Starbucks’ Next Wave of Leadership Gets More Black Girl Magic
- Mellody Hobson will become Vice Chair of Starbucks’ Board of Directors
- Starbucks’ market capitalization is about $78B
Starbucks’ (SBUX -0.21%) Board of Directors is playing a bit of musical chairs after Howard Schultz announced he was retiring as chairman of the iconic coffee chain. As a result, board director Mellody Hobson will take on the mantle as Vice Chair. What does Hobson bring to the table to ensure Starbucks continues to push forward in shaping the coffee business?
Why This Matters: Starbucks has changed the culture of how people interact with one another. Over the decades, the brand has had to react to self-inflicted challenges like closing 600 stores in 2008 after realizing it had too many locations too close to one another. More recently, the company shut down for four hours to provide racial bias training after the well-publicized arrest of two black men.
Hobson currently chairs the audit and compliance committee which is arguably the most powerful group on Starbucks’ board. The committee serves as the primary conduit between Starbucks management, internal and external audit, and the Board of Directors. It ensures the company’s management is top notch and shareholders receive all the disclosures they should.
Hobson brings continuity as Vice Chair of Starbucks board since she has likely been privy to the most information amongst the directors on the health of the business. She will have to put that knowledge to good use as Starbucks recently increased its coffee prices 10 to 20 cents depending on the location. Starbucks’ stock has had a rocky year as shares hit a low of $53.77 back in February after hitting nearly $62 in January. The stock has rebounded some but is currently down 1.5% year to date. Starbucks will need steady leadership to ensure it doesn’t drive customers away with higher prices.
What’s Next: Hobson becomes Vice Chair of the Starbucks Board of Directors effective June 26. She also holds board seats at JP Morgan, Estée Lauder, and DreamWorks Animation.
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