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Sustainability has driven innovation at outdoor equipment giant Patagonia for decades, ever since founder Yvon Chouinard reinvented fundamental mountain climbing gear to minimize his company's impact on the rock faces of Yosemite National Park.
The translation of those core philosophies into legal documents and measurable goals, as part of the formal conversion to a benefit corporation, has been a journey.
Crafting the mission: Initially, Patagonia questioned how - and in what level of detail - its philosophies should be ingrained in its benefit corporation structure, which was established in 2012.
Some advisers argued against committing to a higher level of specificity. But shareholders instead agreed on a set of commitments that, among other things, encourages sharing proprietary information with direct competitors to "produce a material positive impact on the environment," said Hilary Dessouky, the company's general counsel.
The company's leaders and shareholders "wanted it to completely memorialize, in a really impenetrable way, the things they cared most about," she said.
Patagonia's commitment to specificity now provides a backbone for some of the company's boldest decisions, such as encouraging contractors to provide child care for their employees or demanding that manufacturers in Taiwan return extorted fees to workers. The company also donates 1 % of sales to environmental not-for-profits.
"It's really challenged the company to more publicly and more formally state the way that the company's evaluating itself," said Yvonne Besvold, the company's vice president of finance and treasurer. "It gives you that ability to really understand some of the resources needed and some of the changes that you're going to make."
Implementation and assessment: Patagonia dedicated a core team of four people to make regular reports on its stated...