Tim Adams discovers whether Howard Shultz’ plans are good deeds, or just froth
On the long drive up to Dukunde Kawa co-operative in Musasa I sit with Harriet Lamb and Rob Cameron and ask about the implications of Starbucks becoming a Fairtrade organisation in the UK. Isn’t the scale of the operation at odds with Fairtrade’s “know your farmer” ethos?
Lamb is adamant that it is not. The Starbucks deal is one of a number of agreements with large corporations that are currently being rolled out.
Cadbury’s, for example, is about to make Dairy Milk a Fairtrade product. It is, both Lamb and Cameron believe, a natural process of evolution.
“We started with the early adopters, what we call the 100 per centers, the real pioneer brands, Divine chocolate, and Café Direct coffee, and Traidcraft.
Next came some retailers, and now we are getting to the really big players. Starbucks originally said to us we will offer a Fairtrade product as an option and see what happens. When it went down well, we said: ‘Why not do it across the board?’”
Lamb has some research that suggests that 65% of shoppers are willing to pay 10p extra for a bag of Fairtrade-certified coffee.
In that sense isn’t the Starbucks commitment really a clever piece of risk-free marketing?
“Well, I am sure they have their research,” Lamb suggests, “but their commercial interests are not really our problem.
We are there to try to get the best possible deal for the farmers. It stretches beyond price and premium. Their access to loans is improved. Their access and to long-term contracts is improved.
The risk for Starbucks,” she says, “is the fact that they are committing themselves to a global system where the standards are set by multi-stakeholder dialogue, and producers and consumers are very much part of that dialogue.”
“And once you are in Fairtrade,” says Cameron, “it is very hard to leave.”If multinationals like Starbucks come on board, how do they keep the pioneer brands - led more by altruism than shareholders - distinct?
“The role of those brands is critical too because they are always going to raise their bar to the next level. In many cases the chocolate bars and the coffee are actually part-owned by the producers.
Now that is really exciting. That is the next stage.”
I can, I suggest, see the advantages to Starbucks of having a Fairtrade product in the UK.
What does Lamb see as the primary benefits to the farmer?
She tells the story of a farmer in Costa Rica who always sold his coffee to the first middleman who came through his village; he had no idea where his coffee was going or what was a fair market price.
Now, as part of a co-operative, with a long-term fixed contract to sell Fairtrade, he discusses the day’s commodities prices on the New York trading floor with a buyer he can trust.
“The greatest benefit is empowerment,” Lamb says. “The farmers are no longer just impoverished figures at the end of a supply chain - they are international businessmen sitting around a table with Howard Schultz!”
Later that morning the leaders of the Dukunde Kawa co-operative are doing just that.
Schultz has arrived in Musasa by helicopter, loaned by the president, deus ex machina, and now he is seated in an annex of the Fairtrade premium-built canteen discussing the co-operative’s concerns.
It is an odd scene, the multimillionaire and the peasant farmers, but as well as being a good storyteller Schultz is an attentive listener.
The co-operative members raise their questions, and Schultz attempts to address them. One man says they have had difficulties raising a microloan.
“I think we can solve that problem,” Schulz says, and outlines a microbank that Starbucks can help them to access.
‘”We are selling coffee in euros and being paid in dollars ... “ another man suggests.
Schulz believes, too, that those currency problems can be resolved. He refers to the Farmers Support Centre in Kigali, with a full-time staff of two - his first employees in Africa - which he hopes will become these farmers’ new “home”.
There is talk of pests and fertilisers and the administrative costs of fair-trade certification. Schultz gives the impression of being able to solve any problem.
When the question of cows comes up, he calls across to Darcy: “Let’s see if we can organise some cows.” Harriet brings the women into the conversation.
They speak of their hope to set aside one day a week when they can make their own coffee, a feminist brew, “because we work harder at it than the men”.
There is a general agreement that the farmers would like to be able to sample their own product - many of them have never tasted coffee - and again Schultz points them toward the Farmers Support Centre, which will have a “cupping” facility to allow them to taste their coffee and learn how to improve its quality.
When the meeting breaks up, Schultz heads off to address the entire co-operative of 2,000 farmers plus families who have gathered on a hillside.
