Dunkin’ Donuts has a partnership with Keurig Green Mountain to package the chain’s coffee in plastic K-Cups for brewing in homes and offices. The company makes a lot of money from selling these pods, but some shareholders concerns about the amount of trash that results from K-Cups, and they want Dunkin’ to put some serious thought into this aspect of their business.
One investor, a president of a investment firm that focuses on sustainable business practices, has criticized the environmental impact of Dunkin’ Donuts selling coffee packaged in K-cups.
His proposal quotes the company’s corporate social responsibility statement, then points out that “a large part of revenue was derived from the sale of ‘K-Cup’ pods brand product packaging which is not recyclable nor compostable and new studies suggest plastic packaging that reaches the ocean is toxic to marine animals and potentially to humans.”
The proposal goes on to outline environmental and health problems with the pods, including Dunkin’s current pods being made by Keurig Green Mountain from #7 plastic, which is generally not recyclable. It also makes a bottom line argument, pointing out that sales of pods are falling in general, and it may be wise for Dunkin’ Donuts to get out of that business.
Rather than asking Dunkin’ to halt its K-Cup business, the investor is asking the company’s board of directors to prepare a report on the impact of K-cup use by October of this year.
However, the board’s response thus far has been to effectively roll its collective eyes at this suggestion, and point investors to Keurig’s website.
“The manufacturer is in the best position to complete the analysis requested by the shareholder proposal, and Keurig has already done so,” the board said in its response. “Duplicative research would be a waste of company resources.”
While the company is a biased source, it has also set a goal of making all of its pods recyclable, switching to #5 plastic, or polypropylene, which is more commonly accepted for recycling. Recyclable pods are theoretically available, though the only place you can buy them now is from Keurig’s website, and the only offering so far is Green Mountain’s breakfast blend, in regular and decaf versions.
Keurig also has a program designed for offices with Keurig machines where the company sends you a bin to collect pods and send them back through UPS. They take the coffee grounds out and compost them, and send the pods to Covanta, a company that burns trash to generate energy. It’s not ideal, but it’s better than a landfill.
It’s up to the shareholders now: Despite the company’s objection to having shareholders vote on it, the Securities and Exchange Commission says that they have to, Bloomberg reports.