One does not lose one’s rights to participate in the political process just because someone becomes a celebrity, a CEO of a major corporation, or a pastor of a church. Yet it is clear that some discernment is wise. What is also clear is that this discernment is often lacking.
When your work puts you in the public view, you risk alienating people if you choose to promote politically-charged issues. For some like writers and editors, that’s part of their job. However it is not the job of the CEO of a coffee business to advocate for or against issues unrelated to that business. In fact, when the CEO does so, he is no longer acting in the best interests of the shareholders, and is thus derelict in the performance of his duty which is to maximize the profits that accrue to those shareholders.
So it comes as no surprise that the statement by Howard Schultz, Starbucks’ chairman and CEO, in support of open borders and immigration has come back to bite the firm.
The backlash from some consumers about Starbucks’ decision to eventually hire 10,000 refugees worldwide could negatively impact sales in the near term, according to analysts at Credit Suisse, who reiterated a hold rating on the coffee seller.
“Our work shows a sudden drop in brand sentiment following announcement of the refugee hiring initiative on Jan. 29th, to flattish from a run-rate of ~+80 (on an index of -100 to +100). Net sentiment has since recovered, but has seen significant volatility in recent weeks,” equity analyst Jason West wrote in a research note.
Whether Mr. Schultz considers this a price that he’s willing to have the firm pay for positioning the company as part of the anti-Trump left is unknown. Nor can one be sure for how long any negative impacts will last.
What is clear is that Mr. Schultz should conduct his political posturing outside of the business he leads, a point a competent board of directors should make plain to him if the shareholders don’t.
Source: CNBC
Photo: Richard Eriksson
Starbucks should stay out of politics. I will not buy another Starbucks product and was a regular, 3 to 4 times a week.
Its about time for corporates to step to the social responsibility plate the way that Starbucks has. The immigration issue is not a political issue but a human survival issue and Starbucks will be seen as standing on the right side of an important world wide issue and not on the sidelines just profiting from immigrants as a cheap source of labor the way the vegetable industry and fruit picking has taken advantage of Mexican immigrants in the USA for so long without fair wages or health benefits.