Yvon Chouinard, founder and major owner of Patagonia, has announced the establishment a new holding company to invest in companies in five critical areas – clothing, food, water, energy and waste – in ways that will share the same ethical approach to the environment and the same mission statement as Patagonia, using “business to inspire and implement solutions to the environmental crisis.”
The new company, called Patagonia Works, will be supported by a “$20 Million and Change Fund” for investment in start-ups. It will take the place of Patagonia's former holding company, Lost Arrow Corporation, and will be led by Rose Macario, a woman who has been able to triple Patagonia's profits in the last five years as chief operating and financial officer. Casey Shehan will continue in the role of president and chief executive of Patagonia.
Credited by Chouinard with business acumen and a keen sense of social and environmental responsibility, Macario recently launched Patagonia Provision, which has tackled the issue of responsible food production with a project involving local tribes in catching wild salmon in their natal waters. The project is going to be expanded to other types of food.
Chouinard is again breaking new ground with this diversification move. He pioneered the concept of environmental responsibility in the outdoor clothing sector by associating Patagonia with numerous initiatives.
For the last 30 years, Patagonia has been donating one percent of its sales to grassroots environmental organizations. The company contributed to start up the Sustainable Apparel Coalition, and it was one of the first to participate in the Common Threads clothing-recycling program.
It was reported last year that Chouinard had filed a document in California to make sure that the company would continue to donate one percent of sales for environmental conservation in the event of his death or of a stock market introduction. Patagonia's sales have doubled since 2008 to reach $540 million for the year ended in April 2012, it was reported at the time.
“I don't like to think of myself as a businessman,” said Chouinard in a letter to stakeholders announcing the new project last May 6, indicating that his new projects are just the “next logical steps in doing business more responsibly.”
“Economic growth for the past two centuries has been tied to an every-spiraling carbon bonfire,” he went on. “Business – and human – success in the next 100 years will have to come from working with nature rather than using it up. That is a necessity, not a luxury as it's seen now in most business quarters. We invite and encourage all companies to start to work with us in that direction.”