Starbucks Corporation Fiscal 2007 Corporate Social .
Starbucks CorporationFiscal 2007 CorporateSocial ResponsibilityAnnual Report
Contents4Letter to StakeholdersStarbucks and Corporate SocialResponsibility5About This Report8Key Performance Indicators Summaryand Highlights for Fiscal 200711 Starbucks Company Profile12 Integrating Corporate SocialResponsibility (CSR)SOCIETYDIVERSITY44 Starbucks Community & Growth Impacts89 Fostering Diversity, Inclusion andAccessibility49 Starbucks Community Investments54 Our Contributions to CommunitiesAround the World57 The Starbucks Foundation61 Starbucks Commitment to Health andWellness90 Diversity, Inclusion and Accessibility inthe Workplace93 Supplier Diversity93 Urban Coffee Opportunities94 Independent Assurance Report65 Being Responsive to Our Customers66 Public Policy and Government AffairsRESOURCES16 External Recognition17 United Nations Global CompactENVIRONMENTPRODUCTS67 Our Commitment to EnvironmentalStewardship18 Our World of Products68 Our Climate Change Strategy20 Advancing Our Model For Sustainability71 Understanding and Improving OurEnvironmental Footprint21 Coffee – Sustainable Relationships23 Sustainable Prices78 Starbucks Long-Term Commitment toEnvironmental Responsibility25 Defining Criteria for Sustainability:C.A.F.E. Practices30 Fair Trade Certified and CertifiedOrganic CoffeesWORKPLACE79 Providing A Great Work Environment32 Investing in Coffee Communities80 Listening to Our Partners36 Seeking Continuous Improvement83 Offering Benefits to Our Partners38 Responsible Cocoa Sourcing Program– Cocoa Practices84 Focusing on Health and Wellness41 Tazo Tea – Advancing Our Commitmentto Sustainability42 Sustainable Procurement86 Partner Training and Career Development88 Workplace Policies and RespectingPartners’ Rights88 Health and Safety43 Quality Assurance and Product RecallsStarbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report2
It began,as many good things do,with a few genuine,heartfelt conversations.Some sincere, open discussions among a core team ofindividuals who were determined to make sure Starbuckswould become the premier purveyor of the world’s finestcoffee. Frank, forthright, perhaps a bit idealistic, weexamined our values and our beliefs. And we asked ourselvesjust what kind of coffee company we would create.We discussed how critical it would be that we consistentlyapply the highest standards of excellence to the purchasing,roasting and fresh delivery of our coffee. And how essential itwould be that we treat coffee farmers respectfully, helping themachieve the kind of success that would ensure our own future.Today, the effort and energy we invest in ethical coffeesourcing is a direct manifestation of those conversationsthat took place back when we were just starting out. Adiscussion about the kind of coffee company we werecommitted to being – then, now and forever.Starbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report3
Dear Stakeholders,My journey with Starbucks began when I walked into our first storein Seattle’s Pike Place Market more than 25 years ago. Insidewas extraordinary coffee from around the world, roasted with careand shared by people who were passionate about coffee. Anothertransformational moment came a few years later. On a business tripto Italy, I discovered the romance of espresso and the coffeehouseexperience that would define today’s Starbucks.And in the past year, I had a life-changing visit to a coffeecooperative in Rwanda, where I was met by thousands of coffeefarmers and their families. It was an emotional experience for meto see the positive impact Starbucks is making in this community.I reflected on the tremendous responsibility we have as a companyto ensure that we are building an enduring company – not just forourselves, but also for families in coffee-growing communitiesaround the world who rely on us for their livelihoods.Our company is in the midst of a transformation – one that willreinvigorate our business by renewing our focus on coffee andthe customer experience. These three profound experiences arehelping inform our future direction. We are dedicated to embracingour rich coffee heritage, reigniting the customer experience inour stores, and reaffirming our commitment to being a deeplyresponsible company.I believe that Starbucks commitment to ethically sourcing androasting our coffee differentiates us as a leader in our industry. Infiscal 2007, 65 percent of our coffee was purchased from C.A.F.E.(Coffee and Farmer Equity) Practices–approved suppliers who areintegrating our rigorous standards for sustainability throughout thecoffee supply chain. Our goal is to be purchasing 80 percent ofour coffee through C.A.F.E. Practices by 2013, and extending theprogram’s reach to areas in Africa and Asia.Another priority is to develop and implement a global environmentalstrategy for our business. The changes we will make will focus ondecreasing our carbon footprint as we grow. We are also working tostrengthen the connections with the communities we serve by engagingwith our neighbors and stakeholders.The foundation of everything we do at Starbucks is our MissionStatement and Guiding Principles. Although we haven’t always beenperfect, we have always been dedicated to being the kind of companythat is trustworthy and authentic. Being transparent and