Ever wondered if Patagonia is as moral/ethical as it makes itself out to be? Read on for the answer!
Let me introduce you to Stan: Stan is a mid-level advertising associate at Ralph Lauren. Stan’s entire adult life has been dedicated to scheming up ways to convince the brand’s loyal customer base to consume even more products. He knows that it is much easier to maintain a customer base than it is to reel in a new customer, so he is committed to persuading existing customers to purchase Ralph Lauren’s latest and greatest products. Stan is pretty darn good at his job, if he says so himself. Imagine Stan’s reaction when he came across this advertising in a magazine while searching for some inspiration. Needless to say, he was not the least bit impressed by Patagonia’s bold advertisement/deterrent.
Stan is clearly a figment of my imagination, but the notion that any typical, for-profit firm would scoff at Patagonia’s seemingly counter-intuitive marketing efforts is not. So, how is Patagonia able to succeed in a global economy that is chiefly profit-oriented? In this paper, I aim to answer this question while drawing from Norman Bowie’s “A Kantian Approach to Business Ethics”. In short, Patagonia is able to maintain and attract customers because it is a true example of an ethical company. In order to answer this broader question of whether Patagonia is a morally virtuous company, I will analyze the company using Kant’s three elements of the “Categorical Imperative”.
Yvon Chouinard “accidentally” forged (pardon the bad pun) Patagonia in 1957. The avid mountaineer was dissatisfied with the poor selection of climbing pitons on the market, so he taught himself to blacksmith and built his own. His product was so superior that he sold it to other climbers, and an entrepreneur was soon born. Chouinard went on to officially found Patagonia in 1972 (Patagonia, 2012). Unlike many CEOs, Chouinard never lost sight of his initial love of nature and rock climbing. Not only did he seek to provide outdoor sportsmen and women with reliable equipment and gear, but he also made a conscious effort to treat the environment with respect and to make effective use of the company’s popularity.
Patagonia is undoubtedly a popular albeit nontraditional company. Chouinard told the LA Times that he is uninterested in Patagonia’s financial performance, as long as the company does not go into debt (LA Times, 2012). I would be willing to bet that those words do not come out of the mouths of successful company owners very often. Chouinard stepped down as CEO in 1999 in order to pursue his love of outdoor sports like climbing, surfing, and white-water rafting (Patagonia, 2012). However, he maintains his position as the sole owner of Patagonia. In order to prepare Patagonia for a possible initial public offering upon his death, Chouinard recently filed the company as one of California’s first “benefit corporations”. This gives it legal protection from potential shareholder lawsuits resulting from Patagonia’s commitment to environmental and social benefits over financial performance (PSFK, 2012).
In keeping with Patagonia’s concern for the worldwide environment, the company defines itself as a global company despite the fact that it is headquartered in California. Chouinard accepted that any global business is inevitably going to have a negative impact on the planet due to its carbon footprint from product transportation, manufacturing, and waste produced. However, he simultaneously realized that “no business can be done on a dead plant. A company that is taking the long view must accept that it has an obligation to minimize its impact on the natural environment” (1% For the Planet, 2010). Chouinard successfully integrated many environmental and otherwise socially responsible initiatives into Patagonia’s brand identity in an effort to give back to the planet.
Perhaps the most significant program that Patagonia has in place in order to do so is its “1% for the Planet”, or what Chouinard fondly refers to as the “Earth tax”, initiative. It is essentially Patagonia’s pledge to donate either 1% of annual sales or 10% of annual profits (whichever is greater) back to the environment. This program is actually the brainchild of former CEO Yvon Chouinard, and has grown since its inception in 2001. As of 2009, over 1,300 companies joined 1% FTP and donated over $50 million to environmental causes worldwide (1% For the Planet, 2010).
Here’s a video outlining Patagonia’s 1% for the planet initiative.
Another significant step that Patagonia took to minimize its environmental impact was adopting the Common Threads Initiative. It is essentially a promise that Patagonia encourages consumers to agree to. The initiative is summarized by Annie Leonard (author of The Story of Stuff) as a pledge to “Reduce. Don’t buy what we don’t need. Repair: Fix stuff that still has life in it. Reuse: Share. Then, only when you’ve exhausted those options, recycle” (Patagonia, 2012). Patagonia must truly believe that “The greenest product is the one that already exists” (Ebay) because it endorses buying used Patagonia products over new ones. Patagonia partnered with the used-clothing market giant, Ebay, in 2011 to further endorse this initiative. The initiative’s success is demonstrated by 76% energy savings and a 71% decrease in CO2 emissions. The company also established a Common Threads “Second Home” store in Portland, Oregon where Patagonia-lovers can trade in wearable used products for store credit. This enables customers that are tired of their products to replace them in a sustainable manner (Portland Business Journal, 2012).
