Gaining sustainable competitive advantages through CSR engagement and communication

Corporate Communication
1st semester exam 2011/2012
Master of Arts in Corporate
Communication
Student: Tine Grarup 286495
Supervisor:
Steen Michael Hejndorf
Gaining sustainable competitive advantages
through CSR engagement and communication
Total number of characters: 54,997
A case study of Starbucks
“Coffee is the second most consumed beverage on the
planet after water. It’s the second most traded
commodity after oil. People drink coffee all day, every
day in almost every country around the world.”

Gaining Sustainable Competitive Advantages through CSR Engagement and Communication
Corporate Communication 1st
semester exam 2011/2012
Master of Arts in Corporate Communication
Table of Contents
1 INTRODUCTION...............................................................................................................................1
1.1 Problem statement ............................................................................................................................................2
1.1.1 Research Questions................................................................................................................................2
1.2 Methodology.........................................................................................................................................................2
1.3 Delimitations ........................................................................................................................................................3
2 CORPORATE SOCIAL RESPONSIBILITY......................................................................................4
2.1 The Development of CSR.................................................................................................................................4
2.2 The Concept of CSR............................................................................................................................................5
2.3 Key Drivers of CSR ............................................................................................................................................6
2.4 The CSR Critics ....................................................................................................................................................8
3 THEORETICAL BACKGROUND .....................................................................................................9
3.1 First-mover Advantage in CSR Initiatives ..............................................................................................9
3.2 Three CSR Communication Strategies................................................................................................... 12
4 CASE STUDY....................................................................................................................................16
4.1 Starbucks’ Corporate Profile...................................................................................................................... 16
4.2 Stakeholders of Starbuck............................................................................................................................. 16
4.3 Competitive Market Situation - The Basis for a First-mover Advantage ............................. 17
5 EMPRICAL ANALYSIS....................................................................................................................19
5.1 Starbucks’ CSR Profile - Achievements and Activities................................................................... 19
5.2 Starbucks’ CSR initiatives and First-mover Advantage................................................................. 22
5.3 Starbucks’ CSR Communication Strategies......................................................................................... 25
5.4 Connecting and Reflecting upon the Findings................................................................................... 28
6 CONCLUSION ..................................................................................................................................30
7 FUTURE REFLECTIONS ................................................................................................................32
8 LIST OF REFERENCES ...................................................................................................................34
8.1 Books..................................................................................................................................................................... 34
8.2 Articles in Journals.......................................................................................................................................... 35
8.3 Online Articles................................................................................................................................................... 36
8.4 Other Online Sources..................................................................................................................................... 37
8.5 Starbucks.com Online Sources.................................................................................................................. 38
8.6 Online Videos..................................................................................................................................................... 40

9 APPENDIXES...................................................................................................................................41
9.1 Appendix 1 - Attributes Fundamental for a First-mover Advantage...................................... 41
9.2 Appendix 2 - Central CSR Areas and Asymmetries......................................................................... 43
9.3 Appendix 3 - Three CSR Communication Strategies....................................................................... 46
9.4 Appendix 4 - Starbucks’ Mission Statement....................................................................................... 49
9.5 Appendix 5 – Starbucks’ CSR Profile...................................................................................................... 51
9.6 Appendix 6 – Starbucks’ CSR Visibility Examples............................................................................ 54
9.6.1 CSR In-store Signage........................................................................................................................... 54
9.6.2 CSR on Products.................................................................................................................................... 55
9.7 Appendix 7 - Examples of Stakeholder Involvement Communication Strategy .............. 56
9.7.1 Stop wasting pastries idea............................................................................................................... 56
9.7.2 Drink of the month and give to charity idea .......................................................................... 56
9.7.3 Bright idea............................................................................................................................................... 57
9.7.4 Start selling USA made products .................................................................................................. 58
FIGURES
Figure 1: CSR attributes central for first-mover advantage (own adaption) ...............................9
Figure 1A: CSR attributes central for first-mover advantage (own adaption) ......................... 41
Figure 2: Elements of Sustainable First-Mover Advantage in CSR Initiatives............................ 10
Figure 3: Propositions in sustaining a first-mover advantage........................................................... 11
Figure 4: Three CSR communication strategies (own adaption) .................................................... 13
Figure 4A: Three CSR communication strategies (own adaption) ................................................. 46
Figure 5: Starbucks stakeholder map (own adaption) ......................................................................... 17
Figure 6: Environmental Mission Statement.............................................................................................. 23
TABLES
Table 1: Asymmetries in CSR Capabilities .................................................................................................. 45
Table 2: Public relation models ........................................................................................................................ 47
Table 3: Three communication strategies................................................................................................... 48
Table 4: Mission statement principles....................................................................................................49-50

Student: Tine Grarup - 286495 Page 1 of 61
1. Introduction
Today most people are influenced by many different organizations and corporations throughout
every hour of the day, especially in the choices made concerning everything from the food we eat to
what bank we can trust our savings. Consumer attitudes and desires are influenced by corporations
through branding and different hidden advertisements, and political decision-making is affected by
corporation lobbyists. Thus private corporations are achieving a more powerful position in society,
plus growing in numbers and size they are more than ever seen to be an influential agent of the
larger social system. Along with increasing influence and power comes responsibility, a
responsibility that previously was reserved for merely public institutions, however as Cornelissen
argues “companies are now more than ever assumed to act as responsible and proactive ‘citizens’”1
.
When talking about responsibility, the concept of corporate social responsibility (CSR) has
increasingly been the centre of attention. Due to the immense communication overload, consumer
demands of today go far beyond the functional features of the product, as stated already in 1997
“consumers are looking for what a company stands for”2
. Thus consumers identify with their brand
choices and due to the increasing corporate influence, they have become more critical of corporate
operations in society. The growing competition and media coverage makes it important for
organizations to appear the best way possible, and doing responsible business is argued to be one
way of gaining strategic and reputational advantages3
. Hence this paper aims to look into the
concept of CSR and its relation to competitive advantage.
Numerous of corporations have already been trying to meet demands and have devoted attention to
CSR programs in their overall strategies. This also means that social responsibility has become an
acknowledged business parameter and that engaging in CSR might help meet stakeholder
expectations. Nevertheless it will not necessarily generate competitive advantage on its own,
consequently this paper further wish to discuss how CSR should be communicated strategically.
One of these corporations that has devoted much attention to CSR programs is Starbucks, which is
also one of the forth runners of CSR initiatives. As Starbucks is a well-liked brand, ranked no. 3 US
corporation within its industry of food services, surpassed only by McDonald’s and Yum Brands4
,
1
Cornelissen (2011) p. 242
2
Jo Harlow, marketing vice president at Reebok in Klein (2005) p. 422
3
4
Fortune 500

