Yvon Chouinard, founder of US clothing company Patagonia, has given away the company to a charitable trust focussed on fighting the climate crisis.

All money made by the company that is not reinvested back into Patagonia will now be distributed as dividends to help its mission of protecting the planet.

Mr Chouinard said: “It’s been a half-century since we began our experiment in responsible business. If we have any hope of a thriving planet 50 years from now, it demands all of us doing all we can with the resources we have.

“As the business leader I never wanted to be, I am doing my part. Instead of extracting value from nature and transforming it into wealth, we are using the wealth Patagonia creates to protect the source.

Yvon Chouinard, owner of Patagonia who has just given away the company to support the enviroment

“We’re making Earth our only shareholder. I am dead serious about saving this planet.”

The Chouinard family has transferred all ownership to two new entities: Patagonia Purpose Trust and the Holdfast Collective.

The Patagonia Purpose Trust, which now owns all voting stock (two per cent), was founded to “help to facilitate what the company continues to do best: demonstrate as a for-profit business that capitalism can work for the planet.”

All nonvoting stock (94 per cent) is now owned by the Holdfast Collective, which will also receive all Patagonia’s non-reinvested profits.

The Holdfast Collective is a non-profit organisation which aims to “protect nature and biodiversity, support thriving communities and fight the environmental crisis.”

Patagonia projects that it will pay out an annual dividend of roughly $100 million to the Holdfast Collective, depending on the health of the business.

Ryan Gellert, CEO of Patagonia and Patagonia board member said: “Two years ago, the Chouinard family challenged a few of us to develop a new structure with two central goals.

“They wanted us to both protect the purpose of the business and immediately and perpetually release more funding to fight the environmental crisis.

“We believe this new structure delivers on both and we hope it will inspire a new way of doing business that puts people and planet first.”Ryan Gellert will continue to serve as CEO of Patagonia, and the Chouinard family will continue to sit on the company’s board.

Billionare founder of Patagonia gives away company to charitable trust