Hit Different: Starbucks Executives’ Salaries Tied To 2021 Diversity Goals

CBx Vibe:Black Coffee” Sarah Vaughan

By Sabrina Lynch

  • Only 7 of the coffee chain’s 43 Executives are People of Color
  • In the U.S. only 8% of Starbucks’ workforce is Black

Starbucks (SBUX +1.30%) is serving up more than cups of coffee to its leadership team next year, by tying Executives’ pay to inclusion initiatives. In the next five years, the roastery reserve specialist is aiming for 30% BIPOC employee representation within its corporate operations, and 40% BIPOC employees across retail and manufacturing. Although it remains a mystery on how executive salaries will be affected, the coffee giant needs to make giant strides in improving staff diversity.

Why This Matters: In the U.S, only 8% of Starbucks’ workforce is Black, 27% Hispanic, 6% Asian and 5% multiracial. In comparison, the corporate demographics paint a bleaker glimpse of the company’s D&I efforts with 65% of workers being white, 19% Asian, 7% Hispanic and nearly 4% Black.

Two years ago, the business began increasing their DEI programs after losing $12 million in profits when they closed the Seattle corporate office

Making bold promises for greater diversity is not new territory for Starbucks. Two years ago, the business began increasing their DEI programs after losing $12 million in profits when they closed the Seattle corporate office and 8,000 company-owned stores for an afternoon dedicated to anti-bias training. This was required after a manager of a Philadelphia branch called 911 on two Black men who were waiting for a friend in the store but had not bought anything.

This incident, and the global uproar that followed, prompted the company to commission an assessment on its commitment to civil rights and DEI. The compensation initiative is one of many remedies Starbucks is introducing to preserve the integrity of its culture, having sent mixed signals to workers, and customers, before. Case in point, the company launched a mentorship program connecting employees of color with senior leadership this month, but earlier this year temporarily banned employees from wearing Black Lives Matter symbols at work.

Situational Awareness: It’s important to note that 55% of Fortune 100 companies tie performance on meeting diversity goals to a portion of executive compensation. With BIPOC minorities still underrepresented in leadership positions, multiple companies have been announcing initiatives aimed at promoting diversity. Whether Starbucks’ initiative brings meaningful change remains to be seen but it is a positive step in holding leadership accountable for creating a culture of equality.

CBx Vibe:Black Coffee” Sarah Vaughan

CONTRIBUTOR

Sabrina Lynch

Welcome to CultureBanx, where we bring you fresh business news curated for hip hop culture!