NO. 6 I PATAGONIA MAKES A STAND
By extending its environmental mission—including an impassioned defense of Trump-threatened national parks—patagonia has bolstered its bond with customers.
Rose Marcario struggled to sleep. It was November 9, 2016, just hours after Donald Trump had been elected president, and the CEO of Patagonia was worried about how his White House ascent might disrupt not only her company’s business but the planet’s future. From the bedroom of her Ventura, California, home, she agonized over Trump’s campaign pledges—to bring back coal, dismantle public land protections, and unwind efforts to combat climate change—which represented everything Patagonia, a stalwart defender of environmental issues, had long fought against. “It was disappointing on so many levels,” recalls Marcario, who felt “a real threat” that all the company stood for was “on the line.” By 4 a.m., she had had enough. The 52-year-old practicing Buddhist got out of bed to meditate. This was going to be a long one. Marcario centered herself on Patagonia’s 45-year history. While some CEOS were salivating at the prospect of a more laissezfaire regulatory environment, Marcario intuited that this was the moment to embrace Patagonia’s core DNA—“TO double down on our activism.” This wasn’t an end, Marcario thought, but a beginning. She moved to her laptop and began punching out a company-wide email. It was more than her version of “Keep calm and carry on.” In her note, she stressed the urgency “to defend wilderness, to defend air, soil, and water.” She wanted to “galvanize” the Patagonia community around these issues, she says, reminding her people that they must “continue to [use] their voice” and “deepen our resolve to protect what we love.” She hit SEND around 9:30 a.m., then drove to the office. She bumped into Yvon Chouinard in the parking lot. Chouinard, the Patagonia founder and chairman famous for making breathtaking first ascents on Fitz Roy and El Capitan in the 1960s before building the company into a global brand, felt the same. If anything, he wanted Marcario to push the company further. “Keep going,” Chouinard exhorted her. “Let’s get ready to fight.” It was just what she’d hoped to hear. Since then, Patagonia has only intensified its efforts. Incited by Trump’s agenda, the company has upped its commitment to environmental activism, making an unprecedented bet on corporate social responsibility. This has served not only to energize
product innovation and marketing but to grow the company’s brand awareness and sales. Marcario has overseen a quadrupling of Patagonia’s revenue in her decade-long tenure with the company, pursuing investments in sustainable design and manufacturing and in startups allied with Patagonia’s mission. The company has built a righteous flywheel, like an Amazon for do-gooders:
The more it invests in its beliefs and its products, the better Patagonia performs, develops creative solutions, and maps out a blueprint for other businesses, big and small, to follow. “Doing good work for the planet,” Marcario says, “creates new markets and makes [us] more money.” That’s the Patagonia way.
Marcario’s success serves as a rebuttal to companies that restrict societal impact to a second- or third-tier priority in the corporate world. “This isn’t the time to be lazy, to be reserved, to be complicit, to be quiet,” she says. “We’re living in a time when it’s so important for business to drive this new economy, this new view, this aspirational future of business as a force for good.”
Patagonia’s corporate campus in Ventura feels more like a beach town community college than home to one of the world’s most influential apparel brands. Solar panels dot the parking lot, where surfboards and wet suits are splayed atop Priuses and beat-up trucks. The original tin shed where Chouinard first pounded out climbing pitons to sell still sits steps away on its original site, and accents the rustic vibe you’d expect from a company whose founder authored a book titled Let My People Go Surfing.
On a sunny morning last November, I make my way to the second floor of the company’s main building, where Marcario works in an open executive office. Dressed in jeans and a black Patagonia vest over a plaid shirt, with prayer beads around her wrist, she greets me at her desk, which is draped in a giant yellow flag emblazoned with RESIST in black letters. Hanging just outside the window behind her, an American flag gently ripples in the Pacific breeze.
It’s been almost exactly a year since Marcario wrote that post-election letter, and her intensity still burns. Her Zen manner is balanced with a refreshing, no-bullshit bluntness. Whenever Trump’s name comes up, she shakes her head in frustration. She has little patience for leaders who she feels act out of self-interest. Most CEOS? “So, so phony,” she says. Shortsighted investors? “Destroying the country.” The titans of Silicon Valley? “Pathetic. I couldn’t face myself every day if I gave the kind of weenie answers they’ve been giving on these issues. All these guys [at Facebook, Twitter, and Google] are rich. Why don’t they just do what’s right?”
