March 19, 2013
Shareholders, Consumer Groups Call on Starbucks CEO Schultz to Take the Lead in Getting Corporate Money Out of Politics
Company Should ‘Make Coffee, Not Contributions’
SEATTLE – Starbucks CEO Howard Schultz should institute a corporate policy against spending money in elections, said shareholders, customers, and consumer groups Public Citizen and WashPIRG at a press conference today in advance of Wednesday’s annual Starbucks shareholder meeting.
The groups also plan to deliver more than 23,000 petitions to Schultz calling on him to stop such political spending at Starbucks and then reach out to his fellow CEOs and encourage them to create similar policies at companies across the country.
“Starbucks has long had some of the strongest disclosure policies when it comes to political spending. Thanks to Schultz, we know when we buy a dark roast, none of the money’s going to dark money groups,” said WashPIRG Organizer Erin Larkin. “In a post-Citizens United world, where corporations can spend unlimited money to distort our electoral process, we need Starbucks to go a step further and lead by example to get special interest money out of elections.”
The call to action comes in the wake of the first presidential election cycle after the U.S. Supreme Court’s Citizens United v. Federal Election Commission ruling, which allowed corporations and other groups to spend unlimited amounts of money to influence elections. At least 12 percent of the money spent by super PACs in the 2012 campaign cycle came from the treasuries of for-profit corporations. This number represents only funds that were legally required to be disclosed. It does not reflect the potentially hundreds of millions of additional dollars spent by organizations that do not have to disclose.
The groups argue that unlimited spending by corporations distorts our democracy and threatens to drown out the voices of ordinary citizens. Last week, the groups held days of action across the country, taking photos of Starbucks customers holding up posters shaped like cups, labeled “Democraccino” and carrying the words, “Be Our Hero: Make Coffee, Not Contributions.”
The investor groups, represented by Green Century Capital Management and Newground Social Investment, among others, are delivering a letter signed by shareholders representing $1.6 billion in assets asking Schultz “for the ultimate assurance that the funds that we have invested in this company do not find their way into political advertisements or other election-related activities which contribute to this broken democratic system and could otherwise tarnish the Starbucks brand.”
“We applaud CEO Schultz’s track record of minimizing the risk to shareholder value by largely refraining from political contributions and call on him to cement this behavior into a concrete policy that will guide Starbucks and other sustainable companies into the future,’ said Leslie Samuelrich, senior vice president at Green Century Capital Management.
Socially responsible investment firm Harrington Investments has filed a resolution to be voted on at Wednesday’s annual shareholder meeting that would institute an official policy against forming a PAC and against direct and indirect corporate spending on elections.
“As asset managers, we have a duty to our clients to invest in corporations that are using corporate cash on corporate tasks,” stated Dale Wannen, portfolio manager at Harrington Investments. “Granted, Starbucks is one of the better performers in terms of political spending, but it’s time that corporations put an end to any funneling of funds into any election or campaign or super PAC for that matter.”
“We celebrate Howard Schultz for Starbucks’ past leadership in adopting excellent policies on transparency and reporting. Unfortunately, the issue of money in politics has become so dire that it’s time to take the next logical step: to not just report on, but to actually cease, making payments to groups whose behind-the-scenes political activity harms America and her citizens,” added Bruce Herbert, the chief executive at Newground Social Investment.
According to Kelly Ngo, a legislative assistant at Public Citizen, “Starbucks is already out ahead of the pack with its political spending disclosure practices, and going a step further by adopting a no-spending policy would send a loud and clear message that Starbucks believes lawmakers should work in the best interests of all people, not just well-funded special interests. If Starbucks takes this step, it would go a long way toward continuing to build the trust with the public that Howard Schultz sees as so essential to the success of his company.”
“As a loyal Starbucks customer, it’s important to me that Starbucks keeps democracy going by making coffee, not political contributions,” concluded Michael Padilla, a WashPIRG student at the University of Washington.
To read the petition, visit http://action.citizen.org/p/dia/action/public/?action_KEY=12140.