An analysis of the CSR
influence on Starbucks
Evelyn J. Flores Infantes
HAN University of Applied Sciences
Business management studies
503983- IHA-C01
Evelyn.flores.i@hotmail.com
ABSTRACT
In today business world, there are many
strategies to run business. The last couple of years, the concept of Corporate
Social Responsibility (CSR) has grown rapidly. People are requesting the
companies take their social responsibility seriously. Many companies have
started to take CSR as a strategy in order to gain benefits that give them a
competitive advantage in doing business. Currently, CSR can drive companies to
succeed in business by increasing sales volume and brand awareness.
Tags
Corporate social responsibility
(CSR) approach, Starbucks, social, environment and responsibility
1. INTRODUCTION
Companies have an important role in the development of the
society because there is a high demand of product and services that companies
offer to their clients. However, companies have the obligation to do practice
corporate social responsibility (CSR). CSR is entering a new era where suppliers
from developing countries have significantly increased in importance. It is
almost becoming an obligation and responsibility to many companies.
Nowadays, CSR is an important part of many business
organizations. It goes beyond legal rights and duties. It implicates how a
company tries to be beneficial to all its stakeholder groups. The effects of
CSR cannot be overemphasized; they range from companies running business well
to environmental improvements. CSR can also go a long way to improve on product
quality and service to customers. I inquire how companies use CSR strategy to
succeed in business.
In this blog, I will explain how Starbucks Company does CSR
in order to succeed in business. I will show how Starbucks Company integrates
CSR with their business. Also how the company has responsibility with the goals
enhancing the lives of its stakeholder groups.
Moreover, Starbucks has published many Corporate Social
Responsibility (CSR) annual reports which are available on the web site of
Starbucks Company.
1.1 Earlier research
According to The Business Ethic Workshop By James Brusseau, Professor
of ethics at the Mexican National University, California State University, and
the Pennsylvania State University.
Corporation as Responsible
we can start thinking in a different way of doing business
and wondering what if being aggressive competitive is not the only way for
corporations to exist in the world?, what if people who directed business began
understanding their enterprise not only in financial terms (as profits and
losses) but also in ethical ones? What if companies became, in a certain moral
sense, like people, members of society bound by the same kinds of duties and
responsibilities that you and I wrestle with every day? When companies are seen
that way, a conception of corporate social responsibility comes forward.
Three Approaches to Corporate Responsibility
Nowadays, there are large sets of issues that need to be
confronted and managed outside of, and independent of the struggle for money.
Broadly, there are three theoretical approaches to these new responsibilities:
- Corporate social responsibility (CSR)
- The triple bottom line
- Stakeholder theory
1.1.1. 1.1.1. Corporate
Social Responsibility (CSR)
The title corporate social responsibility has two
meanings. First, it’s a general name for any theory of the corporation that
emphasizes both the responsibility to make money and the responsibility to
interact ethically with the surrounding community. Second, corporate social
responsibility is also a specific conception of that responsibility to profit
while playing a role in broader questions of community welfare.
As a specific theory of the way corporations interact with
the surrounding community and larger world, corporate social
responsibility (CSR) is composed of four obligations:
The economic responsibility to make money.
Required by simple economics, this obligation is the business version of the
human survival instinct. Companies that don’t make profits are, in a modern
market economy, doomed to perish. Of course there are special cases. Nonprofit
organizations make money (from their own activities as well as through
donations and grants), but pour it back into their work. Also, public/private
hybrids can operate without turning a profit. In some cities, trash collection
is handled by this kind of organization, one that keeps the streets clean
without (at least theoretically) making anyone rich. For the vast majority of
operations, however, there have to be profits. Without them, there’s no
business and no business ethics.
The legal responsibility to adhere to rules
and regulations. Like the previous, this responsibility is not controversial. What
proponents of CSR argue, however, is that this obligation must be understood as
a proactive duty. That is, laws aren’t boundaries that enterprises skirt and
cross over if the penalty is low; instead, responsible organizations accept the
rules as a social good and make good faith efforts to obey not just the letter
but also the spirit of the limits. In concrete terms, this is the difference
between the driver who stays under the speed limit because he can’t afford a
traffic ticket, and one who obeys because society as a whole is served when we
all agree to respect the signs and stoplights and limits. As against that model
of behavior, a CSR vision of business affirms that society’s limits will be
scrupulously obeyed, even if the fine is only one dollar.