this paper is further based on an interest in examining Starbucks in terms of its CSR communication
and how the corporation is able to use this beneficially in terms of gaining competitive advantage.
1.1 Problem Statement
The goal of this paper is to examine and discuss the concept of CSR, its relation to competitive
advantage and corporate reputation, and how CSR initiatives can be integrated strategically as a part
of the corporate strategy and identity in order to get the most beneficial result. This will be
answered through a case analysis on Starbucks’ CSR engagement and communication. Furthermore
this will contribute to the short reflection of the future of sustainable CSR communication.
1.1.1 Research Questions
RQ2: Does Starbucks’ CSR engagement meet the elements of ‘sustainable first-mover advantage
in CSR initiatives’ put forward by Sirsly & Lamertz?
RQ3: How does Starbucks communicate their CSR initiatives in relation to Morsing &
Beckmann’s three CSR communication strategies?
1.2 Methodology
The scientific method operates as a foundation of this paper. Scientifically, it takes a socio-
constructive approach, claiming that society is a product created by humans, and vice versa. Social
constructionism view knowledge as grounded in social existence, thus as society change so do
ideas, ideology and values5
. This approach will encompass the central argument of the corporate
communication context, to which expression is given through the product of individual and social
interaction, thus changing together with society6
.
The methodology initiates within the problem statement, outlining the scientific problem. In the
process of testing the initial viewpoint and answering the research questions through a case study
and empirical analysis of Starbucks – part four and five, the concept of CSR and relevant theory is
reviewed and accounted for in part two and three. Sirsly and Lamertz’ sustainable first-mover
advantage in CSR initiatives, and Morsing and Schultz’ three CSR communication strategies are
chosen on the basis of their relevance to the problem statement. The theories are argued to support
each other and are in the analysis interlinked. The analysis is characterised by the methodology of a
5
Berger & Luckmann (1966)
6
Hibberd (2005) p.26

directed content analysis – an interpretative analytic approach based on existing theory7
. The case
study and empirical analysis are carried out by looking at Starbucks and its engagement in and
communication of CSR in relation to the theory put forth in part three. The different data and
information is collected through Starbucks’ external communication, mainly through its website
where the corporation among other has a section on responsibility, and additional secondary
material about the corporation. Looking through the collected data the paper is capable of
determining Starbucks’ general CSR engagement and communication hereof, and analyzing the
data in relation to the problem statement goals, and thus the relevant measures and criteria of the
theories. Hence by connecting the findings and interpreting the results, one is able to draw
conclusions to whether the goals have been achieved, and further include a future reflection.
An important characteristic of the scientific method is that it should provide means of checking the
validity of statements and results8
. Validity is in this paper obtained by comparing the content-
analytic data of Starbucks with the external criteria of the theories. To claim that the research results
are valid will thus also be to claim that the findings do not necessarily depend upon the specific
data, methods and measurements of the particular Starbucks study9
. This will be verified in the
analysis and conclusion hereof.
1.3 Delimitations
Content analyses are typically a study of text, however in this paper a more overall perspective is
taken in order to narrow down the scope, as it is not each of Starbucks’ single CSR initiatives that
are in focus but rather the corporation’s CSR engagement as a whole. Also within the theoretical
part Sirsly and Lamertz note in their model that parallel to the first-mover advantage also exist late-
mover or follower advantages10
, however, here focus will be on how the CSR initiatives can
generate a first-mover advantage.
This part one has introduced the paper and provided a basis for understanding the worldview,
structure and content. The following part will create further basis for both theory and analysis,
presenting the concept of CSR.
7
Hsieh & Shannon (2005) p. 1277 and 1281
8
Sawin (2005) p.389
9
Weber (1985) p. 18
10
Sirsly & Lamertz (2007) p. 5

2. Corporate Social Responsibility
This following section will explain and discuss the concept of Corporate Social Responsibility
(CSR). Before addressing the concept and its key drivers, the development and need for CSR will
briefly be discussed in order to enrich the understanding of the concept and its growing importance.
2.1 The Development of CSR
Despite being a more or less voluntary deed, the rising attention towards CSR amongst corporations
has not been entirely voluntary. Many corporations have been taken by surprise by the growing
public interest in responsibility issues that not previously were a necessary part of corporate
strategies11
. In a time where mass communication has become much easier, different activists make
sure that both the media and the general public are aware of corporations that do not encounter their
social responsibilities. Thus being a successful and highly visible corporation indeed bring along a
great demand for being social responsible.
Furthermore, research shows that “almost 80% of all US consumers do consider CSR an important
characteristic for their purchase decision”12
, hence CSR is a crucial factor in corporations attempt to
gain consumer attention. The active voices of consumers have obtained much power in regards to
strengthen or threaten the market value of brands, and in order to reach these market voices many
corporations have understood the necessity of integrating and communicating CSR policies13
, and
will continue to do so, as the assessment of corporations’ social performance most likely will
continue to grow14
. It is hereby argued that CSR is a socially constructed concept and the need for it
has developed in line with the development of society. Thus it is important to keep societal
developments in mind when integrating CSR into corporate strategies, emphasizing the worldview
of social constructionism put forth in section 1.2.
Having established the development and need for CSR and thus the foundation for the paper, the
following will look into what is understood by the term. The clarification hereof will facilitate a
base for further discussions and contribute to the understanding of the empirical analysis of
Starbucks.
11
Porter & Kramer (2006) p. 2
12
Morsing & Beckmann (2006) p.14
13
Risk & Compliance (2008) p. 3
14
Morsing & Beckmann (2006) p.15

2.2 The Concept of CSR
Being socially constructed, CSR is a complex concept in the sense that it covers many different
aspects of business and has been studied within different academic fields15
. Thus there is no agreed
upon definition - or as Pedersen notes: “CSR means different things to different people at different
times”16
. According to Morsing and Beckmann there is a general agreement among marketers and
scholars that “CSR is defined as the organization’s status and activities with respect to its perceived
social obligations”17
. Nevertheless, corporations around the world presumably have different
perceptions of what responsibility is and not the least what ‘sufficient’ CSR is. In an attempt to
bring clarity to the term CSR and set a more specific base for this paper, some other definitions of
the concept will now be presented.
In their article Sirsly and Lamertz exemplify the concept by the definition made by World Business
Council for sustainable Development saying that CSR is “the commitment of business to contribute
to sustainable economic development, working with employees, their families, the local community
and society at large to improve their quality of life”18
. Sirsly and Lamertz further look into the idea
that corporations also engage in corporate social performance including not only responsibility but
also the process of responsiveness and behavior outcomes19
. This notion of the concept CSR can be
argued to match the development in society very well, as a growth in consumer expectations
combined with an increase in social media use, have intensified the demand for corporations to
listen and respond to stakeholder concerns. Thus CSR is greatly related to stakeholder relationships
and the reputational outcome hereof.
Porter and Kramer further support the fact that CSR can be a significant strategic tool for
strengthening a competitive context in which corporations operate. They define CSR by the
following statements; “[…] CSR can be much more than a cost, a constraint, or a charitable deed - it
can be a source of opportunity, innovation, and competitive advantage.” “When looked at it
strategically, corporate social responsibility can become a source of tremendous social progress
[…].”20
However, one must keep in mind that perceiving CSR as an opportunity rather than as
15
Pedersen (2006) p. 138
16
Pedersen (2006) p. 139
17
Morsing & Beckmann (2006) p. 17
18
World Business Council for Sustainable Development (2000) p.10, cited in Sirsly & Lamertz (2007) p. 6
19
20

damage control also requires for some corporations to change their mind-sets in order to achieve the
competitive success.
Both definitions above share the belief that corporations have responsibilities for the society’s good
and puts focus on the engagement in the sense of how well corporations are able to engage with
their stakeholders and define the central areas for CSR engagement, for it to be a source of
competitive advantage. This paper will be based upon a mixture of them, defining CSR as the
ability of corporations to examine and improve its impact on all those affected by its activities. The
many different opportunities of viewing ones long-term reputation within the context of the social
sustainability should encourage corporations to incorporate CSR in their strategies around the
perspectives of their own stakeholders, for it to match their specific market situation.
2.3 Key Drivers of CSR
Different definitions also affect different incentives for CSR engagement. In the following this
paper’s view on the most predominant aims and benefits of engaging in CSR activities will be
highlighted.
 To achieve sustainable economical benefits
Apart from the strong moral obligation, saying that corporations have a duty to do the right thing21
,
there are those who define corporate responsibility in terms of the more profitable benefits. For
many corporations engaging in CSR is based on a self-interest strategy. For instance an
environmental project reducing energy usage, do not only reduce the environmental footprint of the
corporation, it also tend to reduce the cost for the corporation itself, and thus creates shared value.
Some corporations also recognize the advantage of CSR on long-term sustainability, as Porter and
van der Linde argue “environmental standards that are well designed can be essentially self-
financing by prompting cost-saving innovative approaches”22
. Thus one reason for engaging in CSR
is the impact in can have on the corporation’s bottom line, which is also a reason why CSR should
be integrated with corporate strategy and mission. However, it is contrary argued that sustainable
business is no guarantee for profit alone.
21
Porter & Kramer (2006) p.2-3
22

