I have been arguing for some time that investors do not want ESG to the extent progressives like SEC Chairman Gary Gensler claim. Herewith an anecdote on point to support the data I've cited before:
In April 2022, Starbucks CEO Howard Schulz announced that the company would suspend a plan that had promised shareholders a three-year program of distributing $20 billion in profits to the shareholders via stock buybacks and dividends. Although Starbucks would continue to pay dividends, it was cancelling the planned stock buybacks. Those buybacks would have amounts to two-thirds of the $20 billion total. At the same time, Schulz announced a shift in corporate focus to employees and customers. If investors really valued stakeholder capitalism, one might have expected Starbucks’ stock price to rise. It fell by 3.7 percent. Heather Haddon, Starbucks to Prioritize Cafes, Not Stock Price, Wall St. J., Apr.5, 2022, at A1, A4.
In commenting on Schulz’s decision, one of the Wall Street Journal’s Heard on the Street columnists casually remarked, almost as though it went without saying, that “Shareholders of course are less impressed by companies that seek to reward ‘all stakeholders.’” Spencer Jakab, Why Starbucks Went Cold Turkey on Buybacks, Wall St. J., Apr.5, 2022, at B12.
