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Yvon Chouinard leads by example as Patagonia joins B-corp movement

Outdoor apparel maker Patagonia is cited as a poster child for the new wave of “B-Corporations” that elevates “sustainable” business practices as of equal importance with profits.  Does such a strategy, paradoxically, lead to better earnings?

Patagonia founder Yvon Chouinard never set out to start a big company and certainly never wanted to be a businessman. As someone who drives a beat up Subaru and doesn’t own a cellphone or computer, Chouinard never set out to get rich and is genuine in his desire to influence better corporate behavior.

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He was an avid mountain climber by the time he reached high school. Dissatisfied with his climbing tools he taught himself to blacksmith and began making his own equipment. Soon this evolved into a business and he began selling apparel to his fellow climbers. Today Patagonia nears half a billion in sales every year. However, as Chouinard doesn’t see himself as a businessman he does things quite differently.

Despite their steady growth in sales, a couple of years ago Patagonia actually launched a campaign to discourage consumers from buying their products. With Black Friday looming, Patagonia bought a full page ad in The New York Times with bold print stating: “Don’t Buy This Jacket,” with an image of a Patagonia fleece and information about the importance of sustainability. Patagonia did this because to Chouinard, his businesses impact on the community, it’s employees and the environment are far more important than how much profit is brought in.

Patagonia helps it’s employees by providing subsidized daycare and offering flex hours that allow workers to leave the office whenever they want for any reason — especially surfing (hence the title of his autobiography Let My People Go Surfing.) Patagonia also has various initiatives to help the environment such as 1% For The Planet through which Patagonia and other likeminded businesses donate 1% of annual revenues to grassroots environmental organizations. They also consult other much larger businesses on ways to be more green such as Walmart. Chouinard is able to do things so differently because there are no shareholders to be beholden to and he is adamant about keeping it that way.

In 2012 Patagonia became the first company to register as a benefit corporation in California. A benefit corporation or ‘B-corp’ is a corporation that uses the power of business to solve social and environmental problems. These corporations are committed to meet comprehensive and transparent social and environmental performance standards, meet higher legal accountability standards and to build business constituency for policies that support sustainable business.

OBSERVATION: Patagonia remains a great example of the positive power of corporations to do good when business leaders consider values like environmentalism along with profits. 

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