Shareholders of some of America’s biggest restaurant brands have been making a simple but loud argument during the past few years: focus on the food, not the politics. Recently, that argument seemed to land with a company you might not expect.
Outside of Cracker Barrel’s rebrand effort and Anheuser-Busch’s Bud Light woes, few companies in the food industry are associated more with politicized marketing than Starbucks. From the company’s highly publicized plastic straw initiatives to its brush with the bathroom wars, Starbucks has been a magnet for all manner of corporate activism in recent years. In January 2020, then-CEO Kevin Johnson announced aggressive targets on climate, water, and waste, but offered an interesting disclaimer about the risks: “While we’re confident these strategies are directionally right, our eyes are wide open knowing that we do not have all the answers or fully understand all the complexities and potential consequences.”
More than six years later, Starbucks looks to be having second thoughts about those strategies (and apparently about Johnson’s vote of confidence, which is now scrubbed from the company’s website). A recent Financial Times piece revealed that Starbucks is moving away from many of its most prominent climate-related goals, including reevaluating emission-reduction goals and seemingly omitting updates to past targets on water and waste. The company that defended its plastic straw phaseout in 2018 as “the best thing we can do for the environment” is now actively reducing its recycled-content goals. Who could have anticipated such a dramatic pivot?
Well, shareholders could. For years, the ones who allocate scarce capital and stake their financial future on the greenness of the company’s long-term performance have questioned the wisdom of its climate mitigation strategies. As the director of a corporate engagement firm, I saw Starbucks not only become a target for requests from the ESG-aligned left, but also acquiesce to some of them.
Take perhaps the most obvious example. In 2024, PETA came knocking at Starbucks’ door, putting a proposal on the company’s corporate ballot demanding that it study and revise the practice of charging slightly more for non-dairy milk. The rationale given by PETA? Fighting racism and climate anxiety. In a piece written at the time, titled “The ESG Lobby Wants You To Fight Racism With Oat Milk” (a personal favorite), I pointed out the elephant in the room: oat milk costs Starbucks more than cow’s milk, so an upcharge is hardly an irrational policy. Starbucks opposed the proposal at the time, seemingly to agree that an activist investor group wasn’t a good source on whether cost-priced coffee additives were, in fact, a product of deep racial prejudice. But a few months later, Starbucks ditched its opposition and phased out the nondairy upcharge anyway, under then-incoming CEO Brian Niccol, as part of a customer experience initiative.
It’s possible that the coffee giant’s many sustainability policies actually increased corporate performance and corresponding shareholder returns. That is, after all, the sustainability promise: you can go green and make green at the same time. But in our history of engaging with the company, transparency on the details of that assumption has been notoriously hard to come by. In 2025, we asked Starbucks a very simple question: did the company’s famous shift away from plastic straws actually create value for shareholders? The company’s response at the time? “We have not disclosed the financial impact of strawless lids.” Note: not a lack of actual knowledge, or a lack of analysis performed. A response that seems to indicate a mere unwillingness to offer an explanation to shareholders — the very people who, because of Starbucks’ fiduciary obligations, have every right to expect that financial impact is the leading driver of the company’s sustainability policies. To date, we have yet to receive an actual answer on Starbucks’ strawless policies, though this current shift away from ESG commitments may constitute an answer of its own.
Many companies made concessions to ESG/DEI activist groups, and many of those concessions have aged poorly. In practice, the adoption of ESG commitments often functions as a double-edged sword. Struggle to meet the commitment, even because of brand growth, and deal with activist backlash. Meet the commitment, and risk curtailing business growth and prompting further shareholder scrutiny. It’s easy to describe this as an unwinnable situation. But it’s only unwinnable if you are committed to placating both sides equally. Starbucks may be realizing, like other companies in recent years, that its past sustainability commitments may be impossible to square with the legitimate demands of growing the business and the corresponding inevitable resource use.
Amid all these realizations, an entirely defensible premise emerges, one that our particular brand of shareholder advocacy wholeheartedly defends, and one that is seeing a resurgence in corporate America as of late. When we say this to companies, we see heads nodding in approval: ditch the politics, and be a business focused on product quality and brand growth. There are, and likely will always be, activists bent on turning every company into a left-wing or right-wing company. Resisting that pressure, and remaining anchored above that fray, is the challenge facing companies today.
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