Yvon Chouinard gave away Patagonia

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 CantClimbTom 15 Sep 2022

"...The billionaire founder of the outdoor fashion brand Patagonia has given away his company to a charitable trust.

Yvon Chouinard said any profit not reinvested in running the business would go to fighting climate change.."

https://www.bbc.co.uk/news/business-62906853

Wow, that's pretty altruistic!

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 Herdwickmatt 15 Sep 2022
In reply to CantClimbTom:

He's still a billionaire though isn't he? 

Yes it's an amazing contribution, but does he really sacrifice anything?

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 Iamgregp 15 Sep 2022
In reply to Herdwickmatt:

Yes, the circa 3 billion dollars he could have gained by selling or floating the company.

 Dave the Rave 15 Sep 2022
In reply to CantClimbTom:

Is this a case of ‘fecked if you do, and fecked if you don’t’? 

 Marek 15 Sep 2022
In reply to Iamgregp:

The interesting thing (to me) would be the terms of reference of this trust. Whilst it was his company, he controlled its 'mission' and could change it to suit circumstances. A trust is likely to be much less flexible or be subject to the whims or opinions of the trustees (whoever they are at any given time). Tricky situation, but given his age I can't think of a better approach.

 Herdwickmatt 15 Sep 2022
In reply to CantClimbTom:

Well my comment was unpopular. 

To clarify, I'm happy he's done it, it protects Patagonia from being purchased by other companys and funds so they can protect their core values which is great. I'm glad he's done it, it makes him fantastic compared to all the other greedy capitalist corporations and fund managers. It's wonderful to have those investments in climate action. I wish more companies did this.

He's still flipping minted, I can't see it impacting his life one iota so to claim altruism and that it's a great act of generosity? It's like Bill Gates giving away his money to get off the rich list. It's wonderful and can impact mankind in a wonderful way, but it's no greater an act of altruism than someone on the dole buying a homeless person a cup of tea. In fact it's probably less. 

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OP CantClimbTom 15 Sep 2022
In reply to Herdwickmatt:

I think you're confusing altruism and generosity.

Generosity is measured by the heart, so yes giving when you're skint could show more heart than the same gift from someone ultra rich.

But altruism is measured more in overall monetary value (and tax deductables, social brownie points, political kudos, favours earned, etc) but that's not to say that it can't sometimes come from the heart as well. It's just publicly scored by different rules.

Probably in Choinard's case he's wise enough to know he can't take it  with him and he should do something good. Sure it's not going to cause him hardship but that company was a big piece of his life and many people wouldn't have been able to do what he just did. Respect to him

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 Herdwickmatt 15 Sep 2022
In reply to CantClimbTom:

Altruism should be selfless. Its not a selfless act (you've listed lots of reasons why it's not selfless), but I think this is going to end in semantics very quickly so I'm happy not to get sucked into this  

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In reply to Herdwickmatt:

> It's like Bill Gates giving away his money to get off the rich list

Ir seems Bill is struggling with that; his worth has increased to $115Bn, so he's having to give away another $20Bn...

 john arran 15 Sep 2022
In reply to captain paranoia:

> > It's like Bill Gates giving away his money to get off the rich list

> Ir seems Bill is struggling with that; his worth has increased to $115Bn, so he's having to give away another $20Bn...

Could you imagine the same of Zuckerberg or Bezos? Credit where it's due, and huge respect to Yvon Chouinard for not getting sucked into the 'more is always better' fallacy.

In reply to Herdwickmatt:

> He's still a billionaire though 

What, apart from some personal problems you obviously have, makes you say that? 
 

jcm

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 John Alcock 15 Sep 2022
In reply to CantClimbTom:

I recommend everyone reads Chouinard's autobiography Let My People Go Surfing. In my view, it's a very inspiring account of how one boss has tried to run an ethical company in which products are responsibly sourced and staff are well treated- not as easy as it sounds.

In reply to John Alcock:

Indeed. I was going to say the same thing. This guardian piece reports accurately the Chouinard I have learned to respect over the years. I think he has sold it off for the right reasons and I don't think he is a billionaire from what I know. There are some good people in this world and there even some good successful people in this world. Being good at making money doesn't necessarily make you evil.

https://www.theguardian.com/global/2022/sep/15/yvon-chouinard-the-existenti...

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 Herdwickmatt 16 Sep 2022
In reply to The Connor-Crabb:

That's possibly a first a UKC commenting that the Guardian is accurate 😛

Again I've not said he's evil, earlier in the thread I've even stated that I like him/Patagonia and their ethos/core values. 

What I questioned was the way it's being portrayed, and also the need to accumulate such wealth in the first place. Maybe my posts lacked to nuance and explanation needed.

I

@JCM , thanks for your concern, it's probably a long list of problems. 

