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With Schultz As Interim CEO, Starbucks Ramps Up Sustainability Initiatives

It’s back to the future—again—for Starbucks.

The chain announced today that founder Howard Schultz is returning as interim CEO to replace the retiring Kevin Johnson.

At the same time, Starbucks said it’s expanding its longstanding effort to dispose of disposable cups and lids by testing a variety of substitute options.

The chain also announced a pilot program with Volvo Car USA to install Volvo-branded, electric-vehicle charging stations—starting with stores stretching from Colorado to its headquarters state of Washington.

Upon Johnson’s retirement on April 4, Schultz will begin his third tenure as CEO—having held the position from 1986 to 2000 and from 2008 to 2017.

The management change—which Starbucks said was planned last year—and ramped-up sustainability initiatives come as the company struggles with higher product and labor costs, along with the distraction of unionization efforts at some 60 stores in 19 states.

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"It's critical we set the table for a courageous reimagining and reinvention of the future Starbucks experience for our partners and customers," Schultz said in a statement. 

The company hopes to find a permanent replacement for Johnson by this fall. 

According to a Securities and Exchange Commission filing today, Schultz will receive “$1 of compensation.”

Meanwhile, in fiscal 2022, an entity owned by Schultz will pay Starbucks “approximately $6.9 million in fees and approximately $700,000 in rent” for a hangar space lease and associated services for his “aircraft,” according to the filing.

In 2008, Starbucks’ goal was that 25% of consumers would use reusable cups by 2015—but that did not happen. Since the 1980s, it has offered a 10-cent discount on every order for the use of a personal cup or mug.

Nonetheless, the company says disposable cups and lids still comprise 40% of its packaging waste.

The company is doubling down on the use of personal cups, as explained in this video—which focuses on “contactless” exchanges between customers who provide their own containers and employees who fill them.

"Eliminating handling of personal cups ensures the safety of our partners and customers while supporting our commitment to the planet,” the video caption reads.

Among the tests under way are Borrow A Cup—in which beverage containers are designed to be returned to stores, cleaned and reused by other Starbucks customers.

An incentive-based test will offer discounts ranging from 10 cents to 50 cents for customers using their own reusable cup.

Under the pilot program with Volvo, by year’s end up to 60 Volvo-branded, ChargePoint fast chargers will be installed at some 15 Starbucks locations along a 1,350-mile route from the Denver area to the company’s Seattle headquarters.

No purchases at Starbucks will be required to use the chargers.

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