How Patagonia became a purpose-led business

When Yvon Chouinard, the founder of Patagonia, recently announced his family was making the unprecedented move to transfer its ownership of the billion-dollar company to a trust and non-profit designed to help combat climate change, it was a surprise—but not a huge one.

After all, Chouinard has never really followed the traditional business playbook—and his business has been a leader in sustainable business practices, and proponent of environmental responsibility, for decades.

What may come as a surprise is that it didn’t always used to be this way.

In fact, back in 1970, his original company, Chouinard Equipment, was at risk of becoming an “environmental villain”.

As the largest supplier of climbing hardware in the United States, the company had given birth to a movement—making alpine more accessible to more people than ever before. The problem? That surge in climbing activity was damaging the very rockfaces the business, and its customers, held so dear.  

It was this direct connection between his business activities and the natural world that caused Chouinard to see his organization, and its impacts, in a whole new light—and set the company down a purpose-led path centred on sustainability.

It started with a major switch from pitons—the company’s top-selling and renowned product—to aluminum chocks, which could be wedged into rockfaces rather than hammered.

The environmentally-friendly business decisions snowballed from there, and eventually Chouinard decided to create a philosophical guide to help all members of the organization--in every department and function—bake environmental stewardship and sustainability into their work.

This clear sense of purpose tethered the company to what really matters, elevating its social and environmental consciousness.

Today, it’s arguably the backbone to the company’s renowned reputation, loyal customer base and heralded authenticity—which has helped it become the $3 billion company and trusted brand it is today.

All that said, creating a meaningful purpose and building a company that authentically operated according to that purpose wasn’t an easy feat. For starters

•          Patagonia’s purpose wasn’t created behind closed C-suite doors. In fact, it started with a trip of a dozen of the company’s top managers to the real Patagonia in Argentina. Here, they had a philosophical discussion about their common values, shared culture, and the business they wanted Patagonia to be.

•       It formed a board of directors—or valued outside advisors, with varying perspectives and skillsets—that helped the team create philosophies for each of its major departments and functions.

• It focused heavily on attaining employee buy-in—something Chouinard achieved, in the early days, through weeklong seminars designed to teach employees about the company’s environmental ethics and values, as well as the connection between the company’s philosophies and their specific departments.

• It recognized this greater purpose couldn’t be achieved by one organization alone—so it sought to get other companies (and people) to embrace environmental stewardship as well. Patagonia intentionally set out to be a model for other organizations to emulate, backed far-reaching causes (like broadening the practice of organic cotton farming) and regularly educated its customers, to help them make informed buying decisions (in the early days, via feature-length articles in its catalogue).

Moral of the story: To become an environmentally-reputable organization—one your employees, investors and customers can truly believe in and stand behind—you don’t have to give away all your company’s shares to an environmental trust (although, that would be nice). That said, you should strive to create a purpose that is more than a meaningless-but-impressive-sounding phrase.

 When you approach purpose with intention—and make it an organization-wide, collaborative effort—it can be an invaluable compass with which to navigate the world of business sustainability and transform your business into a vehicle to legitimately enhance the greater good.

 (Source: “Let my people go surfing”, by Yvon Chouinard)