The ethical responsibility to do what’s
right even when not required by the letter or spirit of the law. This is the
theory’s keystone obligation, and it depends on a coherent corporate culture
that views the business itself as a citizen in society, with the kind of
obligations that citizenship normally entails. When someone is racing their
Porsche along a country road on a freezing winter’s night and encounters
another driver stopped on the roadside with a flat, there’s a social obligation
to do something, though not a legal one. The same logic can work in the
corporate world. Many industrial plants produce, as an unavoidable part of
their fabricating process, poisonous waste. Isn’t that the right thing to do so
as to ensure that the contamination will be safely contained? True, it might
not be the right thing to do in terms of pure profits, but from a perspective
that values everyone´s welfare as being valuable, the measure could be
recommendable.
The philanthropic
responsibility to contribute to society’s projects even when they’re
independent of the particular business. A lawyer driving home from work may
spot the local children gathered around a makeshift lemonade stand and sense an
obligation to buy a drink to contribute to the neighborhood project. Similarly,
a law firm may volunteer access to their offices for an afternoon every year so
some local schoolchildren may take a field trip to discover what lawyers do all
day. An industrial chemical company may take the lead in rehabilitating an
empty lot into a park. None of these acts arise as obligations extending from
the day-to-day operations of the business involved. They’re not like the
responsibility a chemical firm has for safe disposal of its waste. Instead,
these public acts of generosity represent a view that businesses, like everyone
in the world, have some obligation to support the general welfare in ways
determined by the needs of the surrounding community.
Taken in order from top to bottom, these four obligations
are decreasingly pressing within the theory of corporate social
responsibility. After satisfying the top responsibility, attention turns to the
second and so on. At the extremes, the logic behind this ranking works easily.
A law firm on the verge of going broke probably doesn’t have the responsibility
to open up for school visits, at least not if the tours interfere with the
accumulation of billable hours and revenue. Obviously, if the firm does go
broke and out of business, there won’t be any school visits in any case, so
faced with financial hardship, lawyers are clearly obligated to fulfill their
economic obligations before philanthropic ones.
More difficult questions arise when the economic
responsibility conflicts with the legal one. For example, to remain profitable,
an industrial plant may need to dispose of waste and toxins in barrels that
barely meet legally required strengths. Assuming those legal limits are
insufficiently strict to guarantee the barrels’ seal, the spirit of the law may
seem violated. The positive economic aspect of the decision to cut corners is
the ability to stay in business. That means local workers won’t lose their
jobs, the familial stresses of unemployment will be avoided, suppliers will
maintain their contracts, and consumers will still be served. The negative,
however, is the possibility and the reality that those toxins will escape their
containers and leave a generation of workers’ children poisoned.
Knowing what we do now about those children, there’s no real
conflict; anything would have been better than letting the toxins escape. If
necessary, the company should have accepted bankruptcy before causing the
social damage it did. At the time of the decision, however, there may have been
less certainty about exactly what the risks and benefits were. Even among
individuals promoting a strong sense of corporate responsibility for the
surrounding community, there may have been no clear answer to the question
about the proper course of action. Regardless, corporate social responsibility
means every business holds four kinds of obligations and should respond to them
in order: first the economic, then the legal, next the ethical, and finally the
philanthropic.
1.1.2. 1.1.2. The Triple
Bottom Line
The triple bottom line is a form of corporate
social responsibility dictating that corporate leaders tabulate bottom-line
results not only in economic terms (costs versus revenue) but also in terms of
company effects in the social realm, and with respect to the environment. There
are two keys to this idea. First, the three columns of responsibility must be
kept separate, with results reported independently for each. Second, in all
three of these areas, the company should obtain sustainable results.
