Like many, I’m excited about the announcement that Patagonia’s founder Yvonne Chouinard is giving away his company to fight the climate crisis. It's a creative approach that avoids the traditional perils of company exits and succession plans, but it's also presented as the only available route for someone who distrusts other investors and shareholders to do what is right in the long-term. Patagonia's new jerry-rigged structure is so unique that it's unlikely to gain broader adoption with other mission-driven companies. It's simply hard to break out of the existing legal and corporate structures that define our institutions and ownership rights.
We are often not aware of how powerfully our legal structures drive organizational outcomes. I saw this at Uncharted working with both early-stage nonprofits and for-profits. The biggest predictor of strategy, impact, staffing, growth, and funding was the legal structure chosen at the beginning. We tend to apply our imagination to the things that happen within legal and governance structures: the mission, the strategy, the product, but we often lack imagination about how to better design the structures themselves. This is why I'm interested in innovations at the structural level: blockchain technology that explores new ways of organizing and ownership, the Long-Term Stock Exchange, deliberative democracy. To make sound long-term decisions downstream, we often need to work upstream at the structural level.