 To strengthening corporate image and reputation
Aside from economical benefits, CSR initiatives also lead to more social benefits. Stakeholders
have increasingly higher expectations of how Corporations should be managed, thus meeting these
expectations through commitment to social responsibility, and achieving the positive publicity
hereof, will boost reputation and corporate image, if communicated well23
. As presented in PwC’s
2002 Sustainability Survey Report, enhanced reputation is one of the main reasons for corporations
to be socially responsibly24
. The benefits from reputation, are achieved “when stakeholders
favorably perceive a firm’s actions as predictable and worthy of esteem in comparison to other
firms”25
. Hence engaging in CSR comes with the opportunity and strategic option of
differentiation26
. As argued by Cornelissen “[t]he point, then, is to align external commitments with
the internal values and responsibilities […]”27
. CSR issues have thus become a worthy part of
corporations’ value chain as the CSR image has a role in differentiation-based corporate strategy28
.
In that sense one could argue for a circular effect, as reputational returns will create higher sales and
often allow for premium pricing, thus in the long-run also create an overall increase in financial
performance as well.
Strong corporate reputation and image further affects internal stakeholders, making it easier to
recruit employees. The other way around, presenting a satisfied workforce to the public would also
have image related benefits. Moreover there are benefits in regards to investors, as socially
responsible investment is an increasing tendency29
, viewing CSR as a sustainable ground for growth
and profitability within corporations, and as a means of justifying a corporation’s reputational and
regulation risk30
. However, this angle will not be in focus within this paper.
All in all companies face many opportunities when engaging in CSR, and additionally corporations
might be exposed to a variety of legal and reputational risks if they do not have adequate CSR
programs. This supports the notion and argument of CSR being an important factor which
corporations must look into and include in their strategies.
23
Gray & Balmer (1998) p. 697
24
Visser et. al. (2007) p. 128
25
26
27
28
29
Hancock (2005) p. 7
30
Risk & Compliance (2008)

2.4 The CSR Critics
It is however also important to keep in mind the critics. Corporate Watch argue that “[CSR often is]
an active attempt to increase corporate domination rather than simply a defensive 'image
management' operation”31
. Herein lays the much discussed criticism that CSR is nothing more than
a PR exercise, where many critics question the benefits, doubting “its effectiveness in actually
tackling social and environmental problems”32
. Some believe that the CSR trend damage the free
society as corporations use it only to make money33
. Nevertheless, this paper will look upon CSR as
creating shared value for both corporations and society, when being properly integrated within the
corporate strategy.
31
Corporate Watch
32
Hancock (2005) p. 7
33
Hancock (2005) p. 8

3. Theoretical Background
In the following part Sirsly and Lamertz’ first-mover advantage in CSR initiatives and Morsing and
Beckmann’s three CSR communication strategies will be used in the clarification of CSR and the
discussion of how corporations are able to generate favorable stakeholder attitudes and differentiate
themselves by communicating CSR initiatives as a part of their core corporate values and
communication. This is relevant for the paper in order to conduct the analysis and hence evaluate
how Starbucks have integrated and communicated CSR initiatives to gain competitive advantage.
3.1 First-mover Advantage in CSR Initiatives
The need for sustainability and responsibility and the advantages hereof have long been seen as
implicit, however, today’s business reality means that corporations must act strategically, also
within their nonmarket environments, wherein the term CSR is a critical aspect of organizational
performance34
. Sirsly and Lamertz propose a framework indentifying essential elements of strategic
CSR initiatives to generate a competitive first-mover advantage, which is all about gathering market
share and attaining competitive advantages and superior performances35
. However for a CSR
engagement to lead to sustainable advantages it must be characterized by three attributes of; “(a) the
centrality of the CSR initiative to the firm’s mission, (b) the specificity of the benefits of the CSR
initiative to the firm, and (c) the visibility of the CSR initiative to the firm’s stakeholders”36
. The
attributes are visualized below in figure 1 and are further explained in appendix 1. Thus
corporations must exploit a resourced-based view on strategic management, and have these strategic
elements help generate internal sustainability and thus ensure external defensibility. By this,
strategic management is not limited to the market alone, it also embraces the ability to respond to
stakeholder concerns as well as social issues, hence making CSR a key area of strategic concern and
corporate activities in general37
.
Figure 1: CSR attributes central for first-mover advantage (own adaption)
34
Sirsly &Lamertz (2007) p. 5
35
36
37
Sirsly & Lamertz (2007) p. 1-2

CSR initiatives characterized by these attributes above “should result in a behavioral commitment
[...] that ensures ongoing resource contributions to maintain the advantageous CSR performance”38
.
Thus they create the internal conditions essential for acquiring a sustainable strategic CSR
positioning. The three attributes are fundamental to Sirsly and Lamertz’ model below and establish
an important basis for the sustainability of any CSR engagement.
Figure 2: Elements of Sustainable First-Mover Advantage in CSR Initiatives39
The first-mover advantage should furthermore arise on the basis of three types of asymmetries
between a corporation and its competitors. The first asymmetry exist when a corporation already
posses a key resource. The second asymmetry arises based on the effects of a learning-curve,
meaning that first entry on a market create a lead-time advantage. This also includes stakeholder
perceptions, as an early entrant can have great impact on how attributes are valued, as argued by the
authors “When faced with commercial choices, the value that stakeholders attribute to a CSR
38
39

initiative is translated by the preference they actually accord the initiator.”40
Thirdly first-mover
advantages can occur on the base of a corporation having a pioneering position on the market,
enabling consumer loyalty and commitment, also when competitors enter the market, as the cost of
switching might by high for customers41
.
Within their model Sirsly and Lamertz also identify three central areas of CSR initiatives being;
environment assessment, stakeholder management, and social issues management42
. They argue
that performance within these areas is complementary to each other, and thus form an overall and
integrated CSR profile of the corporation43
. Having strategic capabilities in these three areas is
important for corporations to attain a CSR first-mover advantage44
. The asymmetries mentioned
above need to be identified and linked to the CSR initiatives and the strategic capabilities hereof, in
order to assure that competitors cannot easily reproduce the initiative to achieve the same benefits.
See appendix 2 for a more detailed description hereof.
The authors put forward the two below propositions in sustaining a first-mover advantage.
Figure 3: Propositions in sustaining a first-mover advantage45
Through these propositions Sirsly and Lamertz hereby finalize the concept, stating that “[a] first-
mover advantage is thus likely to accrue to a firm and generate sustainable competitive advantage
when it capitalizes on asymmetries in environmental scanning, stakeholder management, and issues
management to develop a strategic CSR initiative that is central to the firm mission, visible to
40
41
42
Sirsly & Lamertz (2007) p. 12 and Appendix 2
43
44
45
Sirsly & Lamertz (2007) p. 19-20

