WHEN IT COMES TO THE ENVIRONMENT, it's probably no secret that I'm a total pessimist about the fate of the natural world. In my lifetime I've seen nothing but a constant deterioration of all of the processes that are essential to maintaining healthy life on Planet Earth. Most of the scientists and deep thinkers in the environmental field who I know personally are also pessimistic, and they believe that we are experiencing an extremely accelerated extinction of species—including, possibly, much of the human race.

In Edward O. Wilson's 2002 book The Future of Life, he describes the time we live in as "nature's last stand." His "living planet index," which measures the condition of the world's forests and freshwater and marine ecosystems, puts humanity at an environmental bottleneck of our own making. The 21st century must become the Century of the Environment, Wilson insists. If government, the private sector, and science don't begin to cooperate immediately to address issues of environmental degradation, the earth will lose its ability to regenerate. In other words, life as we know it is toast.

Thinking these dark thoughts doesn't depress me; in fact, I'm a happy person. I'm a Buddhist about it all. I've accepted the fact that there is a beginning and an end to everything. Maybe the human species has run its course and it's time for us to go away and leave room for other, one hopes, more intelligent and responsible life forms.

Then again, maybe there's something we can do about it. Patagonia's environmental efforts began in the seventies with simply trying to prevent physical damage to the rock walls of Yosemite. It was about clean climbing and making high-quality products that weren't disposable. Later we started looking at minimizing the environmental harm associated with manufacturing our products.

One of the hardest things for a business to do is to investigate the environmental effects of its most successful product and, if it's bad, change it or pull it off the shelves. We confronted this when we were looking into switching over to organic cotton, in the mid-nineties. Though we successfully made the transition, we still haven't completely solved the problem. Even when cotton is grown without toxic chemicals, it still uses an inordinate amount of water and cannot be grown year after year without permanently depleting the soil. When a cotton garment is worn out, it is usually thrown away. We have to dig deeper and try to make products that close the loop—clothing that can be recycled infinitely into similar or equal products, which is something we continue to strive for.

Despite the challenges involved, we've found that every time we've elected to do the right thing, even when it costs twice as much, it's turned out to be more profitable. This strengthens my confidence that we're headed in the right direction. Our Environmental Assessment Program educates us, and with education we have choices. When we act positively on solving problems instead of trying to find a way around them, we're farther along the path toward sustainability. Plus we're constantly discovering more things we can do, both internally and externally.

Back in the early eighties, one of the maintenance employees asked if I knew how much it cost to line every wastebasket with a plastic bag: $1,200 a year. I said get rid of them, but he returned the next day to report that the janitorial service refused to clean unlined baskets if people threw away wet garbage like coffee grounds or food. So we gave each employee a personal trash can for recyclable paper and made everyone responsible for disposing of wet garbage in separate containers scattered throughout the offices.

No matter how diligent we are at Patagonia, everything we make causes some waste and pollution. So our next step is to pay for our sins until such a time that we hope to stop sinning. Since the early eighties we have donated $22 million in cash and in-kind donations to activist groups committed to environmental causes. In 1996, we pledged to give 1 percent of our total sales to environmental causes, meaning that whether we turned a profit or not, whether we had a great year or a bad one, we had to give. Last year this meant donations of $2.4 million. In 2001, we helped start 1% for the Planet, an alliance of 148 companies committed to giving at least 1 percent of their sales to saving the planet.

Our efforts, and those of others who work toward similar goals, are making an impact. The organic-food industry is growing at a rate of more than 20 percent a year. Worldwide demand for organic cotton has tripled in the nine years since we changed over. As this drives costs down, large companies like Nike buy organic cotton to blend in with their industrial cotton as a way to support the cause but not price themselves out of the market. Some of the fiber mills we work with, at our prodding, are actively researching ways to eliminate toxic materials like antinomy and methyl bromide in polyester.

If Patagonia can continue to be successful operating under the constraints of our environmental philosophy, then perhaps we can convince other companies that green business is good business, and they can gain the confidence to take a few steps in the right direction.