Patagonia Made the Planet Its “Only Shareholder” - What Can Other Brands Learn?

This is really a clarion call to the brand community. While Patagonia has been rooted in sustainability, the truth is that every brand has a role to play in the effort to make our planet and ourselves healthier. In fact, our own research shows that 77% of people globally believe that brands have a greater ability to make positive change than the government… making sustainability not only a moral imperative but a business one as well. Increasingly, people are looking to go to, engage with and buy from companies that have integrated their business goals with the greater good. In essence, Mother Earth is the new primary shareholder.

The key here is knowing that there is no one-size-fits-all way of doing this – every brand must find their own role to play in sustainability that is authentic to who they are. And, most importantly, whatever their approach, it must be, well, sustainable. Those brands that commit to the fight and general real impact will forge the ties that bind with people and planet alike.

This is what imagination and leadership looks like in a climate and ecological emergency. In order to create the change needed to halve emissions by 2030 we need to reimagine everything. This is every brand, every campaign, every agency - the whole industry model. The joy of Patagonia is that it has never been afraid to do what they know is right, and have been bold enough to pave the way for others. As Yvon Chouinard says himself, “There were no good options available so we created our own.” In doing this they recognise that they “influence customers and other businesses and maybe change the system along the way.” This is what we need right now. We need a new system. Patagonia's move provides a signal for the direction of travel and gives an idea of the contribution brands and agencies could make.

A brilliant article from the New York Times describes Yvon Chouinard as a “reluctant billionaire”, and frames his decision as giving away the company that he has created.

I see things a bit differently. Despite Chouinard declaring that he started Patagonia as a craftsman, and not as a businessman, he has progressively embraced business and wealth while giving both a different role, scope, and destination.

Today, the company’s purpose is stated as ‘We’re in the business to save our home planet’. Patagonia sees the climate crisis as its own business and as a systemic threat, therefore every part of the way the company does business must be revisited, reorganised, and reinvented.

Patagonia defines this approach as ‘Business as Unusual’. In defining the future of Patagonia, Yvon Chouinard added further meaning to the company’s approach.

And because making a wealth of difference often requires actual wealth, he declared his intention to use that created by Patagonia to protect the planet – the ultimate source of all wealth.

Yvon Chouinard’s decision is in line with the transformative shift from ‘Shareholder Capitalism’ to ‘Stakeholders Capitalism’, which many businesses are starting to embrace.

It also emphasises the importance of moving from purpose to impact, from intention to action - all while marrying brand equity, brand consistency and brand integrity.

Most business people want their companies to become market leaders.

Some want their brands to lead in culture. With his decision, Yvon Chouinard fulfilled an even bigger ambition. He moved beyond its category, considered all of society, and ended up leaving a legacy.

 

For over 50 years, Patagonia has proven it’s possible to have a sustainable, thriving business. At the end of the day, Patagonia is still a company - they manufacture, they advertise (or anti-advertise), and they sell – a lot. And they do so while taking care of workers, customers, and the environment. Patagonia understands its influential role in combating the climate crisis and has acted accordingly. While not everyone has a $3 billion company to give away, Yvon Chouinard’s move shows we all have an important part to play. And as advertisers, marketers, and growth partners, we have the power to elevate the authentic work, people, and stories that inspire action. This is our role in the climate crisis – let’s bravely follow Patagonia’s example and leave our footprint without leaving a mark.

I don’t foresee many large advertisers following in Patagonia’s footsteps simply because of ownership structures not residing with individuals as much anymore. However, I like them setting the example that corporations must live their mission. For Patagonia, that has always been about people enjoying the world we live in.  

I’m always reminded in ESG that as an employee, consumer, and ad executive there’s a higher expectation on brands to contribute to making the world better; brands with a purpose-driven mission will be seen differently by their employees and consumers and long-term that’s proven to be good for business! 

OK, I’ll admit it. I’ve tried to work at Patagonia more than once.

Never got an email back. But that’s ok. 

Not only did Patagonia get that earth needs help, but they provided onsite daycare for parents and their toddlers and let their people surf and ski.

I wear only Patagonia, as does my husband, my child, my mom, sisters and brothers - and as would my dog, if that was a thing.

So, is Patagonia’s latest move anti-capitalism? Hell no. Yvon Chouinard used capitalism to get Patagonia to where it is now. His legacy is to do even more. And to be honest, in 10 years, I hope to work for a pure non-profit myself. It’s what all my colleagues dream about. Go ahead, ask anyone. When they’ve saved enough money to pay for their kids’ college, they’re heading to a non-profit.

But in the meantime, I will continue to be part of a growing group of leaders who know that it’s capitalism that is going to get us out of the mess we are in. 

We are potentially entering a new phase that I call ‘Creative Capitalism’. This is when we actually bring social and environmental context into our decisions and use creativity to make those contexts LUCRATIVE. 

So here we go. Hat’s off to Yvon. He’s passed the baton on to us and all the other brands that need to step up. We’re ready.

Patagonia has never been shy about its mission of being in business to save the planet. This step feels like the logical next step in its evolution, but at the same time came as a surprise in the very best of ways. I suspect it will lead to sales increasing and even greater customer loyalty. Other brands, such as Chipotle and Cotopaxi, have recognised the intrinsic value of making sustainability part of their business model. Still, we need more business leaders and brands to step up. Patagonia has modelled the way for years and hopefully, this grand act will inspire others to follow their lead. Saving the planet truly depends on it.

Far from ‘giving away’ the company, he has acted in accordance with his company's purpose and values.

Did you think he was going to build up a company dedicated to planetary and people values, then revert back to single-minded profit when it came time to sell? Who could blame you? We’re surrounded by businesses, brands and billionaires using values and purpose only as long as they don’t get in the way of shareholder profits.

This is a leading example of a brand truly living its purpose, which Chouinard could do confidently because Patagonia’s purpose is incredibly clear. Co-created with employees, reviewed and adjusted, mulled over in nature-based meetings to get staff to connect on what’s really important to them. This is the culmination of decades of focus on purpose and how to act on it. So whilst a dramatic move to us, it is a logical and authentic step from Patagonia.

With more examples like this, the growth-at-all-costs and profit-only business approach is going to start to look a bit old-fashioned. So if you’re a business leader feeling inspired but unsure how to act, go and look at your purpose and values. What are they? Go for a big nature-based walk and talk them over with a friend. Are they true? What would it look like to act on them, really? And then act. Leadership is only really demonstrated when it's time to act.

You don’t need to be a billionaire to make change that counts. You need to dig deep into your business’ purpose, and then dedicate time and resources to acting on that purpose. That’s something we can all focus on and benefit from.

It's more than just Patagonia, the company, in a moment of generosity. It's a brand going beyond shareholder value to build authentic cultural value. Brands have the opportunity to grow from the level of personal experience to tell stories that move everyone to action. In this case, it's a story that inspires people to do their part for the planet - by example.

If brands have a purpose or want to show purposeful intent when they connect with consumers, they need to align marketing with authentic values and operations. If they can dedicate themselves to a purpose and show consumers that they’re willing to take risks and support them – and then repeat this over and over again – they’ll attract a new audience by doing the right things and that audience will reward them by purchasing and engaging with them, as a brand or product. As our industry continues to move into new and immersive web3 environments, this authenticity and value exchange will become even more important.

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