The notion of sustainability is very specific. At the
intersection of ethics and economics, sustainability means the
long-term maintenance of balance. As elaborated by theorists including John
Elkington, here’s how the balance is defined and achieved economically,
socially, and environmentally:
Economic sustainability values long-term
financial solidity over more volatile, short-term profits, no matter how high.
According to the triple-bottom-line model, large corporations have a
responsibility to create business plans allowing stable and prolonged action.
That bias in favor of duration should make companies hesitant about investing
in things like dot-coms. While it’s true that speculative ventures may lead to
windfalls, they may also lead to collapse. Sustainability as a virtue means
valuing business plans that may not lead to quick riches but that also avoid
calamitous losses.
Corporations trying to get away with polluting the
environment or other kinds of objectionable actions may, increase their bottom
line in the short term. Money is saved on disposal costs. Looking further out,
however, there’s a risk that a later discovery of the action could lead to
catastrophic economic consequences (like personal injury lawyers filing huge
lawsuits). This possibility leads immediately to the conclusion that concern
for corporate sustainability in financial terms argues against the dumping.
Social sustainability values balance in people’s
lives and the way we live. A world in which a few Fortune 500 executives
are hauling down millions a year, while millions of people elsewhere in the
world are living on pennies a day can’t go on forever. As the imbalances grow,
as the rich get richer and the poor get both poorer and more numerous, the
chances that society itself will collapse in anger and revolution increase. The
threat of governmental overthrow from below sounds remote, almost absurd , to
Americans who are accustomed to a solid middle class and minimal resentment of
the wealthy. In world history, however, such revolutions are quite common. That
doesn’t mean revolution is coming to our time’s developed nations. It may
indicate, however, that for a business to be stable over the long term,
opportunities and subsequently wealth need to be spread out to cover as many
people as possible.
The fair trade movement fits this ethical
imperative to shared opportunity and wealth. Developed and refined as an idea
in Europe in the 1960s, organizations promoting fair trade ask
businesses, especially large producers in the richest countries, to guarantee
that suppliers in impoverished nations receive reasonable payment for their
goods and services even when the raw economic laws of supply and demand don’t
require it. An array of ethical arguments may be arranged to support fair
trade, but on the front of sustainability, the lead argument is that peace and
order in the world depend on the world’s resources being divided up in ways
that limit envy, resentment, and anger.
Social sustainability doesn’t end with dollars; it also
requires human respect. All work, the logic of stability dictates, contains
dignity, and no workers deserve to be treated like machines or as expendable
tools on a production line. In today’s capitalism, many see, and the perception
is especially strong in Europe, a world in which dignity has been stripped away
from a large number of trades and professions. They see minimum wage workers
who’ll be fired as soon as the next economic downturn arrives. They see bosses
hiring from temporary agencies, turning them over fast, not even bothering to
learn their names. It’s certainly possible that these kinds of attitudes, this
contempt visible in so many workplaces where the McJob reigns, can’t continue.
Just as people won’t stand for pennies in wages while their bosses get
millions, so too they ultimately will refuse to accept being treated as less
dignified than the boss.
Finally, social sustainability requires that corporations as
citizens in a specific community of people maintain a healthy relationship with
those people. Any hope for cooperation in the name of mutual benefit will be
drowned by justified hatred.
Environmental sustainability begins from the affirmation
that natural resources, especially the oil fueling our engines, the clean air
we breathe, and the water we drink, are limited. If those things deteriorate
significantly, our children won’t be able to enjoy the same quality of life
most of us experience. Conservation of resources, therefore, becomes
tremendously important, as does the development of new sources of energy that
may substitute those we’re currently using.
Further, the case of an industrial chemical company pouring
toxins into the ground that erupt years later with horrific consequences
evidences this: not only are resources finite, but our earth is limited in its
ability to naturally regenerate clean air and water from the smokestacks and runoff
of our industries. There are, clearly, good faith debates that thoughtful
people can have about where those limits are. For example, have we released
greenhouse gases into the air so heavily that the earth’s temperature is
rising? No one knows for sure, but it’s certain that somewhere there’s a
limit; at some point carbon-burning pollution will make the planet unlivable.
