Ethics and Social Responsibility - Starbucks - Essay Example

? Ethics and Social Responsibility Ethics and Social Responsibility Introduction Starbucks Corporation is an international coffee house chain based in Seattle, Washington. It has been termed as the largest coffeehouse chain in the world operating in more than 55 countries. The products provided by the company, include coffee that is drip brewed, espresso based drinks, hot and cold drinks. Others on its menu include coffee beans, salad and sandwiches. The large population that forms part of consumers of products needs protection from any activities that might endanger their lives. The company also owes the duty of care to every single person or region that it operates from thus bringing in the issue of corporate social responsibility. This paper aims at assessing the ethics and corporate social responsibility at Starbucks Corporation. Ethics and Social Responsibility: The Case of Starbucks Farmer Loans According to Washington (2010), Starbucks coffee processer understands the financial positions of its collaborate farmers, which at times lures the farmers into borrowing high interest loans to finance their activities. Starbucks also understand that financial shortage could make farmers opt for premature harvest of coffee that they sell at lower prices thereby cutting their profit margins (Washington, 2010). To cushion the collaborate farmers from the effects of financial depravity, Starbucks has established pioneering programs designed to provide access to credit to help farmers in managing risks and stabilize business. In 2008, Starbucks offered $12.5 million as loans to collaborate farmers. In 2009, Starbucks coffee company launched Small farmer Sustainability Initiative (SFSI) in collaboration with the TransFair USA and Fair-trade Labeling Organization International with projections to help in thriving of small scale farmers (Washington, 2010). Starbucks coffee company has established elaborate goals of investing in farmers and their communities by doubling farmers’ loans to $20 million by 2015. It is worth stating that impressive progress has been achieved as commitment to farmer loans increased by $2 million in 2009. Water conservation and protection Starbucks has great regards on water and considers water as vital component of their business operation. Starbucks relies on water for making coffee beverages and washing of containers. In that line, Starbucks coffee processors have prioritized measures to introduce new water conservation strategies. Starbucks have set strategies of sanitizing the coffee handling equipments to reduce excessive wastage of water (Washington, 2010). In 2008, Starbucks made clear their intentions to reduce water consumption in their operations. Starbucks coffee processors have set targets of reducing water consumption by 25% by the end of 2015. So far, Starbucks have made commendable achievements after having managed to reduce its rate of water consumption by 4.1% during its financial year 2008 to 2009 (Washington, 2010). Statement and codes of ethical responsibilities of Starbucks Company The operation of Starbucks coffee company recognizes and embraces diversity as an essential component o its business activities. Starbucks Company also operates under the vigils of providing ample working environment by showing abundant respect of personal dignity to all of its employees (Starbucks Coffee Company, 2007). In addition, Starbucks Company operates with the basic missions of providing high quality coffee under fair prices. Starbucks coffee company operates towards all time satisfaction of its customers’ expectations. Moreover, Starbucks missions and objectives entail positive contribution to community and environmental protection. Starbucks also recognizes the purpose of operation as basic profitability for future survival. Starbucks accountability on ethical and social responsibilities Starbucks have an established Business Ethics and Compliance program that provide guidelines that help partners in ensuring the business operates facilitates legal compliance and ethics training (Starbucks Coffee Company, 2007). The Starbucks corporate also has well structure customer care lines that help the customers and business partners voice their concern regarding the performance of the business. In addition, Starbucks coffee company has well recorded audit line for the parties like the vendors, consumers, and investors among others to help in revealing any possible accounting or auditing irregularities in the financial statements (Starbucks Coffee Company, 2007). Starbucks raises the level of its financial accountability by sharing the audit line with all the partners. Starbucks Company also has well defined procedures for selection of new board members that takes place in transparent manner by exposing the members’ real integrities. Evaluation of Starbucks with regard to ethical and social responsibilities Starbucks coffee company has worked to display senses of transparency by openly involving its partners in assessing and checking the financial statement of the company through elaborate and open audit line. Starbucks’ act of establishing an elaborate customer care lines have helped the company in identify with consumers’ grievances on matters concerning product quality. The company’s strategies of conserving and protecting protect reservoirs have