Starbucks and its CSR Fail
Back in 2015, Starbucks launched a Corporate Social Responsibility (CSR) campaign called #RaceTogether. The campaign’s objective was to get Americans to talk about the elephant in the room: Race. Baristas all across the US were encouraged by management to casually chat with customers about race relations and to write the” Race Together” slogan on the cups. The idea was to kickstart a national conversation about race in response to the killing of Michael Brown, an unarmed black man shot by policemen. There were good intentions behind the campaign but unfortunately, it backfired.
Companies create CSR programs for several reasons. First, the bigger the company, the bigger the influence. In most cases, you don’t get bigger than Starbucks as they are a global company with over 300,000 employees. Second, 81% of Americans believe that corporations should take action to address important issues facing society. This means consumers want the companies they buy from to be agents of change in their community. Furthermore, one-third of Americans actively seek information about the position companies take on divisive social and political issues. Inaction and ambivalence from brands against issues like these can ultimately harm the brand in the long run. It’s clear that consumers want the brands they patronize to deliver more, not just in terms of service or product value, but in terms of making the world a better place.
These CSR programs create value for different groups. Obviously, it creates values for the people being helped by these programs. For example, when Starbucks promoted sustainable coffee-growing practices and developed guidelines for ethical sourcing of coffee, they were ultimately helping the people working in the fields, they were helping the communities that depend on the cultivation of the coffee beans. Additionally, these practices have ecological implications too, by developing ethical guidelines and promoting sustainable practices across their supply chain, Starbucks is making a positive impact as their practices are better for the land and for the people that work on it.
CSR programs also create value for employees. There is a high employee satisfaction rate within Starbucks, with 79% of baristas recommending the job to their friends. These are higher rates than some of the smaller regional competitors like Peet’s Coffee. Eventually, Starbucks was named one of the best places to work in. This all goes to show that benefits and salaries are just as important as the way that companies decide to tackle issues affecting real people.
CSR programs also create value for the company as I said, inaction and ambivalence from brands against social issues can ultimately hurt the brand in the long run. Ultimately, corporate responsibility creates value for consumers, because now they are not just drinking a cup of coffee, they are drinking a sustainable and ethically grown cup of coffee. This added value is passed on to the consumers who will keep picking the brand because of the ideological added value that stems from the hot beverage.
Starbucks eventually started running into problems with its #RaceTogether campaign. The company was met with widespread criticism and was mocked by social media users. TV shows like Saturday Night Live, for example, mocked the campaign in one of their comedy sketches.
Employees agreed, they thought it would be uncomfortable to have to talk about serious topics such as race with commuters picking up an iced coffee. The main reason behind all this criticism is the fact that a lot of people on different sides of the aisle believed that Starbucks was overstepping their limits in regards to sensitive social issues that don’t belong inside a coffee shop. America doesn’t want a rich white CEO preaching about race.
Starbucks would benefit if they keep developing their CSR programs but need to be very selective and careful with which ones are right for the brand. For example, promoting sustainable coffee-growing practices and developing ethical guidelines for sourcing coffee is right on brand. At their core, Starbucks is a coffee brand, it makes logical sense in the consumers’ minds, that they would try to make the process greener and more ethical now that they are operating in different communities all over the world. Tackling racism is something that of course comes from a good place with the best intentions, but since they aren't specifically related to the company’s core activities, they are a fairer game for criticism. I would recommend postponing talking about race altogether, and instead, as some critics say, maybe Starbucks should tackle diversity within its own executive ranks first.