SBUX Starbucks Corporation

By Heather Haddon 

Starbucks Corp. appointed investor Mellody Hobson as its next chairwoman, positioning the coffee chain to be among the biggest U.S. companies with a Black person leading its board.

Seattle-based Starbucks said Wednesday that Ms. Hobson would succeed Myron Ullman III as the leader of its board when he retires in March. Ms. Hobson, co-chief executive at Ariel Investments LLC, has been a member of the Starbucks board since 2005.

Ms. Hobson, 51 years old, is among the most prominent Black investors in the U.S. Chicago-based Ariel Investments, a roughly $13 billion value-investment firm, says it is the country's largest minority-run mutual-fund firm. John Rogers Jr., Ariel's chairman and investment chief, is a longtime director at McDonald's Corp. Mr. Rogers and Ms. Hobson are both Democratic donors and supported former President Barack Obama.

Many companies have pledged recently to increase diversity in their workforces and boards. Nasdaq Inc. filed a proposal with the Securities and Exchange Commission last week that would require listed companies to have at least one woman on their boards, in addition to a director who is a racial minority or one who self-identifies as lesbian, gay, bisexual, transgender or queer.

Around 8% of directors in the S&P 500 were Black as of the end of August, according to corporate-governance-data firm Equilar Inc. As of earlier this month, 149 companies in the S&P 500 didn't have a Black director, down from 180 in June, according to recruiting firm Russell Reynolds Associates.

Ms. Hobson would be the only Black chairwoman of an S&P 500 company, according to Equilar.

Starbucks in October mandated antibias training for executives and tied their compensation to increasing minority representation in the company's workforce.

The Trump administration earlier that month discouraged companies with federal contracts from issuing specific diversity-related targets or conducting racial-sensitivity training. Starbucks, a federal contractor, hasn't received any federal inquiries about its diversity targets or training plans, a spokesman said Wednesday.

Starbucks in November joined Mondelez International Inc. and PepsiCo Inc. in signing onto the Board Diversity Action Alliance, a group co-founded by Xerox Holdings Corp. former CEO Ursula Burns to advocate for greater diversity on boards.

Ms. Hobson also serves as a director at JPMorgan Chase & Co. and formerly was a member of the board at Estée Lauder Cos. Ms. Hobson and her husband, filmmaker George Lucas, are involved in a number of charities and business ventures.

Ms. Hobson grew up in Chicago, the youngest of six children in a family she has said sometimes had trouble paying rent and bills. She was the first in her family to graduate from college when she received a bachelor's degree from Princeton University in 1991.

"I loved school and I had a very singular focus," she said in a December talk with the Economic Club of New York. "I realized my brain was all I had."

She became an Ariel employee when she was 22. She said she was still in her 20s when Mr. Rogers introduced her to Jack Bogle, Vanguard Group's founder and index-fund pioneer, as a future president of Ariel.

She was named president of Ariel in 2000 and co-CEO last year.

Ms. Hobson has pushed for companies that Ariel invests in to cast a wide net for talent. "It's very important for the board to first recognize the need to be diverse, and that hopefully then creates a ripple effect through the corporation," she said in December.

Ms. Hobson was appointed independent vice chair of the board at Starbucks in 2018. Howard Schultz, Starbucks's chairman emeritus, said Ms. Hobson has advised the company for more than 20 years.

"I look forward to working with the board and talented leadership team on accelerating our strategy, supporting our valued partners, and continuing to create significant value for all of our stakeholders," Ms. Hobson said in a statement.

Micah Maidenberg and Dawn Lim contributed to this article.

Write to Heather Haddon at heather.haddon@wsj.com

(END) Dow Jones Newswires

December 09, 2020 16:04 ET (21:04 GMT)

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