The Accidental Capitalist

HE TELLS PEOPLE NOT TO BUY HIS PRODUCTS.

HE DOESN'T SHOW UP AT WORK FOR MONTHS

AT A TIME. NO WONDER WON CHOUINARD IS

AMERICA'S MOST UNCONVENTIONAL CEO

It's not easy to get ahold of Yvon Chouinard, the legendary climber, adventurer and founder of Patagonia, the wildly successful apparel company headquartered in Ventura, California.

He s 74 years old, tit, rich and very cranky about the destructive

smudge humans continue to lay on the planet. His efforts to mitigate the damage by making his company and others ecologically responsible have cast him as the Galahad of the green revolution. And it turns out, saving the environment is a good excuse to be out in it: Chouinard spends six months a year out of touch around the world—wherever the surf is good and the fish are biting.

"We haven't seen him in five months," said his assistant when I called. "He's off surfing and fishing somewhere. He doesn't own a cell phone. There's no way to get in touch with him."

I met Chouinard 30 years ago in Moose, Wyoming at his house—a log cabin with a chimney made of river rocks set in a way that allowed his then eight-year-old son and three-year-old daughter to learn to climb to the top. I spent three days there with Yvon and his wife, Malinda, whom he met during an argument over a Yosemite campsite. We talked about his days in that famous cathedral of rocks where he and a ragtag gang of lost boys authored the first climbs of El Capitan, Half Dome and other famous monoliths in the valley. It was there, out of the trunk of his Chevy, that he used a portable forge to hammer out pitons for his climber friends, his first business.

I still had the number for the cabin, and I dialed it on the off chance that I might catch him there. He doesn't own an answering machine, so it rang till I gave up. I phoned half a dozen times over the next two weeks, until one afternoon

in September Malinda answered and called Yvon to the phone. He was stopping there for a week before heading to New Haven for

a panel at Yale University to discuss his new book, The Respon­sible Company. Then he was off to fish in Canada for a month. We made a date to meet in early November in Ventura.

The Yale appearance took place in a wood-paneled theater-style classroom that held 500 adoring students. They watched

as a moderator introduced Chouinard, who was wearing a travel-anywhere Patagonia sports coat, one of more than 600 products the com­pany manufactures and sells. Also on the panel was the book's co-author, 61-year-old Vincent Stanley, novelist, poet and marketing direc­tor of Patagonia. He is also Chouinard's nephew, and his face, though less sun-weath­ered, bears a resemblance. This wasn't Chouinard's first trip to Yale. In 1995 its school of forestry awarded him an honorary doctor of humane letters degree for his work on many eco projects. When he received the let­ter announcing the award, he was cranky as usual, but

his response was tinged with the wry humor that often accompanies his crankiness.

"They didn't know what to give me because I didn't have a degree in anything. So when they said humane letters I told them I didn't even like hu-

mans. It was really just a smart remark."

A smart remark, sort of, but with an undercurrent of cynicism evinced by the fact that he will tell you evil is stronger than good.

"I still believe that," he says. "Whether or not it's true it's a good way to think. It keeps you from getting hit in the back of the head. Like I've said, if you want to do good, you actually have to do something. Good doesn't just happen; evil does, without your doing anything. It's all around us. In sports, for instance, you're always being pulled to cheat, to make it easier to get one up on somebody else, whether you're doping or using extra-sticky rubber on your climbing shoes. You have to resist it, and if you want to do good you actually have to act."

He has designed his company to be an ongoing act for good, and the book he and Stanley were at Yale to discuss is a detailed blueprint for bringing companies toward the Patagonia model: a laid-back, committed and enlightened approach to corporate con­sciousness that brought the company $600 million in sales last year. Patagonia has 1,500 employees worldwide and 900 applicants for ev­ery job. It's been described as more of a movement than a business.

The Responsible Company includes chapters on pay and benefits, transparency about products' social and environmental impact, en­ergy use and reducing toxins, a point Stanley illustrated by holding

up his ring finger: "To make a wedding ring generates 20 tons of mine waste," he said. The second half of the book contains guidelines that detail how companies can move toward the corporate responsibility that Chouinard champions with the evan­gelical energy of a tent preacher.

" I hate the word sustainable," he told the audience. "Responsible is the word I use. Society is always pushing us to exceed our resources. We're not citizens anymore, we're consumers. We don't have to stop being consumers; we just have to become better consumers."

