Investing.com -- Starbucks Corporation (NASDAQ:SBUX) announced on Monday that it completed the underwriting of an initial public offering of senior notes, including its first-ever U.S. Corporate Sustainability Bond.
On Monday afternoon, the Seattle-based coffee giant said it will use the proceeds from $500 million in 2.45% Senior Notes due in 2026, to help enhance the company's sustainability programs centered around its coffee supply chain management programs through a variety of eligible sustainability projects. The initiatives include coffee purchases from third-party suppliers who comply with Starbucks' ethical sourcing verification program of Coffee and Farmer Equity (C.A.F.E.) practices, as well as the development and operation of farmer support centers in coffee growing regions. In addition, the proceeds will be used to help facilitate short and long-term loans made through the company's Global Farmer Fund.
"Coffee is at the core of our business, and we intend to continue to finance initiatives that will make a positive social and environmental impact in our coffee supply chain as well as other areas across our business,” said Scott Maw, Starbucks' chief financial officer. “Issuing a bond focused on sustainable sourcing, demonstrates that sustainability is not just an add-on, but an integral part of Starbucks, including our strategy and finances."
Every year, Starbucks says it ethically sources its coffee by supporting coffee farming communities, assisting in efforts to mitigate the impacts of climate change and maintaining crop stability and farm sustainability in third-world countries. Currently, Starbucks operates a network of eight Farmer Support Centers in: Rwanda, Tanzania, Guatemala, Colombia, China, Ethiopia, Costa Rica and Indonesia. Consequently, Starbucks designed its C.A.F.E. Practices' protocol, in an effort to ensure that its methods in growing and processing coffee are "efficient, effective and sustainable," the company said in a statement.
Trading in Starbucks' shares were inactive in the after-hour session. In the regular session, Starbucks closed at 55.53, down 0.29 or 0.52%.