Corporate social responsibility focusing on Starbucks - Essay Example

? Corporate Social Responsibility of Starbucks Nelizer Tumampos of Lethbridge Introduction Starbucks is involved in many CSR initiatives ranging from philanthropy to service projects. The company is keen on enhancing ethical sourcing programs and environmental concerns. The organization has various NGOs and CSR programs which follow different ethical and social standards. In order to successfully achieve this, the company has developed an effective communication strategy that fits the needs of the various stakeholders. Organizations are increasingly being pressured by their environment to become social citizens while still being profitable. Rather than being a differentiation strategy, acting ethical and social responsibility has become an expectation. Organizations have to achieve legitimacy through responding to the expectations of the community. The company uses both online and multimedia communication features to address the expectations of the stakeholders. The company has suffered from stakeholder skeptism (Forehand and Grier, 2003). The company was accused of being unrealistic and extremely philanthropic. In order for the stakeholders to develop confidence, the company has increased transparency and decreased the chances of miss communication. The company ensures that there are no self-beneficial motives when carrying out the social responsibility and ethics program. In doing this, the company has stressed the need for engaging in the social issues that counter the skeptics from the stakeholders. Ethical/social issues targeting stakeholders Starbucks is sentient that its stakeholders have diverse prospects and requirements (Morsing and Schultz, 2006). The company has explicitly tailored its CSR program to meet these needs. Starbucks is using transparency and philanthropy to target the stakeholders. This includes supporting coffee farmers in Mexico and Ethiopia. The company has developed programs that emphasize on the long-term commitment to the CRS and ethics initiatives (Forehand and Grier, 2003). The shareholders of the leading organizations have been consistent in their shift from maximizing profits to increasing value. Companies have to balance people, planet and profit in a globalised market (Schwartz and Carroll, 2003). More power relies on the stakeholders to demand increased transparency and organizational communication. The stakeholders expect the companies to document and acknowledge their impact in the environment (Saksson and Jorgensen, 2010). The organizational ethical behaviors have come under sharp focus (Forehand and Grier, 2003). CRS is perceived to be a morally and ethically correct approach in which all the shareholders stand to gain. The modern corporations have a major part of their assets being the intangible parts i.e. the reputation, goodwill and human capita (Morsing and Schultz, 2006). Therefore, CSR approaches are significant for the achievement and legitimization of any successful corporation. Stakeholders perceive an organization based on the reputation and goodwill the company enjoys (Schwartz and Carroll, 2003). For CSR initiatives in Starbucks to be successful, the corporate communication tools must be interpreted in the right ways (Forehand and Grier, 2003). The process of establishing and maintain the mutual relations between the public and an organization is crucial (Morsing and Schultz, 2006). Many organizations are facing a dilemma on how to handle stakeholders (Preble, 2005). Organizations have to achieve maximum profits and at the same time meet the demands of the stakeholders (Saksson and Jorgensen, 2010). The company has stressed on both economic and ethical motives while executing the CSR program. Analysis on multiple factors The ethical motives are salient and are emphasized through ethical organizations (Preble, 2005). Starbucks has to meet certain standards in its value chain. The strategic team of the company acknowledges that having a bad reputation has negative implications to the stakeholders (Saksson and Jorgensen, 2010). The company defines the corporate social responsibility as performing business ways in methods that produce environmental and social benefits (Morsing and Schultz, 2006). At the same time, CSR means being responsible to the stakeholders. The corporation has established high level environmental responsibility (Schwartz and Carroll, 2003). This entails recycling programs and green teams. The company has come up with codes that focus on improving economic and social conditions of the farmers (Morsing and Schultz, 2006). There are partnerships with farmers that support people with support communities that grow coffee. The CSR initiative in Starbucks promotes diversity and conduct of business among its partners (Saksson and Jorgensen, 2010). The company believes that CSR should have indirect benefits to the core values and targets of the organizations. The strategic team is keen on encouraging farmers to produce quality coffee beans. Overproduction of low quality coffee leads to reduced revenues. With the world being increasingly globalised, businesses and people are highly interlinked (Preble, 2005). Profits cannot be separated from people or environment. The