openlysharing our successes and challenges through our Corporate SocialResponsibility Annual Report is an important part of our strategy.Another component is our support of the 10 universal principles of theUnited Nations Global Compact.Even during this time of change for our company, one thing that willnever change is our long-standing commitment to conducting businessin a responsible and ethical manner. Going forward, we will only deepenour approach by continuing to integrate social and environmentalresponsibility into every aspect of our business. I invite you to comealong with us on this journey.Howard Schultzchairman, president and chief executive officerSTARBUCKS MISSION STATEMENT ANDGUIDING PRINCIPLESTo establish Starbucks as the premier purveyor of the finestcoffee in the world while maintaining our uncompromisingprinciples as we grow.The following six Guiding Principles will help us measure theappropriateness of our decisions: Provide a great work environment and treat each other withrespect and dignity.Letter to Apply the highest standards of excellence to the purchasing,Stakeholdersroasting and fresh delivery of our coffee. Embrace diversity as an essential component in the way wedo business. Develop enthusiastically satisfied customers all of the time. Contribute positively to our communities and our environment. Recognize that profitability is essential to our future success.Starbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report4
sityStarbucks andCorporateSocialResponsibilityAbout This ReportScopeThis report includes information on Starbucks U.S. and Canadacompany-operated retail and global supply chain operations – theareas that represent the majority of Starbucks social, environmentaland economic impacts. Starbucks system for collecting and reportingreliable social, environmental and economic performance data doesnot encompass all of our operations. We acknowledge the impactsof our licensed and international stores, but we currently do nothave a systematic way to collect reliable data from these operations.Where available, anecdotal information is included for international,licensed store operations and joint ventures. Information on totalcoffee purchases is for Starbucks brands, including Starbucks coffee,Seattle’s Best Coffee and Torrefazione Italia coffee.Reporting YearStarbucks fiscal year 2007 (October 2, 2006–September 30, 2007),unless otherwise noted.CurrencyAll references to currency are in U.S. dollars, unless otherwise noted.Starbucks 2007 CSR Report andPrevious Reports www.starbucks.com/csrInformation IntegrityStarbucks management is responsible for the preparation and integrityof the information in this report. Through a system of internal controls,including a comprehensive verification process involving internalsubject matter experts, we believe this report fairly represents our CSRactivities and results for the fiscal year ended September 30, 2007.External verification is provided by Moss Adams LLP. Read the Moss Adams Independent Assurance Report.About This ReportStarbucks and Corporate Social ResponsibilityStarbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report5
Global Reporting InitiativeFocusing on MaterialityStarbucks reporting continues to be influenced by the GlobalReporting Initiative’s (GRI) G3 Sustainability Reporting Guidelinesin determining relevant content and performance metrics to include.This is Starbucks seventh annual Corporate Social Responsibility (CSR)Report. This year, we took a different approach by publishing a fullreport online, along with a short printed report focused on our coffeepurchasing practices. We also produced a summary highlights brochureof our CSR initiatives and performance for fiscal 2007. This brochureis distributed through Starbucks stores and available at the StarbucksSupport Center in Seattle and Regional Support Centers (U.S. andinternational).The GRI Table is available for review online in the Downloadssection at www.starbucks.com/csr.A description of how we applied the GRI principles is included inTransparency and Reporting later in this section. We self-declarethis report to GRI Application Level B . Learn more about GRI at www.globalreporting.org.We began our reporting process for the fiscal 2006 CSR Report byconducting a materiality assessment to ensure that we are aligned withthe materiality principle of the Global Reporting Initiative regardingcontent. Specifically, the topics and indicators covered in our CSRReport should reflect Starbucks significant economic, environmentaland social impacts, or substantively influence the assessments anddecisions of our stakeholders. We consulted a variety of inputs – bothinternal and external – as part of our materiality assessment. Company objectives, strategies, policies, programs and risk factors. Partner (employee) surveys and other input gathered through variousfeedback mechanisms. Customer contact feedback. Shareholder resolutions and anecdotal feedback. Input gathered through stakeholder dialogues. Informal input from coffee suppliers. Media coverage and blog discussions of issues. Stakeholder feedback specific to Starbucks 2005 CSR Report. Global Reporting Initiative (GRI) recommended topics and datafor inclusion.After reviewing these inputs, we compiled a list of issues, andprioritized each one based on the