By Emily O’Connor
On January 29, 2017, Howard Schultz, CEO of Starbucks, released a letter to Starbucks’ employees and partners outlining a company initiative to hire 10,000 refugees. The international coffee chain giant is committing to hire 10,000 refugees over the next five years in the 75 countries worldwide where has business operations. The initial focus of hiring will be for individuals who have served with U.S. troops as interpreters and support personnel. This is not unprecedented move for Starbucks. For years, Starbucks has prided itself on its commitment to work with individuals, communities, and local partners in creating economic opportunity. The company already has programs in place that prioritize hiring veterans, military spouses, and unemployed youth, as well as investing in low income communities through providing education and employment initiatives.
While the company’s new announcement to hire refugees has been met with a mixture of support and criticism, it highlights a growing trend in the private sector to integrate social impact initiatives into business practices. The private sector is becoming increasingly involved in addressing issues which traditionally have been led by humanitarian and government efforts. With more than 65 million displaced people in the world today, the current refugee crisis has become not only a major human rights dilemma but also a highly debated political topic. In his letter to the public, Schultz states that “these uncertain times call for different measures and communications tools” and reiterates the company’s commitment to its values of protecting human rights and promoting economic opportunity for all.
As social issues and human rights become increasingly politicized, private companies are stepping up to create market-driven solutions to some of the world’s most pressing needs. The role of corporate social responsibility or “conscious capitalism” can, in many ways, be more sustainable and far reaching than humanitarian or government interventions. By providing employment to refugees, as in the case of Starbucks, companies are creating mutually beneficial opportunities. Refugees are able to gain skills, earn a living, become economically independent, and integrate into the economy as contributors and consumers. The private sector is a powerful agent for change because it is market-driven and therefore provides sustainable, stable opportunities for refugees who live in state of constant instability and dependency on foreign aid organizations. The United Nations reports that just over 100,000 refugees were able to be resettled in 2015. If Starbucks accomplishes its goal of hiring 10,000 resettled refugees, it will become one of the single largest employers of refugees, making the Seattle-based coffee company a dominant force for social impact.
Recognizing the power of corporate social responsibility, in 2016 the Obama administration launched an initiative called Partnership for Refugees to facilitate collaboration between private companies, government programs, and humanitarian organizations. The Tent Foundation, a philanthropic initiative from the CEO and founder of Chobani, Hamdi Ulukaya, now manages the initiative by leveraging the innovations, networks, resources, and entrepreneurship of the private sector to address the current refugees crisis. Working with dozens of private companies and NGOs, the Tent Foundation seeks to recognize businesses’ current efforts in working with refugees and to inspire more companies to adopt similar CSR programs and socially conscious business strategies. Companies like Starbucks, Airbnb, and Boston Consulting Group are finding innovative ways to harness their expertise, market, and business needs to create large scale, economically viable ways to assist refugees.
Furthermore, by utilizing business for social impact, companies are tapping into changing consumer trends. Although Starbucks’ announcement was met with public criticism and even a campaign to boycott the coffee chain, studies show that consumers in the US are becoming increasingly socially conscious in their purchases. The National Retail Federation reports that a company’s authenticity and social responsibility efforts are becoming more compelling for consumers than pricing or advertising. Millennials, who now make up one of the largest generations in history, seek to support brands who align with their values and beliefs. Because of this, companies who adopt CSR as a business strategy, and not only as a means of charity, create mutually beneficial opportunities by helping refugees and profiting from consumer support.
In the current tumultuous political environment in the US, private businesses are becoming increasingly influential in addressing social issues. Howard Schultz and Starbucks believe that by prioritizing the hiring of refugees they will be creating equity for all their stakeholders. The intersection of addressing social needs, tapping into consumer trends, and harnessing business opportunity is power of CSR. By choosing to build business strategies at this confluence, Starbucks will not only dominate the global coffee industry but also will become an influential force for social change worldwide.
Sources:
http://www.unhcr.org/en-us/figures-at-a-glance.html
https://news.starbucks.com/news/living-our-values-in-uncertain-times
https://news.starbucks.com/news/starbucks-hiring-initiatives
https://nrf.com/news/connecting-socially-aware-consumers
