Catch Up Quick on Perpetual Purpose Trusts

A new organizational form, "steward ownership" could be on the rise in the US

Last year Patagonia’s owner converted the company into a purpose trust. As explained by the authors at ImpactAlpha:

“The Patagonia Purpose Trust will own all of the company’s voting stock (2% of the total stock). The Holdfast Collective, a new nonprofit organization, will own the other 98% of non-voting stock. Profits not reinvested into the business will transfer as dividends to the collective to finance nature-based solutions and biodiversity protection. Ventura, Calif.-based Patagonia will remain a B Corp. and continue to donate 1% of sales to grassroots activists.”

Learn more here:

• First, a primer on purpose trusts from June 2022 by the Purpose Foundation, now called Common Trust, a partner of EO+WD. Exiting to Employees Through Ownership Trusts.

• Second, a Medium post on Patagonia, purpose trusts, and steward ownership from Purpose Foundation in response to the sale: “The Patagonia Structure in the Context of Steward-Ownership.”

• Third, EO+WD maintains a public available database of ownership trusts in the United States. You can access and contribute to that data on our Harvard Dataverse instance.

• And if you’d like to go straight the source, here is Patagonia’s press release, “Earth is Now Our Only Shareholder.”