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 Jim Walton 16 Sep 2022
In reply to Herdwickmatt:

So this article in the NYtimes gives good detail on the Trust and also the Taxes that Chouinard will pay.

https://www.nytimes.com/2022/09/14/climate/patagonia-climate-philanthropy-c...

 wbo2 16 Sep 2022
In reply to Herdwickmatt: Honestly , your post looks like cheap, cynical sniping.  Ergo the dislikes, 

 Pedro50 16 Sep 2022
In reply to The Connor-Crabb:

> Indeed. I was going to say the same thing. This guardian piece reports accurately the Chouinard I have learned to respect over the years. I think he has sold it off for the right reasons and I don't think he is a billionaire from what I know. There are some good people in this world and there even some good successful people in this world. Being good at making money doesn't necessarily make you evil.

He hasn't sold it off, that's the whole point.

 Herdwickmatt 16 Sep 2022
In reply to wbo2:

That's fair. I'll take the criticism, it wasn't meant as sniping, but is the way it reads. 

 climberchristy 16 Sep 2022
In reply to CantClimbTom:

> I think you're confusing altruism and generosity.

> But altruism is measured more in overall monetary value

I think you're misunderstanding the definition of altruism: 'disinterested and selfless concern for the wellbeing of others'. Thus, for example, choosing to volunteer for a charity could be altruistic or going out of your way to help a mate,  or putting a quid in a collection tin. Nothing at all to do with monetary value. 

 Andy Hardy 16 Sep 2022
In reply to Herdwickmatt:

Can you think of another $bn company that would do the same?

And what could YC do that would be better? If he sold Patagonia to Mike Ashley and gifted the proceeds to Greenpeace, the Patagonia brand would still be making money for Mike Ashley, just less ethically.

 Arms Cliff 16 Sep 2022
In reply to Herdwickmatt:

> He's still a billionaire though isn't he? 

> Yes it's an amazing contribution, but does he really sacrifice anything?

He was estimated to be a billionaire ($1.1bill) due to his Patagonia shares, which he has now given all away, so no, he’s not still a billionaire.  

 Herdwickmatt 16 Sep 2022
In reply to Arms Cliff:

You're right, sorry, my mistake, I think his net worth is 1.5billion (from a BBC report yesterday) so that leaves him with 400million....

Anyway I've invested too much time in this thread, I've come across poorly and articulated my points badly. Apologies I'm out.

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 kevin stephens 16 Sep 2022
In reply to CantClimbTom:

Does Yvon Chouinard still have any stake in Black Diamond 

 sandrow 16 Sep 2022
In reply to kevin stephens:

> Does Yvon Chouinard still have any stake in Black Diamond 

Black Diamond is a wholly owned subsidiary of the Clarus Corporation

Clarus Corporation also own Sierra Bullets and Barnes Bullets. Since I found this out I no longer buy Black Diamond stuff.

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 timparkin 16 Sep 2022
In reply to Herdwickmatt:

> Altruism should be selfless. Its not a selfless act (you've listed lots of reasons why it's not selfless), but I think this is going to end in semantics very quickly so I'm happy not to get sucked into this  

Altruism is rarely selfless...   If you take into account the positive influences it has on your own state of mind etc. Certain 'altruistic' people are actually selfish but not in terms of money but in terms of their own self-image. 

Mother Theresa is a good example where, if you track the whole story, she was acting in her own self interests most of the time (although those self interests sometimes aligned with the gestalt definition of 'caring'). 

Given this, you can't define 'altruistic' by how much the person has to suffer in order to be generous. "it's only caring if it hurts you in the process" seems a silly idea. However, there is a definition of caring based on self-sacrifice which is more interesting I suppose. 

Let's say Chouinard had a particular passion for a place or group of places and would loved to have seen them saved for all time. But he realised that this was selfish of him and his own 'control' was not the 'best' way to work with the money his company had created. Then we can see that his donation to a set of trustees to manage in the best interests of the environment in the way they see fit is actually more selfless than merely donating money to a cause that interests you. 

I vote for the fact that he is very aware of what philanthropy means and has put his best interests (which are certainly not monetary at this point in his life) second.

I've waffled - sorry... 

Tim 

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 TonyM 16 Sep 2022

In reply:

I'm a bit surprised that this thread hasn't been unbridled admiration at the man's generosity. (Even aiming off for a public forum.) When I heard the news yesterday morning it really brightened up my day with renewed optimism towards the human spirit. Anyways, here's more details on the transfer with a FAQ.

https://www.patagonia.com/ownership/?utm_source=em&utm_medium=email&...

 Iamgregp 16 Sep 2022
In reply to TonyM:

I think what he's done here also sets a new benchmark of philanthropy for the wealthy.  Obliviously there are a great deal of other philanthropists that have given away far more in dollar value than Chouinard who, though a billionaire, hasn't anything like the means of Gates, Buffet and Soros, but what he's done is different. 

He's given away a huge company, the source of his wealth, to a charitable cause so that it can continue to generate wealth for that cause long into the future.  

