[CEONEWS = Jaehoon Lee Reporter] On September 14, 2022, a single news line stunned the world. Yvon Chouinard, founder of outdoor apparel brand Patagonia, announced he would transfer 100% of his company’s equity to environmental protection. Instead of “selling” or “listing” a company valued at $3 billion—roughly ₩4 trillion—he “gave” it back to the Earth. This was not a feel-good anecdote; it was a revolution that shook capitalism to its core. His declaration—“The Earth is now our only shareholder”—directly shattered the fortress-like notion that a company exists to maximize profits.
Traditional corporations have raced under the banner of shareholder primacy. Chouinard chose a completely different path. “Instead of going public, we’re going purpose,” he said. It was proof, to the marrow, that Patagonia would protect the planet over the long term rather than chase short-term gains. Under the new structure, Patagonia channels roughly $100 million (about ₩130 billion) in annual dividends into climate and nature protection via a nonprofit called the Holdfast Collective. Patagonia’s growth is now directly coupled to the Earth’s health. Chouinard proclaimed to the world—through the most forceful means of ownership transfer, not advertising—that “growth is the means and the planet is the end.”
■“A craftsman who became a reluctant businessman”… a paradoxical success forged by failure
Chouinard’s life reads like a film about rejecting the beaten path to pursue one’s own philosophy. Born in 1938 in Maine to a French-Canadian immigrant family, he preferred the outdoors to formal schooling. After his family moved to California in 1947, he fell in love with climbing while scrambling cliffs to observe raptors. Dissatisfied with mass-market gear, he began making his own pitons. This craftsman’s insistence on perfection later became Patagonia’s core DNA. His business began almost by accident: selling those pitons to fellow climbers out of his car trunk. “Chouinard Equipment” grew into America’s largest climbing-gear company by the 1970s. But in 1989, product-liability suits and management strain forced it into Chapter 11. The collapse of his first venture created an opening: key staff acquired the assets to found Black Diamond, and Chouinard focused all his energy on the apparel business he had already started—Patagonia. That setback cemented his conviction to build not a profit-chasing company, but a purpose-driven one.
■“Don’t Buy This Jacket”… the counterintuitive ad that smashed conventional wisdom
Patagonia’s rise flowed from Chouinard’s radical management philosophy. After opening its first store in Ventura in 1973, Patagonia designed products on the premise that “the longer it lasts, the more valuable it is.” In 2011, the company launched a campaign that shocked the world: a full-page New York Times ad on Black Friday that read, “Don’t Buy This Jacket.” It wasn’t a mere stunt. It was a declaration of war on the fashion industry’s compulsive consumption. By asking customers to “think whether you really need it,” the ad embedded conscious consumption into Patagonia’s brand. The message evolved into the “Worn Wear” program, emphasizing durability and repair. Patagonia now operates some 110 repair hubs worldwide and, in 2024 alone, repaired 30,000 garments in Europe—advocating not just product sales but a culture of using things longer.
■Environmental management: beyond declarations to structural and institutional innovation
Chouinard’s environmentalism far exceeds CSR as charity. In 2002, he co-founded the bold “1% for the Planet” initiative, pledging 1% of annual revenue to environmental nonprofits—a standard now adopted by over 5,000 companies worldwide. He waded into politics when necessary. In 2017, after the U.S. administration moved to reduce national monument protections, Patagonia sued the federal government, plastering its website with the headline, “The President Stole Your Land.” Since 2007, through “The Footprint Chronicles,” Patagonia has disclosed its raw-material sourcing and factory list, pioneering supply-chain transparency. All of this culminated in the 2022 overhaul of the company’s ownership. Patagonia was split between two trusts: the Patagonia Purpose Trust, holding 2% of the voting shares to safeguard mission and governance; and the Holdfast Collective, holding 98% of the non-voting shares to direct dividends to environmental causes. The design stemmed from Chouinard’s fear that “selling or listing” would expose the company to relentless short-term profit pressure. Harvard Business School has analyzed the setup as a textbook case of “purpose-centered ownership.” Patagonia’s B Corporation score stands at a lofty 166—well above the 80-point certification bar—and the company has set science-based targets to cut emissions 90% across its entire supply chain by 2040, keeping it at the forefront of environmental management.
■What, then, is a company’s true purpose?
Chouinard describes himself as “a craftsman who became a businessman reluctantly.” He chose business as a means to realize his values—climbing and conservation. He also led on employee welfare: on-site childcare from 1983 and a flexible work culture captured by the mantra, “Let My People Go Surfing”—when the surf’s up, work can wait. His management practice was never about money alone; it was about building a better world with his employees. Every Patagonia “innovation” has flowed from that consistent philosophy—proven not by slogans but by ownership, dividends, and legal action aligned with the brand’s mission. At 84, his audacious experiment shows a new possibility for capitalism: a corporate model that exists to protect the planet, not to maximize profit—and one that actually works.
His challenge poses the most fundamental question to founders everywhere: “Who is your real shareholder—your investors, or the Earth we stand on?” The answer will be the compass that determines the future of business.
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