The Future of the Responsible Company

I’ve just read Patagonia’s book, The Future of the Responsible Company, about the lessons they’ve learned from their first 50 years. (By the way, you should definitely read Let My People Go Surfing even if you’re not too fussed about eco stuff. If you prefer podcasts, this one about Patagonia’s eco-mission is excellent, as is this one about Chouinard.)

If you run a business, work for a business, or buy stuff from a business, Patagonia is a fascinating company to pay attention to.

Here are some of the notes I took:

• The company’s longtime purpose statement is: “To build the best product, cause no unnecessary harm, and use business to inspire and implement solutions to the environmental crisis.”
• Or more simply: “We’re in business to save our home planet.”
• “Our new North Star is to do better than doing less harm or becoming carbon neutral. We could give back to Earth as much as or more than we take—we could do positive good.”
• “In 1960, humanity consumed about half of the planet’s potential resource capacity. By 1987, we exceeded it. 25 years later, we were using the resource capacity of one and a half planets. Now we are using the resource capacity of one and three-quarter planets.” (See also: Earth Overshoot Day.)
• “Those who watch the forest being cut and raise their voices against it cannot be heard when the company that cuts the trees does not belong to the community. When local politics becomes subservient to distant economic power, the concept of citizenship—of its duties and possibilities—loses its meaning. The human commons loses its value. It too becomes desert.”
• “In 2021, the Biden administration embraced a worldwide initiative called 30×30, which calls for conservation of 30% of the globe’s marine and terrestrial habitat by 2030. The biologist E.O. Wilson went further, calling for a Half-Earth approach to preserve 50% of the Earth’s land and oceans by 2050. As of 2022, only 17% of the Earth’s land and 8% of its oceans are protected.”
• “Everyone wants to have meaningful work, but what exactly makes work meaningful? And what does meaningful work have to do with the responsible company?”
• “We learned that we could inspire our customers to do less harm simply by making them aware of the problem and offering a solution. We also learned that by addressing the problem, we had forced ourselves to make a better product.”
• “Three important lessons: A grassroots effort could make a difference. A degraded habitat could, with effort, be restored. And the natural world wasn’t just in faraway, silent places—nature still lived outside wilderness, even in our funky oil and ag town, and we could help give it some space to thrive. We had a responsibility to do so.”
• “It dawned on us that we were failing as a business to lead an examined life. It turned out we didn’t know how to make clothing responsibly. What other harms were we causing?”
• “What’s certain is that any 21st-century business seeking to keep customers and make new friends will need to improve the environmental and social performance of its products.”
• “What makes a company responsible? Should it have a healthy balance sheet, provide for the well-being of its employees, make excellent products, be a good force in the community, protect nature, and even revive or recharge natural systems? We think that a responsible company bears all those obligations.”
• “Externalities are everything a company does that someone else has to pay for—socialism for capitalists. Externalities include community blight when an employer moves on, or a company’s contribution to atmospheric carbon or to oceanic gyros of degraded plastic the size of Texas.”
• “Over the coming decade, we will, like all companies, need to be nimble enough to navigate new ‘natural’ disasters—weather chaos, pollution, shortages, viruses—while owning our responsibility to our workers and fellow human beings.”
• “Every company needs to ask itself: Where are we local? And what are our obligations to those places we call home? What businesses do matters to communities. A company’s decision to put down roots or pull out directly hurts or helps the local citizens.”
• “Our immediate responsibility is to reduce the harm we do in our daily work and take Cradle to Cradle responsibility for what we make and what bears our name.”
• “It is time to separate economic health from economic growth—at least the kind of growth that requires ever-increasing extraction of natural resources. It is not pie in the sky to say so. Germany, Japan, and China, among other governments, have made it their policy to create circular economies that promote reduction, reuse, and recycling of materials. The United States needs to build its own circular economy. This would require eliminating government subsidies and tax breaks for industrial agriculture as well as oil and gas production and other non-renewable resources so that prices would reflect true costs. The U.S. Treasury, for example, pays $2 billion a year to support the price of chemically intensive conventional cotton grown in California and Texas. What if the Treasury moved that subsidy to regenerative agriculture—to support growing food that’s good for people and the planet?”
• “For a comprehensive self-examination of your business, we strongly recommend you take the B Impact Assessment. More than 150,000 companies have already done so, many as a first step toward becoming a B Corp.”
• “Signing up to the 1% for the Planet program is a great idea.”
• “Deciding what to tackle first is never easy, but try applying the 80/20 rule: If 20% of your products or services generate 80% of your sales, analyzing those products will gauge the lion’s share of your impact.”
• “As a CEO of any company experimenting with change, you could undertake greening in three steps:
  1. Engage your team to find out the worst things your company does, what costs you the most in reputation and profit, and what will be the easiest problem to correct.
  2. Get together with your team to name priorities for improvement based on your assessment. Use the 80/20 rule to help define what initial success will look like. Condense that vision into one page.
  3. What does your company now know that enables you to take the next step that may have been out of reach before but suddenly is within sight?”
• “Expect internal resistance at first, depending on what you try to do. The poet William Stafford once wrote that no poem should begin with the first line the reader can argue with. Get your people nodding in full agreement a few times before you say something that challenges the half-sleep of received wisdom.”
• “Know your impacts, favor improvement, and share what you learn.”
• “Younger people sometimes approach us for career advice, which we’re reluctant to give… Advice we can give: Explore what kind of work the world needs now.
• The 17 UN Sustainable Development Goals are almost ludicrously aspirational. Among them: end poverty in all its forms, ensure clean water and energy, make cities livable and inclusive, and change the patterns of consumption that are the root cause of climate change, biodiversity loss, and pollution. Do not dismiss these goals for the scale of their ambition. This is the work that needs to be done.”
• “The aim of the 2017 book Drawdown, edited by Paul Hawken, was to lay out a comprehensive plan to displace enough carbon emissions by 2050 to prevent a rise of more than two degrees Celsius in global temperature. For those who want to do useful work, Drawdown is a good survey of what’s both necessary and feasible.”

The book finishes with checklists for your business to tackle and teaching / discussion guides that are worth exploring. Here’s one of them: