Introduction
The successful development of society depends on the interaction of the state and business. However, today, problems are caused by the deterioration of environmental conditions, rising unemployment, the polarization of society, and increased competition between companies. The solution to these problems is reflected in the concept of corporate social responsibility.
Today, from the point of view of entrepreneurs, coffee bars are no less prestigious than computer firms, which have become part of the fast-food world. For most consumers, coffee has become a daily treat, and coffee bars are located everywhere, from single establishments to supermarkets. One of the well-known participants in the global coffee business is Starbucks, which demonstrates the company’s strong corporate social responsibility.
The Concept of Corporate Social Responsibility and its Role in Business
Corporate social responsibility (CSR) implies a conscious and voluntary contribution of business to the development of society. This is mainly aimed at areas primarily related to the company’s core business (Latapí Agudelo et al., 2019). The primary areas of corporate social responsibility are the economic, environmental, and social spheres (Ashrafi et al., 2018). Thus, companies that implement CSR principles should produce and provide high-quality products and services, pay taxes, implement technologies to save resources and energy in their activities, promote employees’ professional and personal growth, and more.
To date, several interpretations of CSR consider it both in a narrow and broad sense. Traditionally, CSR requires organizations to make timely payments, both to employees and external, such as taxes, protecting the health and safety of employees and protecting the environment. Thus, CSR is formed initially based on social and labor relations and those directly related to them, for example, economic or political (Ashrafi et al., 2018). Based on this narrow interpretation, corporate social responsibility is responsible for maintaining the stability of the business and is also aimed at resolving conflicts in the social and labor environment.
The understanding of corporate social responsibility has taken on a broader meaning in recent years. At the moment, this refers not only to relationships within the organization but also to the overall impact of the company on society, that is, what contribution the organization makes to the development of society (Hoque et al., 2018). The concept of CSR is not limited to the activities of a particular business but expands beyond its scope (Ashrafi et al., 2018). Today, the highest form of company CSR is the involvement of businesses in social systems (Lu et al., 2020). Thus, there is a change in the responsibility of businesses, whose activities are now aimed at solving global social and significant problems for a particular society.
CSR in Starbucks
Starbucks is a leading coffee manufacturer and retailer operating in 78 markets worldwide. It opened its doors in 1971 in Seattle, and at the beginning of its existence, the company was engaged in customer service solely to make a profit (Starbucks Company, n.d.). Over time, its goals have been transformed, and today, the company is focused on implementing the principles of corporate social responsibility. In particular, it needs to create a sustainable business environment, which implies building trusting relationships with the authorities in the regions of residence and society.
In the modern world, the effective functioning and development of organizations, enterprises, and companies are often due to the level of corporate culture achieved in them. Starbucks today is not just a chain of coffee shops but a whole phenomenon in corporate culture management. Corporate culture plays an important role in the company (Elsbach & Stigliani, 2018). The mission of Starbucks is “To inspire and nurture the human spirit — one person, one cup, and one neighborhood at a time” (Starbucks Company, n.d.). The main features of the Starbucks culture are:
- Cooperation and communication. Workers collaborate as a team to make the order fulfillment process efficient;
- Openness. Open forums have been created to encourage employees to ask questions and communicate with management;
- Inclusiveness and diversity.
In the context of corporate social responsibility, Starbucks considers the needs and interests of its stakeholders because the company considers itself not only a profit-making organization but also a good citizen of society. Corporate citizenship implies focusing the company’s attention on the needs of the local community and the region of residence. The key stakeholders of the company are:
- Employees (barista, partners);
- Clients;
- Suppliers (supply companies, coffee producers);
- Local communities;
- Investors;
- Authorities in the regions of stay (Starbucks Company, n.d.).
Starbucks contributes to the improvement of society through a wide range of social programs for different stakeholder groups. In particular, the interests of employees, who are more than 300 thousand people, are one of its most important priorities (Starbucks Company, n.d.). Social responsibility lies in non-discrimination concerning the equal treatment of all employees or stakeholders and the equal treatment of them with dignity.
The company pursues the goal of eradicating all types of discrimination: more than 40% of women and 19% of racial minorities work in leadership positions (2021 Starbucks, 2022). In March 2019, the company achieved gender pay parity among workers in Canada and China (2021 Starbucks, 2022). Implementing an anti-discrimination policy keeps employees motivated and helps minimize employee turnover.
The company’s strength is also that it puts employees first and supports their development and social responsibility. In 2014, Starbucks launched an employee program with Arizona State University. As part of this partnership, Starbucks provides employee scholarships and pays 56% of the cost of undergraduate and senior staff training at the University (About us, n.d.). However, underage employees receive low wages in some countries, indicating weaknesses in the company’s social responsibility policy.
Starbucks also has CSR programs to drive green business. For example, 90% of Starbucks’ supply comes from certified coffee farms (2021 Starbucks, 2022). Currently, more than 2,000 green stores are open in 20 countries, with a target of 10,000 green stores by 2025 (2021 Starbucks, 2022). By reducing waste in production and processing, the company conserves the earth’s natural resources and improves living standards around the globe.
In recent decades, climate change and disease outbreaks due to pests have increasingly reduced or even killed crops, leaving many farmers desperate for support. Starbucks partnered with Conservation International in 2015 to support them, making a big commitment (Partnership with Conservation International, n.d.). Starbucks donated enough money to Conservation International to enable farmers in Mexico, Guatemala, and El Salvador to plant 30 million rust-resistant coffee trees in just one year (2021 Starbucks, 2022). Such climate-resistant trees replace old trees and trees affected by leaf rust.
Starbucks actively seeks opportunities to minimize environmental impact and create a healthy planet. According to the company’s 2021 CSR report, one of Starbucks’ key goals is to develop convenient and 100% recyclable cups (2021 Starbucks, 2022). The company also found a way to save $42 million on disposable cups by having consumers bring their mugs to coffee bars (2021 Starbucks, 2022). Thus, Starbucks uses various ways to save the environment and promote this idea to society.
Reputation is not just an abstract concept but a magnet for attracting customers, investors, and employees. Reputation must be visible, authentic, consistent, transparent, and specific to each organization. Various manifestations in this area can demonstrate the application of the company’s policy in practice and how developed the company’s corporate social responsibility is.
In the case of Starbucks, of note was an incident in Philadelphia in 2018, when coffee shop employees called the police to arrest two black men who were regular customers (2021 Starbucks, 2022). As a result, this led to the then-CEO of the company, K. Johnson, meeting with the men in person and publicly apologizing. Subsequently, 8,000 coffee shops were closed to organize business conduct training for 175,000 employees (Isidore, 2018). As this example shows, Starbucks cares about its reputation and implements CSR principles in words and deeds.
Conclusion
Modern companies operating in the global consumer goods and services market in a highly competitive environment must have an effective strategy. It helps the business to understand the prospects for the company’s development clearly, anticipate possible risks, and minimize them. In recent years, management experts have increasingly turned to CSR as a significant competitive advantage for the company.
Despite some weaknesses, Starbucks implements economic, environmental, and social responsibility at the system level. Today, the company seeks not only to make a profit but also to contribute to social welfare. Thus, Starbucks is an example for other businesses, as its achievements in corporate social responsibility are significant and socially significant.
References
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Isidore, C. (2018). Starbucks CEO meets with two black men arrested at Philadelphia Store. CNN. Web.
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