To make the point, on Black Friday in November 2011 the company had run an ad in The New York Times that featured a photo of a Patagonia coat and the headline don't buy this jacket. It was part of a part­nership called Common Threads, which urges customers to buy only what they need and promises to fix or recycle what­ever wears out or is unusable.

Regarding the weak economy, Chouinard told the students, "I love recessions. During this last recession (continued on page 128)

R C C ID EnTR L C R PITR LI5T

(continued from page 106)

we've never had such growth. People be­come conservative. They'll buy products that last a long time. We have loyal cus­tomers. We let them tell us how big we should be and what to make. We grew 30 percent last year. This year we de­cided that's too much and we're going to go for 15 percent. The truth is that ev­ery time we've done the right thing, it's made us money."

On politics he again turned cranky and provocative. "The United States is too big to govern," he said. "Califor­nia is the ninth-largest economy in the world. It should be its own country. We have a flawed Constitution. There isn't an emerging country in the world that wants to copy our electoral process."

The panel opened to questions, and the subject turned to how Patagonia en­listed 50 of the world's largest clothing companies (including Walmart, Levi's and Nike) to create the Sustainable Ap­parel Coalition, which is developing the Higg index—a rating system that will al­low buyers to compare products' envi­ronmental impact.

"The index gives ammunition to the consumer," Chouinard tells me later. "They can look at five pairs of jeans on a table, and if one is a two and the other a 10, they'll be able to tell which was made more responsibly. I think the coalition is the most exciting thing we've done."

Chouinard was born in Maine to a tough, mechanically talented French Canadian father and an adventurous mother, and for his first seven years he spoke only French. In 1946 the family made a Grapes of Wrath-sly\e trip in an old Chrysler to Burbank, California.

Speaking no English and stuck with a girl's name, he had a hard time in gram­mar school. He was an all-around ath­lete in high school but found what would become lifelong passions in the solitary sports of fishing, climbing and surfing.

He is a small man—five-foot-four, about 140 pounds—and has a sense of humor about his size. When Yale asked him how they could improve the uni­versity, "I told them to lower the uri­nals," he says. "They are too high." He is nevertheless a smooth and powerful athlete: nimble, quick and tenacious on the tennis court, able to turn small waves into long rides in the water, and strong, graceful and daring—at a level of difficulty that would make spiders sweat—as a rock climber (one of the most celebrated in the world).

Chouinard began climbing on small rock piles around southern California and then moved on to hobo summers in Wyoming's Tetons, driving there in a 1940 Ford he'd rebuilt in auto shop. One summer he and a friend ate cat food and slept in an old incinerator they'd cleaned out. "I can sleep anywhere," Chouinard says. At 17 he fell in with a hard-climbing

bunch of Yosemite beatniks who were using soft-metal pitons, the spikes from which safety ropes are hung, to make the first climbs of the great valley walls. Chouinard, an obsessive toolmaker, got busy on a better mousetrap. He bought a junkyard forge and anvil, installed them in his car and began making harder, re­usable pitons out of chrome molybde­num, a material that made it possible for climbers to remove the pitons from the cracks after climbing past them. Euro­pean pitons cost 20 cents each and had to be left in the rock. Chouinard's hard­er spikes cost $1.50 but were reusable, and the enterprise began to pay for his climber's lifestyle.

These were the glory days of Yosemite climbing. The great granite faces of El Capitan, Half Dome and others still stood unclimbed. "We didn't know if these things could be summited or not," says Chouinard, looking back on the most perilous of the early big-wall efforts. "We had to face the fear of the unknown. We just went for it." He and the others rev­eled in the fact that climbing rocks that could kill you accomplished nothing. "It was the 1960s," he says. "We climbed

out of rebellion." They called themselves "conquistadors of the useless."

One of his most famous first ascents pushed him to his absolute limit and left him hanging in a hammock 2,000 feet up on the sheer, blank face of El Cap, his fingers so swollen he couldn't tie a proper knot, out of food, out of water, hallucinating. The route was called the Salathe Wall, after a legendary Yosemite climber and blacksmith.

