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NewslettersThe Trust Factor

Why Patagonia is the most reputable company in the U.S.

By
Eamon Barrett
Eamon Barrett
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By
Eamon Barrett
Eamon Barrett
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December 8, 2023, 10:14 AM ET
Vincent Stanley, director of philosophy at Patagonia
Patagonia’s Vincent Stanley shares what makes a reputable company. Lauren Justice—Bloomberg/Getty Images
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With much media attention on the COP28 meeting underway in the UAE this week, it seems like an appropriate time to delve into what makes one of the world’s most environmentally minded companies successful: Patagonia.

Patagonia is one of the most trusted brands in the world. The company ranked first in an Axios-Harris poll on the 100 most reputable U.S. companies earlier this year, marking the clothing company’s return to the top spot after dropping to third in 2022.

“I think one of the things that really interested me about the Axios-Harris poll is that we were the sixth most trusted company among Republicans,” Vincent Stanley, director of philosophy at Patagonia, tells Fortune. “This is great because that means they’re forgiving us for the stances we take.”

Aside from the quality of its products, Patagonia is renowned for its outspoken position on key issues, like climate change and fair trade—the sort of “woke” issues that flustered Republicans a year ago, but might be less of a hot-button topic now.

Although, to hear Stanley tell it, Patagonia’s advocacy and its product quality go hand in hand. The general public might find it “sanctimonious” when companies take on an issue that is “not related either to their product or to a long stance with that business,” Stanley says, but Patagonia only takes a stance on topics that fall within its expertise as a company. 

Once again, authenticity emerges as the hallmark of trust. However, that’s not to say companies can’t discover their realm of influence extends further than first thought. Stanley likes to give the example—in his book The Future of the Responsible Company, which he coauthored with Patagonia founder Yvon Chouinard, and wherever else he can—of Samsung, the Korean technology giant which he inadvertently challenged to clean up water pollution. 

During a meeting with Samsung execs in 2019, Stanley was lamenting that no washing machine manufacturer had created a machine capable of filtering out the microfibers clothes shed in wash before he blurted out, “Say, you make washing machines.” A year later, Samsung had innovated a new filter system for its washing machines. In 2023, Samsung expanded its product line to offer an improved filter, which cuts microfiber shedding 98% and can be attached to competitor products.

It’s a great example of how a company can turn an environmental solution into a business opportunity. Stanley says he thinks “the intrinsic motivation for human beings to do the right thing is actually kind of a secret force in business.” A moral mission can certainly motivate employees to work harder, and, when executives stick to their stated ethics, it enhances employee trust within the company.

“It takes more than competitive pay or humane employment policies to inspire employee commitment and trust,” Stanley and Chouinard say in their book. “Not everyone can satisfy their heart’s desire working for your company, but everyone could at least feel useful, and some even enlivened by what they do all day long.“

Eamon Barrett
eamon.barrett@fortune.com

IN OTHER NEWS

Juicing Tesla
Tesla is well on its way to engineering a $25,000 electric car, Elon Musk claimed Tuesday, raising hopes that the EV manufacturer would soon return to the extraordinary growth rates of the past. Musk’s company is at the low point of its cycle with its first three vehicles all long in the tooth and the Model Y coming up on four years in January, Fortune’s Christiaan Hetzner reports.

All flights pollute
Certain airlines have misled customers by suggesting that there was an environmentally friendly way to fly by plane, a U.K. watchdog ruled Wednesday. In separate rulings delivered by the Advertising Standards Authority (ASA) Wednesday, Air France–KLM, Lufthansa, and Etihad Airways each had adverts banned in which they implied their flights were more environmentally friendly than those run by competitors.

Spotify wrapped
Spotify announced a shock round of layoffs Monday that it said would affect 17% of the group’s nearly 9,000 employees, but investors are pleased, bumping the streaming giant’s stock 11% when the New York Stock Exchange opened that day. Cofounder and CEO Daniel Ek warned his staff to stop doing “work around the work” as it aims to capitalize on its first profitable quarter since 2021.

GM CEO learns about transparency
California regulators are alleging Cruise, a San Francisco robo-taxi service owned by General Motors, covered up the severity of an accident involving one of its driverless cars striking a prone pedestrian. The Public Utilities Commission asserted Cruise tried to conceal how its robo-taxi reacted to the accident for more than two weeks, initially claiming its robo-taxi stopped immediately on impact. Subsequent video footage showed the car dragged the victim six meters before stopping.

TRUST EXERCISE

“The motivation of the alliance is actually to bring together a set of institutions and stakeholders who truly believe that open innovation, open discussions, open technology, open platforms, open ways of even defining safety, open ways of benchmarking, of exchanging data, is actually the right way to both advance the technology and make the benefits available broadly.” 

Sriram Raghavan, vice president of AI Research at IBM, explains the mission behind the AI Alliance, launched this week by Meta and IBM along with around 50 founding members across industry, startups, academia, research, and government. Raghavan told Fortune’s Eye on AI that the group’s first step is to define what “open” actually means.

Learn how to navigate and strengthen trust in your business with The Trust Factor, a weekly newsletter examining what leaders need to succeed. Sign up for free.

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