Two years ago, Patagonia founder Yvon Chouinard and his family relinquished their control of the company. The decision came amidst his reckoning with climate change and the dark side of capitalism.
Thus, Chouinard, his wife Malinda, and two adult children transferred their ownership to a trust and nonprofit — the Patagonia Purpose Trust and the Holdfast Collective — that will use company profits to combat climate change. Chouinard, 83, is known to have an uneasy feeling about his billionaire status while being a massive advocate for climate action and nature conservation.
Fast forward to January 2024, and Patagonia has followed up on the Chouinard family’s desire for eco-philanthropy, and The New York Times interviewed Greg Curtis, former Patagonia deputy general counsel, to see where the company stands almost two years after the ownership transfer. Authors David Gelles and Kenneth P. Vogel discovered that Patagonia has been incredibly dedicated to climate activism and isn’t afraid to work with groups on both sides of the aisle.
Since 2022, the Holdfast Collective has also established five 501(c)(4) trusts, creating a network of nonprofits that have donated more than $71 million.
The entity is allowed to make unlimited tax donations to political groups and nongovernmental organizations (NGOs). Holdfast Collective holds 98% of Patagonia’s nonvoting shares, valued at $1.7 billion.
Curtis is responsible for recommending places to donate, but the Chouinard family has the final say on gifts. All profits not distributed to charity are reinvested into Holdfast Collective.
Photo Courtesy Parsing Eye
Gelles and Vogel reported that more than 70 climate-action groups received Holdfast contributions in the first year of operation. The efforts stretched globally, including protecting the Vjosa River in Albania and Bristol Bay in Alaska. They stopped a dam from being built in Albania, a mine from opening in Alaska, and saved land in Chile and Argentina from development.
Patagonia has been afraid to give money to PACs. Gelles and Vogel highlighted how Holdfast gave money to the Senate Majority PAC and House Majority PAC. Each received $100,000 to support climate-friendly policy. Both filings can be found online. Holdfast has said it is not a partisan organization and will donate to climate action groups on both sides of the aisle.
More states are grappling with legitimate climate change threats. Montana recently passed laws that would scale back fossil fuels, recognizing the damage done. Montana’s rural population has felt the effects of climate change. The courts ruled citizens have the right to a clean environment.
While it’s unclear how this will change Montana’s energy policies, environmental lawyers believe it will accelerate clean-energy adoption and influence other states.
More climate litigation cases are coming into light because we’ve hit critical “milestones.” El Nino will worsen as the planet warms; hurricane season was one of the most violent in recent memory, and winter has been nonexistent some days of the year.
Photo Courtesy Sander Crombach
While some political groups are worried about a cleantech “cartel” similar to OPEC, much of this is rooted in lobbying and special interest groups. Some are worried about the rate of capital going into ESG and cleantech, especially when investors like Patagonia are involved.
To that point, Patagonia’s climate activism is happening when partisan politics have caused a massive disconnect between American lawmakers and citizens.
Pew Research says that 69% of adult Americans believe alternative energy sources are a priority, scaling back coal, gas, and liquefied natural.
More state regulations favor ESG policies and divestment from these industries. The public supports climate action, and so do many private companies.
Patagonia originally aimed to create durable, functional, fashionable outdoor equipment. Two years after transferring ownership, the Chouinards have watched their brainchild evolve from a socially conscious business upcycling plastic for swimsuit material and donating funds to 1%.
Patagonia remains a private, for-profit company based in California, making around $1 billion in apparel sales annually. However, its new purpose is to work full-time to save the environment. The family can sit back and watch the company it founded fight the good fight.
