Starbucks Will Link Executive Pay To Diversity Targets In 2021

The company did not specify exactly how executive pay will be affected, but it set goals to raise the number of BIPOC, or Black, Indigenous and People of Color, employees across the board. At the corporate level, Starbucks is aiming for 30% BIPOC employees by 2025. In retail and manufacturing, the goal is 40% BIPOC employees within that timeframe.

Currently, BIPOC employees make up 18.5% of employees at the level of senior vice president or above.

In additional to linking executive pay to its diversity and inclusion efforts, Starbucks is launching a mentorship program connecting employees of color with senior leadership and including anti-bias materials into hiring, development and performance assessment processes, among other things.

Starbucks (SBUX) started ramping up its diversity efforts a few years ago, soon after the arrest of two black men who were waiting for a friend at a Philadelphia Starbucks caused an uproar. CEO Kevin Johnson apologized for the incident and closed thousands of locations across the country for anti-bias training. In 2019, the company commissioned an assessment on its commitment to civil rights, diversity and inclusion.

The announcement also follows a slew of corporate commitments to increase diversity, which came after waves of Black Lives Matter protests earlier this year.

Adidas plans to fill a minimum of 30% of new positions with Black or Latinx people. Microsoft (MSFT) announced a $150 million diversity and inclusion investment and a plan to double the number of Black managers and senior leaders by 2025. Wells Fargo (WFC) intends to double Black leadership in the next five years and will evaluate senior leaders based on their progress in improving diversity and inclusion in their areas of responsibility.

The efforts have caught the attention of the Labor Department, which has asked Microsoft and Wells Fargo how they plan to enact the commitments without discriminating based on race. Both companies have pushed back on any suggestion that their plans are discriminatory or illegal.

— CNN Business’s Clare Duffy contributed to this report.

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