Yvon Chouinard, founder and owner of Patagonia announcement he handed over the business to a charity tackling the climate emergency.
The shareholding of Patagonia, an outdoor clothing and sportswear brand founded by Chouinard in 1973, will be shared between two new entities.
Patagonia Purpose Trust will oversee the company’s strategy, owning 2% of its voting stock. The Holdfast Collective, which is responsible for the economic interest of the brand, will hold the remaining 98% and distribute an annual dividend.
This means that any profits not reinvested in running the business would now fund efforts to combat climate change.
About $100 million is expected to be used by the company to fight environmental catastrophe, protect the environment and encourage biodiversity.
This year, Patagonia is expected to generate $1.5 billion in revenue. According to Forbes, Chouinard has a net worth of US$1.2 billion.
Each year, California-based Patagonia distributes 1% of its net income in cash and in-kind donations, primarily to local nonprofit environmental organizations. The majority of Patagonia products also incorporate recycled components.