REI has long been famous for its progressive—perhaps even crunchy—corporate culture. 

The company advertises itself as a “values-based organization,” and has historically donated around 3% of its profits each year to causes like protecting public lands. It’s also a member-owned “co-op,” with steep discounts for employees informally referred to as “Green Vests,” and has made a name for itself as a sought-after employer. 

But all is not well in the house that hiking built, writes my colleague Phil Wahba in a new feature. The company lost $311 million last year, its second year of losses in a row, prompting management to tighten its belt and conduct several rounds of layoffs. 

“The customers change, as does the global landscape, so we are trying to meet the moment and do what’s right for the long-term health of the co-op,” says CEO Eric Artz. “There is no mission without margin.”

But the Green Vests aren’t happy about it. REI employees are upset with job cuts and reduced hours. Ten stores have unionized over the past few years, and many employees say that the company seems to be trying to become more similar to a big-box brand like Walmart than a free-spirited mountain outfitter. Workers at a New York City store protested an annual REI sale this year, and many across the country are wearing pins that read: “Ask Me About My Pay Cut.”

“REI does put such an emphasis internally and externally about how they are a different type of company,” says Claire Chang, an employee who works at the New York City location. “But then we’re seeing decision-making that shows that no, actually at the end of the day, they are more similar to big-box companies.”

REI has a big challenge on its hands: Keep the Green Vests happy and maintain its unique corporate culture, while also keeping up with its corporate rivals. 

You can read more about the fight for the soul of REI here.

Azure Gilman
azure.gilman@fortune.com

Today’s edition was curated by Emma Burleigh.

Around the Table

A round-up of the most important HR headlines.

Silicon Valley initiatives to get more women and people of color into tech have had their funding pulled or rebranded due to mounting attacks against DEI policies. Washington Post

Resort-like workspaces have been on the rise as a luxe last-ditch effort from employers to woo workers back into office settings. New York Times

Fintech company Revolut reached a $45 billion valuation through a secondary sale of its employee shares to investors, with a predicted net staff windfall of $500 million. The Guardian

After the arrest of the Goldman Sachs employee who had previously been convicted of sexual assault crimes, conversation broke out over how employers should monitor offenses of their workers. Financial Times

Watercooler

Everything you need to know from Fortune.

High stakes. The CEO of software company Palantir says that he only needs two minutes with a job candidate to know whether he’d keep or cut them. —Eleanor Pringle

All or nothing. British smartphone startup Nothing is demanding its employees return to office five days a week, saying that being remote isn’t compatible with “high ambition level plus high speed.” —Ryan Hogg

Not so fast. One of Oprah’s ex-business coordinators says that any job candidates who expressed interest in meeting the TV host would be cut from the interview process. —Orianna Rosa Royle