Do Businesses Have Souls?

A Review of ‘Let My People Go Surfing’ by Patagonia Founder Yvon Chouinard

By Clay Wilkes, CEO, Galileo

Do businesses have souls? I mean, if machines can simulate human intelligence by crunching billions of pieces of data, isn’t it possible that by pouring our humanity into our businesses, we can imbue in them the qualities of soulfulness? I think it is.

Henry Ford imbued soul into the Ford Motor Company, commemorated by a 1919 lawsuit in which he and his business were sued by the Dodge brothers, alleging Ford Motor Company was “trying to divert too much of the company’s cash resources to pro-social ends.” The shareholding brothers, John and Horace, objected to Ford’s suspension of a special dividend in favor of investing the better part of its $60 million cash surplus back into the business to “employ still more men, to spread the benefits of this industrial system to the greatest possible number, to help them build up their lives and their homes.” In a chalk-one-up-for-taking-the-high ground outcome, Ford won.

Undoubtedly, you can point to more contemporary examples of companies with soul, including, I hope, your own. Does Galileo have soul? I hope and believe we do—the result of so many employees pouring their humanity into our business to create an environment in which we care for each other, our families and friends, our clients, the earth we live on and the people we share it with. But the company I want to focus on today is Patagonia, a clothing and outdoor gear company that lives and breathes soul, as documented in “Let My People Go Surfing,” written by its founder Yvon Chouinard.

Yvon Chouinard: Environmentalist and Capitalist

You might already know Yvon Chouinard—if not by name, by reputation. A living legend in retail, environmentalism and corporate philanthropy, Chouinard is first a committed environmentalist and second a capitalist. And—spoiler alert—when there’s a conflict between the two, his compromise never involves the environment.

Chouinard and Patagonia made news last year, first engaging in a Twitter battle and then suing President Trump over reducing the size of the Bear Ears and Grand Staircase-Escalante national monuments in Utah. When asked to speak before the House Committee on Natural Resources to discuss the issue, Chouinard used terse language to reject Committee Chairman Rob Bishop’s (R-Utah) invitation, which, I suppose, you can get away with when you’ve been the kind of leader Chouinard is.

But, I’m getting ahead of myself.

As an outdoor enthusiast (living in the beautiful high desert of Utah), I first became aware of Patagonia because of its great outdoor wear. After my wife and I started The Galileo Foundation in 2008, I realized Yvon was one of the world’s most principled and unflinching environmentalists and philanthropists. He combined the two by running his company in alignment with his environmental beliefs and dedicating the greater of 1 percent of revenue or 10 percent of profits to environmental causes.

So, I was delighted last summer when a friend gave me a copy of Chouinard’s manifesto “Let My People Go Surfing,” but I didn’t get to it until October, when more than 20 Galileo employees, friends and family members headed off to India as part of a Galileo Foundation expedition. Once I started reading, I was sorry I’d waited so long; but, on the other hand, a 12-hour journey to India was the perfect time to absorb the lessons this “reluctant businessman,” as he calls himself, had for me.

Surf’s Up. Time to Hit the Beach.

“Let My People Go Surfing,” first published in 2005 as a “philosophical manual for the employees of Patagonia,” sets out Chouinard’s eight “philosophies” for how Patagonia does business. (Patagonia remains a private company, although not for a lack of suitors.) The philosophies are open to interpretation, but they’re also non-negotiable and not subject to compromise. I read the version updated in 2016, which is translated into more than 10 languages.

So, where does the book title come from? Early on, Chouinard hired in his own image—avid outdoorspeople (admiringly called “dirtbags”) who constitutionally couldn’t tolerate being indoors when conditions were perfect for surfing … or mountain climbing … or whatever their sport of choice was. Giving employees flexibility to pursue their outdoor sporting passions (particularly sports for which Patagonia sold products) became a core underpinning of the company’s “Human Resources Philosophy” and continues today.

Provided you get your work done and don’t inconvenience your Patagonia co-workers, pursue your

What I Never Knew about Cotton

So, what can I—the CEO of a payments innovation business—learn from the business philosophies set out by a retailer? Turns out, quite a lot, because Chouinard’s philosophies address business fundamentals and ways of analyzing situations that all companies face. I’m sure many readers’ minds, like mine, were racing ahead, applying the philosophies to their own businesses.

