{"id":26088,"date":"2017-11-15T21:41:12","date_gmt":"2017-11-16T02:41:12","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/contents-may-be-hot-can-starbucks-navigate-a-changing-climate\/"},"modified":"2017-11-15T21:41:12","modified_gmt":"2017-11-16T02:41:12","slug":"contents-may-be-hot-can-starbucks-navigate-a-changing-climate","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/contents-may-be-hot-can-starbucks-navigate-a-changing-climate\/","title":{"rendered":"Contents May Be Hot: Can Starbucks Navigate A Changing Climate?"},"content":{"rendered":"

Coffee: An endangered crop<\/strong><\/p>\n

Take a deep breath, caffeine addicts: your daily cup \u2018o joe may be in serious danger. As the impacts of climate change continue to ripple across the planet, the agricultural sector is poised to bear the brunt of its initial effects. Coffee is a particularly sensitive crop \u2013coffee plants require a precise temperature and moisture content for proper growth, as well as predictable and stable weather patterns. As temperatures rise and rain patterns become more intense and erratic, global crop yields could plummet; even a 0.5 degree temperature difference can significantly alter growing conditions. [1] Warming climates can also give rise to diseases such as coffee rust (a fungus), and pests like the coffee berry borer (a beetle), which have already been found to cause coffee bean yield losses tallying hundreds of millions of dollars. [2]<\/p>\n

The overall potential impact of climate change on coffee production is profound: a landmark study in the journal Climatic Change<\/em> concluded that temperature variability from climate change could reduce the global area suitable for coffee cultivation by as much as 50%. [3] Low latitude and low altitude regions are especially susceptible to these climate change effects\u2014a problematic reality, given that the majority of the world\u2019s coffee production derives from these regions.<\/p>\n

Figure 1: Projected Coffee Suitability Changes by 2050 [3]<\/p>\n

\"\"Source: Bunn et al, 2014<\/p>\n

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Starbucks: Skin in the game<\/strong><\/p>\n

As the world\u2019s second-most sought-after commodity (after oil), and most frequently-consumed beverage (at an estimated 500 billion cups annually), coffee reigns supreme. [4] And in the land of coffee, Starbucks is the undisputed king, at over 25,000 locations and $21.7 Billion in sales.[5] Needless to say, as the world\u2019s foremost purveyor of coffee, Starbucks is acutely aware of the potential climate change has to roil production of its most-prized product.<\/p>\n

In addition to its tremendous financial stake in climate change, Starbucks has long been a leader in the realm of corporate social responsibility, with a commitment to have a \u201cpositive impact on the communities [they] serve, one person, one cup and one neighborhood at a time\u201d.[6] Since 2004, the company has implemented a comprehensive climate change strategy, including signing the RE100, a global corporate commitment to purchase 100% renewable energy, and has building over 1000 LEED-certified stores.[7] The company additionally conducted a comprehensive inventory of its direct and indirect greenhouse gas emissions in 2015. [8]<\/p>\n

Figure 2: Starbucks Greenhouse Gas Footprint<\/p>\n

\"\"<\/a>Source: https:\/\/www.starbucks.com\/responsibility\/environment\/climate-change<\/a><\/p>\n

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Can Starbucks\u2019 famed supply chain adapt to a new climate reality?<\/strong><\/p>\n

Starbucks\u2019 vaunted global supply chain is a case study in what long-time CEO Howard Schultz termed \u201cvertical integration to the extreme\u201d. Spanning countries and continents, Starbucks exerts tremendous control over its supply chain, with direct ownership over nearly every component of the chain from roasting plants to warehouses to retail outlets, and enforcement of strict Coffee Sourcing Guidelines and social responsibility standards for all 3rd<\/sup> party suppliers. [9,10]<\/p>\n

Amid mounting climate change threats, Starbucks has additionally ramped up efforts to strengthen the sustainability and adaptability of its supply chain at the level of front-line farmers. Examples of these programs include:<\/p>\n