“We need to build the concept that will kill Dick’s Sporting Goods.” — Ed Stack
Industrial carpet manufacturer Ray Anderson faced an unexpected question in the mid-1990s. A customer asked what Interface was doing for the environment. He froze. The honest answer was nothing. Interface simply complied with environmental regulations. Then one book changed everything: The Ecology of Commerce. He launched Mission Zero, an audacious plan to eliminate Interface’s negative environmental impact by 2020. Interface cut waste and redesigned nearly every industrial process. The company ultimately saved hundreds of millions of dollars through avoided costs. Profits doubled. Its brand became stronger because it chose to do good. It became proof that doing the right thing can also be good business.
One day, a young boy walked into Dick Stack’s sporting goods store. He tried to steal a baseball glove. The store manager caught him. He brought the boy to Stack. Instead of calling the police, Stack asked why he had tried to steal the glove. The boy admitted he simply wanted to play baseball. Stack believed that a lack of money shouldn’t keep a kid from playing baseball. He told the boy to pick out everything he needed. Years later, Ed Stack would say it was never about the glove. It was about what the glove represented. A good company does good.
The Culture You Tolerate Becomes Your Culture
When Alan Mulally took over Ford in the mid-2000s, the company was expected to lose tens of billions of dollars.
Ford’s culture rewarded saving face. Executives hid failures because previous leadership punished the people who surfaced them.
Mulally instituted a weekly Business Plan Review. Executives color-coded every project. Green meant on track. Yellow meant at risk. Red meant serious trouble.
For the first few weeks, every chart was green.
He famously asked, “We are losing billions of dollars, and every initiative is green. Is there really nothing wrong?”
Then Mark Fields tested the system. One of his vehicle launches had a serious problem.
Fields walked into the meeting and projected a bright red slide.
Everyone expected punishment.
Instead of criticizing him, Mulally applauded. “Mark, that’s great visibility,” he said. “Who can help him?”
In that moment, Mulally changed the culture. He rewarded honesty over appearances.
Within seconds, engineering and manufacturing teams offered solutions.
Ed Stack makes a similar point in It’s How We Play the Game. Too many companies reward unchecked ambition. They mistake someone willing to throw coworkers under the bus for someone hungry to succeed.
Stack wanted no part of that culture at Dick’s Sporting Goods. If someone slipped through the cracks, he believed the culture would expose them soon enough.
Dick’s rewards people who understand their role and remember the job is bigger than they are.
Success at Dick’s rests on three traits borrowed from sports: discipline, execution, and endurance.
Discipline comes first. Expectations are high. Time is used deliberately. Focus is non-negotiable.
Discipline isn’t enough. Execute. Finish what you start. Think clearly.
Discipline and execution still aren’t enough. Add endurance. Showing up day after day, year after year.
At Dick’s, the expectation is relentless improvement in everything you do.
Stack believed endurance required balance. Meetings weren’t scheduled late in the day. Weekends were protected. Employees were expected to spend time with their families. He believed it made people more likely to stay.
Dick’s rewards teamwork over office politics. Discipline. Execution. Endurance. Together, they create a culture of relentless improvement.
Good Companies Do Good
In 2022, Yvon Chouinard gave away Patagonia. It wasn’t a publicity stunt. It was the culmination of a 50-year argument with corporate capitalism.
Chouinard famously called himself a “dirtbag climber.” He disliked being called a billionaire. So he spent years working with lawyers under the codename Project Chacabuco to dismantle his fortune.
He rejected an IPO because he believed it would eventually force Patagonia to prioritize quarterly profits over its mission. He also refused to sell to private equity or a luxury conglomerate because both would eventually dilute Patagonia’s values.
Project Chacabuco separated control from ownership.
Patagonia Purpose Trust owns just 2 percent of the stock but controls every voting share. It receives no economic benefit. Its only job is protecting Patagonia’s mission. The Chouinard family oversees the trust.
Holdfast Collective owns the remaining economic interest. It receives every dollar Patagonia doesn’t reinvest in the business. The structure created a permanent funding engine expected to direct roughly $100 million a year toward fighting climate change and protecting wild lands.
Critics immediately questioned the move. Contrary to popular belief, the family received no charitable tax deduction from the transfer.
The family even paid millions of dollars in gift taxes when transferring the shares.
The transaction did reduce future estate and capital gains taxes that a traditional sale would have triggered. But it also left the family with no personal payout from a billion-dollar company.
Many analysts predicted that removing traditional profit incentives would cripple Patagonia. The opposite happened.
Patagonia’s ownership change reinforced a brand identity that many consumers already valued.
Patagonia even imposes an internal carbon price, absorbing millions in additional costs to encourage suppliers to move away from fossil fuels.
Patagonia has consistently reported employee engagement well above the U.S. average.
Dick’s Sporting Goods eventually faced a similar test.
In It’s How We Play the Game, Ed Stack describes the decision to stop selling assault-style rifles and destroy millions of dollars in inventory after the Parkland school shooting.
The decision cost the company hundreds of millions of dollars in lost sales. The backlash was immediate.
Stack believed protecting the brand mattered more than maximizing short-term profits. Like Patagonia, Dick’s chose principle over immediate financial gain.
Stack argues every company eventually reaches a moment when it has to stop thinking only about making money and start thinking about its role in society.
He compares companies to doctors. The first rule should be the same: do no harm.
Shareholders deserve a return. Without profits, a business can’t help anyone.
Profits should be the reward for building great products and behaving responsibly.
Stack put it simply: “To be a good company, you have to do good.”
Chouinard redesigned Patagonia’s ownership structure so the mission could outlive him. Stack made a similar choice. He accepted the financial cost because he believed the company’s values mattered more.
Good Company
These companies couldn’t look more different. Ford rebuilt its culture. Interface reinvented its purpose. Patagonia redesigned ownership. Dick’s kept asking one uncomfortable question: If we started today, what would we build? That’s the idea behind Ed Stack’s challenge. The companies that endure reinvent themselves before someone else forces them to.