following criteria: The importance of the issue to – and potential impact on –Starbucks. The importance of the issue to – and potential impact on –external stakeholders. The amount of reasonable control Starbucks has over aparticular issue.Based on our assessment, we determined that the material issues ofgreatest importance to Starbucks and our stakeholders, over whichthe company has a reasonable level of control, fell into five topic areashighlighted on the next page. We revisited our assessment at the timewe began work on our fiscal 2007 CSR Report and decided that theissues identified here continue to represent what is most material toStarbucks and our stakeholders.The most material content in our report is shown in the upperright box in the matrix on the following page and indicated ingreen boxes throughout the report.Starbucks and Corporate Social ResponsibilityStarbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report6
Materiality MatrixCoffee purchasing practices Fair Trade Certified coffeeWhat Matters MostCoffee purchasing practices Prices paid to coffee farmers and suppliers Respect for workers’ human rights Long-term availability of high-quality coffeeGrowth and expansion Impacts on local communitieshealth and wellness Products Nutrition informationworkplace practices Culture and benefits Satisfaction and engagementCoffee purchasingpractices Organic and conservationenvironmental practices Water usage Waste and recycling Sustainable packaging Transportation/distribution impactsCustomer Concerns rBGH dairy Marketing to youth CaffeineiMportantsiGnifiCanCe to externaL stakehoLdersvery iMportantenvironmental impacts Climate change Energy consumption Paper cupsGovernance Executive compensation Majority voting forboard members Transparencystakeholder engagementLocal Communityengagement Charitable giving Partnerships Partner (employee)volunteerismdiversity Workplace Supplier CommunitiesSustainable Sourcing Supplier Code of Conduct Human rights/working conditions Tea Paper Ethos waterresponsible Marketing Starbucks LiqueursiMportantcoffee purchasing practices Verification and transparency Access to credit Social investmentsenvironmental impacts Store design and operationsworkplace practices Training and development Right to organize Health and wellness Health and safetyManaging Corporatesocial responsibility Vision and priority setting Ethics and governanceCocoa sourcing practicespublic policyGlobal philanthropic programsvery iMportantsiGnifiCanCe or potentiaL iMpaCt on starbuCksStarbucks and Corporate Social ResponsibilityStarbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report7
Key Performance Indicators Summary and Highlights for Fiscal DICATOR200620072008TARGETWHAT WE SAID INFISCAL 2006WHAT WE DID INFISCAL 2007SELFRATINGMOREINFOPounds of green(unroasted) coffeepurchased fromC.A.F.E. Practices–approved suppliers155 millionpounds228 millionpounds(goal: 225million pounds)Introduce a revised versionof the C.A.F.E. Practicesguidelines to allow forstreamlined, efficient andobjective scoring.Introduced a new scorecard– Version 2.0 – for C.A.F.E.Practices. Version 2.0 includesguidelines on more than 200specific indicators, making thesupplier implementation morestraightforward.Page 25(goal: 150millionpounds)Target is basedon a percentageof our totalcoffee purchases(below) ratherthan the numberof pounds.Update our guidelines toaccount for regional differences,including clarification ofminimum performance levelsand compliance with local laborlaws and wages for permanent,temporary and seasonalworkers.Began evaluating the datacollected from the launch ofC.A.F.E. Practices Version 2.0and using it to understandregional differences, whereimprovements or more trainingand support are needed, andhow best to continue expandingC.A.F.E. Practices in East Africaand Asia Pacific.Page 27PRODUCTSCoffee andFarmer Equity(C.A.F.E.)PracticesFair TradeCertified coffeePercentage of totalgreen (unroasted)coffee purchases53%65%65%Implement a new IT systemfor online verifier reporting andscore calculation.Implemented a new technologysystem for online verification,which has helped to streamlinethe reporting process.Page 27Pounds of green(unroasted)coffee purchasedfrom Fair TradeCertified cooperatives18 millionpounds20 millionpoundsFair TradeCertified green(unroasted)coffee purchasesto supportforecastedsales. We expectthat Fair TradeCertified coffees couldrepresent 5% ofour total coffeepurchases in agiven year.Support and promote the sale ofStarbucks Fair Trade Certified Café Estima Blend coffee inStarbucks company-operatedstores, foodservice channelsand other points of distribution.We saw an increase inawareness of the Fair Trademovement, which resulted inmore demand for StarbucksCafé Estima Blend coffee. Wehave continued to find ways topromote Fair Trade Certified coffee to our customers, oftenworking in tandem with FairTrade national initiatives aroundthe globe. In October 2007,Starbucks participated in “FairTrade Month” by featuring CaféEstima Blend twice as theCoffee of the Week in our U.S.stores.Page 30Percentage of totalgreen (unroasted)coffee purchases6%6%Continue to work with FairTrade organizations tocommunicate key findingsand challenges, providetransparency to the farmerlevel, augment the businesscapacity of participating FairTrade cooperatives, and supporta multifaceted approach toethical, sustainable coffeepurchasing.Starbucks and TransFair USAare continuing to work ontransparency issues.Page 30KEY:AchievedMakingProgressDid notachieveKey Performance IndicatorsStarbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report8
