Patagonia

In 2002, rather than selling the company or taking it public, Yvon Chouinard, his wife and two adult children have transferred their ownership of Patagonia, valued at about $3 billion, to a specially designed trust and a nonprofit organization. They were created to preserve the company’s independence and ensure that all of its profits — some $100 million a year — are used to combat climate change and protect undeveloped land around the globe. Patagonia continues to operate as a private, for-profit corporation based in Ventura, Calif., selling more than $1 billion worth of jackets, hats and ski pants each year. In August 2022, the family irrevocably transferred all the company’s voting stock, equivalent to 2 percent of the overall shares, into a newly established entity known as the Patagonia Purpose Trust. Because the Chouinards donated their shares to a trust, the family will pay about $17.5 million in taxes on the gift. The Chouinards then donated the other 98 percent of Patagonia, its common shares, to a newly established nonprofit organization called the Holdfast Collective, which will now be the recipient of all the company’s profits and use the funds to combat climate change. Because the Holdfast Collective is a 501(c)(4), which allows it to make unlimited political contributions, the family received no tax benefit for its donation.