ESG Spotlight: Starbucks plans to eliminate plastic straws by 2020.


Starbucks Corp. announced plans to phase out single-serve plastic straws by 2020 and pledged to reduce packaging waste from their drinks and meals.  Burger King, Dunkin Doughnuts, Hyatt and McDonald’s have also announced similar plans to reduce waste.

Seattle, where Starbucks is based, was the first U.S. city to ban the use of plastic straws, effective July 1.  Company executives say they are responding to advocacy groups and customers who say the convenience of straws and other plastic packaging isn’t worth the environmental damage they can have, particularly to the world’s oceans.  Ocean Conservancy estimates eight million metric tons of plastic enter the world’s oceans every year.

While the move by Starbucks is notable, coffee cafes generally spend less on plastic straws than other types of restaurants.  Seafood and burger establishments spend over three times as much as coffee shops on straws, according to research firm Technomic.  Also, while the move to paper and biodegradable materials is clearly a positive for the environment and sustainability, public officials also need to improve composting programs to handle the increase in biodegradable straws.  “This kind of material wouldn’t break down in your backyard compost bin,” noted Conrad MacKerron of As You Sow, a nonprofit that advocates for corporate social responsibility.

One last point.  Investors who are concerned about a company’s environmental, social and governance (ESG) policies and efforts want better, more consistent, corporate reporting.  As You Sow requested in a shareholder proposal at Starbucks’s annual meeting in March that the coffee chain issue a report on its sustainable packaging efforts and develop a more comprehensive plan to eliminate plastic straws and other waste.  Starbucks recommended that shareholders vote against the proposal, and it fell short of a majority.  At Via Nova, we believe a lack of reporting remains a challenge for ESG investors.