Ethics is defined as what is right and wrong. Business
ethics relates to an individual’s or company’s decision that society defines as
what is right and wrong. In regards to Starbucks, the mission statement show’s
that company’s work and business ethics is based on “respect and dignity” not only to the stockholders, partners and
employees but also the community.
Because of
Starbucks worldwide popularity the company must preserve a positive image, to
care about the community and the environment! Those are positive standpoints
that define the company’s self-portrayal.
With the coffee industry coming out of a major
crisis coffee farmers had been going out of business, this didn’t just become a problem
for a farmers it became a social problem. The problems that they incur are
that with over production. Brazil at one point use to produce 25-30million bags
and coffee in the last few years they’ve had the ability to ring up over
50milion bags. Vietnam, 20 years ago they didn’t produce any coffee at all,
they have become the 2nd largest producer in the world in 2010. It’s not the
coffee Starbucks buy that affects Starbucks, it's the coffee they buy that affects farmers
globally. The dynamics of supply and demand played out in a way that has been
very dramatic, consequently negative for farmers. What Starbucks have
stepped in to do is come out with a buying program called café practices that stand for Coffee and Farmer Equity practices.
Working alongside conservational international, and other NGO’s they have
worked out a way of buying coffee that is sustainable for the future and can
allow farmers to stay in business. It involves Starbucks paying a fair price
for their coffee, as well as economic transparency; they know and is audited by
a third party what that farmer was paid for the coffee. Starbucks began
purchasing in a way that is socially responsible and by that the farmer pickers;
migrant pickers that work on the farm are paid a fair wage, as well as health
and dental care. In an environmental friendly way Starbucks opposed
to famers cutting down trees to plant more, they wanted buffer zones between streams where wastewater is
used in the coffee mills. Starbucks are well aware what is happening in the
environment. As a result of that, farmers can not only earn a premium price for
their coffee, they can earn a premium price on top of what they paid and
help them make these changes which Starbucks is willing to pay for.
Keeping in touch with new farmers in way or another on a
yearly basis but is imperative to have good client rapport. Since 2004
Starbucks have opened farmer customer support centers in Costa Rica, Rwanda in 2009, Tanzania in 2011 so they are on ground in producing countries. Starbucks plans to eventually have an agronomist in each country in Central America. The office
for the agronomist in central America is as of now a four wheel drive and a
laptop, so they are on multiple farms every day which was they want. Incorporating Starbucks
presence there talking to them about their growing practices, learning from
them and sharing with them. To them
that’s where the collaboration in the equity peace comes in café practices.
They believe that profitability and social responsibility are mutually
exclusive they work hand in hand and that’s what Starbucks demonstrates.
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