Patagonia Partners with Planet Earth
ENVIRONMENT, 3 Oct 2022
Sohini Dey | The Voice of Fashion - TRANSCEND Media Service
16 Sep 2022 – Corporate activism drives sales for the outdoor clothing company, which will now transfer all additional profits for climate change initiatives.
American outdoor clothing retailer Patagonia has announced a new ownership to drive profits towards climate change initiatives. Yvon Chouinard who founded Patagonia 50 years ago, announced on September 14 that his family has transferred all ownership to two new entities—Patagonia Purpose Trust which owns all voting stock of the company (two percent of the total stock) and the Holdfast Collective which owns all non-voting stock (98 per cent). According to a statement, any revenue not re-invested into the company will be distributed as dividends (via Holdfast Collective) for environmental causes.
The interiors of a Patagonia store in Hong Kong. Shutterstock.
“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,” Chouinard said in a press statement. “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.” Chouinard, who also co-founded the 1% for the Planet initiative in 2002 urging companies to donate one per cent of annual sales to environmental causes, believes that capitalism can benefit the environment.
Patagonia’s puffer jackets enjoy a cult following but sustainability seals the company’s reputation. Using organic cotton and recycled materials since the ’90s, encouraging repair and reuse, supporting activist groups, funding research and leading protests against anti-environmental action—Patagonia addresses eco goals with a multi-pronged approach. This corporate stand has only made it more popular. Despite exorbitant prices, which sparked the nickname Patagucci, and continued use of down (geese and duck feathers) and microplastic in recycled materials, the company is largely regarded as a leader in the segment and valued at approximately $3 billion. Even in countries such as India, where Patagonia is not available for retail, the company makes news—such as in 2021, when it sourced Khadi from the country for its denim apparel.
Yvon Chouinard, founder of Patagonia – Campbell Brewer
Radical moves such as withdrawing from customised clothing for corporates in 2019 or the new transfer of ownership raises the profile of Patagonia and yields more goodwill for it. Chouinard’s announcement might well raise sales with the company projected to pay approximate annual dividends worth $100 million. Since the announcement, questions have been raised in financial circles and among business journalists whether this move indicates tax evasion while keeping the controls of the big business with the Chouinard family.
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Sohini Dey is Managing Editor at The Voice of Fashion. She lives in Delhi.
Tags:
Capitalism,
Ecology,
Environment,
Nature,
Nature's Rights,
Wall Street
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