The outdoor clothing manufacturer Patagonia’s wealthy founder is donating the business to a trust that will use the proceeds to address the climate problem.
Yvon Chouinard, 83, said on Wednesday that he would transfer his family’s ownership to the trust and a non-profit organisation rather than selling the business or going public.
Chouinard has a net worth of $1.2 billion and rose to fame for his alpine climbs in Yosemite National Park.
He said in an open letter posted on the business’ website that “each year, the money we produce after reinvesting in the firm will be paid as a dividend to assist battle the crisis.”
We’ll utilise the riches Patagonia generates to conserve the source of all wealth rather than taking value from nature and turning it into profit for investors, the company declares.
Patagonia, with an estimated $3 billion in market value, will continue to be a privately held for-profit organisation, but the Chouinard family, who up until last month owned the firm, will no longer be its owners.
Voting shares of the corporation are being handed to the Patagonia Purpose Trust, while non-voting shares were donated to the Holdfast Collective, a non-profit organisation devoted to reversing the environmental catastrophe and protecting the environment.
Members of the family, including his spouse and two adult children, will be in charge of managing the trust.
Although wealthy people often donate money to charitable organisations, the Patagonia founder’s move, according to the New York Times, was structured such that he and his family would get no financial advantage and, in fact, would incur a tax liability as a result of the gift.
Chouinard and Patagonia have a history of setting the bar for corporate environmental advocacy.