stakeholders and with firm-specific benefits beyond those of public good.”46
They further recognize
that the visibility of the CSR initiative can be a result of the utilization of CSR asymmetries,
meaning that it the first-mover advantage may still be obtainable without the presence of visibility
at first hand. However as mentioned in the appendix 1 the control of positive visibility is important,
and might depend on the communication being tailored to the salient stakeholders47
.
Through the first-mover advantage framework strategic opportunities are recognized. Sirsly and
Lamertz thus support the motivation behind CSR engagement as these strategic CSR initiatives are
argued to “provide both tangible economic gains in market share and cost savings as well as
intangible, but nonetheless valuable, enhancements to reputation and social legitimacy”48
.
3.2 Three CSR Communication Strategies
After having discussed and established how the CSR initiative should be structured and what it
should incorporate in order for it to generate a competitive advantage, this section will now go one
step further and determine how the CSR initiative should be communicated best possible to
stakeholders. As argued in Sirsly and Lamertz’ above theory, visibility is a central attribute to any
CSR initiative, and despite visibility being most credible coming from an reputable and independent
source49
, the corporation itself have to initiate the communication. Thus Morsing and Schultz’ three
CSR communication strategies will here be presented.
Based on Grunig and Hunt’s characterization of public relations models (1984) being; press
agentry, public information, two way asymmetric, and two way symmetric50
, Morsing and Schultz
have developed three types of stakeholder relations for the communication used by corporations
when engaging in CSR. Namely the stakeholder information strategy, the stakeholder response
strategy, and the stakeholder involvement strategy as visualized in figure 4 below51
. The full table
developed by Morsing and Schultz is to be found in appendix 3, including a more thorough
explanation.
46
47
48
49
50
Grunig & Hunt (1984) p. 21-25
51
Morsing and Schultz (2006) p. 325

Figure 4: Three CSR communication strategies (own adaption)
The stakeholder information strategy is a one-way flow of information from corporation to
stakeholders, and is similar to Grunig and Hunt’s public information model. This strategy has the
purpose of distributing information, in order to inform the general public about the corporation’s
favorable CSR initiatives as objectively as possible. Focus is here on the design of the concept
message, in the attempt to ensure positive stakeholder support.52
However such an approach might
run the risk of the ‘self-promoter’s paradox’ as credibility of the communication originates from the
corporation itself53
.
The stakeholder response strategy is based on Grunig and Hunt’s two-way asymmetric
communication, where communication flows to and from the external stakeholders. Being
asymmetric the corporation however still attempts to modify public attitude and behavior, and does
not change as a result of public relations54
. This strategy takes an evaluative mode, where the focus
of CSR initiatives is decided upon feedback from the public. This model is frequently used by
corporations, however in is important to note that Morsing and Schultz question and elaborate on
the model arguing that “what aspires to be a two-way communication mechanism is really [sender
oriented and] a one-way method for supporting and reinforcing corporate actions and identity”55
.
Thus using this strategy, corporations need to carefully choose their communication to engage
stakeholders, as they need their endorsement.
The stakeholder involvement strategy does in contrast engage in real mutual dialogue, as persuasion
comes from both the corporation itself and its external stakeholders. This implies that corporations
might also be influenced by stakeholders and thus must change when necessary. By engaging in
these dialogues corporations explore mutually beneficial actions, and are able to keep up with the
52
Morsing & Schultz (2006) p. 327
53
54
55

development of stakeholder expectations and further the corporation’s own ability to meet these56
.
The CSR initiative hereby depends on its ability to integrate both internal and external CSR
concerns in a continuous dialogue.
The stakeholder involvement strategy is further interlinked with the two above strategies, however
it argues that informing and evaluating is not sufficient alone. Hence, the corporations must ensure
a concurrent interaction with stakeholders in order to bring about mutual understanding and rational
agreement57
.
On the basis of CSR being a continuously developing concept demanding continuously adaption,
Morsing and Schultz highlight that “stakeholder involvement becomes increasingly more important
for ensuring that a company stays in tune with concurrently changing stakeholder expectations”58
.
Thus the three strategies cover the development of stakeholder relationships. While one-way
communication of CSR initiatives is necessary in giving sense to stakeholders, it can no longer
stand alone. In order to survive, stakeholders, whom corporations are depending on, need to be
engaged in long-term value creation. This interaction will generate long-term mutual relationships,
being another source of competitive advantage59
. Having a positive recognition from stakeholders
and being perceived as a legitimate corporation further cause a smaller need for loud CSR
communication60
. Reputation surveys indicate that subtle CSR communication such as “annual
reports and websites are the preferred means of CSR communication by stakeholders”61
. Such a
communication strategy might have little public display, yet it allows for a stronger focus on
content. Morsing and Schultz, however, also suggest that such minimal releases would very much
benefit from adding stakeholder involvement, as allowing for stakeholder expression of support
and/or thoughts about the CSR initiative, will then generate the needed visibility62
.
56
57
58
59
Morsing & Schultz in Morsing & Beckmann (2006) p. 139
60
61
62
Comment: In practice communication with stakeholders is costly and time-consuming, thus the
stakeholder dialogue is likely to be located somewhere between the extremes of the
above strategies, making the complexity of the environment manageable, by focusing
maybe on a limited number of stakeholders and issues (Pedersen (2006) p. 142-143).

Combining the above two theories from Sirsly and Lamertz and Morsing and Schultz one will have
an overall perspective of how corporations best possible structure their CSR initiatives in terms of
form and content, and further communicate these to stakeholders to achieve not alone competitive
advantage but also improved stakeholder relationship. Thus the above section set a valuable basis
for the forthcoming case study and empirical analysis of Starbucks. The first-mover advantage
theory will be used in the case study accounting for asymmetries within section 4.3 on competitive
situation, and in the empirical analysis evaluating Starbuck’s use of the attributes. The three CSR
communication strategies will be applied as a part of the visibility attribute and further as
assessment of Starbucks’ CSR communication.

4. Case Study
This following section is set to paint the picture of the Starbucks Corporation, involving the history
of the corporation, stakeholders and competitive positioning, including asymmetries setting the
basis for a first-mover advantage.
4.1 Starbucks’ Corporate Profile
Starbucks is an international chain of coffeehouses, and is known for being a premier roaster and
retailer of specialty coffee. The first Starbucks opened in Seattle in 1971, and 16 years later Howard
Schultz, now CEO of Starbucks, bought the Starbucks Corporation. To begin with, Starbucks was a
roaster and retailer of whole bean and ground coffee, tea and spices, however Schultz had a vision
to create an Italian inspired coffeehouse “a third place between work and home” as he said63
. His
first goal was to open 125 coffeehouses within five years, a goal that seemed too optimistic at the
time, but would attract no skepticism today64
. Five years later the number of Starbucks coffeehouses
had reached 165, and it has grown almost ever since, now celebrating the corporation’s 40th
anniversary with more than 17,000 stores in 50 countries65
.
The overall Starbucks mission is “to inspire and nurture the human spirit – one person, one cup and
one neighborhood at a time”66
, however the mission statement implies much more than that. It takes
in obligations towards the product and the people behind it, partners, customers, stores,
neighborhood, and shareholders67
- principles that the corporation lives by every day. Thus the
corporate mission embraces all Starbucks’ stakeholders and sets a good basis for the corporate
image68
. See appendix 4 for the full elaborated mission statement.
4.2 Stakeholders of Starbucks
The stakeholders of Starbucks are many and the most predominant ones are depicted in figure 5
below. These stakeholders are both internal and external, however, in this paper focus would be on
the external, as they are the ones targeted in the CSR communication analyzed and discussed in the
following part. Nevertheless the internal stakeholders must also be kept in mind as internal
63
Our Heritage
64
Clark (2007) p. 63-66
65
Company Profile
66
Company Profile
67
Mission Statement
68

sustainability further creates prospect for sustainable CSR initiatives and the possibilities of the
competitive advantage69
.
Figure 5: Starbucks stakeholder map (own adaption)
Some external stakeholders are more important than others, for instance customers are often said to
be the main stakeholder group, however, in a more globalized and technological world, all
stakeholders have some sort of influence on the corporation in each their different way, and thus
need to be a part of Starbucks’ values and decision processes, which Starbucks also accomplishes in
its mission statement.
4.3 Competitive Market Situation - The Basis for a First-mover Advantage
As the empirical analysis will take point of departure within Sirsly and Lamertz’ first-mover
advantage it is necessary to include and evaluate on the market situation of Starbucks, as one of the
main factors in their theory is the ability to capitalize on asymmetries between the corporation and
its competitors70
. Thus this section will shortly account for the competitive market surrounding
Starbucks.
69
See section 3.1 page
70
See section 3.1

