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Starbucks' Ethical Sourcing

Erika Massie and Mandee Young

"The purpose in originating these goals was to be very aspirational. We are more interested in being aspirational, innovating, listening to our partners, listening to our customers than in what it looks like if we fall short."

- John Kelly, Starbucks' senior vice president for global responsibility and public policy

Success seen through Media Coverage

  • Covered in:
  • USA Today, Business Wire, Roast Magazine, Men's Journal
  • Ranked third on the EPA's National Top 20 Retail list of largest green power purchasers, and fourth on both the National Top 50 and Fortune 500 lists
  • Newsweek magazine named Starbucks the greenest company in the Travel and Leisure sector
  • Ethisphere magazine lists it as the only cafe and restaurant to earn its designation as one of the world's most ethical companies

Why Necessary

It's not really. But..

Overall Impact

Senior VP of Starbucks, Katie Sewall, announces on USA Today that Starbucks is 99% ethically sourced

"The milestone of Starbucks ethically sourcing 99% of their coffee cannot be underestimated."

- John Buchanan, interim senior vice president and senior director of sustainable food and agriculture markets of Conservation International

Buchanan says the achievement makes it possible "to consider that coffee could be the world's first sustainably sourced commodity."

Starbucks has invested more than $70 million in its comprehensive approach to ethical sourcing; supporting coffee farming communities; mitigating the impact of climate change; and supporting long-term crop and farm stability

Starbucks represents more than 400 million pounds of coffee served globally

Benefits more than 1 million farmers and workers around the world

Steps Taken

The cornerstone to Starbucks' comprehensive approach to ethical sourcing is their Coffee and Farmer Equity (C.A.F.E.) Practices, one of the coffee industry's first set of sustainability standards, verified by third-party experts that they developed with Conservation International

C.A.F.E. Practices were developed to safeguard responsible purchasing practices and economic, social and environmental standards, globally. They include guidelines in four key areas.

"Starbucks Corporation's environmental ratings is around the 90th percentile when compared to U.S., global and industry peers."

- GMI senior research analyst Greg Ruel, in an email citing data provided by Trucost plc

Overall Purpose

"Even HAVING the kinds of aims that are listed in its Global Responsibility Report is not just unusual, it's exemplary"

- former GMI CCO and senior research analyst Paul Hodgson, in 2012

GMI Ratings is the leading independent provider of global corporate governance and ESG ratings and research

C.A.F.E. Practices have helped Starbucks create a long-term supply of high-quality coffee that positively impacts the lives and livelihoods of coffee farmers and their communities

So it is our vision that together we will elevate our partners, customers, suppliers and neighbors to create positive change. To be innovators, leaders and contributors to an inclusive society and a healthy environment so that Starbucks and everyone we touch can endure and thrive.

Product Quality

Environmental Leadership

All coffee must meet Starbucks' standards for high quality

Measures evaluated by third-party verifiers help manage waste, protect water quality, conserve water and energy, preserve biodiversity and reduce agrochemical use

Social Responsibility

Economic Accountability and Transparency

Measures evaluated by third-party verifiers help protect the rights of workers and ensure safe, fair and humane working and living conditions. Compliance with minimum-wage requirements and prohibition of child and forced labor is mandatory

Economic transparency is required. Suppliers must submit evidence of payments made throughout the coffee supply chain to demonstrate how much of the price that Starbucks pays for green coffee gets to the farmer

Practices seek to ensure that Starbucks sources sustainably grow and process coffee by evaluating the economic, social and environmental aspects of coffee production agaisnst a set of criteria detailed in their C.A.F.E. Practice Guidelines

Appeals to younger consumers who want to know where their products come from

51 percent of Millennials say they're willing to pay more for sustainable products, according to a recent Nielsen survey

Environmental, social and governance (ESG) refers to the three main areas of concern that have developed [when?] as central factors in measuring the sustainability and ethical impact of an investment in a company or business. These areas cover a broad set of concerns increasingly [quantify] included in the non-financial factors that figure in the valuation of equity, real-estate, corporate, and fixed-income investments. ESG is the catch-all term for the criteria used in what has become known [by whom?] as socially-responsible investing. Socially responsible investing is among several related concepts and approaches that influence and, in some cases govern, how asset managers invest portfolios

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