On this blog, I would like to contrast between the methods and purposes of philanthropy done by Yvon Chouinard (and the Patagonia company- in general) and those done by other rich people (mostly billionaires). What is philanthropy? according to Merriam Webster online dictionary definition, philanthropy is “goodwill to fellow members of the human race”, and also “an act or gift done or made for humanitarian purposes” (Merriam-Webster.com, 2022). We can see that in the two definitions, the essence of philanthropy is to create goodwill, spread it to others maintain or uplift the humanity of BOTH the giver and the receiver.
It is on this purpose that I can say I contrast the works of philanthropy done by Patagonia, Inc. since 1980’s. Yvon personally lead the company, saying:
“In 1986, we committed ourselves to donate 10 percent of profits each year to these groups. Later we upped the ante to 1 percent of total sales, or 10 percent of pretax profits whichever is greater. We have kept that commitment, boom or bust.” (Chouinard, 2006)
What is interesting was to me two-fold: first this was done in that era, a period in American ( and perhaps western hemisphere economic thinking of corporate greed and excess), and that they committed, not because of external pressures or shareholder requirements (Patagonia is not a public company until today), but because the leader felt it was right. The second thing is this is interesting to me is because of this statement by Yvon:
“…we began to make regular donations to smaller groups working to save or restore habitat, rather than giving the money to large NGOs (nongovernmental organization) with big staff, overheads, and corporate connection.” (Chouinard, 2006)
This tells me that even then, Patagonia knows that the best worth and maximum effect of their donation dollars is to focus on small, dedicated environmental groups that really do their only agenda – do everything they can to help save the environment.
This is in contrast to the way other large companies today donate. In one Youtube video by Jake Tran that I watched (see reference list), philanthropic actions (every subject of philanthropy) had been twisted and hijacked all in the name of tax-avoidance – hence, higher profit. What basically happens is that these companies (mainly in the US) set up foundations – which I think is an extension of their corporate body, a “child of the corporation”, if you may. Then the corporation (and mainly the founders) direct donations of corporate money directly to the foundation. Two things now happen: The foundation can do whatever it wants with the money, it is not subject to accounting rules of the federal government. Especially with “donor-directed” foundations, where the money is directly controlled by the donor (a.k.a. the founder of the company in most cases), then a little imagination can tell you that the “donor” just made the money tax-free. So that means that government money that can be allotted education, healthcare, infrastructure has been reduced.
A more ominous note is the WHY of these corporate philanthropists. In an article from the New Statesmen I read, author Sally Haslanger noted that :
“Large-scale philanthropy is an exercise of power that is fundamentally undemocratic. Since charitable giving brings tax benefits, large-scale philanthropy can undermine the people’s will in favor of the donor’s own values. In effect, taxpayers subsidize the freedom of the rich to realize their own vision of what is good while simultaneously depriving democratically chosen programs of valuable public funds.” (Haslanger, Harrison, Hooper, & Hame, 2021)
If you think deep enough, you will come to the conclusions that these billionaires and foundations that they have built are really just their way of shaping the world, and worldview, in the image they want. I can say that some of them are the biggest megalomaniacs of our time, and their agendas, expressed through their selective funding of projects THEY PERSONALLY selected, is a bane to us a society. (Tran, 2021)
References :
Chouinard, Y. (2006). Let my people go surfing. Penguin Books.
Haslanger, S., Harrison, A., Hooper, D., & Hame, R. (2021, September 9). Retrieved from www.newstatesman.com: https://www.newstatesman.com/politics/2020/10/problem-philanthropy:Large scale philanthropy is%20an,of%20the%20donor’s%20own%20values.
Tran, J. (2021, September 8). Stop donating to charities. Retrieved from Youtube: https://www.youtube.com/watch?v=FXWVX7RNp50
10 March 2022 at 1:17 pm
Review March 10 KM
19 March 2022 at 2:46 am
Hello there,
Thank you for very informative post! I have always wondered about the drive for corporate companies to continuously ask for donations from their patrons, rather than donating from only their own profits. In some cases, there are some that do accept donations from their customers to receive a tax break. Personally, I do not like to donate through Wal-Mart. I refuse their offer every time. I should mention that I do agree that Patagonia is not one of the corporate companies does is solely for the tax break.
One article written on October 13, 2021 by Eva Matzka (a Marketing Executive) was quite eye opening for me. This article highlights the fact that in the 20th century “community development and social responsibility was recognized as going hand in hand with business and success.” (Matzka, 2021). The type of perspective that she has with the connection with marketing, corporate social responsibility (CSR), and corporations giving to charity. When companies take initiative to ask for donations from their customers if they name one of their products to support a movement, they often have to ensure that they do it in a way that doesn’t draw public scrutiny. As an example, Matzka uses the incident of an Australian food company releasing an LGBT sandwich for the 2019 Pride event. What they thought would be a way to appeal to their customers actually had them in the boiler as patrons felt that they were doing it as a PR stunt and they were also accused of tokenism. Matzka says that this may be perceived as “piggybacking on a movement to raise your business profile.” (Matzka, 2021). I think that companies like this do deserve to be “called out” and I think that with the power of social media helps us to do so.
The great thing about your post is that you share just how in-depth Patagonia goes to support their charities. They donate whether they’ve profited or not, which I think speaks volumes. I had no idea that they did that. I was a bit bothered when I read that they didn’t care to lose customers if the sizing wasn’t completely inclusive, but now I can see that their business model is really focused on corporate social responsibility. I really enjoyed this part of the book club, so nice to see how one company can do so much for them without all of the publicity.
References
Matzka, E. (2021, October 13). What are the benefits of corporate donations to charity? Retrieved from goodbox: https://www.goodbox.com/2021/10/why-do-companies-give-to-charity/