I'm sure this isn't the first time this has been done (though I don't know of any precedent) but it's eye catching, has generated news stories and has probably made others wonder if they can't do the same.

I too am surprised at the lack of enthusiasm and praise for what he's done... A climber gives away a $3 Billion to fight climate change.  And the response from climbers?  Meh. (that's more aimed at those who haven't contributed at all to this or the other thread, rather than those who have).

Not even worthy of a news story on one of the biggest (apparently) climbing websites.  Weird.

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 Rupert Woods 16 Sep 2022
In reply to Iamgregp:

Also we shouldn’t forget that he is an absolute climbing legend as well as being a remarkably successful businessman, amongst lots of other interests it seems. An extraordinary life.

OP CantClimbTom 16 Sep 2022
In reply to Rupert Woods:

Absolutely, he's a ***** legend!

In reply to TonyM:

> In reply:

> I'm a bit surprised that this thread hasn't been unbridled admiration at the man's generosity. (Even aiming off for a public forum.) When I heard the news yesterday morning it really brightened up my day with renewed optimism towards the human spirit. Anyways, here's more details on the transfer with a FAQ.

UKC, where no good deed goes unpunished 😂😂

 gethin_allen 16 Sep 2022
In reply to Andy Hardy:

> Can you think of another $bn company that would do the same?

> And what could YC do that would be better? If he sold Patagonia to Mike Ashley and gifted the proceeds to Greenpeace, the Patagonia brand would still be making money for Mike Ashley, just less ethically.

Playing the devils advocate slightly and ready to get shot down in the likes/dislikes.

We don't know what the trust looks like, we only know that the profits will be given to charity. 

So by my very rough calculations, selling the company at current value and giving it to charity would be the equivalent of giving away around 400 years of the profits after tax based on the profits for the year ending 2021. 

Would the money be more effective if front loaded rather than dripped in over time? Who could ever know what the world will be like in a few decades let alone 400 years. And he won't have any say in where much of the charity donations that will go from this endeavour as he's not immortal. 

Yes you could risk losing the company to a Mike Ashley type figure but a good chunk of the Patagonia market is their benevolent/environmental responsibility image so they would lose customers big time.

Alternatively, YC could keep a controlling stake, sell a load of the company, maybe an employee share offer, and still pile a massive lump sum into something that he'd actually get to see.

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 Iamgregp 16 Sep 2022
In reply to gethin_allen:

I suspect YC and his and Patagonia's advisors have looked at all of the options you've mooted, and weighed them up in order to reach the decision they have, given the vast amount of wealth involved in this.

In any case, that a successful 3 Billion dollar now sits as an asset in the charitable foundations possession, that does rather change things in what they can do in terms of credit and borrowing, so it may not be the case that they only benefit from the drip feed of profits.

Post edited at 16:47
 Robbie Ashton 16 Sep 2022
In reply to captain paranoia:

> > It's like Bill Gates giving away his money to get off the rich list

> Ir seems Bill is struggling with that; his worth has increased to $115Bn, so he's having to give away another $20Bn...

Apparently old Bill made $20 billion from a timely investment in Pharma companies and vaccine manufacturers just before the Rona kicked off. His best investment to date apparently so read into that what you will! Bill also has a 'foundation' into which he donates a lot of money.

Shame these charitable foundations seem to be mostly set up as jolly big wheezes to avoid paying tax. I wonder if Mr Chouinard has better morals than this:

https://discovery.ucl.ac.uk/id/eprint/10115020/1/Brehm_PDFsam_Brehm_norrag-...

and this:

https://www.theguardian.com/society/2020/sep/08/how-philanthropy-benefits-t...

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In reply to TonyM:

This

 Only a Crag 16 Sep 2022
In reply to gethin_allen:

Nobody is buying any company for a valuation that pays itself back over 400 years

The equity value transferred to trust = ~$3bn.

Estimated annual profit after tax not required reinvested in business = $100m

$3000m/$100m = 30 years 

OP CantClimbTom 17 Sep 2022
In reply to Only a Crag:

That's still a pretty high valuation/earnings ratio. If I suddenly become an investment billionaire, it wouldn't attract my investment (if it was an ordinary publicly traded company). The valuation must include a whole heap of intangibles stuff to vanity/cook the figure upwards. I'm not likely to become a billionaire investor this week... so that let's them off the hook

 Luke90 17 Sep 2022
In reply to CantClimbTom:

A quick bit of Googling suggests it's high but not wildly so. Presumably boosted by the way it's grown and set expectations for future growth. And that earnings figure seems to be both estimated, so uncertain, and after tax, not sure whether that's the normal way of assessing the ratio or not.

 ian caton 17 Sep 2022
In reply to gethin_allen:

What like the hundreds of thousands of acres of patagonia that he bought and gave to the chilean government. Imagine being able to do that having started with literally nothing. 

Post edited at 21:20

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