A group of Starbucks investors is escalating their pressure campaign over the coffee giant’s ongoing labor turmoil — and this time, they’re targeting the board.
Ahead of the company’s March 25 annual meeting, a coalition of long-term shareholders is urging investors to vote against the reelection of Jørgen Vig Knudstorp, the lead independent director, and Beth Ford, the chair of the nominating and corporate governance committee. The group cites what they call “sustained oversight failures of labor relations.”
“We have a world‑class board of directors with deep, relevant expertise, who is supporting our management team in driving a business turnaround,” a Starbucks spokesperson told Business Insider.
US baristas began unionizing in late 2021. More than four years — and four strikes, supported by politicians like Bernie Sanders and Zohran Mamdani — later, the company has not reached its first collective bargaining agreement.
Starbucks Workers United says it represents more than 12,000 baristas at over 600 locations. After Starbucks shuttered hundreds of US stores in September, a Starbucks spokesperson said the union represents closer to 550, or less than 5%, of its company-owned stores.
A Starbucks spokesperson told Business Insider in October that the company offers “best-in-class benefits” and said the union’s demands for a 77% increase in the minimum wage for hourly partners over the life of a three-year contract are “not sustainable.”
The company also said in a public statement that union delegates “prematurely ended” its last bargaining session in late December 2024.
The investors organizing against the board members include New York City Comptroller Mark Levine, Trillium ESG Global Equity Mutual Fund, Merseyside Pension Fund, and the Shareholder Association for Research and Education. They argue that Starbucks’ board has retreated from its prior commitments to strengthen labor relations as tensions have flared again.
“The sudden U-turn on labor relations oversight by Starbucks’ Board is inconsistent with the Company’s turnaround strategy and commitments — and changes have not been explained to shareholders,” the shareholder letter reads.
The letter points to mounting legal and reputational risks facing the company. In the first three years of organizing, workers filed over 700 charges of labor rights violations with the National Labor Relations Board against Starbucks and its outside counsel. The Economic Policy Institute, a nonpartisan think tank, found the number of charges filed was “almost certainly” the highest number in history.
Since January 2025, workers have filed more than 125 unfair labor practice charges, including allegations of failure to bargain in good faith and retaliatory firings. They also launched three work stoppages, the latest of which began in November and is ongoing at 17 locations. Starbucks has 16,911 locations in the US.
Starbucks has also faced a $38.9 million settlement with New York City in December over alleged Fair Workweek Law violations affecting more than 15,000 workers — “the largest labor law settlement in the city’s history,” the letter says.
An ongoing reputational risk
Jonas Kron, the chief advocacy officer at $4.2 billion Trillium Asset Management, one of the investor groups that signed the letter, told Business Insider that Starbucks’ labor reputation is “enormously important” for shareholder value.
“And reputation can slip in the world of social media relatively quickly and with some pretty small episodes,” Kron said. “It’s not that many stores, that may be true, but that doesn’t diminish the impact that it can have.”
Starbucks has acknowledged the risks posed by its ongoing labor battle. In its most recent annual report, the company said work stoppages from unionized baristas can “have a negative impact on our reputation and brand.”
The investor group argues that the board initially appeared to take those risks seriously. In late 2023, following a shareholder proposal supported by a majority and the threat of a proxy contest, Starbucks created an Environmental, Partner, and Community Impact (EPCI) Committee, tasked primarily with overseeing labor relations.
That committee was “quietly eliminated” in November, with the board taking over three months to “provide an unpersuasive justification” of its breakup, the investors wrote.
The board said the move was meant to “simplify” its oversight structure, but the investor group isn’t buying it.
“This inconsistency and abrupt reversal raise legitimate concerns about whether the Board is retreating from the focused, independent oversight it previously deemed necessary,” the letter states.
The governance shift comes as Starbucks continues its turnaround under CEO Brian Niccol, whose strategy centers on improving service and strengthening connections between staff and customers.
“Starbucks’ turnaround plan depends on an engaged workforce and improved in-store experience, both of which are strained by ongoing labor conflict,” the investors wrote.
Michelle Eisen, a spokesperson for the Starbucks Workers United union and a 15-year veteran barista, told Business Insider in a statement that Starbucks “doesn’t work” without its baristas.
“We also know that Starbucks could be the ‘Best Job in Retail,’ as company executives say, but it isn’t right now and hasn’t been for a very long time,” Eisen said. “Bringing about long-term stability at Starbucks begins with a fair union contract.”
The investor coalition argues that Knudstorp and Ford are “uniquely accountable” for the labor tensions, given their roles. Knudstorp chaired the nominating and corporate governance committee from 2019 through 2025, served on the EPCI committee, and became lead independent director in 2025. Ford joined the board in 2023, chaired the EPCI committee, and now leads the nominating and corporate governance committee.
The investors also point to what they describe as waning transparency and engagement. In proxy statements, Starbucks reported at least 30 shareholder engagements in both 2023 and 2024, and 18 in 2025.
“Taken together, these changes suggest a troubling retreat from transparency, responsiveness, and commitment to engage on labor oversight matters material to shareholder value,” the investors wrote.
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