Ethics and Compliance at Starbucks

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  • Post last modified:February 26, 2020

Ethical business and legal compliance: Starbucks

Apart from its great coffee and wonderful customer experience, there are several other things about Starbucks that have helped it outshine the other coffee brands. Employee empowerment and the power of ethics are also behind its reputation. Particularly when it comes to ethics, its focus has always been on doing business responsibly. In every aspect of its business, Starbucks has always tried its best to remain as ethical as possible.  At Starbucks, employees are not workers, they are partners. Ethics and compliance are an important part of the organizational culture of the coffee brand. It has an ethics and compliance program specially dedicated to training and empowering the employees so they can make ethical decisions at work.

Mission Statement:

As a first step towards understanding the culture and environment at Starbucks, let’s analyze its mission statement:

“To inspire and nurture the human spirit—one person, one cup, and one neighborhood at a time”.

Inspire: Do not do ordinary things. Do things that inspire everyone.

Nurture: Our business is not about money or profits only. It is about nurturing a bond that lasts forever. Starbucks nurtures its bond with its partners including customers to keep it strong.

Human Spirit: Every part of our business should reflect the foundation of our culture. Our business is based on human values and should reflect the same spirit in every aspect. For we are doing it for the society, we must focus on what is most important – the human values.

One person, one cup, and one neighborhood : “One person” – the customer, “one cup” – Starbucks itself, “One neighbourhood” – One community. Starbucks wins hearts in this way.

Standards for conducting business

Whether in terms of flavor or customer service, the brand is relentless in its pursuit of perfection. The customer is always a top priority. However, apart from the customer, ethics and organizational values are also important for Starbucks. As a part of its ethics and compliance program, the brand distributes awareness material that facilitates training in ethical behavior and legal compliance.  Sensitive issues inside the organization are also investigated as a part of this program. It has set its standards of business conduct which is provided to all the partners in the form of a booklet. These standards guide the conduct of the partners throughout the business. Through it, the brand provides its employees with guidance on how to voice their concerns by using the appropriate channels of communication.  It has also set an anti-retaliation policy for the protection of its partners from any kind of retaliation against their raising concerns.

The first important focus area in its set of standards for business conduct is the workplace environment.  Starbucks makes it mandatory that everyone treats everyone with respect and dignity at the workplace. No kind of harassment, discrimination or bullying is permissible. The workplace environment always has an important impact on business. By maintaining a harmonious workplace environment, Starbucks ensures that its employees are able to perform without any fear of hostility.  Apart from it, another top priority is legendary customer service. In this regard, Starbucks is much more customer-oriented than other coffee brands. Employees treat the customers just the way they treat each other, with respect and dignity. Another key focus area for Starbucks is diversity. It does just encourage but maintains and ensures an inclusive environment that nurtures diversity to achieve strategic benefits. The other key focus areas include the health and safety of all the employees as well as the quality of services and protection of the customers. Starbucks is also very clear regarding its wage and hour rules and compensates its workers better than the industry average.   

Focus on legal compliance

Compliance is another important area of focus for Starbucks. Starbucks remains committed to full compliance with laws and applicable regulations. The employees are encouraged to ask their managers whenever they find there to be a conflict of interest happening in any particular area. In terms of international business, it complies with the laws of its home country, as well as the nation where it is doing business. It strives to remain a hundred percent ethical in all its business transactions. In terms of its interactions with the government too, Starbucks strives to follow the highest standards of ethics. It remains committed to the local laws and regulations and encourages its employees to be truthful and straightforward in its conduct with the government officials. Even in marketing, Starbucks strives to be fair and accurate while communicating about its products to its customers.  It competes on the basis of quality and therefore claims only what it really makes happen. Nothing less, nothing more…. While several businesses try to exaggerate their products’ benefits to attract sales, Starbucks always strives to promise only what it delivers and to deliver more than it promises. With regard to competition also Starbucks remains fair and honest to encourage free and fair competition. It is against its values to indulge in unfair competition with the other brands. It encourages its partners to avoid conflicts of interest as well as any kind of gift or entertainment if that can give rise to an obligation or interfere with the person’s duties. Apart from these things Starbucks has also set rules related to confidentiality and any kind of inside information that is classified is not to be sold or disclosed. As a part of its standards of business conduct, the brand has also shared with its employees a model of ethical decision making that can help them make ethical decisions.

Thus, it can be seen that ethics and compliance are important concerns for Starbucks. It strives to act ethically and project a responsible image before the entire community. In this regard, it focuses on both empowerment and training. Empowerment is essential if you want your employees to make responsible decisions. Simultaneously, training is also essential so that they can remain updated on every aspect of their task and how it affects the others. Another important thing that Starbucks tries to accomplish is community involvement which is an important part of its CSR initiative. Since its foundation, the focus of Starbucks has remained on doing ethical and fair business that is good for the community. It works on instilling these values in its employees right from the day they join. These endeavors have also been fruitful and have helped Starbucks gain an edge over its competitors through consistent performance.

CITE THIS.
APAPratap, A. (2018, November 12). Starbucks Ethical Business and Legal Compliance. Retrieved February 26, 2020, from https://notesmatic.com/ethics-compliance-starbucks/
MLAPratap, Abhijeet. Starbucks Ethical Business and Legal Compliance. 12 Nov. 2018, notesmatic.com/ethics-compliance-starbucks/. Accessed 26 Feb. 2020.

Abhijeet Pratap

Abhijeet has been blogging on educational topics and business research since 2016. He graduated with a Hons. in English literature from BRABU and an MBA from the Asia-Pacific Institute of Management, New Delhi. He likes to blog and share his knowledge and research in business management, marketing, literature and other areas with his readers.