Sustainability, finally, on this environmental front means actions must be
taken to facilitate our natural world’s renewal. Recycling or cleaning up
contamination that already exists is important here, as is limiting the
pollution emitted from factories, cars, and consumer products in the first
place. All these are actions that corporations must support, not because
they’re legally required to do so, but because the preservation of a livable
planet is a direct obligation within the triple-bottom-line model of business
responsibility.
Together, these three notions of sustainability (economic,
social, and environmental) guide businesses toward actions fitted to the
conception of the corporation as a participating citizen in the community and
not just as a money machine.
One deep difference between corporate social responsibility
and the triple bottom line is cultural. The first is more American, the second
European. Americans, accustomed to economic progress, tend to be more
comfortable with, and optimistic about, change. Collectively, Americans want
business to transform the world, and ethical thinking is there (hopefully) to
help the transformations maximize improvement across society. Europeans,
accustomed to general economic decline with respect to the United States, view
change much less favorably. Their inclination is to slow development down, and
to keep things the same as far as possible. This outlook is naturally suited to
sustainability as a guiding value.
It’s important to note that while sustainability as a
business goal puts the breaks on the economic world, and is very conservative
in the (nonpolitical) sense that it favors the current situation over a changed
one, that doesn’t mean recommending a pure freeze. Sustainability isn’t the
same as Ludditism, which is a flat resistance to all technological change.
1.1.3.
Stakeholder
Theory
Stakeholder theory,
which has been described by Edward Freeman and others, is the mirror image of
corporate social responsibility. Instead of starting with a business and
looking out into the world to see what ethical obligations are there,
stakeholder theory starts in the world. It lists and describes those
individuals and groups who will be affected by (or affect) the company’s
actions and asks, “What are their legitimate claims on the business?” “What
rights do they have with respect to the company’s actions?” and “What kind of
responsibilities and obligations can they justifiably impose on a particular
business?” In a single sentence, stakeholder theory affirms that those
whose lives are touched by a corporation hold a right and obligation to
participate in directing it.
As a simple example, when a factory produces industrial
waste, a CSR perspective attaches a responsibility directly to factory owners
to dispose of the waste safely. By contrast, a stakeholder theorist begins with
those living in the surrounding community who may find their environment poisoned,
and begins to talk about business ethics by insisting that they have a right to
clean air and water. Therefore, they’re stakeholders in the company and their
voices must contribute to corporate decisions. It’s true that they may own no
stock, but they have a moral claim to participate in the decision-making
process. This is a very important point. At least in theoretical form, those
affected by a company’s actions actually become something like shareholders and
owners. Because they’re touched by a company’s actions, they have a right to
participate in managing it.
Who are the stakeholders surrounding companies? The answer
depends on the particular business, but the list can be quite extensive. The
stakeholders could include:
- · Company owners, whether a private individual or shareholders
- · Company workers
- · Customers and potential customers of the company
- · Suppliers and potential suppliers to the company
- · Everyone living in the town who may be affected by the activity of the company
- · Creditors whose money or loaned goods are mixed into the company’s actions
- · Government entities involved in regulation and taxation
- · Local businesses that cater to company employees (restaurants where workers have lunch, grocery stores where employee families shop, and similar)
- · Other companies in the same line of work competing for market share
- · Other companies that may find themselves subjected to new and potentially burdensome regulations
The first five on the list (shareholders, workers, customers,
suppliers, and community) may be cited as the five cardinal stakeholders.
The outer limits of stakeholding are blurry. In an abstract
sense, it’s probably true that everyone in the world counts as a stakeholder of
any serious factory insofar as we all breathe the same air and because the global
economy is so tightly linked that decisions taken in a boardroom in a small
town on the East Coast can end up costing someone in India her job and the
effects keep rippling out from there.
In practical terms, however, a strict stakeholder theory, one
insistently bestowing the power to make ethical claims on anyone affected by a
company’s action, would be inoperable. There’d be no end to simply figuring out
whose rights needed to be accounted for. Realistically, the stakeholders
surrounding a business should be defined as those tangibly affected by the
company’s action. There ought to be an unbroken line that you can follow from a
corporate decision to an individual’s life.
