Yvon Chouinard, it would seem, isn’t like other bosses.
The 83-year-old Californian is the founder of Patagonia, the outdoor clothing retailer. He’s a passionate rock-climber and is known for allowing employees to spend the afternoons surfing when the conditions are good. He eschews glamorous displays of wealth and does not appreciate the media’s coverage of his fortune. (He recently told the New York Times: “I was in Forbes magazine listed as a billionaire, which really, really pissed me off.”)
Most significantly, it seems that he’s now ready to give it all up to help save the planet.
This week, Chouinard announced that 98% of Patagonia’s shares would be given away to a trust that will use future profits to help combat climate change. (The remaining 2% have been moved to an entity called Patagonia Purpose Trust.)
The height of philanthropy? The Guardian seem to think so; in their unquestioning coverage, Chouinard was described as, “Setting a new example in environmental corporate leadership”.
And indeed, it should be said, there’s no doubt that Chouinard is sincere in his environmentalism. He really does want lots of his money to be spent on these causes. He’s no phoney.
But nonetheless, the story is a little more complicated.
As a piece in Bloomberg explains, Holdfast Collective, the non-profit to which the shares are being transferred, is structured in such a way that means it is not eligible for income tax deductions (unlike other types of non-profits). And the decision to transfer the shares rather than sell the business means Chouinard will avoid having to pay what could have been as much as $700m in federal capital gains tax.
The piece also notes that thanks to the structure of the trust, “Chouinard and his family [will] continue to effectively control the company”. Clearly, all is not quite what it seems.
No doubt there is altruism in Chouinard’s heart. But nobody’s motivations are entirely pure, and it would appear he is also a shrewd businessman.
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