What's Patagonia's Succession Strategy?

What's Patagonia's Succession Strategy?

With Patagonia’s high-profile and well-respected chief executive officer and president Rose Marcario stepping down on Friday, the eyes fall again to Doug Freeman, the company’s chief operating officer, during the transition until a successor is named.

Freeman started his career at Patagonia working nine years in product development. After various stints in sourcing roles across the outdoor apparel and apparel industries, including at Obermeyer, Polo Ralph Lauren and The North Face, he returned to Patagonia in 2004 as a sourcing manager, Asia.

By June 2013, Freeman, then Patagonia’s vice president of production, had already racked up a 17-year legacy with the company over time. That same year, he took the reins as Patagonia’s chief operating officer before Marcario was moved from financial to be the face of the brand as ceo and president the following year.

At the time of Freeman’s appointment to chief operating officer, the-then ceo Casey Sheahan remarked in a statement: “I’m extremely confident in Doug’s ability to oversee such critical areas of the business. Doug brings not only an extensive operational background to the table, but also a rich history and deep understanding of the Patagonia brand.”

Noted for his “strategic vision, leadership and operational expertise,” Freeman’s background in production and sourcing, product development, material research and development would play a hand-in-hand role to domestic and international sales, marketing and product teams in developing innovations in an “environmentally responsible manner,” as the press statement noted.

A source claimed talks of Marcario’s succession had been taking place “for weeks,” but when Sheahan stepped down, it wasn’t immediate — he spent two weeks aiding Marcario’s transition. With its 40-year history in environmental conservation and grassroots activism, it’s no surprise the brand tends to hire from its tightly knit group of veterans who live and breathe the culture. But the unexpected announcement and immediacy of Marcario’s departure and no rush to choose her successor implies the company might be conducting an outside search.

According to a survey from a past WWD CEO Summit, half of the 110 executive respondents believed that by 2021 the role of the retail ceo will change, requiring “strategic and proven digital track records.” This year, already so much is changing, and the expectations of the c-suite are being put to the test.

When asked his thoughts on Patagonia’s successor, PC Chandra, former head of global operations at Diane von Furstenberg and current adviser to Alante Capital, said: “Finding the right ceo candidate for a mission-driven brand like Patagonia will not be easy. You are basically looking for the next Chip Bergh,” speaking to how the Levi & Strauss ceo puts the brand mission first over numbers yet is still financially rewarded for it. In a Tuesday interview with the Atlantic, Bergh relayed how change is in order at Levi’s, given the amplification of the Black Lives Matter movement.

Similarly, Patagonia saw its most prosperous years during Marcario’s tenure.

“The ability to balance realizing Patagonia’s social mission and achieving financial health is more important than ever as stalled sales have put financial pressures on clothing brands to revisit their non-revenue generating strategic investments. With the trajectory of consumerism still uncertain, Patagonia’s ceo will need to navigate the economic downturn and not rob from the disruptive investments the brand has made to live their social and environmental sustainability-oriented mission,” Chandra said.

He added: “All else equal, I hope that Patagonia prioritizes diversity in its ceo search,” pointing to the new juncture of opportunity companies across industries find themselves.

Although the timing seems sudden, the succession had been in the works and is unrelated to any social media claims floating around.

“We have been planning my succession since late last year and believe now is the right time for the next generation team to step in to reimagine the business for a bright future. Patagonia is in great hands, and on a path for 100 years of success,” Marcario said in a statement to WWD.

Corley Kenna, a Patagonia spokesperson, followed by saying: “Circumstances around the pandemic created a natural inflection point for reimagining our business.”

Changes are happening in other areas of the sustainability space, with the Sustainable Apparel Coalition (founded by Patagonia and Walmart) set to reveal its new board later this month. And attempts to broaden recruitment efforts have been seen for outdoor companies have made attempts to broaden recruitment efforts since they began working with foundations such as Greening Youth Foundation, which is committed to increased representation in environmental advocacy. Generally, representation of women is strong among such companies, split almost 50-50 across outdoor apparel brands like Patagonia and REI, as per Fortune’s most diverse workplace rankings.

Sources chimed in with the difficulty of matching Marcario’s list of achievements and leadership while at Patagonia — which have not only driven record sales but made it synonymous with the sustainability and conscious consumerism movements. Plus the search certainly falls amid a challenging new economic, political and cultural climate.