As a pioneering rock-climber during the 1960s, Yvon Chouinard began a small business to make and sell better climbing equipment to fellow climbers. He first sold his wares out of the trunk of his car, but one thing led to another, and by 1970 Chouinard’s business had become an outdoor apparel company called Patagonia.
Today, the company is owned by Yvon, his wife Malinda, and their two adult children. It’s valued at $3 billion!
But the Chouinard family are reluctant billionaires and recently spent close to a year figuring out how to divest themselves of their company. “I didn’t ever want a company or to be a businessman,” exclaimed Chouinard in a recent interview with The New York Times.
The family’s plan made headlines with an announcement that they transferred the voting shares of their company (about two percent of its total value) to a trust. The remaining 98 percent of their company’s common shares were donated to a nonprofit called the Holdfast Collective, which will also receive the company’s $100 million in annual profits.
Some will point out the obvious tax advantages to this strategy. Although the Chouinard’s will pay taxes on the shares they transferred to the trust, they would have paid capital gains tax had they sold the company outright. Additionally, had the parents willed the business to their children, they could have paid as much as 40% of the company’s value in gift and estate taxes.
But regardless of how their tax burden was reduced, the fact remains that the Chouinard’s gave away Patagonia and the bulk of their assets, and in doing so, have established themselves as among the most charitable families in the world.
Debates about the principles the Chouinard’s used to make their decision are inevitable. But in my opinion, what’s undeniable is just how impressive the stand this family has taken. It’s hard to imagine walking away from a company worth $3 billion. By any standard, it required an incredible depth of conviction!
It leaves me wondering, “Could I give up $3 billion?” My answer on paper is an easy “Yes!” but I know my own shiftiness well enough to see how I could probably either employ delay tactics or make excuses about why I should keep the money.
If you can relate, then leverage your self-doubt to do some diagnostics on your convictions. What is the purpose of wealth? How much is enough for you? For your family? For your neighbor? Is there ever such a thing as too much?
More deeply, push hard against the basic Christian tenant that God’s got you in Christ Jesus—no matter what. Imagine yourself bankrupt of not just your possessions, but even of life itself. At the end of your everything, has God got you? Or not?
Yes, there’s a gap between your answer and how you live. But whether you could walk away from $3 billion depends on how wide the gap is between your conviction and how you live it out. And this means that you don’t have to wait for $3 billion to land in your lap to know how you’d respond. Your current assumptions about wealth and corresponding actions are already great indicators.
Already giving freely? Then you could likely part with $3 billion.
Does giving tie a knot in your stomach? Then it’s time to get to the bottom of just who or what is at the end of your everything.