In response to its CSR strategy, Starbucks has done many CSR initiatives and practices. These approaches and their impacts will be analysed from 3 perspectives, ecological, social welfare, and employee retention.
Environmentally, Starbucks has done multiple initiatives to minimise its environmental footprint. Starbucks’s Coffee and Farmer Equity (C.A.F.E.) initiative, launched in 2004, was “one of the coffee industry’s first sets of comprehensive sustainability standards, verified by third-party experts” (Starbucks 2015). The result of this initiative is Starbucks managing to ethically source 99% of its coffee by 2015, with the goal to chase the final 1% (Craves 2015).
Moreover, as a response to its objective of “pioneering green retail,” Starbucks currently has 750+ LEED-certified stores (Leadership in Energy and Environmental Design), more than any other retailers in the world. Additionally, Starbucks has nearly achieved its goal of reducing water consumption by 25% by 2015, with already 23% decrease by 2014 (Starbucks 2015). Overall, Starbucks’s CSR approaches have been impacting the environment positively.
With that said, there is one aspect that Starbucks could and should improve, re-usable cups. Starbucks identified that is goal regarding re-usable cups is to “serve 5% of beverages made in our stores in personal tumblers by 2015“ (Starbucks 2015), however, this number was reduced from the previous goal of 25% set in 2009 (Aston 2012). Starbucks identified that changing customers’ behaviour to change to re-usable personal tumblers have been difficult, with promotions failing to leave major impact on the customers’ purchasing behaviour (Starbucks 2015). Since the promotion methods to entice customers to use personal tumblers are not effective, Starbucks should instead consider charging for plastic cups, similar to government 5p charge for plastic bags (GOV 2015). This method of charging additional for plastic cups may slowly but surely deter customers from using plastic cups and instead use either personal tumblers or ceramic cups to be used in-store. Economically, it would be hard to believe that a very miniscule increase in price can discourage consumers from continuing to purchase Starbucks’s products. With Starbucks being an industry leader, introducing a policy such as this would encourage other competitors to do the same, hence making it possible to reduce the waste from coffee cups, with “fewer than one in 400 [coffee cups] is being recycled” in the UK (Cocozza 2016).
Furthermore, Starbucks should increase its green retail focus to places where it is more needed, meaning focusing on developing LEED-certified stores in its stores in developing countries, since developing countries tend to have “various features that can offer considerable scope for the exercise of CSR,” e.g. environmental protection (Crane et al. 2014).
Social Welfare Approach
Besides ecological, Starbucks’s CSR approaches have positively impacted people’s social welfare. For example, Starbucks identified that its C.A.F.E practices have “positively [impacted] millions of workers, and improved the long-term environmental and social conditions on thousands of participating farms around the world” (Starbucks 2015). Additionally, Starbucks provides credits for farmers at reasonable terms. Starbucks’s already invested $16.3miillion in farmer loans with the goal of $20million by 2015.
Starbucks also engages in corporate philanthropy in the form of Starbucks Foundation, where it “gave $13.1 million in 2014, making 144 grants to non-profit organisations. Grants included $3.37 million for Starbucks Youth Leadership Grants and $4.2 million in social development grants in coffee-growing communities” (Starbucks 2015). These donations not only benefit the social welfare, but it also serves as a way to enhance Starbucks’s competitiveness, since the donations may directly impact Starbucks positively in the future. Hence, Starbucks is able to achieve what Porter and Kramer (2002) believe as strategic philanthropy.
Besides donation, Starbucks encourages people to volunteer and join in its community service projects (Starbucks 2016). Starbucks enables people to sign-up online to find and volunteer for community service projects that encompass areas of interests such as arts and culture, environment, education, health, etc. Up to this day, Starbucks’s community services have completed nearly 15,000 projects, with 87,000+ volunteers and 111,000+ hours logged in. This approach enables Starbucks to fulfill the social contract (Donaldson 1982, cited by Garriga and Mele 2004) it has to the society, while also build relationship with its customers through voluntary engagements.
Although Starbucks has done many commendable practices to increase the social welfare of the society, arguably, Starbucks has not increased the social welfare of all its stakeholders. Going back to the national context of CSR (Crane et al. 2014), Starbucks should consider the social welfare of people in developing country. Arguably Starbucks has done this through its C.A.F.E practices, however critics might argue that Starbucks can do much more to increase the social welfare of people in developing/least developed countries. This means that Starbucks should consider engaging in corporate philanthropy that does not solely focus on what benefits it might reap in the future, e.g. similar to Bill and Melinda Gates foundation in Africa (Bill and Melinda Gates Foundation 2016). Starbucks could, for example, set up donation targeted to tackle health issues or sponsor child education in countries where it………
The post Starbucks’s CSR Approach
Assignment status: Solved by our experts