Several news outlets reported this week that the outdoor clothing and equipment company Patagonia has begun rejecting certain clients who wish to co-brand with them, choosing instead to accept only new business from companies who align with Patagonia’s corporate mission. Simply stated, Patagonia’s mission asserts:
Evidently, Patagonia’s new position came to light when a New York based public relations executive, Binna Kim, had an order of Patagonia clothing rejected for one of her clients. Kim represents firms in the financial services sector: hedge funds, banking and wealth management organizations - that is to say, not traditionally triple-bottom-line-focussed entities.
While saying they had nothing against such businesses, Patagonia’s position was apparently explained to Kim indirectly through a retail partner. Kim was told that the outfitter is “focused now on only co-branding with a small collection of like-minded and brand aligned areas; outdoor sports that are relevant to the gear we design, regenerative organic farming, and environmental activism.”
At the time of writing, Patagonia’s press page doesn’t mention anything about curtailing co-branding clients, though the policy does appear to be official otherwise. According to reporting in the San Francisco Chronicle, the company had told the newspaper, “Patagonia is starting to weed out certain corporate clients to focus on customers that ‘prioritize the planet.’”
The Chronicle goes on to say that as a B corporation, Patagonia now is signing up as co-branding partners only fellow certified benefit corporations, as well as members of 1% for the Planet, an eco-conscious business association.
As a quick refresher, Certified B Corporations “are businesses that meet the highest standards of verified social and environmental performance, public transparency and legal accountability to balance profit and purpose,” while 1% for the Planet members give at least 1 percent of their annual sales to approved environmental non profits.
Practicing what you preach is an admirable position to take, and because Patagonia is a private company, it doesn’t have to worry about Wall Street’s opinion on company policy - which in this case would be likely to diminish future corporate sales opportunities. Publicly traded companies would probably find it more difficult to turn down orders on such a point of principle.
It is not only the financial services sector being denied that stylish co-branded Patagonia fleece. The California-based company has also been popular with Silicon Valley tech companies. But by the definition of the type of clients Patagonia said it would be prepared to co-brand with in the future, tech employees may soon be out of luck in scoring Patagonia garments as part of their wardrobes.
That being said, the Chronicle points out that being in the financial services sector and being a B Corporation are not mutually exclusive conditions, as the newspaper cited a few businesses that would meet Patagonia’s shared mission. For example, Obvious Ventures - an investment and venture capital company that strives to work with companies that have a positive social and environmental benefit - is a certified B Corporation. Many investment funds that have a focus on environmental stewardship, or those that seek to boost opportunities for women or people of color, could also find themselves in lockstep with Patagonia.
But the overarching point is that Patagonia’s mission-aligned stance could be an economically sustainable one, such that they will be still be able to find clients in sectors not traditionally associated with the sustainability world. It also makes sense from a branding perspective to walk the walk and avoid any hypocrisy Patagonia may encounter in supplying clients with their logo when these businesses’ conduct run counter to the company’s mission statement.
In any case, the shift is transitionary, as co-branding sales are unlikely to drop off a cliff for the company. It appears Patagonia isn’t turning its back on doing business with non-aligned partners entirely, since reporting suggests that the change in policy won’t affect customers who are already part of its corporate sales program.
Image credit: Patagonia/Facebook
Phil Covington holds an MBA in Sustainable Management from Presidio Graduate School. In the past, he spent 16 years in the freight transportation and logistics industry. Today, Phil's writing focuses on transportation, forestry, technology and matters of sustainability in business.