SEATTLE — Starbucks shareholders approved a proposition for the board of directors to conduct a third-party assessment of how the company treats its workforce. The Seattle-based coffee giant, which has been facing congressional and legal scrutiny for similar concerns, previously opposed the proposition and announced it would do its own assessment.
In a 418-386 vote last week, shareholders pushed for their proposed independent assessment of Starbucks' labor rights practices. The company's response to the unionization drive, investors argued in the proposition, could hurt its positive brand reputation.
In a Securities and Exchange Commission filing last week, Starbucks said its own "human rights assessment" is already underway, and it will be more comprehensive when it is available at the end of the fiscal year. It will include a review of Starbucks' "principles of freedom of association and the right to collective bargain," according to the company.
"The fact that so many investors voted for the proposal indicates that so many investors are not convinced by what the company has been saying," said Jonas Kron, chief advocacy officer of Trillium Asset Management, which introduced the shareholder proposal.
Starbucks declined to comment on the vote.
It is unclear what the assessment introduced at Starbucks' annual shareholders meeting last month will entail because shareholders have to leave some discretion for the company, according to SEC rules. But the proposition's approval shows that investors are watching the company's pushback with the unionization movement.
Buffalo, N.Y.-based Starbucks Workers United member Michelle Eisen said the shareholders' vote is "unprecedented."
"Between workers, customers, U.S. senators, federal judges and now shareholders, Starbucks is beginning to be held accountable for their vicious union-busting campaign," Eisen said.
Starbucks maintains it is bargaining in good faith with the union and that it has scheduled negotiation sessions with hundreds of stores nationwide.
Investors began calling for Starbucks to uphold its labor standards shortly after the first successful union election in Buffalo in 2021, when Trillium sent a letter requesting that the coffee giant accept the election results.
Then in March 2022, another Trillium letter urged Starbucks to "publicly commit to a global policy of neutrality and swiftly reach fair and timely collective bargains with the workers should they vote to unionize."
Starbucks did not directly respond to a meeting request or the March letter, Kron said. The next step was to file the shareholder proposal in September with a coalition of investors that included the New York City comptroller's office.
Workers of at least 291 U.S. stores have voted to unionize, in a contentious process between the company and its workers. Starbucks has more than 9,000 stores nationwide. AJ Jones II, the company's chief communications and public affairs officer, said during the annual shareholders meeting last month the company would not enter a labor-neutrality agreement — a contract between an employer and a union in which the employer agrees to support a union drive.
Last week, former CEO Howard Schultz denied breaking labor law during a Senate congressional hearing led by Sen. Bernie Sanders.
Shareholders rejected all other investor-introduced propositions, including one calling for the company to create a more robust CEO succession plan.
