Businessethics is an integral part of any business with a vision to prosperin the long run. The business of a business is not only to makeprofits it must consider the well being of its employees, customers,shareholders and the community at large. Businesses which fail toconsider ethics fail as they face hurdles in their operationsincluding conflicts with the community, government, customers as wellas employees. This case looks at ethics at Starbucks, the world’sleading coffee store.

(a)Are ethics ingrained in the organization’s mission and governancestructure?

are embedded right from Starbucks mission statement. The missionstatement which states “To inspire and nurture the human spirit…..”(Business and Compliance, 2011) is achieved through differentprinciples that the company has in place. These principles arededicated to the company’s partners. The company refers to itsemployees, customers, suppliers and stakeholders as partners as it ismore than a business. is an important aspect in the Starbucksbusiness.

Thecompany has a good governance structure in the company also supportsethical practices and activities in the company. The managementupholds and treats each employee with dignity, and requires itsemployees to be ethical in treating one another. Consequently, thecompany employees treat customers and other partners with dignity.

(b)Does it adhere to a code of ethics (its own or an industry code)?

Starbuckshas a well written code of ethics which acts as a guide to itspartners in routine business activities. The code of ethics hasdifferent sections which outline how partners should act. Thisinclude how employees treat one another, how customers are treated,how to handle business with government agencies, adherence to laws,commitment to the environment, regarding property rights, operationswith suppliers, dealing with competition, and community involvement.These aspects are well stipulated in the company’s code of conductto enable its partners to understand and adhere to the code.

Starbuckshas remained one of the most ethical companies in the world. It isthe leading coffee store in the world a reputation that the CEO,Howard Schultz believes is achieved through ethical behavior with itspartners. According to the CEO, all Starbucks partners have a greatrole in ensuring the company’s reputation remains excellent, notjust the quality of coffee (Business and Compliance, 2011).

(c)From your observation, does the organization’s culture appear to begrounded in a utilitarian, teleological, deontological, orvalue-based philosophy of ethics?

Starbucksethical approach is grounded in a utilitarian ethical philosophy.According to utilitarianism approach to ethics, one should act in amanner that offers greater good for the majority. The value of one’sactions is determined by the its usefulness with focus being on theconsequences.

Lookingat the ethical code at Starbucks, it is clear that the main focus isto enhance greater good to the greater number of people. In treatingemployees, and other partners with integrity, many benefits areacquired. The consideration for the environment, involvement with thecommunity, observing fair competition are all aimed at the largerbenefits of the people and the world at large.

(d)Does the culture promote a commitment to integrity, veracity,fairness, and human dignity?

Starbucksorganization culture is one of the best in the world. Being termedthe most ethical company by Ethisphere Institute for eight years in arow shows the company’s focus on human dignity. In particular,Starbucks treats its employees with a lot of dignity and providesthem with a good, safe and conducive environment to execute theirduties and responsibilities without worry. Employees in turn are ableto reciprocate or reflect human concern in their daily interactionwith other partners.

(e)Are ethical principles adequately communicated and reinforced at alllevels of the organization?

Ethicalprinciples at Starbucks are adequately communicated and reinforced atall levels of the organization. Each Starbucks subsidiary has thestandard ethics code that they should apply regardless of theirlocation, country or situation. In some instances, employees feelthat they are required to follow strict code of conduct unlike theircompetitors. Starbucks maintains high level of concern for ethics andgoes beyond what the laws stipulate (Business and Compliance,2011). For example, the company is against child labor. However, itappreciates the role of young people who have not attained themajority age in diversity development and promoting their personalskills for their future career. In such instances, the HR must ensurethat teenagers below 18 are not given work beyond their scope, arewell compensated and that their job does not interfere with theirstudies or put their health and safety at risk.

Toensure that standards of ethics are applied at all levels thecompany has a Business and Compliance program that overseesthe adherence of its code of conduct in all its affiliates. Variouscommunication channels have been provided for reporting infringementcases or complaint. Anonymity is encouraged in reporting which helpsmore and more employees to report without fear. Investigations arelaunched upon reporting and the necessary action taken thereafter.

TheStandards of Business Conduct booklet is also distributed to allStarbucks partners outlining what Starbucks business practicesentail.

(f)What organizational, management, or employee objectives orpriorities, if any, become justifications for overlooking ethicalconsiderations?

Starbuckshas no such priorities or objectives that can jeopardize ethicalconsiderations. On the contrary, Starbucks have a very efficient codeof conduct which at times exceeds the regulations or expectations ofthe governments in various places.

(g)How are ethical violations discouraged and handled if they arise?

Thecompany has vigorous training for its employees to ensure that theyare aware and that they understand what constitutes unethicalbehavior. For example, drugs and alcohol are not allowed in Starbucksworkplace. However, in the event organized b the company, such as endof year parties for employees, it is permitted. Also baristas servingalcohol in Starbucks stores are not expected to consume alcohol.Receiving gifts from customers is also prohibited as it mayjeopardize the relationship between the organization and its partners(Business and Compliance, 2011).

(h)What benefits and problems accrue to the organization as aconsequence of its current approach to and level of ethicalperformance?

Starbuckshave maintained its repute as the leading brand in the globe, a thingthat has been closely linked to its high ethical standards, besidesits high quality coffee. Starbucks received global recognition as themost ethical company of all times. Its concern to the environment andthe community has benefited the company a great deal. As a result,the company is welcomed in all the places it stages its operations,have no major issues with its partners as well as with the law, forkeeping high ethical standards.

(i)What specific policies or practices should the organization implementto improve its ethical performance?

Starbuckshave done well in terms of ethical performance. However, there isalso need for autonomy for partners to act autonomously when it comesto certain issues. Deontological approach should also be employed inthe company in that employees can act with good intentions to enhancethe community’s and other partners’ lives.

Thecompany should also have a reward or recognition program where themost employees are rewarded for observing ethical principles as percompany’s requirement.

Ultimately,Starbucks mission statement and organizational structure ispositioned and supportive of ethical stand the company has taken overthe years. The company’s success is majorly attributed to itsethical performance.


Business and Compliance. Standards of Business Conduct. StarbucksCoffee Company, 2011.