Steph Kronos, a pro-union activist, tries to talk to Starbucks customers as she joins Starbucks workers, former employees and supporters in holding signs in support of a strike, outside a Starbucks store in Arlington, Virginia, on the 16th. November 2023. .
Saul Loeb | AFP | fake images
A group of unions said Tuesday they would end their proxy fight in starbucks, after the two sides agreed last week to work towards a “fundamental framework” on collective bargaining.
“We believe now is the time to recognize the progress that has been made and allow the Company and its workers to focus on moving forward,” the Center for Strategic Organization said in a statement.
The SOC said it will withdraw the three candidates it had put forward for election to Starbucks' board of directors.
A Starbucks spokesperson said the company appreciated the SOC's decision and said the board remained focused on “driving long-term value for all stakeholders, including partners, shareholders, customers and farmers.”
The dismissal comes after two influential proxy advisors, Institutional Shareholder Services and Glass Lewis, recommended that shareholders vote for board candidates.
The organization had argued that Starbucks had responded to a years-long union push with a “flawed” strategy that diminished returns for shareholders and posed a reputational risk. The SOC said in its proxy filings that the company's response to widespread unionization efforts had cost the company nearly $250 million.
Last week's agreement marked a turning point for unions and management, the SOC said in its statement. The group said it thought shareholders were “optimistic” about a “good faith” effort by Starbucks to “repair its relationship with its workers.”
“Starbucks has always been committed to doing the right thing, and most importantly, for our partners who are the heart of our business,” the company spokesperson said.
The fight would have been unusual given the small size of SOC's financial interest and the group's composition. It was the first time that a union (usually opposed to activist campaigns) had drawn on the activist toolkit.
The SOC hired respected legal, communications and representation advisors who have worked on behalf of prominent activists and hedge funds. Together, they constructed a thesis that drew a line between sloppy negotiation tactics and weakened shareholder returns.
“We believe it is imperative that shareholders continue to monitor the Board's performance and Starbucks' approach to labor relations issues in the coming months, and we plan to continue holding the Company accountable in the future,” the labor group said in a statement. .
Starbucks' annual shareholder meeting is scheduled for March 13.
“We look forward to continuing to work alongside our partners as we fulfill our mission together,” the Starbucks spokesperson said.
