A note from Yvon Chouinard

Patagonia Founder & Ex CEO

After giving Patagonia away in 2022, I’ve been working harder than an 87-year-old should. Threats to planetary health are increasing. The climate and nature crisis is worsening, and the truth is being lost in a sea of lies and misinformation. While I have gone back to my roots in design and working on our product quality, things are different. I feel an even deeper responsibility to help the company succeed and provide a counter to the prevailing extractive model of capitalism.

It has never felt more difficult.

The ownership transfer in 2022 solved how we ensure the company’s values stay intact beyond our lifetimes. It also unlocked a way to distribute more money toward saving the planet. We knew we would have to solve other questions as we went, but we never imagined we would be facing trade wars wreaking havoc on the global economy and an assault on nature and the environment at the same time.

Profit has never been Patagonia’s goal, but money and how we run our company are two of the most effective tools we have to protect nature. We dedicated our business to saving the planet, but policy now openly benefits those who succeed by exploiting it. We are seeing what happens when extractive capitalism becomes government doctrine.

The pursuit of short-term profit and mindless consumption are destroying the planet, and it is bad for most businesses. To put it into perspective, when Patagonia was founded in 1973, the average lifespan of an American company on the S&P 500 was around 30 years. Today, it’s less than 18. More companies are being bought up or hollowed out, and the population of billionaires is climbing. Entrepreneurial success went from building a durable business to selling it off to the highest bidder. It is not sustainable, yet it does not show signs of stopping any time soon. Coupled with an attack on science undoing decades’ worth of progress on climate change, any company interested in long-term survival should consider changing its primary purpose to saving our home planet—unless it has a way to make money on a dead one.

Patagonia is not perfect by any means. We do not have all the answers, but the fear of getting things wrong in the process cannot stop us from trying to get things right in the end. We have work ahead of us to reach the full potential of our business structure, prove this experiment works and explain why it matters to our employees and community.

What is clear is that for all the work we’ve done on our products and in our supply chain, and all the money we’ve given away to environmental nonprofits, it is still not enough. We can dedicate all our time and resources to saving the planet, but our impact is ultimately limited considering what we are up against. If supporting grassroots activists taught us anything, however, it is that when enough individuals come together, it is possible to take on a system.

To get there, businesses must exist to do more than provide a good service or make a quality product, and they definitely need to exist to do more than enrich a handful of individuals. They can and should exist to solve problems. Corporate influence already crosses borders and shapes government policy everywhere. Imagine what could happen if interest groups and lobbyists prioritized planetary and human health over environmental deregulation. Or if even just a few multinational mega-corporations dedicated some of their profits toward doing good beyond what can be written off their taxes. Similarly, if enough companies join together and decide our planet takes precedence over profit, we can change the world. We could change capitalism for good. We might even save the planet.

The next 50 years will not be easy. The planet is in bad shape, and many leaders have given in to cynicism or profiteering. But that does not have to be the way we go. Businesses and society can reject hopelessness and apathy and instead shape a future that can support all of us. We can refuse factory farms, poisoned air and water, and quarterly earnings being the basis of our morals.

We can change this fatal form of extractive capitalism that has brought us here. But we have to take the first step.

Yvon Chouinard

A note from Ryan Gellert

Patagonia CEO

Patagonia is a paradox. Our charter mandates we follow social and environmentally responsible practices, yet every product we make takes irreplaceable resources from the planet. Our existence seems counter to our purpose. That tension is not lost on us.

Like every other business, we do not exist in a vacuum. Our impact is often influenced by world events and geographies, and there is no defined end point or agreed-upon definition of success for some of the most urgent work we take on. The best we can do is stay within our means—both as a company and citizens of the planet.

Businesses are implicated in creating the climate and ecological crisis. As governments continue to walk back their social and environmental commitments, however, corporate responsibility becomes doubly urgent. If we hope to have a livable planet in 100 years, we have to take the initiative and use our influence to advocate for things beyond our bottom lines.

Let’s advocate for policy that protects ecosystems, rather than endorsing environmental deregulation. Let’s make the case that pro-business does not have to mean anti-planet. Businesses must move on from declaring they care about the planet, then hiding behind industry organizations that lobby against climate action in the name of profits. It’s going to take real, sometimes uncomfortable, work from all of us, but let’s agree that corporate climate action goes beyond sustainability slogans and examine our own practices and impact.

This is not to say Patagonia has impact figured out. Far from it. It took us 52 years to get to where we are today, and the path has not been linear. Sometimes it is messy. Sometimes it is painful. But in the end, it is progress.

In this report, we detail defining moments like realizing carbon neutrality failed to meet our standards of environmental responsibility (page 13) and the ongoing work to eliminate foreign migrant worker fees for those who make our products (page 75). We reflect on the impact of our Fair Trade efforts (page 73) and spending nearly 20 years researching how to remove PFAS from our products (page 79). And all the work ahead of us to decarbonize our supply chain (page 91).

The last thing we wanted this progress report to be was page after page of self-congratulation. While we do get into specifics about the work done by teams across the company and pay credit to deserving colleagues, this report is a way to stay accountable to our community by showing what we’re committed to and what we’re doing to achieve it. We hope it provides some clarity—or even inspiration to act. By sharing best practices and overcoming our fear of calling out the worst ones, we can have real, lasting impact. Businesses can be a force for good.

Ryan Gellert