Starbucks: New Rwanda Blu Bourbon Coffee
March 13th, 2006 | Posted by in Business Ethics | Business Strategy | Corporate Social Responsibility | Social Enterprise
Starbucks Corporation issued a press release today that caught my attention. Via CSRwire: A Promising Future in Every Pound; Starbucks Introduces Rwanda Blue Bourbon Black Apron Exclusives(TM) Coffee.
Here’s a clip from the release:
“Starbucks Coffee Company (Nasdaq:SBUX) this week introduces Rwanda Blue Bourbon coffee, its first ever from Rwanda and the 10th coffee in its Black Apron Exclusives(TM) line-up.
“…’Until recently, high quality coffee from Rwanda did not exist,’ explains Dub Hay, Starbucks senior vice president of Coffee & Global Procurement. ‘But Rwanda has the perfect terrain and climate for growing the highest quality arabica coffee, and the proof of that is in this cup. As our first coffee from the country, Rwanda Blue Bourbon should be celebrated not only for its amazing flavor but also for the promising future it brings the people of Rwanda.’
“…Starbucks awards $15,000 for each Black Apron Exclusives(TM) coffee for a project that will improve the lives of the farmers in the community. These projects have made immediate impacts in education, transportation, coffee-processing facilities and the environment. For Rwanda Blue Bourbon coffee, we will award $15,000 to the Karengera and Gatare washing stations in Rwanda. The money will be used to make immediate improvements to these station communities, improving efficiency and coffee quality, ultimately ensuring that farmers who use these stations will realize higher quality coffee and obtain higher prices for their crops.”
That sounds wonderful, and I hope the people of Rwanda benefit from the arrangement. Yet, I can’t help but notice the conspicuous lack of any mention whether the beans are Fair Trade Certified.
Admittedly, I have been fairly critical of Starbucks in the past and am perhaps looking for any angle to spin this seemingly “good” announcement into something sinister. In my defense, however, I would argue that if Starbucks’ motives were first and foremost focused on the betterment of the Rwandan people and the country’s economy (which certainly cannot happen in a public company as such an initiative would be in conflict with maximizing shareholder value, but I digress…), then receiving Fair Trade Certification would be one of the most important aspects of this move, if not the most important one. Otherwise, there is no guarantee that the company isn’t simply using the situation to gain positive PR and at the same time sell a “scarce,” and most certainly premium-priced, bag of coffee to its loyal patrons.
Any thoughts?
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Peter, I agree that the lack of Fair Trade Certification is a little worrying; in International Business Management last Fall, Professor Geringer showed us a video of Starbucks trade practices with farmers. For the most part, the video explained that while many companies try to operate in good faith, often times they do not take the final step necessary. For instance, between Starbucks and farmers, there are often middlemen that settle the contracts. And while Starbucks may claim it purchases coffee at Fair Trade prices, often times the middlemen are the beneficiaries and the farmers are left in poor situations.
I agree this is probably a marketing ploy for Starbucks to get more customers in to buy this exclusive coffee bean, and most customers probably wouldn’t think twice about Fair Trade between Starbucks and its farmers. I think you are on the right track, but I think for there to be any change in the situation now and into the future, more needs to be done than an internet blog on the subject. I am in no position to advocate any sort of path that would lead to more involvement in the community and society, but I think more people need to be aware of the situation. Unless all we care about as a society is our personal well-being?
James: Thank you for the thoughtful comment! Any chance you can post the title of the video? I’d love to check it out if possible.
“And while Starbucks may claim it purchases coffee at Fair Trade prices, often times the middlemen are the beneficiaries and the farmers are left in poor situations.”
I have more or less heard the same about Starbucks in the past and feel as if I have read a report that detailed the dynamic quite well. I’ll see if I can find it again.
“I think you are on the right track, but I think for there to be any change in the situation now and into the future, more needs to be done than an internet blog on the subject. I am in no position to advocate any sort of path that would lead to more involvement in the community and society, but I think more people need to be aware of the situation. Unless all we care about as a society is our personal well-being?”
