Starbucks and its relationship with greenwashing

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Starbucks and their strategy

The push for reducing carbon footprints is becoming a global trend among companies, as they realize the importance of addressing environmental concerns. Many businesses are adopting eco-friendly practices that aim to cut down on emissions across different scopes (1, 2, and 3). Scope 1 includes direct emissions, scope 2 covers indirect emissions from purchased energy, and scope 3 refers to all other indirect emissions across the supply chain.

Starbucks, a well-known global coffee giant, has also embraced this movement by setting ambitious goals for environmental sustainability. Through its Environment, Social, and Governance (ESG) initiatives, Starbucks seeks not just to minimize its impact on the planet, but to exceed expectations in how it operates. This commitment covers everything from sourcing sustainable coffee beans to reducing waste in their stores.

Starbucks’ strategy is about more than just appealing to customers. They aim to inspire a wider audience, including partners, suppliers, and local communities, showing that being eco-conscious is not just a trend but a responsibility. By taking these steps, Starbucks and other companies are positioning themselves as leaders in the fight against climate change, while also appealing to a growing number of environmentally aware consumers. It’s a win-win for business and the planet.

Starbucks’ sustainable approach: Profit, planet, and people

Starbucks, a global leader in the FMCG industry, has adopted a strong commitment to sustainability, integrating it into its core operations. The company’s Environment, Social, and Governance (ESG) initiatives aim to exceed customer, partner, and community expectations by reducing emissions across their value chain. Starbucks’ strategy targets Scope 1, 2, and 3 emissions, addressing both direct and indirect environmental impacts. This approach has gained attention from academic institutions, becoming a popular case study in premier B-schools for its sustainable practices and green marketing efforts.

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Starbucks is also celebrated in media for its “triple bottom line” approach, focusing on Profit, Planet, and People. By balancing financial success with social responsibility and environmental stewardship, Starbucks sets a strong example for other corporations. This emphasis on sustainability not only improves their brand image but also resonates with eco-conscious consumers and partners, making Starbucks a leader in responsible business practices.

Starbucks’ bold sustainability goals for 2030

Starbucks is setting new benchmarks for sustainability by aiming to become resource-positive, which means giving back more to the planet than they consume. By 2030, they plan to cut their carbon, water, and waste footprint by 50%, compared to their 2019 baseline. Their green strategies include adopting eco-friendly product designs, reducing electricity and water consumption, and installing electric vehicle chargers. They’ve also embraced LEED-certified stores, minimized landfill waste, and reduced single-use plastics. Additionally, they partner with Nexamp on solar power projects and renovate stores using energy-efficient equipment to conserve resources, leading the way in sustainable business practices.

People centric approach

Starbucks’ sustainable strategies aren’t just about the environment—they focus on people too. The company promotes the procurement of fair-trade coffee to support farmers, empowers women in coffee-growing communities, and ensures ethical sourcing practices. Additionally, Starbucks has increased wages for employees, whom they call “partners,” and invested in their development through training programs. To make stores more inclusive, renovations have made many outlets disabled-friendly. They’ve also introduced healthier, lower-calorie drink options and snacks to cater to conscious consumers.

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These efforts aren’t limited to developed nations. In India, Tata-Starbucks has implemented rainwater harvesting, used coffee grounds as fertilizer, and introduced energy-efficient equipment. They’ve also added electric vehicle charging stations, recyclable paper bags and napkins, and adopted digital bills to minimize paper waste. By blending environmental, social, and governance goals, Starbucks is fostering positive change globally while reinforcing its community connections.

Stark criticism faced by Starbucks

Despite its strong sustainability initiatives, Starbucks faced challenges in 2023. The company reported an 8% rise in its carbon footprint and a 13% increase in landfill waste compared to 2019. Concerned by these figures, Starbucks set ambitious goals to address packaging issues, such as switching to 100% reusable, recyclable, or compostable materials and using 50% less virgin fossil-fuel-based resources. These goals reflect Starbucks’ commitment to environmental, social, and governance (ESG) standards, aiming to enhance its image around sustainability and ethics.

However, some critics accuse Starbucks of “greenwashing”—a term used when companies make misleading claims about their environmental efforts. For instance, CEO Brian Niccol’s use of a private jet sparked controversy, undermining Starbucks’ eco-friendly messaging. While Starbucks’ ESG efforts are commendable and have gained praise, the company’s decisions, such as increasing carbon emissions, show the difficulty of balancing profit and sustainability.

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Not just this, Starbucks also faces a major litigation. The lawsuit filed against Starbucks by the National Consumers League highlights the challenges in ensuring truly ethical sourcing. Although Starbucks claims to source its coffee and tea ethically, verified by programs like C.A.F.E. Practices and Rainforest Alliance, allegations of human rights abuses at its supplier farms, such as child and forced labor, undermine these assertions. The lawsuit argues that these certifications alone cannot guarantee ethical practices across their supply chain, cautioning companies against making absolute claims they cannot fully verify. Instead, businesses should focus on transparency, communicating their efforts to improve, without overstating guarantees.

Conclusion

The lawsuit against Starbucks raises serious concerns about its ethical sourcing claims, suggesting that the company may be engaging in “greenwashing”—promoting sustainability practices that are not fully verifiable. Despite using certifications like C.A.F.E. Practices and Rainforest Alliance, allegations of human rights abuses at supplier farms contradict its commitment to 100% ethical sourcing. This case emphasizes the complexities of ensuring supply chain transparency and highlights the risks companies face when making bold, absolute claims about sustainability without complete certainty or oversight.

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