That's why The Retail Owners Institute has defined the #1 responsibility of the Owner as the survival of the business.
But then, the owner must define "Why?" Why are we doing this, anyway? Why are we working so hard for this business to survive and thrive?
- There are many good answers. To be the biggest? The fastest growing? A way of life? Something to pass on to the next generation? To create wealth? To support a cause?
- It all depends on the owner, and what she or he decides. Then, that answer must be communicated: to staff, customers, family, the community, competitors, everyone.
That brings us to an event that captured a great deal of attention in the business world last week.
And for fifty years, he had been very clear and outspoken about why he wanted Patagonia to survive.
- "He sought out ethically produced materials and made Patagonia one of the first companies to use organic cotton. He treated his staff well and was unusually straight with consumers. For years Patagonia has given 1 per cent of its sales to environmental charities."
As Chouinard approached his mid-eighties, he had another "owner issue": Who would be the successor owner of this family business?
- "The easiest paths, selling the company or taking it public, would have given Mr. Chouinard ample financial resources to fund conservation initiatives.” **
- "But Mr. Chouinard had no faith that Patagonia would be able to prioritize things like worker well-being and funding climate action as a public company.” **
And, he was intent on assuring that the successor owner would have the same commitment and dedication to his vision for Patagonia.
So, he and his family chose "none of the above." They chose a new answer. They chose to give the company away. ***
As Chouinard put it, "Instead of 'going public,' you could say we’re 'going purpose.'”
- The Patagonia Purpose Trust is the new owner, "created to protect the company's values."
- Profits from Patagonia's operations will go to the Holdfast Collective, a nonprofit dedicated to fighting the environmental crisis and defending nature.
“I never wanted to be a businessman," explained Chouinard. "Now I could die tomorrow and the company is going to continue doing the right thing for the next 50 years, and I don’t have to be around.”
Fascinating answers to the questions facing all owners.
And a good reminder that as the owner, not only do you get to decide, you even can come up with new kinds of choices.
* "Why Patagonia’s don’t-call-me a-billionaire owner is giving everything to a climate fund," Conor Pope, Consumer Affairs Correspondent, The Irish Times, September 17, 2022
** "Billionaire No More: Patagonia Founder Gives Away the Company," David Gelles, New York Times, September 14, 2022
*** Earth Is Now Our Only Shareholder, Yvon Chouinard, Patagonia website