Starbucks’s primary competitors are other premium coffee houses, and chains such as Caribou
Coffee and Tully’s Coffee are direct and main competitors to Starbucks71
. “Accounting for nearly
three-quarters (73%) of the market value, Starbucks is the clear market leader”72
, and neither
Caribou Coffee and Tully’s Coffee have the same experience within the field, first being established
in 199073
and 199274
respectively. Thus with its leading experience and still expanding market share
worldwide, Starbucks hereby meet the basic requirements for achieving a first-mover advantage,
seeing that the corporation gain benefit of asymmetries in regards to both the effects of a pioneering
positioning and a learning curve, as accounted for in section 3.175
.
In a time where many consumers have a busy everyday life, Starbucks is also facing greater
competition from quick service restaurants as for instance Mc Donald’s and Dunkin’ Donuts,
despite their entire different approach to coffee76
. Secondary competitors would further comprise
other coffee manufactures making specialty coffee for home use, such as Green Mountain Coffee.
Hence, Starbucks is facing a threat of substitution from corporations producing the same products,
and satisfying the same needs, a threat that further creates a greater demand for differentiation. Not
being able to compete only on product, convenience and price, Starbucks have hereby done wise in
taking in the CSR perspective on top of their already quality products. Caribou Coffee, Tully’s
Coffee and most secondary competitors also engage in some CSR initiatives, however with the
benefits of asymmetries Starbucks still have the desired lead, if it manage to live up to the principles
of first-mover advantage, and further communicates its potential to stakeholders.
71
US Coffee Shops
72
Mintel
73
Our Story
74
About Tully’s
75
Section 3.1 p. XX of this paper
76
Starbucks Competition and Liu (2009)

5. Empirical Analysis
This following part comprises the empirical analysis of Starbucks’ CSR engagement and
communication.
5.1 Starbucks’ CSR Profile - Achievements and Activities
For a global corporation like Starbucks it is a challenge to develop a strategy that both
communicates consistency and demonstrates respect for and value of the individual communities in
which the corporation operates. However, Starbucks has made a great obligation in applying
sustainable, globally recognizable and locally relevant initiatives. The corporation first started
engaging in CSR 10 years ago, making it a part of the corporate identity, and thus the uniqueness of
the corporation77
. Back then, according to Ben Packard vice president of Global Responsibility,
Starbucks was one of the few that reported such initiatives and objectives78
. A lot has changed since
then, and Starbucks now also face competition in the field of CSR. Hence acquiring a first-mover
advantage, which Starbucks does have the prerequisites to do79
, could be of great benefit for the
corporation’s future competitive position, when communicated properly. Starbucks’ own
perspective on CSR is that “[a] responsible company is one that listens to its stakeholders and
responds with honesty to their concerns”80
. This definition puts focus on responsibility as measured
by the ability to listen to stakeholders, thus it corresponds to the definitions and notions from Sirsly
and Lamertz81
, and hereby also assist the reasoning behind analyzing Starbucks on the basis of their
first-mover advantage theory.
Based on Starbucks’ own and the overall definition of CSR, discussed in section 2.2, arguing that
corporations should be able to examine and improve its impact on all those affected by its activities,
and that CSR should be incorporated into the corporate strategy with a stakeholder perspective in
mind, one could argue that Starbucks is indeed engaging in CSR. The corporation calls its
commitment to doing business responsibly “Starbucks Shared Planet” and the main areas of CSR
initiatives herein are listed below, see appendix 5 for a more detailed elaboration of each area.
77
78
Dawson (2011)
79
See section 4.3
80
Starbucks, CSR Report, (2004), cited in Blowfield & Murray (2008) p. 13
81
See section 2.2

Giving back to community is all about “bringing people together,
inspiring change and making a difference in people's lives”82
. It involves
CSR initiatives as community services with employees engaging in
innovative volunteering, neighborhood clean-ups, youth action grants,
the Starbucks foundation supporting communities around the globe
improving access to education, agricultural training and levels of health,
the (STARBUCKS)RED
project fighting ADIS in Africa, Ethos® Water
Fund supporting water, sanitation and hygiene education programs, and
the newest campaign; Create jobs for USA acting according to societal
developments and supporting underserved communities and lending
programs for small business83
.
Environmental stewardship entails “the importance of caring for [the]
planet working with and encouraging others to do the same”84
. A
corporation as Starbucks has a great environmental imprint, take for
instance their extensive water use or the great paper and plastic trail85
.
Thus the corporation does wise in having focus on this. Starbucks for
instance engage in CSR activities as recycling in stores, reusable cups,
purchasing renewable energy, focus on water-saving solutions, reduced
energy consumption and re-establishments of natural habitats to
addressing the problem of climate changes. Starbucks acknowledge that
part of its success depends on a healthy coffee harvest, now threatened
by climate changes, which the corporation then must address. As stated
by Ben Packard, Starbucks VO of Global Sustainability "The way we
see it, addressing climate change will help companies like ours reduce
operating costs and mitigate future economic instability due to extreme
weather conditions, agricultural loss and the very real human costs they
bring."86
82
Community
83
Nocera (2011) and Starbucks: Community
84
Environmental Stewardship
85
Bryant (2009) p. 180-181
86
Lubber(2008)

Ethnically sourced coffee implies the goal “for all of [Starbucks’]
coffee to be grown under the highest standards of quality, using ethical
trading and responsible growing practices”87
. To reach this goal
Starbucks has with the help of Conservation International and Fairtrade
developed guidelines to ensure a responsible supply of coffee, tea and
cocoa. Furthermore Starbucks offer loan programs and is setting up
farmer support centers working directly with the farmers to help reduce
costs, improve quality etc. As Starbucks CEO, Howard Schultz states
“We feel very strongly that the long-term success of our company is
directly linked to the long-term success of […] all the coffee farmers
around the world”88
.
Wellness and Diversity are also areas of Starbucks’ CSR initiatives.
Wellness involves improving health within communities, by offering
nutritious food and beverage options, giving consumers the possibility to
live healthy. Diversity is based on a commitment to celebrate cultures,
and Starbucks thus extend to all customers and support all
communities.89
Starbucks hereby engage in CSR initiatives that attend to the corporation’s impact on environment
and the areas where the corporation operate. The activities do far from only benefit the corporation;
they are all initiated with the stakeholders in mind. One could argue that all stakeholders, shown in
the map in section 4.2, do in some way benefit from the various CSR initiatives. Thus Starbucks’
CSR engagement is in alignment with this paper’s definition of CSR and further Sirsly and
Lamertz’ three central areas of CSR initiatives being; environment assessment, stakeholder
management, and social issues management90
.
87
Ethnical Sourcing
88
The New York Times (2007)
89
Wellness and Diversity at Starbucks
90
See section 3.1 and Appendix 2