INDICATOR200620072008TARGETWHAT WE SAID INFISCAL 2006WHAT WE DID INFISCAL 2007SELFRATINGMOREINFOTotal cash and inkind contributions 36.1 million 18.0 millionDo not currentlyset targets forfuture charitablecontributions.Starbucks and The StarbucksFoundation will announce aglobal philanthropic frameworkfocused on supportingeducational initiatives inStarbucks retail markets aroundthe world.Page 50Percentage ofpre‑tax earnings4.0%1.7%Created a new approach andfocus for our local givingprograms that will be centeredon our vision to strengthenlocal communities by aligningresources and leveragingtechnology to support youngsocial entrepreneurs who areseeking to change their localcommunities through innovativeideas, volunteerism and civicaction.Number of hoursvolunteered bypartners andcustomers in theU.S. and Canada383,000320,000(goal: 421,000)Starbucks updated the MakeYour Mark guidelines in fiscal2007, providing clarity on thenumber of team projects eachstore could submit annually.Page 52(goal:375,000)ElectricityKilowatt-hours persquare foot of retailspace per month6.576.78By 2010, we willreduce energyuse by 25% inall companyoperated andinternationalstores.Work with the U.S. GreenBuilding Council to developLEED (Leadership in Energyand Environmental Design)standards for the retail sectorthat set out best practices forenvironmentally sound design ofnew stores.Continued to play an activerole in advancing the USGBC’sLEED standard for retail throughits Retail Pilot project. We arecurrently working on the finalapplication for our volume buildprototype, anticipated to becompleted in 2008.Page 71WaterGallons per squarefoot of retail spaceper month2625Target has notbeen established.Use a representative sampleof stores as a “test bed” tomonitor energy and water usageas part of a comprehensiveaudit to help us determineconservation opportunities.Began a six-monthcomprehensive energy audit,which involved 24-hourmonitoring of all aspectsof energy usage among arepresentative sample of 19Starbucks stores in the U.S.Results will be evaluated inspring 2008.Page 75PaperPercentage ofpost-consumerfiber (not includinghot cups)66.4%62%66.9%(goal: 66.9%)Test the Environmental PaperAssessment Tool (EPAT) withour top two suppliers of paperproducts to help determine howto best incorporate the tool intoour paper procurement decisionprocesses.Postponed our plans to test theEPAT tool until fiscal 2008.Page 77(goal: 50%)Percentage ofunbleached fiber(not includinghot cups)86.3%76%(goal: 87.1%)The decreases in post-consumerfiber and unbleached paperpercentages were mainly drivenby increases in tonnage butno significant increase to PCFor unbleached paper changesin product categories. We areclose to maximizing PCF andunbleached in many categorieswithout having operationalimpacts to products.Page 77(goal: ake ProgressDid notachieveKey Performance IndicatorsStarbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report9
INDICATOR200620072008TARGETWHAT WE SAID INFISCAL 2006WHAT WE DID INFISCAL 2007PartnersatisfactionPercentage ofsatisfied or verysatisfied partners86%Percentage ofengaged partners69%Conduct aPartner ViewSurvey of allpartners incompanyoperated storesglobally.Take additional steps to respondto the fiscal 2006 Partner Viewsurvey results in the areas ofpay and bene
Starbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report 2 SOCIETY 44 Starbucks Community & Growth Impacts 49 Starbucks Community Investments 54 Our Contributions to Communities Around the World 57 The Starbucks Foundation 61 Starbucks Commitment to Health and Wellness 65 Being Responsive to Our Customers 66 Public Policy and Government Affairs
Starbucks Fiscal 2007 CSR Annual Report will be available online at starbucks. com/csrannualreport in May 2008. Market Information Board of Directors Howard Schultz Starbucks Corporation, chairman, president and chief executive officer Barbara Bass Gerson Bakar Foundation, president Howard Behar Starbucks Corporation, director
Starbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report 2 SOCIETY 44 Starbucks Community & Growth Impacts 49 Starbucks Community Investments 54 Our Contributions to Communities Around the World 57 The Starbucks Foundation 61 Starbucks Commitment to Health and Wellness 65 Being Responsive to Our Customers 66 Public Policy and Government Affairs
Starbucks Corporation is an American coffee company and coffeehouse chain. Starbucks was . Peru and first store in Russia in 2007. In February 2016, Starbucks announced that it will enter Italy, its 24th market in Europe and the home of the . Starbucks results for fiscal 2017 continued to demonstrate the strength of its global business
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U.S.A. Starbucks Coffee Company P.O. Box 34067 Seattle, WA 98124-1067 206-318-1575 Starbucks Coffee Company 2401 Utah Ave. S., Suite 800 Seattle, WA 98134 206-318-1575 EMEA Starbucks Coffee EMEA BV P.O. Box 58081 1040 HJ Amsterdam 31-20-4076500 Starbucks Coffee EMEA BV - Starbucks Coffee Company
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