{"id":31589,"date":"2024-01-28T13:30:20","date_gmt":"2024-01-28T13:30:20","guid":{"rendered":"https:\/\/www.vosa.tv\/eng\/?p=31589"},"modified":"2024-01-28T13:30:20","modified_gmt":"2024-01-28T13:30:20","slug":"nyc-comptroller-investor-coalition-starbucks-workers-rights-assessment-beset-by-lack-of-worker-input-failure-of-board-to-accept-responsibility","status":"publish","type":"post","link":"https:\/\/www.vosa.tv\/eng\/archives\/31589","title":{"rendered":"NYC Comptroller & Investor Coalition: Starbucks’ Workers\u2019 Rights Assessment beset by lack of worker input & failure of board to accept responsibility"},"content":{"rendered":"

New York: New York City Comptroller Brad Lander, on behalf of the five New York City retirement systems, alongside Trillium Asset Management, PIRC, and the Shareholder Association for Research and Education (SHARE) (Proponents), released an analysis of Starbucks\u2019 workers\u2019 rights assessment conducted by independent assessor Thomas M. Mackall.<\/strong><\/p>\n

The analysis raises concerns about Board oversight and governance failures, a lack of worker input, and ambiguity about the company\u2019s ongoing commitment to international standards. As Starbucks prepares to resume negotiations with workers who have unionized over the past two years, and as shareholders consider the nominations of independent Board members at the Starbucks annual general meeting this spring, the analysis raises important questions about boardroom accountability.<\/p>\n

\u201cIf an assessment of how well a company is respecting its workers\u2019 rights does not actually include input from workers, it is not assessing much,\u201d said\u00a0New York City Comptroller Brad Lander, noting that it does not appear that the assessor talked to any workers. \u201cThe Starbucks Board needs to accept responsibility for the companies\u2019 shortcomings and set a clear tone from the top that it will hold management accountable to its commitments to its workers\u2019 freedom of association.\u201d<\/p>\n

“The assessor\u2019s report and the Board\u2019s response represent a sadly missed opportunity for Starbucks to pour out yesterday\u2019s bitter brew and start fresh with a bold commitment to respecting fundamental labor rights,” said\u00a0Anthony Schein, Director of Shareholder Advocacy at SHARE.<\/p>\n

“The Abridged Report is revealing and concerning. Given that the company’s 2021 SEC filings identified material reputational and operational risks related to potential unionization activity, it is troubling that, as the Assessor put it, ‘Starbucks was not prepared for the emergence of union organizing activity,'” stated\u00a0Jonas D. Kron, Chief Advocacy Officer at Trillium Asset Management, LLC.\u00a0“Starbucks Board leadership should publicly acknowledge this failure – doing so is an important step towards living up to its commitments to worker rights.”<\/p>\n

The assessment was conducted following majority shareholder support for the Proponents\u2019 2023 shareholder proposal requesting an independent, third-party assessment of Starbucks\u2019 adherence to its stated commitment to workers\u2019 freedom of association and collective bargaining rights. An abridged report of the assessment was made public in December.<\/p>\n

Rather than taking accountability for the Board failures outlined in the assessment, a letter to shareholders from independent Chair Mellody Hobson and independent Director and Chair of the Nominating and Corporate Governance Committee J\u00f8rgen Vig Knudstorp, which accompanied the publicly released version of the report, cast the assessment and its recommendations in a more positive light than warranted. The letter failed to publicly acknowledge the most salient takeaways that reflect on Board oversight, including that the company was unprepared for the emergence of union organizing activity in 2021, that Starbucks\u2019 own Global Human Rights Statement (GHRS) was not a material consideration in response to the organizing activity that emerged in late 2021, and that the report identified circumstances where there was an \u201cabsence of strong and clear governance.\u201d<\/p>\n

Unfortunately, rather than assuaging investor concern, the assessment raises additional questions of accountability for such significant governance failures, and if the Board, as currently constituted, includes the right members to implement the needed reforms.<\/p>\n

Recommendations made by the Proponents to insure a transparent and genuine assessment went unheeded by the Board. In addition to the striking corporate governance failures, the Proponents\u2019 review of Starbucks\u2019 assessment raises four main concerns:<\/p>\n

1. A lack of worker input, undermining the credibility of the assessment from the start.<\/strong><\/p>\n

There is no evidence that the Assessor spoke to any workers or obtained any worker input. Workers obviously have vital perspectives on whether the company was adhering to its policies as it responded to their effort to form and join unions, and to collectively bargain.<\/p>\n

The Proponents clearly communicated to Starbucks in advance that worker input was a threshold matter, a fundamental expectation, and necessary for a credible assessment.<\/p>\n