5.2 Starbucks’ CSR initiatives and First-mover Advantage
To recap from section 3.1 achieving a first-mover advantage requires that the corporation’s CSR
initiatives are characterized by the attributes of centrality, specificity and visibility. Looking into
Starbucks’ overall mission statement that embraces the corporation’s different obligations to
stakeholders91
, the CSR initiatives above are very much linked hereto, thus making the initiatives
central to the corporation’s core mission and opening for the opportunity of achieving reputational
and image related benefits. One could argue for Starbucks’ CSR initiatives being established on the
basis of the mission statement principles. A couple of years ago Starbucks further initiated a
transformation to get back to the core of the corporation and back to the importance of the mission
statement, in the effort to move forward after the time of a financial crisis. An extra focus was put
on sustainability and environmentalism and Starbucks’ approach to this, being a part of the
corporations’ DNA from the very beginning92
. This further enhances the centrality of the
corporation’s CSR initiatives. As Starbucks’ president of Global Development, Arthur Rubinfeld
argues; “We cannot afford not to do this, in the transformation of the company going forward,
sustainability has to be a part of the company’s forward motion”93
.
Moreover, Starbucks also has a supporting environmental mission statement including a list of
principles that further outline the corporation’s willingness to make sure that its affect on the
environment is as positive as possible, which is beneficial to the corporation’s image as well94
. The
statement and principles are visualized in figure 6 below.
91
See section 4.1
92
Rubinfeld (2011)
93
Rubinfeld, (2011) time [1:29]-[1:38]
94
Maignan & Ralston (2002) p. 497

Figure 6: Environmental Mission Statement95
This supporting mission statement further enhances the centrality of Starbucks’ CSR initiatives, and
especially the CSR areas; Environment and Community embracing the values and commitments
listed above96
. Some might argue that Starbucks have a too widespread CSR scope, however being
a global corporation with coffee shops and suppliers all over the world, fulfilling the obligation of
commitment and environmental leadership in all facets of their business further demands CSR
engagements that likewise touch all parts of corporate involvement. Moreover despite the numerous
of initiatives and ambitious targets, Starbucks manage to be well under its way in reaching their
global responsibility goals for 2015. Out of 12 goals in the Starbucks Global Responsibility Report
from 2010, only four goals are not on track and need improvement, and in fact two goals have
already been achieved97
. The clarity of this presentation and the honesty of the update against
targets are definitely positive, however it is important to note that the information communicated is
seen from the corporation’s one-sided point of view.
As mentioned Starbucks’ CSR initiatives do not only embrace benefits for stakeholders but also for
the corporation itself, this for instance comes to show in the energy and water consumption
reduction programmes, as Starbucks here will benefit from cost savings. Furthermore, combined
with initiatives such as ethnical sourcing and farmer support, the CSR engagement will most likely
95
Business Ethics and Compliance
96
See section 5.1 and Appendix 5
97
Starbucks: Global Responsibility Report (2010)

attract a price premium due to the increased product quality, thus leading to specific benefits for the
corporation itself. Hereby Starbucks’ CSR initiatives are further characterised by the attribute of
specificity. As Rubinfel states himself; “environmentalism and attention to detail in sustainability
does not need to cost more […] there are long term opportunities for the decisions that all of you, all
of us make over time, that pay back in tremendous ROI’s that cannot be quantified and cannot be
qualified.”98
Aside from the corporation-specific economic gains, one would also have to
incorporate the timeframe for further benefits, as the value of many CSR initiatives requires a more
long-term horizon to be fully understood99
. Meaning that some of Starbucks’ CSR initiatives most
likely will generate unique reputational judgements in the long-run, which will further add to this
attribute of specificity. Moreover the reputation and image in the eyes of stakeholders will be
reinforced in comparison to the reputation of its competitors when for instance news agencies write
positively about Starbucks’ program to help create American jobs100
, when (RED) announces their
new partnership with Starbucks in a press release101
, when the grass root organization GBM
announces that they wish to learn from Starbucks successful partnership with farmers102
, when
Ethisphere features Starbucks in 2011 World’s Most Ethical Companies for several years in a
row103
, when passionate consumers blog about Starbucks104
, or when green@work a corporate
sustainability magazine praises the CSR strategy at Starbucks105
. The firm-specific strategic value
of the CSR initiatives thus has a great impact on competitive positioning. Nevertheless it is
important to note that such publicity can be negative as well, which will be discussed later in this
section.
When it comes to the last attribute; visibility, it is argued that Starbucks has done good in
visualizing their good deeds to stakeholders. A part of this attribute has already been touched upon
above when accounting for different examples of reputable and independent sources openly
supporting Starbucks’ CSR initiatives, which is some of the most credible and invaluable visibility
a corporation can get106
. Apart from second hand visibility Starbucks’ CSR initiatives are visible to
stakeholders on the Responsibility section on the corporation’s website, in social media, in annual
98
Rubinfeld (2011) time [4:54] - [5:19]
99
100
WTVM (2011) and Reuters (2011)
101
(RED) Press Release (2008)
102
The Green Belt Movement (2006)
103
Ethisphere (2011)
104
Starbucks Passion
105
Timm (2005)
106

reports, in business conducts and in global responsibility - goal-process reports. Furthermore, the
corporation’s engagement is also communicated to customers in stores and on most products which
is illustrated in appendix 6, however Starbucks does not take part in any direct pull marketing107
outside their stores to make their CSR engagement visibly to stakeholders and the general public.
This means that if stakeholders wish to know more about the corporation’s social responsibility
they have to be somewhat active in finding the information themselves, thus within the attribute of
visibility lies also the corporate need for attracting stakeholder attention and interest, and hereby
being able to capture the benefits of positive impressions108
. That has however not been a big
problem for Starbucks. The corporation has for example been able to attract much more hits on their
website than compared to their biggest competitor Caribou Coffee. Where Starbucks attracts 671.3k
US visitors each month to their website, Caribou only attracts 30.8k US visitors a month109
. This
vast difference in popularity is most likely attributed to the success of Starbucks’ wide geographic
reach, leaving the corporation with more branding and reputational power110
. The difference
presents asymmetries between Starbucks and its competitors, which Starbucks is able to capitalize
through its CSR engagement.
5.3 Starbucks’ CSR Communication Strategies
Looking into the attribute of visibility the paper will here draw a line towards Morsing and Schultz’
three CSR communication strategies; the stakeholder information strategy, the stakeholder response
strategy, and the stakeholder involvement strategy, accounted for in section 3.2. Going back to the
visibility of Starbucks’ CSR initiatives above, it can be argued that the corporation engages in a
mixture of the three strategies. The one-way information strategy Starbucks uses on its homepage
and in the different public available reports where the corporation informs the general public about
its favorable CSR initiatives. The response strategy is for instance used in the ability for
stakeholders to comment on the different posts made concerning CSR by the corporation itself on
the website111
. Also the corporation’s social media channels such as Twitter, Facebook and
YouTube comprise this communication strategy, inviting stakeholders to have an opinion and
comment on the different CSR engagements and other initiatives. This two-way asymmetric
communication demonstrates to stakeholders that the corporation listens and values their concerns,
107
High spending on advertising and consumer promotion to build up consumer demand (tutor2u)
108
Appendix 1
109
Case Study: Caribou Coffee vs. Starbucks (2009)
110
Case Study: Caribou Coffee vs. Starbucks (2009)
111
Pablo 2011

