Two years since Patagonia’s founder gave everything away, what does it mean now?

On Wednesday, September 14, at a global ‘town hall’ event in Berkeley, California for Patagonia staff, customers, journalists and others, the company’s founder Yvon Chouinard made a shocking announcement. Nearly half a century after the former rock climber had begun selling clothing and climbing gear, he was giving his entire company – which analysts have valued at around $3 billion – away. Not to future generations of his family, or current business stakeholders, but instead to the planet.

“Earth is now our only shareholder,” he said. “If we have any hope of a thriving planet 50 years from now, it demands all of us doing all we can with the resources we have. As the business leader I never wanted to be, I am doing my part. Instead of extracting value from nature and transforming it into wealth, we are using the wealth Patagonia creates to protect the source.”

The new arrangement meant that Chouinard, its billionaire owner – a fact that “really pissed [him] off” – was no longer its owner, but now an employee of Patagonia. Its profits would now be paid out to the Holdfast Collective, a nonprofit set up to fight the climate crisis, while its voting stock (estimated to make up 2% of the company) was going to the Patagonia Purpose Trust, which was set up to “enshrine Patagonia’s purpose and values”. His stated aim, delivered with gusto, was to “turn capitalism on its head”.

Matt Barr, a longtime journalist and host of the Looking Sideways Action Sports Podcast, was one of those in attendance, and the event soon led him to think about its deeper meanings. After speaking to staff and experts in sustainability, law and business, over two years later, Patagonia’s move is the subject of his new three-part podcast series The Announcement. It’s an incredibly deep dive, touching on the Chouinard succession dilemma, the oxymoron of ethical businesses, and the future of capitalism. We caught up with him to hear more about the series, from its long research process to surprisingly pertinent findings.

Where were you when you first heard The Announcement, and what were your first impressions?

I was invited to its launch as a journalist. They did a big ‘town hall’ meeting in September 2022 and I remember being impressed at the time. Everything was well presented and I remember thinking: “What’s not to like?” Then it was only when I began to give it a bit more thought that I decided it would be interesting to look at it as an actual story, to see what they’re trying to do, and what it all means.

The series is very well researched – you speak to a lot of people, with authority in different spaces. What was your time frame for putting it together?

I didn’t really have a deadline, which I think you can probably tell, so I did it around my day job. I also didn’t know that it was going to evolve. The only idea that I had was to look at it and try to understand what it means, and whether some of the things that Patagonia claimed – this is going to change capitalism, this is going to fight climate change – and kick the tyres on how true that was. So it evolved into a lot of different themes as I wrote and recorded it. Marshalling all those threads into three episodes took two years.

Can you give a brief bit of background is into Patagonia as a company and its values?

As a disclaimer, I don’t work for Patagonia, so I’m saying this as an observer of the company, but they are generally held up as an extremely progressive company and held up as an exemplar of the type of sustainable business that a lot of brands and companies aspire to. I personally do think that they have walked the walk – they have a history of corporate activism that I think has been going on for so long that you can’t really claim it’s just marketing or a front. I was lucky enough to speak to leaders of the company when I was making the podcast, and they are all clearly very bought into the notion of using ‘business for change’. It’s a common topic these days, but they have been doing that for at least 30 years. They famously ran a campaign called ‘Don’t Buy This Jacket’, which in sustainable business circles is very lauded. They’re also one of the first B Corp companies, and now this move to give all their profits to a nonprofit fits the lineage of that history.

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Why did you think that The Announcement was such a momentous thing?

Well, the question of: “Can capitalism be a force for good?” is a fundamental question right now. It was a thing before the events in the USA this year, and it’s a question that everybody is grappling with individually. Can you affect change when you are a participant in what is a very extractive, rapacious system? We live in the West, and we’re all participants in that. I think that is one of the existential questions of our age – what can we do as individuals? Those topics are very pertinent right now in the face of the climate crisis, and then you can take those ideas to the brand and company level as well.

