making authority. It will be charged with taking the profits generated by Patagonia and using those funds to address climate change.

Patagonia said in a statement that it expects to pay out roughly $100 million a year to Holdfast Collective, depending on the health of the business.

Stacy Palmer, who has been editor of the Chronicle of Philanthropy since it was founded in 1988, said it was the first she has heard of an arrangement such as this.

“As far as I know, this is extraordinarily different than what others have done because of Patagonia’s size and profitability,” Ms. Palmer said.

She noted that Holdfast Collective is a 501(c)(4) not-for-profit organisation, which allows it to use the money to advocate for causes and political candidates, not just to give to charities.

“This means that the money is intended to shape policy and politics, more than, say, supporting a charity that does river cleanup,” Ms. Palmer said. “That’s a lot of money pouring into advocacy and could be very powerful.”

Mr. Chouinard has said that he approaches leading his company as a sort of a road map for aspiring business owners.

“I never even wanted to be in business,” he said in a 2012 interview with The Wall Street Journal. “But I hang onto Patagonia because it’s my resource to do something good. It’s a way to demonstrate that corporations can lead examined lives.”

The Chouinard family will oversee leadership of the Patagonia Purpose Trust and will spearhead the philanthropic work of the Holdfast Collective. The family will also remain member of Patagonia’s board of directors.

Worrying about the cost of living is causing accelerated ageing, household arguments and creating significant stress, according to new research. More than half of Australians say they have experienced personal setbacks due to financial strain over the past year. Almost 20 percent say that have suffered a stress-related illness, 33 percent have lost sleep and almost one in five are seeing signs of early ageing.

Household hostility is also rising, with 19 percent of Australians admitting they have argued with their partners about money, and a further one in 10 have argued with family and friends.

The Finder survey of 1,070 Australians reveals women are bearing the brunt of financial stress, with 62 percent reporting they have worried about money compared to 42 percent of men.

Younger Australians are struggling the most, with almost 7 in 10 Gen Z respondents reporting financial strain compared to 58 percent of Gen Xers and 24 percent of baby boomers.

The impact of cost-of-living pressures among different age groups and income levels is reflected in new data from the Australian Bureau of Statistics (ABS). The selected living cost indexes show employee households are under more strain from inflation, with the CPI measure for this population group at 6.5 percent today compared to the official overall CPI figure of just 3.6 percent.

The discrepancy is due to higher mortgage interest payments – which make up a higher proportion of expenditure for employee households — as well as an increase in primary and secondary school fees, and the indexation of tertiary education fees at the start of the year. The official CPI does not include mortgage payments, so the living cost indexes provide a more accurate picture of how rising interest rates are impacting households with mortgages today.

The inflation rate is much lower for older Australians, who have often paid off their mortgages. The inflation rate on living expenses for age pensioner households is below the official CPI level at 3.3 percent, and it’s only slightly higher at 3.4 percent for self-funded retirees.

Graham Cooke, head of consumer research at Finder, said that despite cooling inflation, Australians were still under significant financial pressure.

“This can be seen in Finder’s Cost of Living Pressure Gauge, which has been hovering in the extreme range for the past year and a half,” Mr Cooke said. The gauge returned a reading of 78 percent in March this year compared to 47 percent in March 2021, when inflation was 1.1 percent and the Reserve Bank’s official cash rate was 0.1 percent.

Interestingly, Australians’ cash savings are higher today than they were in 2021, likely reflecting stimulus payments received and saved during the pandemic. The Reserve Bank has cited pandemic savings as a factor in keeping mortgage arrears low despite much higher interest rates. The Finder research shows Australians have an average of $37,206 in cash savings today, up from $24,928 two years ago.

“Money concerns can cause problems in your everyday life and snowball quickly if you don’t get them under control,” Mr Cooke said. “Building financial resilience is as vital as ever as costs continue to rise. Pay close attention to where your money is going so you keep impulse spending to a minimum, and don’t overspend.”

Australians appear to be heeding this advice, with the latest ABS retail figures showing seven straight quarters of declining per capita spending. “Per capita volumes show retail turnover after the effects of inflation and population growth have been accounted for,” explained Ben Dorber, ABS head of retail statistics. “Following an unprecedented seven straight falls, it is very clear how much consumers have pulled back on spending in response to cost of living pressures over the past two years.”

Patagonia Founder Is Giving His Company Away in Pledge to Fight Climate Change

Yvon Chouinard says nearly 50-year-old outdoor clothing brand will be owned by trust and nonprofit, rather than sell or go public

Money worries are having a cascading effect on stress levels, conflict and even the rate of ageing