The Climber Who Gave Up Everything
The story begins in September 2022 with a letter from an old climber. The outdoor brand Patagonia, built over a lifetime with a value of about 4 trillion won, was handed over entirely to the Earth by its founder, Yvon Chouinard, instead of being sold or listed on the stock market. His declaration was quiet yet powerful enough to shake every boardroom in the world.
“From now on, the Earth is our only shareholder.”
This was not just a heartwarming tale of generous donations. It was a signal of a massive revolution that overturned the very reason for a company’s existence and the formula called ‘success’ in a capitalist society.
What force made him give up everything for the nature he loved all his life? The answer lies in the most important yet misunderstood word today, ESG. This story will show that ESG and its heart, ‘carbon neutrality,’ are no longer just words in boring reports but the most dramatic adventure that determines the survival and prosperity of companies in our era. Chouinard’s decision is merely the first scene of that grand narrative.
Chapter 1: The Ultimatum from a 1 Quadrillion Won Letter
Once, ESG (Environmental, Social, Governance) was a good term but far from making money, a slogan only of a few kind investors. The event that brought this peripheral concept to the center of the world began with a letter in January 2020.
Larry Fink, CEO of BlackRock, the world’s largest asset management company, sent a letter to CEOs around the globe declaring, “Climate change is an investment risk.” This was effectively an ultimatum to invest only in companies that contribute to the environment and society.
Why was his letter so powerful? Because three massive waves of the era converged at that point.
🌊 First, the Wave of Regulation: Invisible Tax, Carbon Border Tax
The European Union (EU) is erecting a massive barrier called the ‘Carbon Border Adjustment Mechanism (CBAM).’ In simple terms, it means that products made in countries that do not strive to reduce carbon emissions will be subject to a ‘carbon tax.’ Starting in 2026, this will make carbon reduction a matter of survival, determining the price tags of exporting companies rather than just an ethical issue.
🛒 Second, the Revolution of Consumption: People Speaking Their Beliefs with Their Wallets
Nowadays, consumers do not just buy products. ‘Meaning Out’ has become the new standard, where they express their values and beliefs through consumption. They willingly purchase products from companies that care for the Earth, even if they are a bit more expensive, instead of buying from those that harm the environment and disrespect workers.
🏛️ Third, the Shift of Responsibility: From Charity to Survival Strategy
In the past, Corporate Social Responsibility (CSR) was a ‘choice’ to do good after making money. But ESG is different. It integrates environmental (E), social (S), and governance (G) considerations into every aspect of corporate activity, making it a ’necessary’ strategy to determine whether a company can continue to make money. This is why investors scrutinize ESG performance as closely as financial statements.
Ultimately, ESG is not a campaign to become a ‘good company.’ It is the new rule of the most intelligent and evolved capitalism to predict upcoming risks more accurately and survive for a long time while making profits.
Chapter 2: Shadow Inventory, How to Measure Carbon Footprint
“Our company will achieve carbon neutrality!” It’s easy to shout that. But to understand the real weight of those words, we must first learn the ’language of carbon.’ The global common promise of recording carbon emissions like an accounting ledger is called ‘Scope (Scope) 1, 2, 3.’
- Scope 1 (Direct Emissions): Smoke coming from our factory chimneys. Carbon emitted directly from facilities owned and operated by the company.
- Scope 2 (Indirect Emissions): Smoke from power plants supplying electricity to our factory. Carbon emitted indirectly during the process of generating the electricity we use.
- Scope 3 (Other Indirect Emissions): The most complex and vast area. It includes all carbon emitted throughout the entire process of extracting raw materials, manufacturing parts, transporting goods, using products by customers, and finally disposing of them. It is like ‘shadow inventory’ that does not appear in the ledger but determines the fate of the company.
When a company declares ‘carbon neutrality,’ we can gauge its sincerity and capability by whether that promise extends only to Scope 1 and 2 or embraces the most challenging task of Scope 3 as well.
| Scope | Definition | Example from an Automobile Manufacturer |
|---|---|---|
| Scope 1 | Direct emissions from sources controlled directly by the company | Emissions from factory boilers, exhaust from company-owned test vehicles |
| Scope 2 | Indirect emissions from the production of purchased energy (electricity, etc.) | Emissions from power plants generating electricity supplied to factories and headquarters |
| Scope 3 | All indirect emissions occurring throughout the entire value chain (supply chain) | Production of raw materials like steel, partner factories, customer vehicle operation, disposal |
Chapter 3: Four Souls, Four Strategies
Heading towards the same destination of carbon neutrality, companies take different paths with their unique souls, much like four protagonists trying to save the world in their own ways.