When I ask about her own leadership style, Marcario says she strives to embrace risk by acting “quickly and decisively,” but not by sacrificing the future, eschewing what she calls the business world’s “suicidal” addiction to quarterly earnings. Marketing VP Cory Bayers tells me that when employees proposed that the company give away all of its 2016 Black Friday sales to grassroots environmental organizations, Marcario green-lighted the plan within 30 minutes via text message. (The company raised $10 million and signed up 24,000 new customers that day.) Lorna Davis, CEO of the multibillion-dollar organic CPG conglomerate Danonewave, who counts Marcario as a close adviser, says she pushes those around her to work on a “30-year framework,” to understand the long-range consequences of business decisions, rather than merely what will move the needle next month or next year. “There isn’t too much of that happening in the U.S. right now,” Davis says.
Marcario didn’t always seem destined to become a corporate rebel. When she was 10,
her parents split up, and “we went from having a nice, middle-class life to being on welfare and food stamps,” she says, adding that she developed an “underlying neurosis” in the ensuing years to never end up in her mom’s dire financial situation. “I was always afraid I wouldn’t have enough money.” She studied finance in college, earned her MBA at Cal State in L.A., and by her early thirties was heading up M&A at a West Coast investment firm. She became CFO of General Magic, the Apple spin-off that birthed such Valley stars as Android creator Andy Rubin and Nest founder Tony Fadell, and then moved into private equity.
But Marcario found this string of achievements unfulfilling. Her career and personal life weren’t aligned. After profiting from the financial system, she says she burned out and faced “a moment of reckoning.” In 2006, she quit, and spent part of the next two years traveling in India and Nepal. “I went through a kind of personal transformation,” she says. “Studying Buddhism, just figuring out who I was as a person . . . . If you don’t take that to your work and the world, then I don’t think that transformation is complete.”
At one point, Marcario even considered becoming a Buddhist nun, but a chance encounter brought her back to the business world. An old friend who worked at Patagonia told her the company was seeking a new CFO and suggested she speak with Chouinard. An avid adventurer herself who loves kayaking in Big Sur and hiking in Joshua Tree, Marcario only knew him by reputation as a mountain climber who, in her words, never “sold out.” (As Chouinard tells me, “I couldn’t give a shit about how much money we make.”) She admits that she was skeptical of whether the company would live up to its hype, but found in Chouinard an executive mentor and a kindred spirit.
Joining Patagonia in 2008, Marcario worked quickly to review supply chains and streamline production, helping the company eliminate waste and excess packaging. She also helped shepherd new technologies, working with supplier Primaloft to develop a recycled insulation, for instance, which ultimately transformed not just Patagonia’s products but lines from Adidas, Nike, Helly Hansen, and the North Face. In 2014, Chouinard elevated her to CEO. Since then, by funding small, environmentally responsible ventures, Patagonia has helped produce major strides in materials science as well as regenerative agriculture, leading to a surprising foray into selling food under the banner of Patagonia Provisions. By focusing on reducing waste and extending the life of its gear, the company now has a blooming new market for used goods. By engaging customers in its fight for a healthier planet, Patagonia boosts its power. Marcario tells me her spiritual journey from her pre-patagonia career and life now feels complete.
“My whole self is here,” she says. “My values, my passion, my sense of urgency.”
On the outskirts of Reno, Nevada, four dozen technicians lean over sewing machines, stitching away inside the largest garment-repair facility in the United States. Racks of vintage Snap-t fleeces and Fitz Roy down parkas await their attention, a rainbow of retro pastels and neons. This repair center reflects a significant leap forward from the company’s first major move into what’s now cheekily known as recommerce. In 2011, Patagonia purchased a full-page ad in The New York Times, which featured a simple shot of a fleece under the headline “Don’t Buy This Jacket.” The ad encouraged customers to repair and reuse as much of their clothing as possible, and Patagonia created a market with ebay for customers to trade items they no longer needed. The Common Threads Initiative, as the company then called it, repaired more than 30,000 items in 18 months. Ironically, the more Patagonia campaigned on this anti-consumerist message, the more people bought its products. Sales increased about 30% during 2012, to $540 million.
The next year, Common Threads spawned a project dubbed Worn Wear, which began accepting used merchandise in flagship stores, from Austin to Chicago to Seattle. After accumulating enough gear, Marcario established a dedicated Worn Wear section within
“Earnings per share is a like a chain around the neck of the country,” says Marcario, who advocates for a healthier form of capitalism that also takes into account people and the planet.