Starbucks Corporation CORPORATE SOCIAL RESPONSIBILITY ...

Starbucks Community InvestmentsStarbucks seeks opportunities to contribute positivelywherever we have a presence. At any given time, we maybe funding a water purification system in Indonesia;contributing to the rebuilding of a library damaged by anatural disaster; or helping to establish a new high school in arural coffee-growing village.The specific topics we discuss include:• Our overall approach to community investments• Investing in local communities– Promoting the need for clean water– Rebuilding communities struck by natural disaster– Starbucks partners – supporting their communities– Localized initiatives• Investing in communities around the world– Investing in coffee- and tea-growing communities• The Starbucks FoundationOur approach to community investments has been shaped byour increasingly global presence. After thoughtful discourse –internally and with external stakeholders – Starbucks decidedin fiscal 2006 to begin focusing a significant portion of ourcommunity investments on two universally important issues:education and access to clean water. These two complex yetcritical issues complement Starbucks core values and ourstrategic direction. We also believe that by focusing andaligning the giving priorities of Starbucks Coffee Companyand The Starbucks Foundation, Starbucks contributions willhave greater impact and provide more benefit to communitiesaround the world.Given the complex nature of the issues we address, our givingis done in a number of ways and through various channels.These include:• Cash contributions made at the corporate, regional andlocal level• In-kind donations of Starbucks products and resources• Partner (employee) volunteer and gift-matching programs• Contributing funds to The Starbucks Foundation for itsgrant-making efforts• Adding premiums to some of our coffee contracts to fundcommunity projects• Encouraging customer charitable donationsWe recognize that our focused approach to communityinvestments needs to remain flexible so we can be responsiveto emergent needs in the areas where we have a local presence.This was certainly the direction we took in fiscal 2006, bytargeting our giving in the following ways:• Launched a campaign to call attention to the globalwater crisis and provided funds to address critical water,sanitation and hygiene programs in regions of Ethiopiaand Indonesia.• Provided ongoing assistance for rebuilding efforts in U.S.Gulf Coast communities affected by Hurricane Katrina.• Supported locally relevant education programs incommunities where we do business.• Contributed to the local nonprofits that our partnerspersonally support with their contributions of timeand money.• Invested in projects that benefit coffee- and tea-growingcommunities.In fiscal 2006, Starbucks cash and in-kind contributions werevalued at $36.1 million, or four percent of the company’searnings before income tax. (See pie chart below.)Starbuckscontribution toThe StarbucksFoundation$15.9 millionCorporate giving$9.8 millionStarbucks Donations Paid in Fiscal 2006*Total: $36.1 millionProjects in coffeecommunities$2.7 million**Product andin-kind donations$7.7 million* This chart represents grants and product donations paid by Starbucks Coffee* This Company chart represents during grants fiscal and 2006. product These donations numbers paid differ by Starbucks from grant Coffee Company expenses during fiscal2006. recorded These in numbers our consolidated differ from grant financial expenses statements, recorded in our which consolidated are shown financial on an statements,which accrual are shown basis as on required an accrual by basis generally as required accepted by generally accounting accepted principles accounting principles (GAAP) in(GAAP) the U.S. in the United States.** ** Represents the total the total amount amount Starbucks Starbucks paid through paid some through coffee some contracts coffee to fund contracts various to projects toimprove fund various coffee-growing projects communities. to improve coffee-growing communities.S O C I E T Y40