Chouinard and climbing partner Tom Frost, carrying the minimum supplies they thought they'd need, spent nine days hammering, carving a way up— "becoming one with the rock in a way you don't get when you're up there for just a few hours or a few days," he says. "You're hungry and freezing and it be­comes like you're in the mountain. I love the big walls for that."

About the hallucinations he says, "There are different ways to get there, that deep Zen moment, but they all take a lot of time and effort. I've experienced it in the shed, at the forge, the repetitive pounding out of pitons one after anoth­er, then throwing them in a barrel. After a while the barrel starts to glow."

The tin shed he's talking about still stands among Patagonia's other build­ings in Ventura. He and Frost rented it from a meatpacking company and incor­porated as the Great Pacific Iron Works. They expanded their catalog into soft goods, including rugby shirts, jackets and shorts, as well as the climbing hard­ware, and in 1972 incorporated as Pata­gonia. The first employees were a dozen climbing friends.

Becoming a businessman has been a long struggle for Chouinard, who to this day calls businessmen "greaseballs" or "pasty-faced corpses in suits." Working with money, he likes to say, is "getting doo-doo on your hands," and Patagonia's early success embarrassed him in a way.

As Chouinard writes in his 2005 au­tobiography, Let My People Go Surfing, "The typical young Republican's dream of making more money than his parents, starting a company, growing it as fast as possible, taking it public and retiring to the golf courses of a leisure world has never appealed to me. My values are the result of living a life close to nature and being passionately involved in what some people would call risky sports. My wife, Malinda, and I and the other contrarian employees of Patagonia have taken lessons learned from these sports and our alternative lifestyle and applied them to running a company."

He takes great pride in being contrar­ian. "If I'd done all the things the busi­ness people have told me to do, I'd have gone out of business a long time ago," he says. "The only fun is breaking the rules and making it work. And since I own the company and have no stockholders, I can do what I want."

In fact, there was a moment about 20 years after he started the company when its runaway success came perilously close to sinking the business and forced Chouinard to put both hands deep into the doo-doo. Company earnings were $80 million, and it took galloping expansion to keep up with demand for the clothing.

"Those were the toughest times we ever went through," says Stanley, who as head of marketing was in charge of putting together the highly praised cata­logs. "It was 1991. We had very strong sales and were committed to growing. We launched new product lines. We had almost unlimited credit with the bank, and we were using it. Then the country went into recession, and our bank wasn't prepared and we weren't prepared. There was a cutoff of credit. We had too much inventory and not enough inven­tory control, and we had to let 20 per­cent of our people go."

Chouinard still suffers from the mem­ory of firing 120 people, many of them old friends. "It was absolutely a feeling of failure," he says. "It was certainly my fault. I took my eye off the ball, and we just got lost going for growth. Since then I've done everything differently."

In 2001 the good that Chouinard built into his business became a program called 1% for the Planet, which mandates

that one percent of company sales go to small environmental activist groups. Last year that amounted to $750,000 for Pa­tagonia, not including the contributions from individual stores, which now num­ber 60 worldwide. Today the program has expanded to include 1,300 other companies, which have contributed more than $45 million since its founding.

In the early 1990s Chouinard decided to examine the pollution and energy use involved in producing Patagonia's cloth­ing line. The company looked closely at the four major fabrics and all the dyes being used. It began to recycle plastic soda bottles to make fleece jackets. And in 1994 it made the risky decision that the only kind of cotton it would use in its clothes would be organic.

"It wasn't easy to make the transi­tion," says Chouinard. "Cotton had been grown for most of its 4,000-year histo­ry without the use of all the poisonous chemicals currently in the process. But we found there weren't many organic-cotton growers in the world. It's very la­bor intensive, and we knew it was going to be expensive."

Patagonia's cotton T-shirts cost an average of $10 more than conventional cotton shirts. Patagonia customers, how­ever, have been willing to pay the price.

Ventura is a beach town about 70 miles northwest of Los Angeles, and Chouinard chose it for his tin-shed forge because the local waves were good. He's been surfing here since 1958. He and Malinda own a house on the water, but these days he does most of his surf­ing about an hour and a half north at a place he calls the ranch—100 gated acres of pristine coastal hills dotted with huge old oak and eucalyptus trees where he built his dream getaway. It's a small three-bedroom house with a view of a perfect reef break 100 feet below that is accessible only from the private land or by boat. The 1,500-square-foot house was built to extreme green standards: Nearly all the wood and stone is recy­cled, and 600 toxic materials Chouinard says are ordinarily used in home con­struction were painstakingly excluded.

