The billionaire owner of US-based sportswear brand Patagonia yesterday set a new example in environmental corporate leadership.
Founder Yvon Chouinard is giving the entire company away to fight the earth's climate devastation.
The businessman, who turned his passion for rock climbing into one of the world's most successful sportswear brands, is giving the firm to a trust and a non-profit, designed to pump its profits into saving the planet.
"As of now, Earth is our only shareholder," the company announced. "All profits, in perpetuity, will go to our mission to 'save our home planet'."
The Guardian says Chouinard, 83, worked with his wife and two children as well as teams of company lawyers to create a structure that will allow Patagonia to continue to operate as a for-profit company whose proceeds will go to benefit environmental efforts.
"If we have any hope of a thriving planet - much less a thriving business - 50 years from now, it is going to take all of us doing what we can with the resources we have," said Mr Chouinard. "This is another way we've found to do our part."
His family donated 2% of all stock and all decision-making authority to a trust, which will oversee the company's mission and values. The other 98% of the company's stock will go to a non-profit called the Holdfast Collective, which "will use every dollar received to fight the environmental crisis, protect nature and biodiversity, and support thriving communities, as quickly as possible".
Fighting environmental crisis
Each year, the money Patagonia makes after reinvesting in the business will be distributed to the non-profit to help fight the environmental crisis.
The structure, the statement said, was designed to avoid selling the company or taking it public, which could have meant a change in its values.
"Instead of 'going public', you could say we're 'going purpose'," said Mr Chouinard. "Instead of extracting value from nature and transforming it into wealth for investors, we'll use the wealth Patagonia creates to protect the source of all wealth."
Patagonia's new direction is designed to set an example that disproves the old shareholder capitalism axiom that corporate goals other than profit will just confuse investors, said Patagonia board chair Charles Conn.
"Instead of exploiting natural resources to make shareholder returns, we are turning shareholder capitalism on its head by making the Earth our only shareholder," he added.
Mr Chouinard and Patagonia have long been ground-breakers in environmental activism and employee benefits. In its nearly 50 years in operation, the California-based company has been known for extensive benefits for employees, including on-site nurseries and afternoons off on good surf days.
Mr Chouinard, who started his business fashioning spikes to wedge into cracks while rock climbing and lived out of his van at climbing destinations for many years, was horrified to be seen as a billionaire, he told the New York Times.
"I was in Forbes magazine listed as a billionaire, which really, really pissed me off," he said. "I don't have $1billion in the bank. I don't drive Lexuses."