Starbucks CEO Howard Schultz will be replaced on April 3, following a tough couple of weeks for the coffee giant. Schultz is a well-known Democrat who openly supported presidential hopeful Hillary Clinton during the 2016 election. Despite her loss, the CEO has remained vocal on issues regarding Trump, particularly on the issue of immigration. Schultz will now be shifting to “innovation, design and development” of the high-end Starbucks Reserve Roasteries located across the globe.
Howard Schultz has been a somewhat controversial figure for Starbucks during his time as CEO, harnessing the coffee giant’s position in the market to further social initiatives. Schultz was so active in the political sphere that he was even pegged as a potential presidential candidate for the Democratic party in 2020. Therefore, it should come as no surprise that the CEO has made some politically controversial statements on behalf of Starbucks.
The Daily Mail reports that following President Donald Trump’s first immigration executive order, Schultz declared that Starbucks would hire 10,000 refugees over the next five years. In response, Trump supporters boycotted the coffee chain and sales began to dip. The BrandIndex’s Buzz score, which tracks consumer sentiment towards companies, noted a distinct drop following the January 29 announcement by Schultz regarding their refugee initiative.
The immigration comment was not the first controversial one made by Schultz. In fact, he has not been shy about where he stands on social issues. During a shareholder meeting, the CEO informed shareholders that if they did not support diversity and gay marriage, they should sell their shares. As Forbes previously reported, Schultz sent a clear message that he felt the company’s stance on diversity issues were important and that not all decisions are “economic” ones.
“Not every decision is an economic decision. Despite the fact that you recite statistics that are narrow in time, we did provide a 38% shareholder return over the last year. Having said that, it is not an economic decision to me. The lens in which we are making that decision is through the lens of our people. We employ over 200,000 people in this company, and we want to embrace diversity. Of all kinds. If you feel, respectfully, that you can get a higher return than the 38% you got last year, it’s a free country. You can sell your shares in Starbucks and buy shares in another company. Thank you very much.”
Some other political issues that Schultz has involved Starbucks in over the years includes racism and open carry gun laws. Starbucks drew criticism from Second Amendment supporters when he ran ads asking people not to open carry in Starbucks stores. The initiative was not very well received and sparked numerous sit-ins by gun supporters. Likewise, the coffee giant’s “Race Together” racism awareness initiative, in which the company asked employees to open conversations about racism with consumers by writing #RaceTogether on coffee cups, lead to awkward conversations and a fizzle.
Though Starbucks has taken some small hits from those boycotting the company for various social stances, the company, as a whole, under Schultz has skyrocketed over the years. The Seattle Times reports that Schultz took the coffee giant to a whole new level by making coffee a luxury item that was attainable. Sales have steadily rose over the years with the company growing from 17 stores in 1987 to roughly 26,000 stores today. Likewise, the company now employs over 254,000 people.
It is unclear what the long-term effect of the controversial statements will have on the company. However, it seems that it won’t be Schultz who will be dealing with them. On April 3, 2017, Schultz will hand over the reigns to Kevin Johnson, Starbucks’ current chief operating officer. The decision for Schultz to step down was made back in December of 2016.
[Featured Image by Richard Drew/AP Photo]