Proponents emphasized the need to publicize the name of the Assessor so that there would be sufficient time for inbound feedback; timely, meaningful, and effective disclosure to all stakeholders of the Assessor\u2019s identity would also be an imperative. It appears these recommendations went unheeded and the identity of the assessor was not made public prior to issuance of the report.<\/p>\n

We do not know whether Starbucks’ workers were made aware of the assessment by the company or the Assessor, whether they were informed on how they could voluntarily and confidentially contact the Assessor to provide feedback, and whether the Assessor spoke to a single worker or obtained any worker input. No worker input is reflected in the publicly-released version of the assessment.<\/p>\n

2. The assessment conducted a limited review of Starbucks\u2019 adherence to the international standards they committed to follow in their Global Human Rights Statement (GHRS).<\/strong><\/p>\n

Starbucks commits to several international labor standards including the UN Guiding Principles on Business and Human Rights and ILO Core Labor Standards, which include standards which exceed U.S. labor law. However, the assessment only measures Starbucks\u2019 compliance with U.S. law. As an example, the Assessor looked at \u201ccaptive audience\u201d meetings entirely through the lens of U.S. law and ignored international standards on the topic.<\/p>\n

Compliance with U.S. law, while obviously required, is not Starbucks\u2019 sole obligation, nor does it necessarily satisfy Starbucks\u2019 GHRS obligations. Nothing in U.S. labor law prevents Starbucks from complying with the international norms it has committed to uphold.<\/p>\n

It appears that Starbucks made commitments to internationally recognized fundamental workers\u2019 rights which it did not take into consideration as it moved to restrain union activity.<\/p>\n

3. The accompanying Board letter to shareholders calls into question whether it will seek to weaken commitment to and implementation of international labor standards going forward.\u00a0\u00a0<\/strong><\/p>\n

Investors believe that Starbucks should strengthen its implementation to ensure that it complies with both U.S. law\u00a0and\u00a0its policy commitments to international labor standards so that Starbucks workers can exercise their fundamental rights.<\/p>\n

Instead of reaffirming their commitment, the Board Letter highlights the opportunity to \u201cstrengthen\u201d Starbucks\u2019 Global Human Rights Statement and referenced the assessment\u2019s view that there are things the company can and should do to \u201cimprove its stated commitments and adherence to these important principles.\u201d Investors are unclear as to what \u201cimproving\u201d its stated commitments means to Starbucks, especially when the assessor\u2019s narrow view of Starbuck\u2019s current commitments has gone unchallenged by the Board and the assessor directly recommended \u201crevising\u201d the GHRS.<\/p>\n

Proponents are concerned that the Board has left open the possibility of weakening the company\u2019s commitments to international standards that it has already publicly pledged to follow \u2013 as eBay recently did, when its non-adherence to international standards was made public.<\/p>\n

Proponents were encouraged by Ms. Hobson\u2019s and Mr. Knudstorp\u2019s indications that the Starbuck\u2019s Board does not intend to weaken its commitments in a meeting held to discuss the Assessment after its release, and hope that commitment will be formally clarified and followed through by the Board.<\/p>\n

4. The assessment does not absolve the company of any wrongdoing despite the tone in the accompanying letters to shareholders. In fact, it raises significant questions of conduct and accountability.<\/strong><\/p>\n

Starbucks touts the assessor\u2019s statement that the company does not utilize an \u201canti-union playbook.\u201d However, the assessment did not examine Starbucks\u2019 strategy in its approach to union activity or its effect on Starbucks\u2019 workers. Even without a formal \u201cplaybook\u201d the strategy of challenging union elections, the delay of constructive collective bargaining and overall aggressive tactics, which resulted in many National Labor Relations Board actions and, as the Assessor recognized, from October 2022 to the Abridged Report date, Administrative Law Judges issued more than 35 decisions arising out of the post-August 2021 organizing activity.<\/p>\n","protected":false},"excerpt":{"rendered":"

New York: New York City Comptroller Brad Lander, on behalf of the five New York City retirement systems, alongside Trillium Asset Management, PIRC, and the Shareholder Association for Research and Education (SHARE) (Proponents), released an analysis of Starbucks\u2019 workers\u2019 rights assessment conducted by independent assessor Thomas M. Mackall. The analysis raises concerns about Board oversight […]<\/p>\n","protected":false},"author":5,"featured_media":28886,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1469,31,1378,37],"tags":[],"class_list":["post-31589","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-new-york","category-news","category-us","category-world"],"_links":{"self":[{"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/posts\/31589","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/comments?post=31589"}],"version-history":[{"count":1,"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/posts\/31589\/revisions"}],"predecessor-version":[{"id":31590,"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/posts\/31589\/revisions\/31590"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/media\/28886"}],"wp:attachment":[{"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/media?parent=31589"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/categories?post=31589"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vosa.tv\/eng\/wp-json\/wp\/v2\/tags?post=31589"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}