[Reporter’s Reading] 1% of Sales as an 'Earth Tax'... Patagonia, a Company in Harmony with Nature

[Asia Economy Reporter Byunghee Park] At an altitude of 811m, Insubong Peak of Bukhansan Mountain is the second highest peak after Baegundae (837m). However, unlike Baegundae, Insubong does not allow general hikers. It can only be climbed by rock climbing. Among the rock climbing routes on Insubong, there are paths called 'Chouinard A' and 'Chouinard B,' named after Yvon Chouinard (82), an American rock climber and environmental activist.

Chouinard served in the US military stationed in South Korea in the early 1960s. "After basic training, I hastily married a woman from Burbank and was immediately deployed to Korea. (Omitted) With more free time, I secretly left the workplace and began climbing the smooth granite peaks north of Seoul with some young Korean climbers."

The smooth granite peak Chouinard mentioned is Insubong. He was a natural mountaineer. "In 1964, I miraculously received an honorable discharge. Upon returning home, I headed straight to Yosemite Valley."

Patagonia is an American outdoor company founded by Chouinard in 1973. Patagonia is also the name of the region at the southernmost tip of South America, bordering Chile and Argentina. It is a very windy area, with maximum wind speeds often exceeding 60m/s. Chouinard lived a life in harmony with this powerful force of nature.

'Patagonia, Let My People Go Surfing' is Chouinard's management guidebook applying his life philosophy to business. He grew Patagonia into a global company. After 15 years of effort, he published the book in 2005. A revised and expanded edition was published in the US in 2016, and Lighthouse recently translated and published it domestically.

The book is divided into two main parts: history and philosophy. About 30% of the total volume covers history, which is about Chouinard's own life and thus Patagonia's history. The philosophy section explains his corporate management philosophy divided into eight areas: product design, production, distribution, marketing, finance, human resources, management, and environment.

Chouinard was born in Lisbon, Maine, USA, in 1938 and lived there until moving to California in 1946. Maine is a rural area in the northeasternmost part of the US. Chouinard learned climbing alongside walking. At six years old, he became deeply fascinated by fishing, following his older brother. As he revealed that he miraculously discharged from the military, he had many problems during school. He was uninterested in classes and often wrote apology letters. To write them quickly, he even developed a technique of tying three pencils together with a rubber band to write simultaneously.

At fifteen, Chouinard joined a hunting falcon training club. One of the members was a climber. From then on, whenever he had time, he climbed rock walls. He survived several near-death experiences. From 1957, when he was nineteen, he learned blacksmithing to make climbing equipment himself. He set up a workshop called 'Chouinard Equipment' in his backyard.

At that time, pitons used as anchors in rock climbing were made of mild steel. Once hammered into rock, they were difficult to reuse. Climbers left pitons hammered into the rock as they climbed.

Chouinard made pitons that could be used multiple times. The material was the blade of a harvester made of chromoly steel. His pitons sold for $1.50 each, while the commonly used mild steel pitons cost 20 cents. This was an environmentally conscious choice. The piton business became the core of Chouinard Equipment. However, realizing that the strong pitons actually damaged the rock, he discontinued the piton business in the early 1970s.

The opening of Patagonia's Boston store in 1988 became a turning point for making products only from organic cotton. Shortly after opening, some employees complained of headaches. Investigation revealed that formaldehyde, a chemical, was emitted from cotton clothing. Since then, Chouinard has been concerned about whether his products harm the environment. From 1996, he made products exclusively from organic cotton.

Patagonia donates 1% of its annual net sales to environmental organizations under the name '1% for the Planet.' This so-called 'Earth tax' was introduced at Chouinard's suggestion. In 2016, Patagonia donated 100% of sales generated after Black Friday, totaling $10 million. Despite this, Patagonia has continued to grow. Even Chouinard says it is ironic that Patagonia has become a large company he never dreamed of or wanted.

Chouinard views companies as having dual aspects. Companies become enemies of nature, destroying indigenous cultures, exploiting the poor to enrich the wealthy, and polluting the earth with factory wastewater. On the other hand, companies produce food, cure diseases, employ people, and generally improve our quality of life. Chouinard believes companies can do good while making profits without abandoning reason and soul, just like Patagonia.

The original purpose of Chouinard writing the book was to explain corporate philosophy to Patagonia employees. After publication, the book was translated into ten languages and used as a textbook in high schools and universities.

Harvard University studied Patagonia as a research subject. The question was how his philosophy, which prioritizes the earth and environment and seems to go against capitalism, could lead to business success.

(Patagonia, Let My People Go Surfing / by Yvon Chouinard / translated by Youngrae Lee / Lighthouse)