Yvon Chouinard, the founder of apparel brand Patagonia, is handing over his company, valued at $3 billion, over to trusts and non-profit organizations focused on fighting climate change. The unprecedented move makes his family some of the most charitable business owners in the U.S.
“Hopefully this will influence a new form of capitalism that doesn’t end up with a few rich people and a bunch of poor people,” Chouinard told The New York Times. “We are going to give away the maximum amount of money to people who are actively working on saving this planet.”
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Instead of passing along the business to his two children, the Chouinards relinquished control of the company to organizations they believe will bring good to the environment. They handed over their voting stock (2% of overall shares) to the Patagonia Purpose Trust, overseen by members of the family and advisers with the intention of overseeing that the company makes good on its commitment to combating global warming.
The other 98% of its shares have been handed over to a nonprofit organization called Holdfast Collective, which will receive Patagonia’s profits in their entirety and fight climate change.
“I feel a big relief that I’ve put my life in order,” Chouinard — who said he was “pissed off” when Forbes listed him as a billionaire — said. “For us, this was the ideal solution.”
Before this decision, the company had already given $50 million to the Holdfast Collective, and will continue to give $100 million this year. The company has also, for years, pledged 1% of profits to grassroots environmental advocates. They even went head-to-head with former President Donald Trump in court to fight for the Bears Ears National Monument in Utah.
“There was a meaningful cost to them doing it, but it was cost they were willing to bear to ensure that this company stays true to their principles,” said Dan Mosley, a partner at BDT & Co., a merchant bank, who helped Patagonia with the decision. “And they didn’t get a charitable deduction for it. There is no tax benefit here whatsoever.” Instead, the family had to pay $17.5 million in taxes on the gift.
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