Howard Schultz is stepping down from his role as executive chairman of Starbucks, effective June 26, according to a memo sent to employees Monday.
Schultz is seen as the architect of the modern Starbucks, having overseen its expansion from a single coffee shop that opened in Seattle's Pike Place Market in 1971. He joined Starbucks in 1982 as director of operations and marketing. Over time he grew it into the iconic brand it is today, with more than 28,000 locations globally.
Schultz's latest leadership transition sparked speculation about his potential political plans: He has been a supporter of former President Barack Obama and Hillary Clinton during her bid for president. Some have already questioned whether he would pursue his own presidential run.
"I'll be thinking about a range of options for myself, from philanthropy to public service, but I'm a long way from knowing what the future holds," Schultz said in the memo.
Myron E. Ullman, former chairman and CEO of J.C. Penney, was named chair, while Mellody Hobson, president and director of Chicago-based investment management firm Ariel Investments, will be named vice chair.
Schultz, who now will become its chairman emeritus, served as the company's chief executive from 1987 to 2000, stepping down to focus on the company's global strategy. He remained on as chairman of the board. At that time, there were only 350 cafes located outside of the U.S.
From 2000 to 2008, Starbucks rapidly expanded from 3,500 to about 16,000 locations, but for Schultz, the quality of the brand and its coffee had deteriorated. He returned to the head position in 2008 to revitalize it.
Again in 2017, Schultz stepped down, handing the keys over to current CEO Kevin Johnson. Once more, he picked up the mantle of executive chairman of the brand, this time focusing on Starbucks' Roastery and Reserve Bar expansion.
"I set out to build a company that my father, a blue-collar worker and World War II veteran, never had a chance to work for. Together we've done that, and so much more, by balancing profitability and social conscience, compassion and rigor, and love and responsibility," he said.
Schultz laid the groundwork for Starbucks' extensive employee benefits including, health care, stock ownership and free college tuition. As CEO, Schultz also lead global hiring initiatives for veterans and military spouses as well as refugees.
He is currently writing a book about his social work and his efforts "to redefine the role and responsibility of a public company in an ever-changing society."
"Howard Schultz has been a pioneer in setting and maintaining a culture of social responsibility — both environmentally and socially — while being able to maintain financial performance," Tim Hubbard, assistant professor of management at the University of Notre Dame's Mendoza College of Business, told CNBC via email. "He has served as an example to other executives who work towards socially responsible firms, and as an example to board members who frequently cite his behavior as models for executives." Under Schultz's leadership, the company's stock has grown 21,000 percent since its initial public offering in 1992. He currently owns 37.8 million shares of Starbucks, or a 3 percent stake, worth about $2.17 billion.
Schultz's leaves at time when the company is struggling to revitalize same-store sales in the U.S., a trend that has contributed to a nearly 12 percent decline in its stock over the past year. Shares of the company were down nearly 1 percent in after hours trading on Monday.
The coffee chain's image also took a hit recently after two black men were arrested in one of its cafes in Philadelphia after asking to use the restroom. The company responded swiftly, and closed last week to provide anti-bias training to 175,000 employees.
Schultz has always been a big proponent of Starbucks as a "third place," a space for the community to gather.
"We will learn from our mistakes and reaffirm our commitment to creating a safe and welcoming environment for every customer," Schultz said after the incident.
—CNBC's Andrew Ross Sorkin contributed to this report.Origin source :CNBC