shareholders must become aware of what is going on through the appropriate channels. The ethics of CSR demand that the company comes up with the proper initiatives that preserve the wellbeing of the company in a sustainable way (Saksson and Jorgensen, 2010). Therefore, the CSR strategy of Starbucks includes both initiatives and communication strategies. The stakeholders are the essential motive why stakeholders engage in CSR (Morsing and Schultz, 2006). The announcement of CSR strategies facilitates the understanding of both the stakeholders and the community. The strategic team of the Starbucks believes that the society should be part and parcel of the organizational growth. The socially acceptable corporate are increasingly becoming profitable (Schwartz and Carroll, 2003). The company partners with CARE to ensure that the environment of the coffee producing areas is clean and secure. The company is looking to credible partnerships with organizations and non-governmental bodies to further the interest of the communities without incurring losses. According the management, these partnerships are introducing new dynamics in the perception of the communities and the perception of the communities. Overall assessment Through partnership with CARE, the corporation has raised money to touch millions of lives in Latin America, Asia and Africa (Saksson and Jorgensen, 2010). In 2001, Starbucks provided $43, 500 towards construction of a health center and schools in both east Timor and Guatemala. Through CRS, the company has been able to gain a competitive advantage. Starbucks has secured premium coffee from Ethiopia and gained access to the Indian market. The organization has invested in coffee farmers from high potential areas in Ethiopia. The organization’s strategic team acknowledges that a corporation must be legitimate in the environment of operation. The responsibility to the environment in which it operates is simply the societal expectations from all the stakeholders (Schwartz and Carroll, 2003). The complexity of CSR is found in the ethical domain of Schwartz and Carol’s three domain model. The ethical implications of a corporation in the CSR initiatives are categorized into legal, economic and both (Saksson and Jorgensen, 2010). There are instances where the aims of the corporate social responsibility are purely ethical. The company needs to be relevant to the society and to be seen as a member of the community. Conclusion Corporations are considering the holistic approach to engage and conduct meaningful dialogue with a wide spectrum of the stakeholders (Saksson and Jorgensen, 2010). The management and strategic team of Starbucks openly shares information with employees and other important organizational players. CSR is essential for long-term sustainability of a firm. Starbucks understands that when the stakeholders are not satisfied, the company is likely to suffer in the long-term (Schwartz and Carroll, 2003). Therefore, philanthropy is just a superficial manifestation of CRS. Restricting CSR to philanthropy can have a negative impact to the organization. The management at Starbucks believes that getting committed to the welfare of employees and empowerment is part of the CSR. Customers love durable and quality products. CSR must be viewed in terms of production of safe and innovative products. CSR is a management approach that takes into consideration a wide and integrated collection of indicators that map the real impact of a corporation. Starbucks considers the reciprocal effects of the CSR initiatives in the societal and environmental impact to the organization. The CSR is Starbucks has led to increased sales and revenues. The management of Starbucks has increasingly advocated for the inclusion of the stakeholders and the community interest in the process of coming up with the CSR strategies. The company is still developing more enhanced plans that shall expand the scope of the CSR in the organization. The management is investing in the coffee farmers to converse the environment and increases chances of future sales. Currently the company has vibrant and effective strategies that ensure that that the losses are not suffered in the process of rolling out the CSR programs. In future, the company is likely to diversify the CSR program to incorporate new markets. This might raise the social standing of the company, which could increase the sales revenues. References Forehand, M.R. and Grier, S. (2003). When is Honesty the Best Policy? The Effect of Stated Company Intent on Consumer Skepticism. Journal of Consumer Psychology, 13(3), 349-356 Morsing, M. and Schultz, M. (2006). Corporate social responsibility communication: stakeholder information, response and involvement strategies. Business Ethics: A European View,15(4), 323-338 Preble, J.F.(2005). Toward a Comprehensive Model of Stakeholder Management. Business and Society Review,110(4), 407-431 Saksson, M. and Jorgensen, P.E. (2010). Communicating Corporate Ethos on the Web: The Self-Presentation of PR Agencies. Journal of Business Communication,47(2),119-140. Doi: 10.1177/0021943610364516 Schwartz, M.S and Carroll, A.B. (2003). Corporate Social Responsibility: A Three-Domain Approach. Business Ethics Quarterly,13(4), 503-530 Read More