Oxfam and Starbucks: Head to Head with a mug of jo'

It's multi-national non-profit VS. multi-national corporation -- each vying to control the coffee; each vying for a piece of Ethiopia's growing coffee trade.

Last week Oxfam and Starbucks went head to head (via press releases) regarding Ethiopia's bid to trademark coffee names. Oxfam accused Starbucks of urging the National Coffee Association (a trade association for the US coffee industry) to oppose the Ethiopian Intellectual Property Office (EIPO) applications to the US Patent and Trademark Office to trademark the "Sidamo," "Harar" and "Yirgacheffe" names. Starbucks countered with statistical evidence of its support for Ethiopian coffee farmers; the conglomerate noted that it favors a certification program as a better means to "protect geographically descriptive terms and ensure they represent quality products." Oxfam's response: Starbucks, stop being "disingenuous" and acknowledge your role in opposing the trademark application.

Now this is highstakes Corporate Responsibility in action. Starbucks built its brand and its image on socially responsible business practices. It was one of the first (and still one of the few) corporations to offer part-time employees health benefits; Starbucks markets its coffee based on better business practices (practices they determine and they enforce) and it pumps hundreds of thousands back into the community continent wide. Corporate responsibility is an important aspect of the Starbucks brand-image.

Enter Oxfam.

Oxfam is a confederation of 13 organizations that work together in more than 100 countries. Their mandate is to "increase worldwide public understanding that economic and social justice are crucial to sustainable development." That purpose is motivated by the fact that Oxfam wants to make equity the same priority as economic growth. From this rubrik, Oxfam has taken up the Ethiopian fight for rights and ownership. According to the non-profit, if Ethiopia secures the rights to the coffee names than the economically repressed country would capture more value from the trade -- this is because Ethiopia would have more control over the use of their names in the market, which enables farmers to receive a greater share of the retail price. Oxfam suggests that this shift (giving Ethiopia the trade name rights) would provide the Ethiopian coffee industry and its farmers an estimated $88 million (USD) extra per year.

The very public fight between Oxfam and Starbucks is reminiscent of earlier exchanges the two multi-nationals had over Fair Trade. A few years ago Oxfam and activists criticized Starbucks for insufficient support of Fair Trade. At that time, Starbucks pointed out that it was the largest purveyor of Fair Trade in the USA. At that time, Starbucks also stated that the primary factor holding it back from only using Fair Trade coffee was lack of supply. The coffee conglomerate also pointed to its numerous policies and actions in social and environmental standards to plantations that are not covered by Fair Trade standards.

The rhetoric, facts and opinions are rampant on both sides -- as this is confrontational activism. Rather than collaboration, Oxfam (and partners) have chosen to attack Starbucks. While questions still exist (such as, how will the patent ownership actually help Ethiopian farmers) they are being ignored in favour of positioning.

Corporate responsibility is important -- not only for the purposes of branding and image, but in terms of developing and fostering worldwide equity. However, corporate responsibility is still immersed in the school of confrontation -- a school that we know all too well (just look at any election, anywhere). This style of activism often ignores poignant and important questions in favour of quick and snappy sound bites. As such, facts get lost and lines are drawn and little is done to find a solution.

Regardless of your opinion on Starbucks, this mega-coffee-brand is the Wal-Mart of coffee companies in North America. As such, their buying power is an economic force in the coffee industry -- a worldwide industry that accounts for six-million tonnes of picked beans every year. If we are to create an equitable solution (that benefits farmers, companies and consumers) we will need to include Starbucks and other coffee companies in the debate. Oxfam's tactic of shaming is an old tactic and a good tactic, but in the end, it's good old fashioned discussion and compromise that will result in a responsible and equitable solution.

Until then, make mine a dark, Grande. Fair Trade, of course.

For more information on Oxfam's position on Ethiopian trademarked coffee go to:
http://www.oxfam.org/en/news/pressreleases2006/pr061026_starbucks

For more information on Starbuck's position go to:
http://www.starbucks.com/aboutus/pressdesc.asp?id=714