Yale School of Management

Program on Social Enterprise

Harnessing business skills and markets to achieve social objectives.

Grow from Values: Lessons in Sustainability and Growth at Patagonia

The world is faced with a two-pronged crisis from environmental devastation and social inequality, according to Vincent Stanley, and all actors - governments, businesses, and non-governmental organizations - must play a role in response, not only by reducing their harm but also by working proactively to restore the planet.

Stanley, currently Director of Philosophy at Patagonia (which he joined more than 40 years ago) and an Executive Fellow at the Yale Center for Business and the Environment, shared his thoughts on Patagonia’s evolution towards sustainability and environmental activism, the role of business in improving the planet, and challenges for the next generation of business leaders during a January 23rd visit to Yale SOM’s Social Impact Lab.

The Evolution of Sustainability at Patagonia

Though widely recognized today for its leadership in corporate sustainability and activism, Patagonia wasn’t always an environmentally-minded enterprise. Stanley described early conflicts among players at Patagonia; finance teams aimed to maximize the bottom line, product designers focused on creating best-in-class gear, and tree huggers lobbied for grassroots environmental organizations. But after switching to organic cotton in its apparel 20 years ago, the company began a gradual evolution, with questions about the impact of its materials leading to reflection about Patagonia’s role in soil degradation and its effects on animal welfare, farming communities, and worker welfare.

Today, Stanley says, sustainability is a shared commitment at Patagonia and is adopted as a responsibility throughout the company. “If I’m a product manager at Patagonia now,” Stanley describes, “I know that I have to meet my sales goals, my marketing goals… but I also know that I have to make more of my styles fair trade certified, I know that I have to eliminate the toxic water repellent that we use on nearly all of our garments. I know that if I’m making fleece then I have to address the problem of micro-pollution. I’m responsible for that, and my team is responsible for that. I’m not relying on somebody else in the company to slap my hand and insist that I take care of the problem. It’s not a question of compliance. It’s a question of my real commitment and real effort.”

Sustainability at Patagonia is multi-faceted. First, it aims to do less environmental harm with its products, moving to more sustainable sources and suppliers. But not only does the company want to cause less harm, it also takes seriously its commitment to restore the planet. For Patagonia, that means engaging with suppliers to improve pay and labor practices, working to replenish soil and lands, and taking a leadership position in industry by partnering with other firms to establish the Fair Apparel Coalition and lobbying the federal government to protect public lands.

The Business Case for Responsible Companies

Though Stanley views Patagonia’s actions as worthwhile and necessary on their own merit, they often contribute to the company’s bottom line as well. “When we do the right thing,” Stanley says, “we often have some business benefit.” Actions that may have initially appeared risky, like the move to organic materials or the company’s activist stances, have engendered customer loyalty, improved employee engagement and retention, and sparked innovation. Some customers take loyalty to the extreme – a new receptionist at Patagonia was surprised to receive a call from a customer asking to leave the company money in his will.

Grow from Values, Address Problems Head-On

Stanley’s experience at Patagonia yielded several insights for the SI Lab audience on using business as a force for social and environmental good. First, it’s critical that growth be rooted in values, not in conflict with them, and that a firm’s actions be consistent with its values from an early stage. Socially-minded companies must also build a culture that reinforces values – at Patagonia, the company’s environmental commitment has created positive feedback loops, with customers, NGOs, and the world at large holding it accountable, instilling in the company the confidence needed to pursue further environmental initiatives.

On a more personal level, Stanley described the importance of taking action in response to the massive contemporary crises: “at some point, we’re all going to face very baldly that there is a real environmental and social crisis, that it is going to affect the way we live in the world,” Stanley said. “The best way to deal with that – the most human way to deal with that – to feel agency and to feel a sense of hope and responsibility, is to actually take those problems on rather than push them to the side.”

Stanley concluded his remarks with a call to action for students: “I think it’ll be your work, and the work of everyone who’s involved in business or NGOs or government, to figure out how to meet our needs by making things that are not bad for the planet, and in a way that creates positive good… I think that’s the task ahead.”

By Bryan Fike, MBA ‘20

Bryan Fike

Explore. Discover. Connect.