It is an impressive sight. “Starbucks is here to stay,” Schultz says. “We are going to be buying coffee from you for many years, we see something in the hearts and minds of the people here, and we want to bring it to our stores all over the world ... “
As he leaves for the helicopter, the coffee collective’s choral society joins in a farewell song. I ask for a translation.
“Through coffee we should be able to make money and be rich,” the chorus goes. “All the women grow coffee, please, and will all be wealthy.” The drummers go wild as the helicopter takes off.
It has taken Howard Schultz a long time to integrate an idea of Africa into his great Starbucks narrative.
In his memoir of the company’s growth, Pour Your Heart Into It, the first and only mention of Africa (of a trip made to Kenya by a colleague) comes on page 295.
Over an early-morning Rwandan coffee the following day, I ask him why it took him so long to get here.
Schultz suggests that in the early years of Starbucks’ growth, they were so concerned with paying the bills that they did not have too much time to think of what he likes to refer to as “origins” - his global network of coffee farmers in 30 countries.
“We were fighting for survival every day. I remember sitting at the kitchen table and trying to figure out how we were going to pay the milk guy ... “
But after that, when things started to go well?
“I think we as a company realised a long time ago that whether we liked it or not we inherited a relationship with many different people across the planet.
We’ve tried to integrate our values in all those relationships. We haven’t always got it right. It’s hard, especially when you get bigger and successful people are looking for the warts as opposed to the positives.”
In the past few years, the positives for Starbucks have been a little hard to come by. Its ethical standards and anti-union practices were widely debated - particularly in the damning documentary about Ethiopian coffee, Black Gold.
After two decades of unprecedented growth, profits also fell last year by more than 50%. The firm announced more than 10,000 job losses and 1,000 store closures.
Schultz, who had stepped back from the day-to-day running of the company in the millennium year to spend more time with his family, returned as chief executive in January 2008.
He came back, he says, “principally to try to fix some things. I just felt we had achieved 15 years of astounding success as a public company, and I think success sometimes breeds entitlement.
We reached the point where I thought maybe the company was drifting. I didn’t want to come back to point blame; I just wanted to get back to the culture that formed the company.”
It seems that the fair-trade commitment in the UK and the involvement in Rwanda is a key part of that attempt to reaffirm values, join up the various parts of the Starbucks story. Is that why he is here?
“I think it is emblematic of what we are trying to be about. I remember my early conversations with President Kagame, where he was outlining his vision for Rwanda.
It took me a while to understand that in fact Starbucks could come here and really make a difference. We do not have the resources to do it all.
The line is so long of people who have needs.” Is it, I wonder, in part a kind of penitence? Starbucks became in some minds synonymous with the excesses of multinationals, wedded to growth at all costs ...
“I think that association has been blown out of proportion,” Schultz says. “In some way we were labelled as one of the poster children of the prevailing culture, but that was never fair.”
Would he like to see all the coffee they sell across the world be Fairtrade? He would, he says, and that is the way they are heading, though there are questions of quality and supply to deal with.
I wonder, thinking back to yesterday, how strange it felt for him to be sitting down with the coffee farmers, given all that he has, and all that they lack.
“It is perverse,” Schultz suggests. “The only difference between me and them is that I was born here and they were born in Rwanda.
The determination we must have when we get to our daily lives is that we do not forget them, and their stories.”
As Schultz goes on to describe how his formative years have given him a special affinity for understanding poverty I find myself thinking of another question: can any organisation as vast as Starbucks and one so in thrall to its shareholders really keep the lives of Rwandan coffee farmers at the front of its thoughts?
The Fairtrade commitment is one answer, but it is not the whole story. Later that day a farmer’s leader we meet offers Schultz a parable of his own, which describes the impact he hopes he might have on the CEO.
“At one time there was a great king who had a loyal servant,” he says. “The great king says to the humble servant: ‘You have served me well, and if I could give you anything as a reward, what would it be?’
The servant thinks for a long time and then he says: ‘What I would like is this. I would like that the next time you meet with all the other kings from the region and they sit around you in their fine clothes, I would like you at one point to break off from talk with them and lean over to whisper something in my ear, let them know I am important too ... ‘”
Do stories like that ever come true?