1 00:00:00,180 --> 00:00:01,710 - Patagonia has a new owner. 2 00:00:01,710 --> 00:00:02,543 I'm Jeff Beer 3 00:00:02,543 --> 00:00:05,430 and this is Fast Company's Brand Hit or Miss of the Week. 4 00:00:05,430 --> 00:00:07,590 Since its founding in 1973, 5 00:00:07,590 --> 00:00:09,150 Yvon Chouinard and his family 6 00:00:09,150 --> 00:00:10,800 have been the owners of Patagonia. 7 00:00:10,800 --> 00:00:13,890 Now, almost 50 years later, the company is announcing 8 00:00:13,890 --> 00:00:16,620 that the Chouinards are transferring all ownership 9 00:00:16,620 --> 00:00:19,410 to two newly-created entities in an effort 10 00:00:19,410 --> 00:00:21,300 both to cement the company's values 11 00:00:21,300 --> 00:00:22,680 and its operating structure 12 00:00:22,680 --> 00:00:25,650 and step up its fight against the climate crisis. 13 00:00:25,650 --> 00:00:28,650 All voting stock, which is about 2% of the total, 14 00:00:28,650 --> 00:00:31,830 is now under control of the Patagonia Purpose Trust. 15 00:00:31,830 --> 00:00:34,830 The other 98% is now under what's called 16 00:00:34,830 --> 00:00:36,600 the Hold Fast Collective. 17 00:00:36,600 --> 00:00:38,880 The goal behind the Patagonia Purpose Trust 18 00:00:38,880 --> 00:00:40,830 is to create a permanent legal structure 19 00:00:40,830 --> 00:00:43,140 to enshrine the company's purpose and values 20 00:00:43,140 --> 00:00:45,000 so that there'll never be a deviation 21 00:00:45,000 --> 00:00:46,380 from Chouinard's intent 22 00:00:46,380 --> 00:00:48,660 and to make sure the company continues 23 00:00:48,660 --> 00:00:51,330 to demonstrate that capitalism can work for the planet. 24 00:00:51,330 --> 00:00:54,030 Meanwhile, the company says that all annual profits 25 00:00:54,030 --> 00:00:56,850 that aren't directly reinvested back into the business, 26 00:00:56,850 --> 00:00:57,720 which they estimate 27 00:00:57,720 --> 00:00:59,850 to be about $100 million dollars every year, 28 00:00:59,850 --> 00:01:02,610 will be distributed by Patagonia as a dividend 29 00:01:02,610 --> 00:01:03,870 to the Hold Fast Collective 30 00:01:03,870 --> 00:01:06,330 to fund grassroots environmental organizations, 31 00:01:06,330 --> 00:01:09,240 invest in businesses, and support political candidates 32 00:01:09,240 --> 00:01:11,670 that all work to protect nature and biodiversity, 33 00:01:11,670 --> 00:01:14,730 support thriving communities, and fight the climate crisis. 34 00:01:14,730 --> 00:01:16,207 In a statement, Chouinard said, 35 00:01:16,207 --> 00:01:18,840 "it's been a half century since we began our experiment 36 00:01:18,840 --> 00:01:20,160 in responsible business. 37 00:01:20,160 --> 00:01:23,460 If we have any hope of a thriving planet 50 years from now, 38 00:01:23,460 --> 00:01:25,440 it demands all of us doing all we can 39 00:01:25,440 --> 00:01:26,700 with the resources we have. 40 00:01:26,700 --> 00:01:28,980 As the business leader I never wanted to be, 41 00:01:28,980 --> 00:01:30,150 I'm doing my part. 42 00:01:30,150 --> 00:01:32,310 Instead of extracting value from nature 43 00:01:32,310 --> 00:01:33,660 and transforming it into wealth, 44 00:01:33,660 --> 00:01:35,850 we are using the wealth Patagonia creates 45 00:01:35,850 --> 00:01:37,020 to protect the source. 46 00:01:37,020 --> 00:01:39,300 We're making Earth our only shareholder 47 00:01:39,300 --> 00:01:41,850 I am dead serious about saving this planet." 48 00:01:41,850 --> 00:01:43,920 Okay, so how is an ownership shift, 49 00:01:43,920 --> 00:01:46,500 even when as significant as this, a brand hit? 50 00:01:46,500 --> 00:01:49,110 Patagonia has long worn its environmental heart 51 00:01:49,110 --> 00:01:51,870 on its sleeve, making it core to who it is as a brand 52 00:01:51,870 --> 00:01:53,130 and what it represents. 53 00:01:53,130 --> 00:01:55,050 It co-founded 1% For the Planet, 54 00:01:55,050 --> 00:01:56,550 which has led thousands of companies 55 00:01:56,550 --> 00:01:59,640 to commit 1% of annual sales to environmental causes. 56 00:01:59,640 --> 00:02:01,350 It helped pioneer the very definition 57 00:02:01,350 --> 00:02:02,730 of benefit corporations. 58 00:02:02,730 --> 00:02:04,230 It's embrace of organic cotton 59 00:02:04,230 --> 00:02:05,970 and recycled materials in apparel 60 00:02:05,970 --> 00:02:07,830 led to their widespread proliferation. 61 00:02:07,830 --> 00:02:10,230 And it's led the push for the certification 62 00:02:10,230 --> 00:02:12,240 of regenerative organic agriculture. 63 00:02:12,240 --> 00:02:13,830 Whether it's mountain-first descents 64 00:02:13,830 --> 00:02:15,750 or finding a better way to make apparel, 65 00:02:15,750 --> 00:02:18,240 Patagonia is a company, and a founder, 66 00:02:18,240 --> 00:02:20,100 that has never been afraid of a challenge. 67 00:02:20,100 --> 00:02:21,757 As Chouinard told me a few years ago, 68 00:02:21,757 --> 00:02:23,460 "it's a never-ending summit. 69 00:02:23,460 --> 00:02:25,050 You're just climbing forever. 70 00:02:25,050 --> 00:02:27,600 You'll never get to the top, but it's the journey." 71 00:02:27,600 --> 00:02:29,520 The company is about to mark the 50th year 72 00:02:29,520 --> 00:02:31,710 of its own unique journey and, once again, 73 00:02:31,710 --> 00:02:33,750 it's reached the edge of the corporate map 74 00:02:33,750 --> 00:02:35,700 and decided to chart a new path. 75 00:02:35,700 --> 00:02:36,720 That's it for this week. 76 00:02:36,720 --> 00:02:37,720 Thanks for watching.