It's a handsome, comfortable place so energy efficient he's never had to heat or cool it. When I ask him how much it cost, he says, "The materials were nothing— broken sidewalk and old railroad-trestle beams. But the labor," he rolls his eyes, "I don't even want to know."

Chouinard had returned to Ventura for two reasons: because Patagonia's board of directors (which includes Yvon and Malinda and their two children, Fletcher, now 38, and Claire, 33) sched­uled a meeting, and because Claire was about to deliver his first grandchild, a girl named Arrow.

I've been to the headquarters prop­erty they call the campus half a dozen times over the years. I've watched it grow from two buildings to five, but the feel of the place remains pretty much what it

was 30 years ago. The fuel-efficient cars in the parking lot have surfboards and kayaks on roof racks for when the surf is up. The company flex-time policy al­lows employees to pursue their sports. Young staffers, dressed mostly in Pata­gonia, move without hurry past a sand­box and a large, grassy play area for the 50 kids, 16 months to five years old, who are part of the company's child-care program. All the 300 employees here, as well as 1,300 others around the world, full and part time, have health insur­ance. Women make up more than half the staff. Chouinard, who has two older sisters, says, "I think women are smarter than men, more intuitive, more loyal."

"The most amazing thing about this place," Vincent Stanley tells me the morning I arrive in Ventura, "is that it hasn't changed in 40 years. When I got here in 1968 it was this tiny culture of 20 climbers and surfers, and it had this feel­ing for equality and excellence that has survived into a company of 1,500 people with a very sophisticated management process. I think it's because Yvon and Malinda's spirit, and what they consider important, hasn't changed. And the day care," he points to three women shep­herding 15 preschoolers across a lawn, "which Malinda is instrumental in, is a big part of the reason for the feeling of community. It's hard to be hierarchical around kids. They soften the culture, keep us honest."

On the way across the campus I stop by the Quonset hut that houses Fletcher Chouinard Designs, where Yvon's son builds Patagonia surfboards. I'd heard Yvon complain for years about the shoddy quality of the boards he was breaking around the world, and 20 years ago his son began to design boards out of new, sturdier, nontoxic material. Son had followed father into risky sports, surfing big waves, 20- and 30-footers, including at Mavericks, northern California's noto­rious garden of breaking monsters.

"I really enjoy riding the big waves," Fletcher tells me as we talk over the noise of computerized machines grind­ing boards out of nontoxic Styrofoam. "Mavericks is a scary place, but it's fun being terrified. And I don't let anything come out of here that I haven't ridden."

"What Fletcher has done with surf­boards is what I did with climbing gear,' says his proud father. "He's reinvented the surfboard, making the best boards out of totally different, stronger ma­terials. He's got a great reputation for big-wave boards because he rides them himself, does his own testing. I'm his old-guy tester."

"He's a real innovator," says Fletcher of working with his dad. "It doesn't even matter whether he's involved in an in­dustry, he always has an idea how to im­prove on everything."

I meet the old-guy tester in the com­pany lunchroom, where the staff has the choice of a long salad bar or a hot menu.

As we sit we're joined by Rick Ridgeway, an old Chouinard friend, award-winning photographer and long-famous adven­turer. He has worked off and on for Pa­tagonia for 40 years and is currently vice president of environmental projects.

"Nice to see the two of you alive and well," I say, remembering the story of an emblematic moment in their outdoor ca­reers: An avalanche nearly killed both of them and left them profoundly changed in its deadly wake. I hear the fear in their voices as they describe their terror.

It was 1980 and China had just reopened to mountaineering. Chouinard, Ridgeway, climber Kim Schmitz and photographer Jonathan Wright were at 20,000 feet on a 24,700-foot peak called Gongga Shan. It was midday and just warm enough to loos­en the snow, and they were roped together as they started down toward base camp. Just before the steep snow slabs broke loose, Chouinard had a premonition.

"I was right in the middle of a sen­

tence, saying 'This snow doesn't feel '

and, boom, it happened. It was a feeling you can't describe; like a safecracker try­ing to describe how to crack a safe, you can't do it. It's a seat-of-the-pants feeling, like when you're surfing in sharky waters and the hair on the back of your neck stands up. You don't know why, but you know you should get out of the water."

