OK, so where are we on this odyssey through a typical day? Teeth brushed? Check! Dressed? Check! Breakfast? Check! Phone on? Check! Despite having had a peanut butter cup to give yourself a boost, you’ve started nodding off at your desk. It’s time to head out and get some fresh air and a caffeinated beverage.
So I want to ask for your input, dear readers. I’d like you to rate Starbucks using this poll (just one click). Please also post a comment at the end of this post if you’d like to explain your rating or share information that may be helpful to others. Or you can say which of the factors listed in the next section are most important to you.
This poll is for social and environmental impact only. It’s on a scale of one to five green stars. So only consider how you think Starbucks impacts society and the planet.
Just in case you also want to also rate Starbucks for quality and value (“I need closure!” ) I’ve included this optional poll:
Starbucks – some social and environmental factors to consider
Here are a few things to consider if you’re trying to decide on a green star rating – please list others that you want to mention in the comments section. I’ve broadly color-coded them from positive (green) to negative (red). I’ll provide some info from their 2015 and 2016 Corporate Social Responsibility (CSR) reports. Bear in mind that when you read a company’s CSR report, you are drinking their Kool-Aid. Or in the case of Starbucks, you may be drinking their Unicorn Frappuccino. Two things to always keep in mind when reading a CSR report:
- Focus on their numbers and be aware of whether they apply to the entire company or just one “poster child” example that they have cherry picked.
- Every CSR report is designed to give you a warm fuzzy feeling that “these kids are alright,” so often what you really need to identify are the things that they are not saying; what’s not covered in the report?
Starbucks: social impact
1. Price paid for green coffee.
In their CSR report, Starbucks don’t talk about pricing. A little odd, considering that a large part of the social impact boils down to the prices that farmers receive. Elsewhere on their website it’s mentioned that, “Starbucks paid an average price of $2.38 per pound for our premium quality green (unroasted) coffee in 2011.” Why no update since then? I suspect that’s because commodity coffee prices were at their 20-year peak in 2011, so Starbucks are quoting this price because it sounds great relative to today’s price, but back in 2011 it was not very different to the average commodity price.
So, if Starbucks is paying close to the commodity market price then there are two issues:
- It’s below the fair trade price and also lacks the security of the fair trade minimum guaranteed price.
- Most transactions are likely with middlemen, meaning that farmer will get considerably less than this price.
2. Hiring of refugees at Starbucks
Starbucks announced a plan to hire 10,000 refugees in response to Trump’s proposed Muslim travel ban, even though it could have hurt the brand (Trump supporters initiated a Boycott Starbucks campaign).
3. Animal welfare rating for Starbucks
The Business Benchmark on Farm Animal Welfare have placed Starbucks in Tier 5 – the second lowest ranking.
Despite the overall progress made since 2012, some 40% of companies (including Burger King, Domino’s Pizza Group and Starbucks) provide little or no information on their approach to farm animal welfare.
4. Employee education (in the US)
Starbucks will pay full tuition coverage for qualifying employees to earn a bachelor’s degree at Arizona State University.
5. Hiring of youth in need of opportunities
“Starbucks is embracing and employing tens of thousands of youth, ages 16–24, who are disconnected from work and school, to help them achieve their dream and our shared future. Starbucks is committed to hiring 100,000 Opportunity Youth by 2020.” They also have a program for hiring veterans.
6. Food waste
“Through a new and unique strategic partnership with Feeding America, we will rescue 100 percent of food available to donate from all of our U.S. company-owned stores by 2020, positioning Starbucks as the sector leader in food rescue.”
Contrast that with personal experience: in many stores the pastry case is now for display purposes only. A few days ago I asked for a slide of raspberry cake, seeing three of them stacked in the display case (all in the name of research!). The server ignored these and obtained one that was individually packaged in plastic, opened this package and put the cake into a paper bag for me. Illusion of buying a freshly baked pastry: complete. I asked what happens to the considerable amount of food on display and was told that it stays out for 3 days and is then dumped. No donation is allowed. Clearly, they could be doing better job on this.
“For more than 20 years, we’ve offered health insurance coverage to partners in lesbian and gay relationships.” “When our partners can come to work, be fully themselves and do their best work, we consider that success.”
8. Employee ratings on Glassdoor are quite good
9. Tax evasion
Ethical Consumer has a summary of one example where Starbucks avoided taxes, claiming to have made no money in the UK in 2012.
Starbucks: environmental impact
1. Sustainability on coffee farms
To get into sustainability you have to look at Starbucks’ Coffee and Farmer Equity (C.A.F.E.) auditing system. You can get the scorecard here and read about it in this well-balanced article. There are almost 200 criteria, from worker rights to shade, soil health and biodiversity. Some are listed as Zero Tolerance; for example, “No conversion of natural forest to agricultural production since 2004.”
“Preferred supplier” status is awarded to those that score at least 60 percent, and suppliers that score 80 percent or greater get “strategic supplier” status. Preferred and strategic suppliers get enhanced pricing and contract terms.
The key is whether it’s really working and whether a farmer is sufficiently incentivized to, for example, introduce or maintain shade trees. It’s probably better than UTZ certification, but not as good as coffee that’s certified organic or bird-friendly and fair trade (or bought from a reputable roaster that has a good direct trade relationship with farmers).
2. Food Ingredients.
The majority of Starbucks food is made without any organic ingredients, with the exception of their new organic avocado spread. Starbucks had a poor record on palm oil purchasing. They have strengthened their policy in response to pressure but it’s still on a 2020 deadline “for achieving our zero deforestation commitment.” However, only a few items on their menu (e.g., doughnuts) contain palm oil.
3. Plastic waste.
Most food items these days are individually wrapped in plastic. Coffee bean packaging is not compostable or recyclable. At one point Starbucks was interested in tackling the cup waste issue but they have lost momentum on this issue and need to do a better job. Starbucks’ 2015 CSR report included details on personal cup use – the numbers didn’t look good. In 2016 they stopped reporting numbers.
4. Tree planting
“Thanks to our partners and customers, more than 25 million trees have been donated to coffee farmers. This effort began in September 2015, when Starbucks launched the One Tree for Every Bag Commitment.”
“To build on that success, Starbucks will quadruple its commitment by providing 100 million healthy coffee trees to farmers by 2025 by leveraging our green coffee purchases in coffee-growing communities most impacted by climate change.”
5. Energy Use
They haven’t met targets for energy conservation in their stores, but they have purchased renewable energy to cover company-operated stores.
In their 2016 report Starbucks lists a goal to “Invest in 100% Renewable Energy to Power Operations Globally by 2020.”
Thanks for your attention!
In a follow-up post, I took a look at the poll results and suggested a course of action to let Starbucks know how you’d like it to improve.