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Starbucks expands diversity efforts, commits $1.5B to diverse suppliers by 2030 - WSBuzz.com
Starbucks expands diversity efforts, commits $1.5B to diverse suppliers by 2030

Starbucks (SBUX) is expanding diversity and inclusion efforts that the coffee giant broadened back in October in 2020, which include a big financial commitment to diverse suppliers.

The Seattle-based company aims to achieve Black, Indigenous, and People of Color (BIPOC) representation of at least 30% at all corporate levels, and at least 40% of all retail and manufacturing roles in the U.S. by 2025.

The new plans include Starbucks boosting annual spending with diverse suppliers to $1.5 billion dollars by 2030. It will also launch a second cohort of its mentorship program for U.S. partners, and will reinstate its commitment to link those efforts to executive compensation.

"We know the impact that we can have at Starbucks and we are looking at embedding inclusion and diversity in every aspect of Starbucks," Starbucks' chief inclusion and diversity officer Dennis Brockman told Yahoo Finance in an interview. "This is the next wave of our commitment to do that."

Brockman added that through its executive compensation program announced in late 2020, top leaders are held "accountable for what we set out to accomplish here with inclusion and diversity."

As of October 2021, U.S. partners are 51.8% White; 7.7% Black; 28.5% Hispanic or Latin; 5.9% Asian; 4.9% mixed race; 0.6% American Indian or Alaskan Native; and 0.5% Native Hawaiian or Other Pacific Islander, according to its Workforce Diversity report.

Starbucks' initiative comes at a time when employers in general have attempted to address racial blindspots in workplace and supplier diversity. Meanwhile, stressed out workers at some locations have been pressuring Starbucks with organized labor efforts.

Addressing a 'very daunting' process

In fiscal year 2021, the coffee giant spent $800 million dollars with diverse suppliers, which translated into more than 6,400 jobs and $1.2 billion worth of economic impact, according to Starbucks data. One of these companies include FGF Brands, whose creations like the Blueberry Muffin and the Iced Lemon Loaf are featured at many locations.

To reach and onboard these small, diverse-owned entrepreneurs, Starbucks will also launch a free, open source toolkit with Arizona State University — an effort to address what Brockman noted was a process that can seem "very daunting" to some. 

"We want to make sure that we are sharing with diverse-owned organizations how to do business with Starbucks and make it easier to think about the certification process," the executive told Yahoo Finance. He noted that this is a lofty goal, especially at a time when small companies are struggling to stay afloat because of supply chain challenges throttling the economy.

Despite the labor crunch hitting U.S. companies across industries, Brockman is optimistic these goals can be achieved via Starbucks' key three principles of intentionality, transparency, and accountability. 

Brockman, a 14-year Starbucks veteran himself who joined the company as a District Manager in Kansas City, told his personal story in a letter to employees. He grew up in the Midwest with a single mom as the youngest of seven.

"I was exposed to the realities of Jim Crow at an early age… The idea that a young Black boy could dream of one day going to college and aspire to be something great existed in my home with my mother and siblings, in my church, and within my community, but the dream often stopped there," he noted in the letter. 

Brockman, who assumed his current role in March of 2021, stressed that he hoped to keep the memory of his mother alive through these diversity efforts.

"She was never a leader of any company… but the number of people that she attracted to our home based on her love, based on her unique opportunity to show compassion, to treat everyone the same — that's the work that I get the opportunity to embark on here at Starbucks," he told Yahoo Finance.

Brooke DiPalma is a producer and reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.

Follow Yahoo Finance on Twitter, Instagram, YouTube, Facebook, Flipboard, and LinkedIn.

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