and Starbucks can then use this as an evaluation of corporate actions, however not necessarily with
the need to change as a result hereof112
. Additionally the “My Starbucks Idea” concept goes under
this communication strategy, the concept suggest that stakeholders share their different ideas on the
website, tell what they think of each other’s ideas and hereby join a discussion around the Starbucks
brand113
. This is not purely CSR communication but the concept among others contains a section
for involvement ideas, with main focus on social responsibility. Through this concept Starbucks can
get feedback from stakeholders, and as everybody is able to rate and comment on each other’s
ideas, Starbucks can use this as an assessment of which CSR initiatives and concerns that are most
important for stakeholders. However, as Starbucks here in fact review and launce some of these
ideas, this communication channel also becomes two-way symmetric, using the stakeholder
involvement strategy, engaging in real mutual dialogues114
. For example in 2008 an idea was posted
proposing that Starbucks should strengthen the encouragement of using reusable tumblers115
when
purchasing freshly brewed drinks. This idea got numerous supporting ideas and comments, so
Starbucks responded hereto and launched different size tumblers to match the paper cup sizes,
larger discounts for bringing one’s own tumbler, and reinforcement of barista training regarding
these procedures116
. A year after Starbucks further posted a video on their YouTube channel
encouraging customers to bring a tumbler and then save 10₵ and a great amount of paper cups – a
video that got 17.475 views117
. Also Starbucks asked back if anyone had ideas how to further
encourage customers to bring their own tumbler to save paper waste, and additional 165 comments
were made by stakeholders. This is just one example of Starbucks engaging in mutual dialogue with
stakeholders and hereby being able to explore mutually beneficial actions, and thus keep up with the
development of stakeholder expectations118
- more examples are presented in appendix 7. Thus
Starbucks integrates external concerns with its internal strategies and hereby strengthens the
sustainability of its CSR initiatives and the mutual understanding from stakeholders.
As argued by Morsing and Schultz stakeholder involvement becomes increasingly more important
in order for corporations to stay up-to-date with stakeholder expectations, and create the long-term
112
Section 3.2 and Morsing & Schultz (2006) p. 327-328
113
Starbucks: My Starbucks Idea and Groundswell (2008)
114
Section 3.2 and Morsing & Schultz (2006) p. 328
115
Reusable mugs perfect for on-the-go. Help keep coffee hot, or iced coffee cold – while saving a paper cups.
116
Starbucks: Reusable cups
117
Bring in a Tumbler (2009)
118
Section 3.2 and Morsing & Schultz (2006) p. 328

mutual relationships that are one source of competitive advantage119
. As Starbucks mainly has
positive recognition from stakeholders the corporation also have a smaller need for loud CSR
communication, however it is an advantage for the corporation that it adds to the more subtle CSR
communication of its website and annual reports with actual stakeholder involvement. By allowing
for stakeholder expressions will not only support the CSR initiatives but also strengthen Starbuck’s
reputation and generate the visibility needed for a first-mover advantage.
However as mentioned in section 3.1, having a strong CSR reputation and corporate image also
makes the corporation more vulnerable to damage from the double edge of visibility. Achieving the
majority of its CSR visibility through communication online, including social media, Starbucks is
not able to fully control the value of visibility. This means that time and effort must be put into
monitoring its CSR initiatives and the publicity hereof, in order to be aware of opportunities and
risks. Having high focus on CSR as Starbucks, one is also target of a variety of advocacy groups
who might accuse the corporation of failing to live up to its goals of social responsibility. One
example of such case occurred this year when stakeholders questioned the purpose behind the
recent campaign; Create jobs for USA, a case that is also mentioned in appendix 7. Hereto
Starbucks responded with a clarification of the purpose of the campaign and a justification of their
actions. Moreover back in 2008 Starbucks was put in the spotlight after an investigation done by the
U.K. newspaper The Sun, revealing that the corporation wasted up to 6 million gallons of water
every day120
. The investigation showed that each Starbucks had a cold tap running all day, called a
dipper well - used to clean utensils, and due to the corporation’s health and safety rules at the time,
staff were not allowed to turn it off as the constant flow would prevent germs breeding in the
taps121
. However this regulation was much criticized by both activists and water companies, and
disapproved in a time where water shortage was/is one of the world’s biggest problems122
.This
raised questions about Starbucks’ much hyped environmental records, and further exposed
misalignments in corporate mission and culture - a gap between the corporate objectives and values,
and the actual behavior123
. Nonetheless, Starbucks did defend itself and now states on the website
“[w]e are implementing new alternatives to the dipper well system used to clean utensils that we
believe will significantly reduce our water usage across the globe” and that the corporation “will
119
Section 3.1 and 3.2
120
Victor (2008)
121
Balakrishnan (2008)
122
Victor (2008) and BBC News (2008)
123
Hatch & Schultz (2001) p. 130

continue to include water-saving technologies in [its] equipment specifications”124
. Thus Starbucks
has made an attempt to re-align and create consistency between its mission, culture and image
hereof. Starbucks’ response to this negative publicity is what William L. Beniot calls a ‘corrective
action’ within his image restoration theories, as Starbucks attempts to play down the negative
effects by emphasizing good behavior and promising to correct the problem125
, however this is
another topic and discussion that will not be elaborated on in this paper.
The direct effect of negative publicity will most likely be damaging to the corporate image, being
the immediate mental picture that stakeholders have of the corporation126
. Nonetheless, through
both these examples of negative CSR publicity above, Starbucks makes use of the Stakeholder
involvement strategy meeting the stakeholders with openness towards both ideas and critique,
which in the long-run will help generate some positive reputation despite being based on a negative
claim. However, in the corporation’s global responsibility report from 2010, Starbucks fail to make
a reference to the corporation’s own stakeholder engagement, which is also part of the GRI
guidelines127
. This could be argued to be a missing point in the stakeholder information, as the
corporation then will not be able to gain full benefits from its stakeholder engagement, not
including it in the reporting.
5.4 Connecting and Reflecting upon the Findings
Starbucks is able to capitalize on competitive asymmetries because of its pioneering positioning and
market experience, and on this basis the corporation has developed capabilities for performing CSR
initiatives that generate first-mover advantage. Behind this logic lies the notion that sustainable
competitive advantage often is a result of asymmetries within the existing skills and processes of a
corporation that when developed can produce a unique value creation128
. Based on the findings
above Starbucks manage to engage in CSR initiatives that are central to the corporation’s mission,
with corporation-specific benefits, and visible to stakeholders, and through stakeholder management
and communication Starbucks prioritizes and meets stakeholder interests and is thus able to
generate capabilities of reputational benefits and behavioral commitment that competitors cannot
124
Starbucks: Water Conservation
125
Benoit (1995) p. 79
126
127
”Global Reporting Initiative (GRI) guidelines serve as a framework for reporting on social, economic, and
environmental performance.” Cited in Blowfield & Murray (2011) p. 217
128

replicate129
. Thus through the central areas of CSR initiatives and beneficial communication hereof
presented by Sirsly and Lamertz and Morsing and Schultz in part 3, Starbucks generates
asymmetries based on strategic capabilities within these areas, and hereby ensure ongoing resource
contributions needed for acquiring a sustainable competitive advantage130
. Thus Starbucks’ CSR
engagement provides the corporation a first-mover advantage, which is only confirmed by the
corporation’s success and competitive position131
.
As mentioned in the analysis, one will also have to consider the time frame. Through this first-
mover advantage, having the CSR engagement as integrated into the competitive strategy,
Starbucks is capable of gaining from short and long-term strategic opportunities, including both
economical returns and reputational benefits. Furthermore, on the background of this first-mover
advantage Starbucks can to some extend set itself as the standard against which competitors, now
considered as followers, are evaluated. This will strengthen the corporation’s reputation and maybe
also even influence the direction of more general environmental regulations132
.
Being consistent with the theoretical arguments and meeting the criteria hereof, the observed results
above suggest validity133
. This also means that the findings do not necessarily depend on this
particular case but can to some extend be generalized. All together this analysis proves the
importance of integrating CSR initiatives into the corporate strategy and aligning them with
corporate mission, culture and image, which is applicable to all corporations and thus generalizable
in the broad perspective. Engaging in CSR initiatives and having these as a central part of one’s
corporate identity will be beneficial for most corporations, if of course they are communicated
properly to stakeholders, involving mutual dialogue and shared values. This could among others be
achieved through the use of social media developments, to ensure the transparency needed within
today’s market. Thus, despite the fact that not all corporations are able to obtain a first-mover
advantage it is still argued to be somewhat self-beneficial for corporations to utilize resources and
capabilities to meet societal demands and engage in stakeholder relationships, it will just not
generate the same competitive advantage as having competitive asymmetries present.
129
Sirsly & Lamertz (2007) p. 14-15 and Appendix 2
130
131
Starbucks (SBUX)
132
133
Weber (1985) p. 20 and section 1.2

