by Cathleene Filmore

Created on: August 28, 2009

Starbucks versus Nike, which company is more ethical?

Starbucks and Nike have many things in common. They were born around the same business era, around the 1970's. Each was established as a small business with the goal of making their product a signature brand. Both companies use a decentralized organizational model and both companies have suffered allegations of unethical labor practices; Nike in regards to its factories and Starbucks in regards to fair trade (Ferrell, Fraedrich & Ferrell, 2007). Both companies have successfully overcome these allegations to become a model of cooperate social responsibility, however Starbucks is arguably the more ethical of the two.

The question of what is social responsibility remains much like the question of whose perspective is correct. When assessing social responsibility one must also assess the measure that this responsibility must extend thereto. A proper definition of social responsibility must include cooperate culture, environmental protection, philanthropic endeavors as well as responsible social influence and one must never make the mistake of defusing social responsibility to the corporate level, social responsibility begins with the individual.

According to a researcher a Harvard University there are five phases to the development of social responsibility at the corporate level (Zadek, 2005). This model begins with the defensive stage, social responsibility is not our job; the compliance stage is next, we will only do what we are required; the managerial stage, this is the stage where social responsibility is viewed as a public relations strategy; the strategic stage, social responsibility can give us a competitive edge; the civil stage, this is the stage where a company becomes a leader in social responsibility, encouraging other companies to do so (Zadek, 2005).

When Nike was accused in the 80's, the beginning of the social responsibility movement, of in humane labor practices it responded to the allegations characteristic of stage one, the defensive stage, but when colleges across the nation cut Nike contracts, dropping stock prices by 50%, Nike realized that it must comply with the demands of society catapulting it into stage three the managerial stage (Ferrell, Fraedrich & Ferrell, 2007) (Zadek, 2005).

Some would argue that Nike is now a leader in social responsibility with its guidelines for review, using fewer chemicals in the process of product production as well as its philanthropic opportunities,

• 1
• 2
• 3
• 4
• Next Page >>