One of the best examples (included in “Product Design Philosophy”) involves cotton, one of the many fibers Patagonia uses in its clothing. In 1999, following a significant rough patch in which Patagonia contracted in size and even laid off employees, the company commissioned an independent study to determine the environmental impact of its choices to use one fiber over another in its products. Turns out, cotton—seemingly the most natural and wholesome fiber—was also the most environmentally detrimental choice.

The study found that growing modern-day cotton growing involves injecting tons of pesticides and herbicides into the environment; troublesome enough on its own but exacerbated by generating immense greenhouse emissions. At that point, Patagonia committed to switching to pesticide- and herbicide-free organic cotton, but in the late nineties only a handful of small farmers grew organic cotton and they couldn’t supply all of Patagonia’s needs. Nevertheless, Patagonia imposed an 18-month transition schedule on itself.

The company met its self-imposed goal by taking on the enormous task of creating an entirely new supply chain for organic cotton, working not only with growers but also with cotton processing intermediaries to ensure the purity of the cotton it sourced. Since then, every cotton product Patagonia sells is made of organic cotton. Most people don’t buy its cotton products because they’re organic, Patagonia says, but organic is “an important added feature.”

For Patagonia, committing to organic cotton was the right thing, but the 18-month transition was costly and difficult. It literally had to create a fabric category that no longer existed in bulk—organic cotton. Even knowing that using chemically laden cotton harms the earth, I wonder how many of us, myself included, would have taken the route Patagonia did. Wouldn’t it just be easier to conflate “difficult” with “impossible,” throw up our hands and say, “It can’t be done.” Or, would we kick the ball forward so many years that we wouldn’t have to deal with it?

At Galileo, we’ll never buy bulk cotton, but Patagonia’s example of great corporate citizenship is a powerful message about sourcing—knowing the real impact of the resources we consume; making the best possible choices, even when those choices are hard; and consuming only what’s necessary.

Not all examples Chouinard provides are as grand as the growing and sourcing of cotton. Some are extraordinarily simple. I can’t recall which philosophy this falls under, but using Patagonia as his petri dish, he talks about the positive environmental impacts of eliminating plastic bags to line office trash baskets and replacing Styrofoam cups with non-disposable mugs. Chouinard assures us, little changes matter too.

‘Ethical Capitalist:’ A Moral Imperative!

We all recognize the inherent tension between capitalism and ethics. I believe business leaders must lead in topics related to our earth and its current and future inhabitants—changing the conversation from businesses existing only or primarily to reward founders or shareholders to businesses stepping up to serve as stewards—as Chouinard does through his inspiring example. We also must expand our understanding of our fiduciary responsibilities to include the world we inhabit, along with our shareholders.

Lessons Learned

Every book I read influences me in some way, of course. So, what was the effect of “Let My People Go Surfing”? On the flight home from India, I pulled out my laptop (which I hadn’t touched in almost two weeks because of the lack of reliable electricity and Wi-Fi) and the thoughts that had been percolating poured out. Inspired by reading Chouinard, along with Muhammad Yunus’ “Building Social Business” and Gandhi; the overwhelming experience of India; 18 years nurturing Galileo from a vision to its current status as a payments leader and innovator; and the work of the Galileo Foundation, creating Galileo’s values was like taking dictation—it poured out like revelation.

In truth, I think I’ve always known these are Galileo’s values. And, I hope over the years I’ve expressed these values, if not in words, by actions and deeds in my relationships with the Galileo team, our clients and all whom work with us and support us. It was Chouinard’s example and passion, however, that inspired me to articulate what Galileo stands for and to share my expectations, first for myself and second for the entire company. There’s a certain refinement of passion that comes with publicly stating one’s values and asking others—an entire company, in fact—to sign on. That refinement involves sometimes falling short of those values. I’ve fallen short plenty in the past and I’m sure I’ll do the same in the future. But, when I do, I also know there will be people to call me out—and they have my full permission to do so—and I promise I’ll learn from it.

Whether you’re into biography, business, the environment or philanthropy, I wholeheartedly recommend “Let My People Go Surfing” as a great read. And, who knows, like me, it might inspire you to think about shaping the soul of your business.

I’m always looking for good book references, so please shoot me a note and let me know what you’ve found valuable:

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