Patagonia has many other methods in place to ensure a minimal impact on the environment as well as a positive impact on communities affected by manufacturing. These include the Bluesign fabric initiative, Fair Labor Association membership, a social/environmental responsibility team, a strict code of conduct between the company and factories, support for solar power, and product material requirements. 30% of the fabric that Patagonia currently uses is “Bluesign” certified; this means that textile manufacturers/suppliers agree to meet certain environmental standards (Patagonia, 2012). Public outcry resulting from negative publicity surrounding the manufacturing practices of Nike and Kathie Lee Gifford’s Walmart clothing line in the 1990’s led Patagonia to question the morality of its own supply chain. Patagonia began by joining the Fair Labor Association in 1999; this association strives to improve factory-working conditions worldwide as well as to put an end to child labor (Patagonia, 2012). The company follows through with its dedication to improving factory-working conditions by sending a member of its Social and Environmental Responsibility Team to ensure that factories meet Patagonia’s requirements before contracting with them. Finally, Patagonia’s physical headquarters are “going green”, as is evidenced by the fact that they are 1/3 powered by solar power (LA Times, 2012). Patagonia’s products are constructed in the most sustainable way possible; the polyester fleece used in many jackets and sweaters is made of recycled water bottles, and the company switched to using 100% organic cotton in 1995 (Article 13, 2006). Patagonia continuously works toward meeting its own definition of the ideal business; the company is currently working to increase wages in its factories to the local living wage. Of course, Patagonia will probably never completely change the world as there are always going to be businesses that blindly put profits before corporate social responsibility, but the company is a rock in the movement towards ethically responsible businesses.
Patagonia has been involved in very little social and legal controversy thanks to its dedication to its mission statement, “Build the best product, cause no unnecessary harm and use business to inspire and implement solutions to the environmental crisis” (Article 13, 2006). Patagonia faced the most significant legal trouble in 1989 when novice rock climbers sued the company for selling climbing equipment without warning of the hazards associated with the sport (ANBHF, 2000). Aside from this legal trouble, Patagonia has just dealt with nature enthusiasts upset about the company’s endorsements. Specifically, the climbing community associated with slackpacker.com called for a boycott of Patagonia products because Dean Potter, a climber sponsored by Patagonia, climbed the Delicate Arch rock formation located in Utah.
Below are slackpacker’s reasons for the boycott:
I am not a rock-climbing enthusiast, but these reasons for the Patagonia boycott seem quite petty to me. If situations like these are the worst of Patagonia’s problems, then the company is following its mission statement quite well.
So…is Patagonia a truly ethical business as is defined by Kant?
“Act only on that maxim by which you can at the same time will that it should become a universal law”
Bowie summarizes Kant’s first categorical imperative as a test to determine whether or not a business is moral. To complete this test, we must consider whether the global business environment would benefit from adopting Patagonia’s business philosophy and the actions it has taken to comply with its mission statement. If other companies were to follow in Patagonia’s footsteps taken to ensure fair labor, the Common Threads initiative, and the 1% for the planet program, then the global environment would undoubtedly benefit. While it is unlikely that Patagonia’s business practices will become universally standard, it is possible that the company’s success fueled by its ethical actions will encourage other companies to act similarly in order to better compete (Bowie).
“Always treat the humanity in a person as an end and never as a means merely”
Kant meant this categorical imperative to be a measure of how well a business treats its employees. He is adamant that people all have free will and should therefore be respected. However, a person must have both negative freedom and positive freedom in order to be truly respected. He defines a negative freedom as the “freedom from coercion and deception only” and a positive freedom as the “freedom to develop human capacities” (Bowie, p. 7). The goal of a morally sound business should be to not only provide negative freedoms to employees, but also to provide meaningful work. Meaningful work should not be forced upon employees and should provide him or her with opportunities, be reasonable, provide a living wage, and should not get in the way of a person’s moral development. Patagonia could certainly improve upon fulfilling this categorical imperative, but then again, so could the vast majority of businesses. Patagonia denies employees their right to meaningful work by paying wages less than the living wage. However, the company is working with the Fair Labor Association to increase wages to the living wage in factories (Bowie).
“So act as if you were a member of an ideal kingdom of ends in which you were both subject and sovereign at the same time ”
Kant’s third categorical imperative provides a method by which to determine whether or not a business is a “moral community”. In order to be moral, a business must be sure to take stakeholder interests into account, allow people who are affected by decisions to make them, not favor any stakeholder over another, and make sure that relationships with stakeholders are fair and just. Based upon the logic that Patagonia was founded and is owned by a man who publicly announced that he has no interest in the financial performance of his company so long as it remains out of debt (LA Times, 2012), pays employees to take up to two months off in order to complete environmental volunteer work (Article 13, 2006), and who quickly accepted that his innovative climbing pitons were detrimental to rock faces and took the profitable item off the market in the company’s early days, it is safe to say that the company takes stakeholder interests to heart in every major business decision. This is especially remarkable considering that Patagonia considers the entire global community to be its stakeholders. The company’s grade for following this categorical imperative can be improved upon by maintaining fair and just relationships with stakeholders; namely, factory-workers who deserve to be paid a living wage (Bowie).
The company was able to pass all three of Kant’s categorical imperatives so easily because it has “purity of motive”. This means “an action is only truly moral if it is morally motivated” (Bowie, p. 12). It is evident that Patagonia’s actions are morally motivated because they are neither legal nor social obligations, yet the company still feels compulsion to do what is right for the future of our planet. Based upon this assessment, Patagonia is a truly moral business that other businesses should at least admire, if not aspire to be.
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