The four were engulfed, swept down and over a 40-foot drop into a steep gully. Then it stopped, 20 feet short of a 300-foot cliff. They didn't know it yet, but Wright's neck had been broken.

"We'd been tumbled, wrapped in our rope, crampons on, trying to extricate ourselves, and then it started again. At that point I knew a 300-foot cliff was

coming up, and I thought we were dead. I expected to die."

The slide stopped for a second time, 30 feet short of the death plunge.

Chouinard, who says he stopped counting his dead friends when the number reached 50, tells me he was par­ticularly depressed after the avalanche, not because he had almost died but be­cause he had come back from death.

"I had accepted death," he says. "I was dead and I was okay with that. And when all of a sudden I was back, it was depressing."

After lunch Chouinard and I sit in the sun at a picnic table in the middle of his success, surrounded by the fruit trees— apple, fig, kumquat, mango—that he has planted all over the property. He hasn't changed much in the 15 years since we last spent time together. His hairline is ebbing, and the lines in his face are carved deeper into his wind-roughened tan. He carries an almost shy aura, but he's not shy when you hit his cranky zone or one of his passions.

He still climbs but not as much as he used to, and his approach has changed. "I've done a lot of first ascents in the past 10 years that I've never written about or even bothered to name. It has taken a while to get there. In the begin­ning your ego is involved and you want to tell the world about it. But the goal isn't the point. Who gives a shit what the holy grail is? It's the quest."

His current greatest passion is a dif­ferent way to fly-fish. It's called tenkara, and he can talk the side of your face off about it. It's a Japanese technique devel­oped hundreds of years ago that uses a telescoping pole with no reel or runner eyes. Picture Huck Finn with a bamboo

pole. Chouinard's excitement about the method borders on the sexual.

"The tip of this 10-foot pole is so sen­sitive that with the smallest move I can make the fly do a lap dance in front of the fish," he says, demonstrating with his hands. "They go absolutely crazy. I've been going out with some of the best fly fishermen in America, and at the end of the day they'll have caught six or eight fish and I'll have caught 50. It's exciting because I've always believed in simplicity, though the hardest thing in the world to do is simplify your life."

Chouinard applies tenkara to bigger issues and has used it to draw out the heart of his economic theory. "I take it as a metaphor for society," he says. "We think all our problems will be solved by technology, when what we have to do in a lot of cases is turn around and take a forward step. Technology destroys jobs. The lesson for the next economy is that we have to go back to the old handcrafted, high-quality stuff."

When I ask if he thinks his business philosophies would translate to larger companies, he says, "If they're making the best stuff and they've got their shit to­gether. If they're just making crap, people will buy somewhere else. Every problem we've had at Patagonia has been solved by doing one thing: improving quality."

Despite the fact that he has designed Patagonia to be here in a hundred years, his outlook for the planet remains dour.

"Sometimes I think it's hopeless," he says about the lack of progress toward meaningful environmental change. "We have to try to get a grip on global warm­ing. They told us 20 years ago that we had 30 years to get it together or else, and even if we did it would take a thousand years to repair the damage we've done to the ocean. The storm that hit New York ought to be a real wake-up call."

Chouinard has been a Zen adept since the beatnik days, though he doesn't meditate. "Mine is a Zen of action, not contemplation," he says. And, he claims, it keeps him from despair.

"Thinking dark thoughts doesn't de­press me," he writes in Let My People Go Surfing. "In fact, I'm a happy person. I'm a Buddhist about it all. I've accepted the fact that there is a beginning and an end to everything. Maybe the human species has run its course and it's time for us to go away and leave room for other...more intelligent and responsible life-forms."

"Still," he tells me, "you have to do something to save your soul. I want to be a person who sleeps at night knowing I'm part of the solution."

A young staffer stops by and leans into our conversation. He's wearing shorts and a T-shirt, has longish hair and says he heard there's a nice swell building at the ranch.

"Probably ought to check it out," says Chouinard. Then he turns to me and smiles. "Nothing's changed. All I really want to do is go surfing and fishing."

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"The only fun is breaking the

rules and making it work,"

Chouinard says. "And since

I own the company and have

no stockholders, I can do

what I want."