Corporate Social Responsibility and Starbucks

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April 18, 2011; Source: Earth911 |  The autobiographical story of Howard Schulz’s second go-around as CEO of Starbucks hit number one on the New York Times hardcover nonfiction best-seller list its first week on the market, probably because of the big in-store displays wherever you order your iced espresso macchiato.  Too bad Starbucks outlets also don’t sell—or give away—the latest annual report on Starbucks’ corporate social responsibility (PDF).

Most of the press coverage of this tenth annual CSR report from Starbucks has focused on the company’s efforts to reduce its corporate environmental and energy footprint through LED lighting initiatives, purchasing renewable energy, and reducing water consumption.  Starbucks is also working on ethical sourcing of its coffee purchases, collaborating with Conservation International to develop social and economic guidelines, providing financing to farmers in coffee-growing communities, and purchasing 84 percent of coffee pursuant to Coffee and Farmer Equity (C.A.F.E.) practices (which Starbucks hopes to raise to 100 percent by 2015). 

The press coverage is a little thin on the gourmet corporate retailer’s philanthropy.  Like many corporations in recent years, Starbucks leads with the community service volunteer hours of its employees, counting 191,000 hours through partners such as the HandsOn Network. The corporation also makes “Youth Action Grants” to get young people to devote hundreds of thousands of hours to community service, a program that Starbucks says it “amplified” somehow with “inspiring changemakers Blair Taylor of the Los Angeles Urban League and Geoffrey Canada with the Harlem Children’s Zone.”

Starbucks distributed a total of $22.4 million in 2010, including $17 million in corporate giving and $5.4 million in grants through the Starbucks Foundation.  The corporate philanthropy was $10.3 million in cash and $6.7 million in in-kind contributions to community building initiatives, including its commitment Product (RED)™ campaign.  If the foundation’s 2009 990 is any indication, the bulk of the grants go to or through big program initiatives such as disaster relief, youth grants, and others, and the remainder is distributed as relatively small grants around the nation apparently through local stores.

Whether one likes or dislikes Starbucks or its philanthropy, the Starbucks CSR model looks like a recipe that many corporations recognize as a solid formula for social responsibility—a mix of environmental sensitivity, global development, disaster relief, employee community service, and small grants through retail outlets.  Is there a hidden downside to the Starbucks CSR model that isn’t immediately evident from its CSR report?—Rick Cohen


  • Raffael Hoffmann

    Starbuck’s net revenue was $10.7 billion and their overall giving was $22.4 million in 2010. So, their overall giving is about 0.2% of their net revenue. If this is a recipe for social responsibility is something everybody can decide for themselves.

  • Andy Robinson

    For people who want to explore this subject in more depth, take a look at Kim Fellner’s book, Wrestling With Starbucks,

  • Geri Stengel

    I, too, wish Starbuck

  • Harriet Petti

    Great point Geri, instead of criticsism we need to applaud them, and reward the behavior so corporations and business continue to see that it is not only the right thing to do, but good for business.The profits enable them to further invest in green policy and enable them to further promote good corporate citizenship.Lets not forget we are talking about free-enterprise, they are supposed to make money.Beside you are talking of revenue, it is really about profit, what is the bottom line?

  • Ryan Salame

    10.7 billion in net revenue. so 10.7 billion – building expenses, trademark expenses, employee expenses, coffee expenses, and all the other stuff companies buy = profit. now, out of their profit how much do they give??

  • Alex

    Starbucks’ net earnings were $945 million, so that works out to about 2.4% of its profits. This is actually above average (~1% of profits is the average annual contribution). Companies can always be doing more, but it’s important to put it in the correct frame of reference before jumping to conclusions about their CSR.