One thing that’s significant about what Patagonia did is that they have asked themselves a very important question: If we purport to change this picture, what is the most effective thing that we could do to do that? And the answer that they’ve come up with is a pretty significant one – putting all of their profits into a nonprofit. And its significance is that it has changed the parameters of the responsibility conversation. For most brands, being a proponent of ‘business for good’ means becoming a B Corp or signing up for 1% For The Planet, or as a consumer it’s something like taking a reusable coffee cup to the café. I’m not saying these things are just part of a box ticking exercise, but Patagonia have gone quite significantly further than that.

One section I found particularly interesting is when you explore philanthropy in the modern age – it’s by no means a new thing to do for wealthy folks to give money to charitable causes. You explore whether philanthropy is compatible with democracy, and one of your interviewees Carl Rhodes said: “It’s fine if some billionaire of company supports something that I like… [but] what if billionaires decide to do something else?” Given that the US President is a billionaire, and hired a ‘special government employee’ who is the richest man in the world and owns one of its largest social networking platforms, how pertinent is that statement now?

It’s a definite critique of Yvon Chouinard, and it was quite a conceptual argument up until January. And yes, I remember when I was writing and researching the documentary, I spoke to Carl about [PayPal and Palantir co-founder] Peter Thiel, who bankrolled JD Vance as an example, but it was still more of a conceptual argument than reality. When I would chat to friends about it, they’d say: “I don’t really know why it’s that bad.” But now you’ve got Elon Musk who is taking a wrecking ball to the fabric of democratic society in the States, so you’ve got a very handy example of why that is such a troubling concept across the world. That was why I thought The Announcement was such an interesting topic because it was a way into all these really pertinent debates.

What did you find out then, about the best path forwards to save the planet given that billionaires hold so much power and wealth right now?

It’s a real funny one, isn’t it? The point that Rhodes and Chuck Collins made is that whatever you think about the veracity of our democratic process, it’s more democratic than billionaires. And I heard the classic counter argument to this on Piers Morgan the other day, when Garys Economics (real name Gary Stevenson) was making the argument that we should tax [rich] people more and billionaires fairly using the democratic process. And [US right wing commentator] Dave Rubin was basically saying why the fuck would we trust the government after Covid and Gaza and so on.

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Obviously at the minute, what Rhodes and Collins say is an incredibly difficult argument to make and the prevailing political orthodoxy – especially in America – is to shrink the state and invest more in capital. So ultimately, it’s about leadership, isn’t it? It’s about strong leadership and a strong vision, and for right or wrong, the right has that at the minute. They have these strong men who are prepared to make their arguments in the most brutal, unsentimental way possible that clearly appeals to a lot of people. So the challenge for more progressive elements of society is how to not go down the same path? How do you make the case for trust in democratic institutions? Or we’ll just have two teams of billionaires fighting it out, and that’s the road to oligarchy at the end.

I ended up coming away from your podcast with a sense of optimism, in the sense that although most companies won’t follow Patagonia’s lead and give all their profits away, what they did was almost the equivalent of high-end couture in fashion. Where luxury brands will push the boundaries of what we think is possible in fashion, and smaller, less radical but still impactful aspects of that would trickle down to the high street, which for the purposes of this analogy would be other businesses.

Like I just said, we need active leadership, and that’s what that is. The other good thing that I took from the process, and that I’ve heard from people who have listened to the series is that there’s a lot of people doing worthy stuff out there. It’s easy to get overwhelmed by the news cycle but there are people doing good work and it’s not all doom and gloom. I do think Patagonia believe what they’re doing.

When I first heard it, I guess as someone who’s been worn down by endless marketing ploys and greenwashing, I was sceptical. But what have you learnt of its real impact and how the money has been used?

It’s a really pertinent question, and some of the feedback that I’ve had about the podcast is that I probably didn’t examine that closely enough. I think it’s a fair comment to say that the way that Patagonia disseminate that money is slightly opaque, and a few people have said that I should have asked them more about how they choose where the money goes and how they disseminate that capital. I do know that a year ago, they gave away about 80 million, which is listed in the first episode of The Announcement, and they’re talking about giving away 100 million a year to The Holdfast Collective. What I’m trying to do now is do a follow up interview with someone senior at Patagonia to ask these questions and potentially explore those topics through follow-up episodes.

The Announcement by Matt Barr is out now, listen below.

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