Once a discrete set of stakeholders surrounding an
enterprise has been located, stakeholder ethics may begin. The
purpose of the firm, underneath this theory, is to maximize profit on a
collective bottom line, with profit defined not as money but as human welfare.
The collective bottom line is the summed effect of a company’s
actions on all stakeholders. Company managers, that means, are primarily
charged not with representing the interests of shareholders (the owners of the
company) but with the more social task of coordinating the interests of all stakeholders,
balancing them in the case of conflict and maximizing the sum of benefits over
the medium and long term. Corporate directors, in other words, spend part of
the day just as directors always have: explaining to board members and
shareholders how it is that the current plans will boost profits. They spend
other parts of the day, however, talking with other stakeholders about their interests:
they ask for input from local environmentalists about how pollution could be
limited, they seek advice from consumers about how product safety could be
improved and so on. At every turn, stakeholders are treated (to some extent)
like shareholders, as people whose interests need to be served and whose voices
carry real force.
In many cases transparency is an important value for those
promoting stakeholder ethics. The reasoning is simple: if you’re going to let
every stakeholder actively participate in a corporation’s decision making, then
those stakeholders need to have a good idea about what’s going on. The theory
demands that all those who may be affected know what’s being dumped, what the
risks are to people and the environment, and what the costs are of taking the
steps necessary to dispose of damage more permanently and safely.
What’s certain is that stakeholder theory obligates
corporate directors to appeal to all sides and balance everyone’s interests and
welfare in the name of maximizing benefits across the spectrum of those whose
lives are touched by the business.
1.2 Research question
How does Starbucks Company take CSR in order to succeed in
business.
2. METHODOLOGY
The
research method will consists of literature study. The data sources will be:
Starbuck reports, C.A.F.E. practices program assessment and expert opinions.
In order to answer the research question, Starbucks´ CSR
report has been analyzed by applying guidelines derived from different CRS
definitions according to James Brusseau.
Different aspects in the Starbucks´ CSR report will be
analyzed and theses aspects will be compared with theoretical approaches to
corporate responsibility.
3. RESULTS
Company responsibility
When
people go inside a Starbucks outlet to buy their favorite coffee, the first
thing most will look to get is a handful of tissues, maybe something to stir
their coffee with or an extra sugar or cream. Did you ever stop to look at the
tissues supplied in their stores and wonder why it´s so different from the
rest?
If
everybody says “I’m going to change one person at a time,” before you know it,
we’ve changed a neighborhood, we’ve changed a town, we’ve changed a city, we’ve
changed the nation. - Blair Taylor
Starbucks
takes an active role in addressing environmental concerns that little things in
their coffee shops, like tissues, are made recyclable. In fact, Starbucks takes
their environmental responsibilities so seriously that it’s stated on
their two Starbucks´ mission statements, one for the company and one that defines their
commitment to the environment “ To
inspire and nurture the spirit- one person, one cup and one neighbor at the time” and they’ve even
made the latest Starbucks Corporate Social Responsibility Annual Report,
which is basically a document where the
company writes about their global responsibility commitment and they way they approach
business, available for public view on
their website.
One long-standing initiative is
Starbucks’ partnership with Conservation International, a nonprofit
organization dedicated to protecting soil, water, energy, and biological
diversity worldwide. Starbucks is particularly focused on environmental
protection and helping local farmers earn more for their crops.
Efforts to contribute positively
to the communities it serves and the environments in which it operates are
emphasized in Starbucks’ guiding principles. “We aren’t in the coffee business,
serving people. We are in the people business, serving coffee,” says Howard
Schultz. Starbucks and its partners have been recognized for volunteer support
and financial contributions to a wide variety of local, national, and
international social, economic, and environmental initiatives In addition,
Starbucks is a supporter of CARE International, a nonprofit organization
dedicated to fighting global poverty.
Starbucks
is also committed to environmental responsibility. Starbucks has a longtime
involvement with Earth Day activities. It has instituted companywide energy and
water conservation programs and waste reduction, recycling, and reuse
initiatives proposed by partner Green Teams.
