Starbucks of Hong Kong

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CGE25101
Globalization and Business

Individual Assignment
(Topic 2 Sustainable development- Starbucks)

Introduction

In these days, instead of merely focusing on economic interests, multinational corporations (MNC) have engaged a number of sustainability initiatives in an effort to satisfy the needs of the present while preserving the ability to future generation by contributing on the three main elements: economic, environmental and social development. As a company becomes popular and possesses good reputation, consumers will put their eyes on how it gives back to communities and focus on the sustainable development thus has gradually become an essential strategy for global companies to strengthen the consumer loyalty. This report is going to discuss how a powerful and recognizable international coffeehouse, Starbucks, has made sustainability a part of the company responsibility.

Enhance the economic sustainability

Provide loans for farmers
In order to steadfastly reach small-scale farmers, a three-year program named Small Farmer Sustainability Initiative (SFSI) is launched with Fair Trade USA and Fair trade International. Under this program, fair-trade farmers can receive loans from the funds supported by Starbucks to increase the living condition, reduce farming risk and enhance their business. In 2010, nearly 56,000 farmers who grow Starbucks’ coffee are benefit from fair loans. Recently, Starbucks has also worked with EcoLogic to develop the financial skills of them by providing $2.5 million to the loan fund at a 2% interest rate.

Fair Trade to improve the life of farmers
Starbucks’ creates a long-term supply of the high-quality beans to better the future of farmer, the root of the supply chain. To reach the commitment, it sets up Coffee and Farmer Equity (C.A.F.E.) for small farmers as well as all suppliers under the movement of fair trade which helps to engage in long-term relationships and deal directly with producers. Since 2000, it paid over $10 million to ensure farmers receive fair prices for their crops and assure the coffee sell in high quality standards. Besides, the major project with the Ford Foundation raises the supply of coffee and brings premium prices of crops for 16,000 farmers.

Reduce the impact on environment

Construct Green building
To promote the “Green” concept, Starbucks designs and constructs 75 % of highly environmental- friendly stores by making use of green building materials and interior décor to water and energy conservation such as low-flow valves and recycled flooring. All the materials of every store will be processed and pre-certified by the LEED volume-certification program, the nationally benchmark for the green buildings which was approved by U.S. Green Building Council (USGBC), to meet the environmental standard. The project totally reduces 60% of construction waste, 30% of lighting and 60% of water Conserve energy consumption

By fully committing to the energy conservation, Starbucks has also focus on renewable energy through the purchase of Renewable Energy Credits (RECs) to reduce 25% energy consumption and replace the electricity consumption by renewable energy by 2015. Besides, it has integrated solar energy for the sustainable energy development. In 2009, Starbucks also changed almost 80% of light bulbs to LED (Light Emitting Diode) which apparently reduces the energy consumption. Later, they develop better bulbs with General Electric Company (GE). Reduce the wastage Starbucks’ stores generate

Starbucks develops a comprehensive recycling program to make recycling easier for the local stores and customers by offering front-of-house recycling in several markets. The success of each place increases the commercial opportunity of other markets across different countries. Besides, to reduce the environmental impact of disposable cups and enhance recycling efficiency, Starbucks launches the recyclable cup project and offer a discount of 10% for...
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