led to great achievement of the company’s goals of reducing wastage and rate of water consumption. It is also worth mentioning that the farmers’ loans as offered by Starbucks company have assisted and boosted the growing of coffee on large scales due availability of finance for mechanization and practicing modern production styles. General assessment of ethical and social responsibilities of Starbucks Starbucks Corporation understands that it is part of the wider community and should take part in development and other matters that appertain to the needs of the society. The company states that it is responsible in any community that it undertakes its businesses and has therefore donated and done many activities for social projects. In Egypt for example, the partner for Starbucks visited the cancer awareness center and donated a painting board to the playroom. On matters concerning the environment, the company shares environmental information with its employees in a move that is aimed at making sure that they understand it clearly. The company has also ventured in innovative and flexible solutions towards environmental conservation such as recycling some waste products. The company encourages responsible environment as part of its co-operate values and gets its partners involved in the company’s mission. Starbucks operates in a diverse ethical environment and has been able to comply with all laws governing businesses in companies that they operate in. only officially permitted standards in the country of operation are complied with. Starbucks also engages in communal activities by supporting various social projects that are tailored towards developing a good community. A good example is how Starbucks foundation has openly assisted global fund through dedication of a certain percentage of its sale towards the kitty. The company has also ensured that its activities do not violate any human rights within their operation. In terms of Co-operate Social responsibility, it can be said that Starbucks has good governance and ethical conduct. Social responsibility is core their way of running business which has driven them to increase their shareholder value. The company defines social responsibility as a way of doing business in a manner that produces a social, economic and environment that is beneficial to the society. Customer loyalty and retaining employees are some of the many activities that the company does to enhance its relationship with the general public. In terms of environmental stewardship, the company has achieved a lot especially in sensitizing communities around its premises on the need for environmental conservation. The company recycles all the materials that can be recycled within its stores including usable cups. The move by the company to give a 10% discount on all customers who come with their commuter mugs with an aim of reducing environmental impact from cups waste is one of the successes by the company. The belief held by the company is that for a good business, there has to be an external support community that must be protected is fundamental when it comes to co- operate responsibility. The support and nature of protection that the company provides to its customers entail good that meets the international standards. The Starbucks quality and customer protection are a surety of customer’s health and safety, which are significant for any other business. Conclusion In the world of business today, many strategies are implemented with the aim of maximizing on profit. There is a need therefore to regulate what all these companies are engaged in and therefore business ethics and co-operate social responsibility. Starbucks is a major multinational co-operation that has ventured in the coffee business in over 55 countries that have different ethics that govern business operations and matters relating to co-operate social responsibility. The company has been at it its level best in ensuring that it remains within the set limits in the countries of operation to avoid conflicts. Major initiatives by the company have included proper consumer protection and quality policies. The interests of the company have been safeguarding the rights of its consumers while at the same time enhancing the lives of coffee farmers. Other activities by the company have been geared towards improving living standards of those within the region of its operations, which include environmental awareness and conservation. The integral part of the corporate social responsibility and compliance to ethics by the company can therefore be termed as transparent. References Draft, R. & Marcic, D. (2010). Understanding Management. 7th Ed. West Port: Cengage Porke, R. & Stewart, A. (2010). Social Development. New York: John Wiley and Sons. Schwartz, M. (2011). Corporate Social Responsibility: An Ethical Approach. New York: Broadview Press Sims R (2003). Ethics and corporate social responsibility: why giants fall. New York: Greenwood Publishing Group Wueste, D. (1994). Professional ethics and social responsibility. London: Rowman & Littlefield Washington, S. (2010). Global Responsibility Report 2009. Retrieved November 1, 2011 from http://www.starbucks.com/assets/ssp-g-p-full-report.pdf Starbucks Coffee Company. (2007). Starbucks and Corporate Social Responsibility. Retrieved November 2, 2011 from http://www.starbucks.com/assets/fy06-csr-full.pdf Read More