At
Starbucks, profitability is viewed as essential to its future success. When Starbucks’
guiding principles were conceived,
profitability was included but intentionally placed last on the list. This was done not because profitability was the least important. Instead,
it was believed that adherence
to the other principles would ultimately lead to good financial performance and in fact, it has.
CSR
approach of Starbucks Company
For Starbucks, CSR is really about conducting
business in a way that produces social, environmental, and economic benefits
for all the communities in which Starbucks operates. Social consciousness has
always been at the core of the business. In general, the main driving force
corporate social responsibility is consumer awareness, which Starbucks sees as
a very positive development. Over the years, the public has become more
educated on concepts such us global warming, poverty, alleviation, human
rights, and the broader concept of sustainability. Sustainability is certainly
important to agricultural commodities, such as coffee, tea, cocoa, and water,
and permeates every aspect of Starbucks´ business.
Starbucks is a CSR-driven company; this means
that Starbucks has a long term relationship with suppliers (farmers who grow
coffee), the retention and satisfaction of our own partners (employees), and
the goodwill of the communities in which we live and work.
Regardless of the CSR pressures in newer,
emerging markets, Starbucks’ business philosophy stays the same. The bottom
line is that Starbucks put people before products. Starbucks´ strong
relationships with farmers yield the highest quality coffees. The connections
the company makes in communities create a loyal following. And the support
Starbucks provides their baristas pays off everyday. For Starbucks, it’s all about
the “human connection” and relationships with the farmers, suppliers, partners
(employees), customers, and communities.
Coffee-growing communities (in Latin America,
Africa, and Asia/Pacific) have historically faced a devastating range of
social, environmental, and economic challenges. Starbucks´ coffee-buying
guidelines have provided economic and market incentives for suppliers to adopt
a sustainable development approach, to protect biodiversity, and respect the
rights of workers. Starbucks works with coffee farmers, cooperatives, mills,
exporters, and local communities to build schools, health clinics, and other
projects that strengthen the social infrastructure and benefit nearby
residents. Similar efforts are now underway in areas where we buy cocoa and
tea.
Social investments are not only made through
their philanthropic contributions. One approach that has worked well is the
inclusion of social premiums in coffee contracts to provide additional funds
for community projects. Starbucks has also given out financial awards to
farmers who produce a specific coffee that is selected as part of Starbucks
Black Apron Exclusives™ program. In these cases, $15,000 is awarded to each
farm and earmarked for a social project chosen by the community. The return on
investment for Starbucks is higher quality coffee for their customers and
sustainable development in these regions in those regions.
At Starbucks, CSR does not just flow through
the chain, it is the supply chain. Starbucks continually strives to ensure that
CSR is effectively integrated within all divisions of the company, this is
their highest priority. Regardless of market fluctuations and other factors,
Starbucks has always been committed to purchasing high-quality coffee in a
socially responsible manner. When the most recent and dramatic downturn in the
coffee market occurred, Starbucks reviewed their approach to buying coffee and
adopted an integrated approach based on six fundamental principles:
- Paying premium prices to help farmers make profits and support their families.
- Encouraging participation in C.A.F.E. (Coffee and Farmer Equity) Practices, their social and environmental guidelines for producing, processing, and buying coffee.
- Purchasing conservation (shade grown) and certified coffee, including organic and Fair Trade Certified™.
- Providing a framework and funds for farmers to access credit.
- Investing in social development projects in coffee-producing countries.
- Working together with coffee producers globally on coffee quality, production, processing, and research through the team of experts at the Costa Rica-based Starbucks Coffee Agronomy Company.
Starbucks commitment to CRS reduces operating costs, many
environmental measures, such energy-efficient equipment or lighting, involve
initial investments but deliver long-term environmental and cost- saving
benefits. Starbucks has a strong reputation as a socially responsible company
that makes it more likely to be welcome into a local community.
Starbucks vision is that there will someday be no need for a
CSR department within Starbucks because social, environmental, and economic
responsibility will be embedded in every department, office, and retail store.
I hope every business decision, whether on the procurement of coffee, cocoa,
and tea; or water conservation, is grounded in CSR. This approach leads every
partner (employee) to assume responsibility on a personal level for each action
he/she takes every day. Accountability is a large part of this, but it is also
essential that employees believe in the CSR movement and want to do their part.
