Starbucks is facing warnings from proxy advisory firms regarding potential financial and reputational risks linked to ongoing labor disputes with its U.S. union. Contract talks have stalled for over a year, but recent discussions are set to resume following a new proposal from the union. Analysts from Institutional Shareholder Services (ISS) raised concerns about the lack of board oversight on labor relations amid controversies such as strikes and a significant settlement over schedule stability violations in New York City. The dissolution of a labor relations oversight committee has drawn criticism, prompting calls from shareholder groups for increased accountability. Starbucks asserts that overseeing labor issues will now fall under the general board, and it believes this restructuring will enhance long-term shareholder value. Additionally, while union representation remains limited to about 6% of Starbucks locations, the company acknowledges ongoing challenges with labor relations, including historical strikes and their impacts on business.