Compensation and benefits inequities persist across employee gender categories and pose substantial risk to companies and the shareholders who own them. In 2022, shortly before the Supreme Court’s 2022 decision in Dobbs v. Jackson Women’s Health Organization that overturned Roe v. Wade, Starbucks announced(1) its intention to reimburse employee travel for abortion. Despite the personal nature of reproductive care, the Company’s behavior seems to indicate a belief that abortion, and other controversial medical decisions, ought to involve patients, physicians, and also the political opinions of Starbucks. As noted by the 1792 Exchange’s Corporate Bias Rating,(2) Starbucks has committed(3) itself to covering costs of “medically necessary transition-related care” for employees and their children. The Company has staked out a position on gender dysphoria and confusion that indicates that sufferers can “transition” to a different sex. Yet, an increasing body of scientific evidence shows harms resulting from such “transition” treatments. Do the Company’s employees victimized by such treatments receive healthcare benefits too?

This is not merely a moral or social issue. It is an area of direct, significant risk for the company. Starbucks is one of the highest-valued restaurant brands in the world, with an estimated brand value(4) near $40 billion, a massive proportion of its over $100 billion valuation(5). The higher the brand value of a company, the more vulnerable it is to public scandal, scandal that is quickly emerging for companies that have taken non-fiduciary activist positions on issues such as abortion and gender-affirming care. Healthcare organizations like Kaiser Permanente are currently facing high-profile lawsuits(6) over coverage of transition treatments resulting in long-term harm(7) to patients, seeking damages worth millions of dollars.

Given the rapidly-shifting legal landscape surrounding such treatments, evidenced by cases such as United States v. Skrmetti, this risk area is only increasing for companies like Starbucks. Shareholders are right to ask Starbucks to address the obvious contingent liability and brand damage caused by championing controversial, scientifically dubious, and risk-fraught procedures such as abortion and gender-affirming care, especially when the company is unclear as to its coverage of corresponding areas such as detransition care.

Side-taking via healthcare policy is not in keeping with Starbucks’ fiduciary duty or its responsibility to mitigate significant areas of legal and reputational risk and avoid widespread damage to brand value. In its healthcare coverage, as with all aspects of its corporate policies, Starbucks must instead focus on its fiduciary duty to shareholders, a fiduciary duty likely to be violated by engaging in politically divisive rhetoric and/or actions, including through its decisions on healthcare coverage.