There is a growing
recognition of the need for corporate accountability. Consumers are demanding
more than “product” from their favorite brands. Employees are choosing to work
for companies with strong values. Shareholders are more inclined to invest in
businesses with outstanding corporate reputations. Quite simply, being socially
responsible is not only the right thing to do; it can distinguish a company
from its industry peers.
Starbucks not only recognizes the
central role that social responsibility plays in its business. It also takes
constructive action to be socially
responsible.
4. DISCUSSION
In this part I will analyze the collected data and compare
it with the earlier theoretical research frameworks. I will try to integrate the theory and
attempt to answer the research question.
Firstly, I will analyze on the Corporate Social
Responsibility which is composed of four obligations: The economic responsibility to make
money, the legal responsibility to
adhere to rules and regulations, the ethical responsibility to do what’s right even when not
required by the letter or spirit of the law, the philanthropic
responsibility to contribute to society’s projects even when
they’re independent of the particular business. Then, I will analyze on Triple
Bottom Line that consist on environmental, social and economic sustainability.
Finally, I will analyze on the stakeholders Theory.
In terms of Corporate
Social responsibility:
Economic
responsibility
Based on one of the principal that Starbucks has
prioritized, the financial one was intentionally placed last on the list. This
did not mean that they hadn’t prioritized the profitability of the company.
Instead, it was meant to be adhered to previous principals which ultimately
lead to a good financial performance.
Legal responsibility
Starbucks is aware that the knowledge of their people has
developed with the years, concepts like human rights, global warming and other
are being considered in the CSR plan. This mean that Starbucks is prepare to
adhere rules and regulations in every community they place a new store.
Ethical
responsibility
The company has operated business by bringing the best
coffee in the world. So it supports the farmers live by buying coffee fairly
and help them how to grow coffee bean efficiently including responsible
environment.
Philanthropic
responsibility
Social investments go further than their philanthropic
contributions, Social premiums and financial awards has been added in coffee
contracts to provide additional funds for the community projects.
In terms of Triple
Bottom Line Model:
Economic sustainability
Starbucks put people before products. The connections
the company makes in communities create a loyal following. And the support
Starbucks provides their baristas pays off every day. For Starbucks, it’s all
about the “human long term connection” and relationships with the farmers,
suppliers, partners (employees), customers, and communities.
Social
sustainability
Starbucks works with coffee farmers,
cooperatives, mills, exporters, and local communities to build schools, health
clinics, and other projects that strengthen the social infrastructure and
benefit nearby residents. Let´s not forget their partners (employees) who are
treated as good as their customers are treated. Starbucks believes that the
company and the communities have to run together.
Starbucks believes that it is
important to help care our planet, and to encourage and work with other to do
the same. Starbucks is also committed to environmental responsibility and to
reduce its operating costs Starbucks has a longtime involvement with Earth Day
activities. It has instituted companywide energy and water conservation
programs and waste reduction, recycling, and reuse initiatives proposed by
partner Green Teams.
In terms of
stakeholders theory
According with the stakeholder theory, if Consumers are
demanding more than “product” from
their favorite brands; employees are choosing to work for companies with strong
values; Shareholders are more inclined to invest in businesses with outstanding
corporate reputations and communities are demanding fear trade, we can assume
that every group interested becomes a stakeholder being responsible for their
rights and duties.
5. CONCLUSION
After having analyzed and
compared the data with the earlier research, we can conclude that Starbucks
takes an Holistic CSR approach which give it advantage over it competitors so that
It succeed in business.
Starbucks has run its business by
driving Corporate Social Responsibility (CSR) as a tool that covers the company
in every sector of their business. For example; Human resource, teamwork and
Involvement, Brand differentiation, Ethical consumerism, social awareness and
education and advertising
Starbucks’ efforts in being
responsible for society and the environment can be major inspiration for many
small businesses. This Starbucks Coffee Company is an example of how any
business can take a huge part in making changes for the better in the world today,
as well as effectively use this participation to benefit and succeed in business.
