NEW YORK CITY-“We are sitting idly as if nothing is going on” while Congress and the President erode domestic and global confidence with their lack of leadership on the fiscal cliff and the debt ceiling, Starbucks‘ Howard Schultz told a National Retail Federation audience Monday morning. The “we” to whom the coffee giant’s chairman, president and CEO referred was the American people in general, but Schultz had a more specific group in mind in his call to action: the retail sector.
“We must send a message to Washington that we deserve better,” Schultz said. “The world is hungry for America to lead.” He called on the audience gathered for the NRF’s 102nd Annual Convention & Expo, at the Jacob K. Conventions Center here, to “do everything you possibly can—as an employer, with your customers, with your community—not to be a bystander.” That means engagement with the political process on a nonpartisan basis, he said.
Schultz’s rallying cry dovetailed with the overall message of “Conscious Leadership: A Call to Action for the Retail Industry and Beyond,” in which he took the stage with Walter Robb, co-CEO of Whole Foods Market Inc., and moderator Kip Tindell, chairman and CEO of the Container Store. The three CEOs offered examples from their own stores’ success in advocating for a proactive approach to everything from community involvement to empowering employees. It’s a view of retailing that Robb described as “a competitive strategy.”
Tindell, for example, disputed the assertion of the late economist Milton Friedman, who argued that a corporation exists solely to maximize profit for its shareholders. At his stores, he said, employees come first, on grounds that they’ll take better care of customers. This increased customer satisfaction in turn leads to happier shareholders, he argued.
Robb cited instances in which Whole Foods voluntarily provided leadership rather than waiting for government directives. In the stores’ seafood department, for example, red-rated species—those that independent organizations have determined are being overfished—are no longer sold; it was reportedly the first national grocer to make that call last March. When Superstorm Sandy knocked out more than 20 Whole Foods locations in the New York metro area, the chain brought in emergency generators so that the stores could reopen and serve food a few days later.
This kind of transparency, advocated by all three CEOs, wasn’t the only aspect of retail in which they advocated taking the lead. “We are witness to a seismic change in consumer behavior,” one that’s technology-based, Schultz observed. He warned that a retailer that maintains the status quo in terms of marketing and merchandising “is literally facing a collision course with time.”
Monday morning’s session began with an address by Kofi Annan, former secretary- general of the United Nations. As moderator Terry Lundgren, outgoing NRF chairman and chairman, president and CEO of Macys Inc., observed, it might seem out of place for a global political leader to address a group of retailers. In fact, Annan saw plenty of opportunities for retailers and retail-related businesses to make a difference outside the US, ranging from local sourcing of goods to lending their collective voices in support of public policy.