1) The Activist: Patagonia’s Radical Experiment 👨🌾
Patagonia’s soul is ‘mission-driven.’ They exist for the single statement, “We do business to save the Earth.”
- “Don’t buy this jacket”: On Black Friday, the biggest shopping day of the year, they ran an ad denying their own sales, stating, “Buying less is the best environmental movement.” Paradoxically, their authenticity inspired fans to become even more passionate supporters.
- Earth Tax: They donate 1% of sales, not profits, to environmental organizations. This is a philosophy of paying a tax for doing business on this Earth, regardless of whether they are doing well or not.
2) The Technologist: Microsoft’s Bold Gamble 🤖
While Patagonia moves by conviction, Microsoft (MS) embodies ’technological optimism.’ They have a strong belief that technology can solve the problems humanity has created.
By 2030, they aim to absorb more carbon than they emit (carbon negative) and by 2050, erase all carbon emitted since the company’s founding!
However, behind this great promise lies a massive dilemma: the ‘AI Energy Paradox.’ The AI revolution led by MS consumes enormous amounts of electricity, resulting in significant carbon emissions. The most crucial growth engine directly conflicts with their greatest climate goals.
To solve this problem, MS has become a ‘venture investor for the Earth.’ They are betting on the future by pouring massive amounts of money into cutting-edge carbon removal technologies (DAC) that still seem like science fiction.
3) The Giants: The Green Transformation of Korean Conglomerates 🚢
When we shift the stage to Korea, the level of challenge changes. For large manufacturing companies, changing direction is as difficult and challenging as turning a tanker moving at full speed.
- Samsung Electronics’ Responsibility: Samsung Electronics, which consumes 1.76 times more electricity than all households in Seoul, has taken on the heavy responsibility of ‘carbon neutrality by 2050.’ However, they face the challenge of managing numerous partners (Scope 3) and the reality of insufficient renewable energy domestically, showcasing the weight of ‘responsibility-based transition.’
- SK’s Strategic Betting: SK Group has chosen to turn crises into opportunities through ‘strategic betting.’ They are making a bold dream of creating a massive ecosystem encompassing the entire process of producing, transporting, and using ‘hydrogen,’ which will be the key to future energy, by investing 18 trillion won.
| Category | Patagonia (Activist) | Microsoft (Technologist) | Samsung Electronics (Giant) | SK Group (Giant) |
|---|---|---|---|---|
| Core Soul | Mission-driven | Technological optimism | Responsibility-based transition | Strategic betting |
| Main Goal | Earth as the only shareholder | Carbon negative by 2030 | Carbon neutrality by 2050 | Contribute 1% to global carbon reduction by 2030 |
| Core Strategy | Reduce consumption, recycle, donate | Invest in carbon removal technology | Ultra-low power semiconductors, renewable energy | Build a hydrogen ecosystem |
| Main Challenge | Sustaining the ‘anti-growth’ philosophy | AI energy paradox | Managing a vast supply chain | Uncertainty of large-scale investments |
Chapter 4: Innovators in the Garage, Changing the Game
The massive puzzle of the climate crisis cannot be solved solely by the power of giants. The last piece is held by startups that are burning the midnight oil in garages and labs, harboring technologies that can change the world.
In the past, large corporations conducted all research and development themselves, but now, ‘open innovation’ has become the norm, actively acquiring brilliant ideas from outside. Especially in the era of carbon neutrality, a symbiotic relationship is formed where large companies and startups must join hands for each other’s survival.
Large companies need innovative technologies from startups to solve the massive homework of Scope 3, and startups need capital and markets from large companies to bring their technologies to the world.
Large companies have the ‘pulling power’ of the market, while startups have the ‘pushing power’ of technology, together evolving the entire industry.
Conclusion: What is Your Story?
The story returns to Yvon Chouinard. The miraculous actions he demonstrated are no longer the cries of a quirky individual. From Patagonia’s ‘belief’ to Microsoft’s and SK’s ‘gamble’ and Samsung Electronics’ ‘responsibility,’ every company is writing the survival methods of the new era in their own language and way.
A new era has opened where ‘good companies ultimately become strong companies.’ Numerous studies have proven that companies with good ESG performance are more resilient in crises and recognized for higher value over the long term.
Corporate success stories are being rewritten. The definition of success is expanding from merely how much money has been made to how we impact the Earth and society we stand on.
The question is no longer whether companies will participate in this great adventure. The real question is this:
“In this new narrative, what kind of protagonist will your company become, and what story will it write?”