Guuess how investors in Starbucks reacted when a fellow investor had the guts to stand up at the annual shareholder meeting and question why CEO Howard Schultz gave all the lovin’ to the Obama Administration but reserved its scorn for the Trump Administration.
Five points for saying they considered the question carefully.
Ten points for saying they listened sullenly but made no response.
Go to the head of the class if you figured they booed the investor.
Justin Danhof, from the National Center for Public Policy Research, referred to Starbucks’ vow to hire 10,000 refugees in response to President Trump’s travel ban order.
Danhof questioned why CEO Howard Schultz, who wrote in January, “I write to you today with deep concern, a heavy heart and a resolute promise,” when he attacked Trump’s order, didn’t have a “heavy” heart when Obama administration’s State Department in 2011 stopped processing visas for six months for refugees from Iraq.
I have two quick questions: I understand that as you said “not every decision is based on economics,” but economics are a hard reality. So, the first question is how much will investors have to spend so that company can properly vet refugees that the federal government admits it can’t always afford to vet? And why were you willing to have Starbucks’ reputation take a beating by attacking President Trump’s executive order when you lacked the courage to speak out against Obama/Clinton travel ban?
Danhof’s queries elicited boos from his audience;
If there’s one message that I think, I hope, you came away with today it’s that none of the things we’ve tried to do as a company, which is based on humanity and compassion, is based on politics. But it’s based on principles and our core beliefs … I can unequivocally tell you…that there’s zero, absolutely no evidence whatsoever, that there’s any dilution in the Starbucks brand, reputation, or core business as a result of being compassionate.
Perhaps. But a YouGov report last month showed Starbucks’ brand perception had fallen by two-thirds after Schultz’s letter; and Bloomberg News reported that xAd found Starbucks’ share of foot traffic dropped from 12 percent in January to 11 percent in February.