STARBUCKS COFFEE COMPANY

Presented By: Diana Spagnolo

Ethical Sourcing• Ethical and responsible sourcing is an important material

issue because it has a social and economic impact• Starbucks utilizes ethical trading and responsible

growing practices although it only counts for 77 per cent of the coffee it produces

• Starbucks set a goal for the year 2015, and that goal is to be able to produce 100 per cent of coffee that is responsibly grown

• The stakeholders involved with the ethical sourcing issues are:

1. Farmers/Suppliers2. Third Party and NGO’s3. Consumers

Stakeholders: Farmers and Suppliers

• Starbucks stakeholders are the farmers/suppliers that harvest the coffee and are the main audience Starbucks needs for production

• For 10 years, Starbucks has purchased fair Trade certified coffee which helps recognize small-scale farmers and helps them to compete in the global marketplace

• Starbucks is Fair Trade’s largest buyer.

Communication Tools for Consumers

• The communication tools used to address ethical sourcing for farmers are working face-to-face with them through support centres

• These centres provide the skills farmers need to improve the quality and pricing of the coffee they produce

Stakeholders: Non- Governmental Organizations

• Starbucks second audience are third-party organizations, like NGO’s which include Fair Trade and Business for Social Responsibility (BSR)

• NGO’s perform evaluations which make transparent that farms are ethically sourced and pricing is legitimate.

Communication Tools for NGO’s

• The communication tool that is used to address ethical sourcing for third-party organizations is Starbucks website which includes sustainability reports, community involvement and Starbucks criteria for its suppliers

Stakeholders: Consumers

• Starbucks last stakeholder group is its consumers• Consumers are important because they purchase the

products. Consumers can volunteer through Starbucks website, which has various volunteer postings with its

partners, and they can also help to support Starbucks goals and initiatives.

Communication Tools for Consumers

• The communication tools that are used to address ethical sourcing for consumers are Starbucks use of social media such as Twitter, Facebook and the company’s website• These tools communicate Starbucks goals and achievements for ethical sourcing and how consumers can participate• Starbucks social media networks offers a variety of communication tools such as posting suggestions and making comments which is effective because it allows for Starbucks to receive feedback• Starbucks also educates its employees about product information and labelling which helps answer questions consumers may have about ethical sourcing

Gaps

• Starbucks proves to utilize ethical sourcing and, of course, like many companies there are always areas which need improvement

• A few areas that need improvement and are lacking are Starbucks website and CSR report

Opportunities

• Areas for opportunity include:

• Starbucks can restructure its website

• Starbucks needs to expand its development towards sustaining 100 per cent responsibly grown coffee

Community Involvement

• Starbucks prides itself on being involved with the community

• With help from employees, customers and stakeholders, Starbucks has created programs to give back to the community

• “Shared Planet” community service grants; involves partners such as local non-profit organizations, volunteers and employees working together on projects which directly affect the community.

• By 2015 Starbucks hopes to contribute over 1 million hours of community service

Stakeholder and Communication Tools for Partners (Employees)

• Starbucks partners are an important stakeholder• The Starbucks Community Service Program is a new

communication tool used to encourage volunteering and the organization of local projects

• Social media such as Facebook and My Starbucks allows employees to provide feedback and also

contribute new ideas for community involvement

Stakeholder and Communication Tool: Consumers and Local

Communities• Starbucks Consumers and Local Communities go hand in

hand as a stakeholder audience• Consumers help not only financially, but also through

volunteering, which benefit their local communities• Volunteer-Volunteer (V2V) “promotes direct connections

among partners and customers to share community experiences and

opportunities to improve local communities• Facebook and My Starbucks Ideas site allows feedback, comments and suggestions

Stakeholder and Communication Tools: Third Party/Local Non-Profit Organizations

Third Party organizations, Non-Profit organizations• Starbucks partners with local non-profits worldwide to

help communities in need• Through ‘Make your Mark’, Starbucks matches partner

and customer volunteer hours with cash contributions to non-profit organizations

• Starbucks communicates through online information including; CSR reports as well as the ‘Shared Planet’ goals and progress 2009

Gaps

• Starbucks demonstrates a wide variety of community involvement worldwide

• The website would benefit from being more organized and providing clearer links for a better direction

• Starbucks needs to provide information on past, present and future goals on community involvement

• The Starbucks CSR report allows readers to customize the information, although locating the CSR report is extremely difficult

Opportunities

• Including a page with specific information on each community involvement project would be a useful tool

• Starbucks should invest in, in-store brochures on current involvement projects and efforts that can be made by employees and community members

• Five cents off each purchase of a water bottle goes to Ethos Water Fund• More in-store signage with increase community

involvement

Environmental Stewardship:

• Starbucks is vulnerable to the effects of climate change• Recycling, reducing waste, energy and water conservation

and green building are some of Starbucks main priorities• Farmers, customers and third party non-government

organizations are some of Starbucks stakeholders concerned with the environment

Environmental Stewardship: Farmers

• Farmers are a very important stakeholder to Starbucks; addressing issues such as climate change

• In 2009, Starbucks engaged 29 coffee-growing communities and regions with distinctly sensitive environments and coffee growing traditions

• Starbucks is partners with Earth-Watch Institute, sharing sustainable practices with farmers

• Starbuck’s goal is to generate support to their stakeholders through programs that facilitate farmers’ access to carbon markets, allowing them to generate additional

income while helping to prevent deforestation.

Environmental Stewardship: Customers

• By 2015 Starbuck’s goal is to serve 25 per cent of beverages made in store in reusable serve ware or tumblers

• Encourage customers through in-store signage to use or purchase tumblers and save 10 cents on every purchase.

• Although serve ware and tumblers only account for 1.5 per cent of total beverages sold, this tactic will keep 1.2 million pounds of paper out of landfills

Environmental Stewardship: Third Party and NGO’s

• Starbucks collaborates with many non-governmental organizations

• Earth-Watch works with Starbucks to assist in expeditions to replant rainforests, map water sources and biodiversity indicators.

• Starbucks is a member of Business for Innovative Climate and Energy Policy (BICEP) addressing environmental challenges

• Website and the internet is used to communicate with third-party stakeholders

Gaps• Starbucks fails to demonstrate its failures and

setbacks• Starbucks also speaks about its future goals, yet

neglects to speak about how they are planning on becoming more environmentally friendly

Opportunities

• The website should include more third-party website information

• The CSR report should include both goals and setbacks• Starbucks should become more transparent; this will enable

Starbucks to gain more trust and respect from each of their audiences

• Starbucks should provide discounts on its tumblers