April 17, 2018 / 8:57 PM / 3 months ago

Breakingviews - Starbucks’ anti-racism coffee break sets example

NEW YORK (Reuters Breakingviews) - Starbucks is setting an example for corporate America with its anti-racism coffee break. Facing a backlash over the arrest of two black men at a Philadelphia shop, the chain will shut all of its company-owned U.S. outlets for an afternoon of racial-bias education. The swift response backs up Starbucks’ social goals and offers a lesson to others.

A Starbucks coffee cup with "Stop Calling Cops!" written on the side sits on a table as police monitor protestors demonstrating inside a Center City Starbucks, where two black men were arrested, in Philadelphia, Pennsylvania U.S., April 16, 2018. REUTERS/Mark Makela

The two men were waiting to meet a friend and hadn’t bought anything when the store manager called police, according to the Philadelphia Inquirer. “All the other white people are wondering why it’s never happened to us when we do the same thing,” tweeted customer Melissa DePino, who posted a video of the incident.

Executive Chairman Howard Schultz and Chief Executive Kevin Johnson quickly traveled to Philadelphia and met with employees, police and community leaders.

One result is that on May 29 Starbucks will close more than 8,000 U.S. outlets for an afternoon to provide anti-bias training to nearly 175,000 employees. That could cost perhaps $20 million in lost latte sales, based on pro-rated recent sales figures. The company has asked civil rights leaders and officials including former U.S. Attorney General Eric Holder for help developing a curriculum, which it will make available to other companies.

That sounds a bit like a PR gimmick but Starbucks deserves credit for its efforts on a broad front. The company was an early U.S. adopter of social-responsibility reporting. It gets almost all of its coffee from sustainable farms and has set targets for powering all of its worldwide stores with renewable energy by 2020, getting 25,000 employees to graduate college by 2025 and hire 10,000 refugees by 2022.

Not every initiative works. Schultz faced blowback in 2015 when he urged employees to write “Race Together” on customers’ cups to foster a dialogue on the issue. Maybe next month’s training will work better. A retail company that depends on daily interactions with millions of people has to take social currents seriously.

The #MeToo backlash over sexual abuse and harassment cost Steve Wynn the chairmanship of Wynn Resorts recently, while Facebook saw more than $65 billion wiped off its market value last month amid a furor over its data practices. They could learn something from Starbucks about how to tackle a crisis in a viral era.

Breakingviews

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