I absolutely agree, especially about the need for more effort. However, I would add that any action, regardless of size and scope, has the potential to spark change. While bantering about the subject on a blog that only a small population follows is action, it is impossible to determine if there will be any positive residual movement as a result. I know you are not saying that public discourse (via a blog) is pointless, rather, I want to be certain that you are merely calling for more action.
I don’t know you well enough to make that assumption about your statement confidently, but I have a feeling that you are simply pushing for more action. I respect your opinion a lot and am looking forward to traveling with you this summer.
“Unless all we care about as a society is our personal well-being?”
Hmmm. That’s a heavy one. I’d argue, even about myself, that at some very deep and dark level, we truly care only about our personal well-being. On the positive side, I think many people (again, including myself) wake up every day and do their best to fight that primal urge.
Also, if you have a moment, search the internet for information on the Starbucks Challenge. While many people who don’t actively read and participate in blogs may not have heard of the effort first hand, the movement gained quite a bit of traction.
Hey Peter, I was looking at your eBay post, and thought what you wrote about eBay also fits Starbucks perfectly in this case:
“If you knowingly facilitate transactions between two parties where one is being taken advantage of (and you’ve been made aware of the abuse), the ethical thing to do would be to stop the machine and figure out how to prevent such abuse from happening on your watch. Otherwise, whether through complacency, ambivalence, political ideology, or osmosis, you then become a participant in the abuse. Then, on top of your participation, you receive a cut of the transaction and thus profit from the abuse. ”
I emailed Prof. Geringer about the video. In response to your comments, you are correct in that I am simply pushing for more action. However, I am uncertain as to what the correct path would be, and also I do not have the initiative to take the first step. I think it is common among consumers… to quote Joaquin Phoenix’s character in Hotel Rwanda, “I think if people see this footage, they’ll say Oh, my God, that’s horrible. And then they’ll go on eating their dinners.” Sadly, that was true about the civil war in Rwanda, and it is true for countless numbers of other wrongdoings in the world.
Thank you for looking into the information on that video—if you come across any others that are in the same arena, definitely point me in their direction. If you haven’t seen Enron: The Smartest Guys in the Room yet, I’d definitely recommend it. I watched it again last night with my wife and think it is a great film.
I was going to respond to your comment above about not having the initiative but then saw the follow-up post you made on your blog. I’ll say something anyway, even though I know you are already aware of this, simply for the benefit of someone who may not have considered the following yet:
One of the things I was guilty of all the time a few years ago (and to a certain extent, an area I continue to fail in) was underestimating myself or not giving myself enough credit. In my opinion (and I think you would agree with this now), you are well beyond taking the first step. You are poking around, reading opinions, offering counter-points, participating, thinking, questioning, etc. To me, that looks like a huge amount of initiative.
Your rhetorical question about whether people ‘care only about their well-being’ expresses the same viewpoint I would offer regarding a broader discussion of ‘initiative’ by asking how many people take the initiative to even stop and notice that something might be a little off, let alone progress to the point you have?
I try to be an optimist all of the time, but often struggle with what I perceive to be a deep ambivalence (at least in the US) about some of the heavier issues the world is struggling with. What helps is realizing that I can’t possibly know what goes on in anyone’s head other than my own (I have trouble with that one too) and that assuming that the masses are generally ambivalent is both unfair and stifles progress. It’s a lot easier to stew in the corner of my room about how little people care than it is to give them a bit of credit, go outside and engage the world. And as you pointed out on your blog, it’s the engagement the promotes change.
Hotel Rwanda is an amazing and disturbing film. I had forgotten the line you mentioned but remember feeling sick when Joaquin Phoenix said it. The line is definitely appropriate, but the optimist in me wanted to shake the TV and tell him that I, for one, wouldn’t be able to eat my dinner again for a very long time.