Patagonia founder Yvon Chouinard has transferred the company into a trust to ensure its profits are used to help fight climate change.
"Each year, the money we make after reinvesting in the business will be distributed as a dividend to help fight the crisis," Chouinard wrote in a post on Patagonia's website explaining the ownership move.
Climate change stems from the greenhouse gas emissions that come from human activity like burning of fossil fuels, deforestation and certain types of agriculture. Scientists say that rapid action is needed to reduce emissions in time to avoid climate change's worst effects.
Chouinard and his family are giving away the company to a nonprofit and a trust set up to protect Patagonia's independence and to ensure that its $100 million in annual profits are used to help fight climate change and "protect undeveloped land around the globe," according to The New York Times. Chouinard has long been known for his passion for fighting climate change, eschewing business norms and encouraging others with massive wealth to give it away.
"Hopefully this will influence a new form of capitalism that doesn't end up with a few rich people and a bunch of poor people," Chouinard said in his interview with The New York Times. "We are going to give away the maximum amount of money to people who are actively working on saving this planet."
A private company, Patagonia is valued at around $3 billion, according to the Times. Patagonia says it has given away more than $140 million to environmental groups over the past few decades.
The outdoor apparel company will continue giving away 1% of sales to grassroots activists each year, and the leadership of the company will not change, Patagonia said in a statement.