Ethics and Compliance Paper

Ethics and Compliance Paper

Ethics and Compliance

FIN/370

Team E: Travis Murphy, Jennifer Barrier, Amy Strohn, and Rosa Ortiz

February, 24 2014

Richard Jenkins

In today’s business world, all businesses, organizations, and corporations must conduct business with the utmost honesty and in an ethical manner. If the associate is new to the field or recently moved into a new position, each associate has the reasonability and held to a high level in compiling with the policy’s and regulations. With corporations becoming more diverse, it is important each company has policy’s set in places so each associate does not break the law or policy’s the company has set in place. In this paper we will be discussing Starbucks role of ethics and compliance in the financial environment, describe procedures Starbucks has in place to ensure ethical behavior, Identify the processes Starbucks uses to comply with SEC regulations, evaluate Starbucks financial performance during the past 2 years, and closing discuss the trends for each ratio and what it tells you about the organizations financial health.

Starbucks Information Management Policy states that partners will manage information in such a way that supports the needs of the business while ensuring efficiency, security and compliance with any legal or regulatory requirements. (Standards of Business Conduct, 2013, pg. 20). Two thousand and thirteen marked the seventh year in which the Ethisphere Institute placed Starbucks on the list of the World’s Most Ethical Companies (Business Ethics and Compliance, 2013). As part of their business practice, Starbucks commits to following regulations and laws of local and foreign countries. All transactions must abide by these laws. Financial records must be prepared accurately, and all required transactions must be recorded. Partners should not knowingly destroy or dispose of any legal records that should be included in financial statements. Partners must also follow a protocol when working with government officials, in the event of a conflict of interest, promoting fair competition, and accepting gifts. Communication channels are provided to partners who want to express concerns with financial accounting, internal controls and audits.

        Business Ethics and Compliance is a program that supports Our Starbucks Mission and helps protect our culture and our reputation by providing resources that help partners make ethical decisions at work. (Business Ethics and Compliance, 2013). Starbucks provides its partners with compliance and ethical training. Partners can anonymously report any concerns where ethical practices are not being followed. Partners receive resources such as the Standards of Business Conduct, which provides explanations of the expectations to uphold the Starbucks mission and core values. It also provides contact information to report any laws and ethical procedures that are not being followed. Starbucks believes that with every cup of coffee that it servers it is vital to their success to be a company that provide a service that is ethical and complies with the laws.

Financial Markets

Starbuck sells their securities, mainly in the form of common stock, in the primary market. As per SEC rules and regulations, their financial information is available on their website or from any other reputable source, either printed or online. As of February 21, Starbucks stock prices were selling for $72.56 on NASDAQ. Outlined on their financial statements are factors such as total revenue, gross profit, operating expenses and income, and their balance sheet among others. Through this transparency, factual information is made available to potential investors with aspersions of buying Starbucks common stock (Starbucks Corp, 2014).

In order to attract investors, Starbucks regularly publishes its accomplishments and shortfalls in the website. Announcements such as expansion of one of its manufacturing facilities in Augusta, GA can be found, touting their growth and solidity in the marketplace. To appeal to diverse sectors of the market, they also regularly announce initiatives, proposals, and advocacies that address social entreaties such as the environment, education, and human welfare (Financial Release, 2014).

In the global arena, Starbucks has found itself treading very lightly over sensitive international issues such as the accusation of its alleged support of the Israeli army over the sentiments of the Palestinian issue. As such, its entry into certain areas can be daunting, and is careful to assert neutrality in regards to those controversial subjects (Dudovskiy, 2013). Antipathy of Americans in foreign countries is a subject that Starbucks recognizes and positions itself accordingly.