The Hobby Lobby founder says he gave up ownership of his multi-billion dollar retail empire because he ‘chosen God’ – and the move could also help him avoid a heavy blow tax invoice.
David Green, the 80-year-old CEO of the arts and crafts chain whose net worth has been valued by Forbes at $13.7 billion, compared his decision to similar moves by Patagonia owners and Barnhart Crane who have “relinquished” ownership to “enable the mission and purpose to remain intact.
Last month, Patagonia founder Yvon Chouinard announced that he had transferred ownership of the sportswear brand to a non-profit organization, redirecting almost all of the company’s profits to environmental conservation organizations.
“When I made the decision to give up my property, like Yvon Chouinard of Patagonia, it allowed us to maintain our mission and purpose,” Green wrote in an op-ed for Fox News.
A Bloomberg News analysis, meanwhile, found that Chouinard, whose net worth was calculated by Forbes at $1.2 billion, may have saved himself more than $700 million in taxes. on capital gains by transferring 98% of Patagonia stock to a non-profit organization.
Chouinard also dodged federal estate and gift taxes that amount to 40% on large fortunes that are transferred to heirs, according to Bloomberg News.
Hobby Lobby did not immediately respond to requests for comment.
Green wrote in his op-ed that he planned to transfer ownership of the business to a trust instead of passing it on to his children, and told Fox and Friends Weekend there were downsides to being wealthy.
“Wealth can be a curse and in most cases if you explore it, wealth is a curse in terms of marriage, children and things of that nature,” Green said.
“So we run our business and as a result our kids come in to work and they get what they earn…it’s a paradigm shift from ownership that can really destroy a family.”
Green said he became uncomfortable with the idea of a business owner selling the business and “keeping[ing] benefits for you and your family.
“As our company grew, this idea started to bother me more and more,” he writes.
“Well-meaning lawyers and accountants advised me to just pass the property on to my children and grandchildren.”
Green added: “It didn’t seem fair to me that I could change or even ruin the future of grandchildren who weren’t even born yet.”
Green wrote in his op-ed that he sees himself as a “steward” of the business rather than its owner.
He recalls a period in the 1980s when “I almost lost the company” after “growing up proud thinking I had the Midas touch”.
“God had to show me that he was the one who granted success,” according to Green, who quotes the scriptures as saying “it is God who gives us the power to create wealth.”
Green acknowledges that “prayer and the Bible” are “my source of truth,” writing, “I truly believe that if leaders pray and seek truth from the Bible, their businesses will be revolutionized.
Alan Barnart, an evangelical Christian and former CEO of Memphis-based steel rigging company Barnhart Crane & Rigging, announced years ago that he and his brother, company co-founder Eric Barnhart, had given their $250 million fortune, quoting scripture.
New York Post