Patagonia founder Yvon Chouinard revealed Wednesday that he and his family are selling the company and all future profits from the apparel maker will go to fighting the climate crisis.
It’s a groundbreaking charity. By voluntarily forfeiting all of Patagonia’s stock worth more than $3 billion, the Chouinard family is giving up its status as one of America’s richest families.
And by redirecting all of Patagonia’s profits, about $100 million a year, to a new nonprofit called the Holdfast Collective, they quickly created one of the nation’s largest funders of climate action. Did.
The Chouinards aren’t the first billionaires to invest their fortunes in fighting climate change.
In recent years, Amazon founder Jeff Bezos pledged $10 billion to what he called the Bezos Earth Fund and began detailing how the money will be spent.Apple co Lauren Powell Jobs, widow of founder Steve Jobs, pledged $3.5 billion. Groups supporting climate change countermeasuresAnd this year, billionaire venture capitalist John Doerr donated $1.1 billion to Stanford University to build a new school to study sustainability and climate change. Mike Bloomberg, Mark Zuckerberg and Bill Gates have also donated heavily to climate change.
“It speaks to the sense of existential threat people feel about climate issues,” David Callahan, founder of the website Inside Philanthropy, said of Patagonia’s gift and wave of climate change donations. rice field.
But when billionaires pledge their entire fortune to combat climate change, it’s worth asking if they’re funding the right things.
After Doerr donated to Stanford University, critic He said the donation was effectively a 20th century solution to a 21st century problem. Donating a university chair or naming a building is good, but how do these efforts rapidly reduce greenhouse gas emissions that are dangerously warming the planet? It is not clear how it will help Stanford students also expressed displeasure after Stanford’s new dean said he was open to working with fossil fuel companies.
Bezos and Powell Jobs have just started distributing funds, but their efforts have been plagued by questions of transparency and how much tax dollars they saved from their donations.
As a Dealbook colleague pointed out today, the Chouinard family sidestepped the estate tax payment issues associated with the company’s transfer. But as Fortune’s Peter Vanham points out, important difference Between Chouinard’s gift and other similar donations.
But when it comes to where the money for Patagonia’s climate action might come from and how it might be spent, Chouinard’s gift stands out. Rather than donating cash, he sold the company and promised to use future profits to protect undeveloped land and support regenerative agriculture. The Holdfast Collective is also a 501(c)(4) group under the tax code, a special designation for organizations focused primarily on social welfare, so they can spend their funds on political activities. This means Patagonia’s profits could soon be used to shape policy on climate issues.
“This is in response to many of the criticisms that people have made of their contribution to climate change, which is that climate change needs a little more political impact and political solutions to move forward. It means we need to invest in,” Callahan said. “It will give extraordinary power in climatic space.”
Leah Stokes, a climate policy expert at the University of California, Santa Barbara, said more funding is needed to combat climate change and the gift from Patagonia is welcome news. It’s a total situation and we need funding so that we can create the necessary political and policy change,” she said.
And given Patagonia’s track record of funding grassroots activists, the new funding from the Holdfast Collective “has a strong following, including groups with different political views using different strategies. You’ll definitely get more diversity in the group,” Stokes said.
Patagonia has yet to reveal details of its strategy, so it remains to be seen how the money will actually be spent. But the prospect of more than $100 million in annual donations and the Chouinards’ abandonment of a family fortune is one of the biggest moves in the emerging field of climate philanthropy.
“All countries have to work together and everyone has to make it a top priority,” Chouinard said in an interview last month. “That’s what we have to do to save the planet. Each of us needs to dig deep and say, ‘OK, is there anything I can do?'”
Important news from The Times
Save cash: The new climate law includes incentives for solar panels, electric vehicles and appliances. Click here for how to use it.
Less Renewable Energy: European lawmakers have decided to phase out wood energy subsidies amid deforestation concerns.
“Cancer Alley”: A judge has revoked a permit for a highly industrialized chemical plant in a predominantly black community in Louisiana. The company plans to build anyway.
Inside Big Oil: Oil company executives have privately challenged their own public statements about the climate, according to documents obtained by a House investigation.
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