6. Conclusion
The paper has been built on an interest in the relationship between CSR, competitive advantage and
stakeholder relationship. With the aim of verifying the underlying claim herein stating that;
integrating and communicating CSR initiatives as a part of the corporate strategy corporations are
able to generate prospects for a favourable competitive advantage, a case analysis of Starbucks has
been carried out. Based on an understanding of the concept and its potentials, CSR is connected to
competitive advantage and stakeholder relations through the clarification of the two theories of
Sirsly and Lamertz and Morsing and Schultz, further used as a foundation for the analysis of
Starbucks’ CSR engagement and communication.
To conclude on the paper it is found important to review the market situation of CSR and thus also
its importance for corporations. We live in an age of consumer culture where the market is
influenced by consumption and consumer decision making. This consumption, conversely is also
very much influenced by the increasing power of corporations. Consumers identify themselves with
brand choices and one could argue for Maslow’s hierarchy of needs being turned upside down as
the postmodern consumers of today have their lower needs satisfied and do now strive to satisfy
higher needs, such as self-actualization through brand choices. Meaning that consumers do not buy
a cup of coffee simply to quench ones thirst but rather to satisfy these higher needs – expressing an
identity that matches the corporate values behind the brand. It has in this paper been argued that
signals of social responsibility could represent a key component in consumers’ efforts to develop
this desired identity as we live in a global society where an interest in and concern about social
issues has increased.
Through the first part of the paper it is clarified that CSR is all about the corporation and its
environment. To some corporations CSR is used to minimize risks and is nothing more than
activities that corporations undertake to ensure that it comply society’s demands and hereby earn its
‘licence to operate’. However other corporations go beyond this and use CSR to illustrate their
corporate methodology as a whole, these corporations take an inclusive approach where corporate
behaviour arises naturally from the corporation’s mission and values. Concluding from the analysis
this is also what Starbucks have done and further benefitted from the success hereof. Engaging in
CSR initiatives that are central to the corporation’s mission, with corporation-specific benefits and
visible to stakeholders, based on competitive asymmetries, Starbucks meet the elements of Sirsly

and Lamertz’ sustainable first-mover advantage in CSR initiatives. Combined with stakeholder
management, dialogue and mutual relationships Starbucks prioritizes and meets stakeholder
interests and thus also follow the favorable stakeholder CSR communication combination put forth
by Morsing and Schultz. Hereby Starbucks develops and presents one unified corporate brand,
achieving a first-mover advantage, differentiating the corporation through its CSR initiatives and
communication hereof, adding meaning to the corporation’s identity. This also means that
Starbucks gains the reimbursements from customer collaboration and loyalty and thus price
premium providing both social and economical benefits. Acting on corporate principles and values
in all corporate areas, including CSR, will be what generate the desired long-term benefits and
differentiation from competitors, as Starbucks is able to generate capabilities of reputational
benefits and behavioral commitment that competitors cannot replicate. Starbucks is an example of
how corporations influence changes to the better in today’s world and at the same time use this
involvement to benefit the corporation itself. Hereby it is established that well managed and
communicated CSR becomes a valuable and central element of corporations, influencing core
success factors as corporate reputation, image and identity, and thus generating prospect for
favorable competitive advantage.
A final remark will be that CSR not is as 'black or white' as it may seem, using different parameters
to uncover CSR engagement and the success hereof will provide different results.

7. Future Reflections
During the last years CSR has changed from being a nice thing to do to being a core corporate value
defining the best corporations134
. By doing what is right, corporations can often do quite well,
however it does not come without challenges. CSR is, as any other corporate scheme, affected by
the trends and developments within society and corporate life in general. Thus for instance the
significant influence of the ‘new era’ of globalization bringing changes to corporations’ place in
society, will also affect the integration of responsibility. Together with globalization comes global
trade, stakeholder expansion, and greater visibility, uncovering new social issues and increasing
pressure on corporate responsibility135
. In recognizing the future of CSR one should thus not only to
consider the different methods and ways forward, but also the context in which the corporation
operates and is observed. Hence an understanding of globalization and the societal developments
herein, including cultural awareness and adaption, is important and necessary for corporations, as
CSR will continue to grow within this context.
Another perspective on this paper could have been to look deeper into such challenges that
corporations are facing due to societal changes, and what Starbucks have done to overcome these.
Despite the fact that Starbucks live up to the elements of the theories prescribed within the paper,
and that its CSR achievements will have earned the corporation considerable recognition and
strengthened its reputation, does not exclude the corporation from facing these future challenges as
well. Along with an increasing focus on CSR and growing global demands come also stronger
regulations on global CSR reporting, enhancing the importance of accuracy and transparency136
. If
the scope of the paper allowed it, one could further have analyzed Starbucks’ CSR reporting in
more detail. Despite Starbucks is doing well in reaching its ambitious global responsibility goals,
the corporation’s reporting could be more forward looking, and more comprehensive in terms of
transparency revealing detailed plans of how the these goals will be achieved, which would increase
trustworthiness and hence stakeholder relationships.
Blowfield and Murray argue that “[t]he future course of corporate responsibility will, to a large
extend, be determined by how business’ obligations to involve itself in major societal issues […]
134
CSR Trends 2010
135
Blowfield & Murray (2008) p. 72-87
136
Blowfield & Murray (2008) p. 171

are defined and realized”137
. This paper agrees and further claims that the degree of passion within
the individual corporation will also make a difference in corporate competitiveness. Being
passionate about its clearly stated mission will help Starbucks to keep its position, further through
an ongoing assessment of the external environment and dialogue with stakeholders Starbucks will
be equipped to manage relevant issues and act upon possible challenges as well as opportunities.
Hence the corporation has the essential tools for staying ahead of competitors138
. However, the good
work needs to be maintained and improved alongside with societal developments. There will always
be room for improvement and innovation within the always developing field of CSR, and the
pressure will still be on Starbucks to do more and better. Thus the corporation will continuously
need to be up-to-date with societal changes, evolving stakeholder expectations and global impacts,
and to maintain its high level of CSR and its ‘license to operate’.
One could argue that corporations do not really have the choice not to consider their footprint on
society, given that they need to obey to both government and societal systems, locally and global.
The question then is; how responsible is responsible enough?
137
Blowfield & Murray (2008) p. 387
138

8. List of References
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8.3 Online Articles
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american-jobs
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 The New York Times. “Ending Dispute, Starbucks Is to Help Ethiopian Farmers”. The New York
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8.4 Other Online sources:
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fundamentals.php?ticker=SBUX>
 Tutor2u. “Promoting – push and pull strategies.” Tutor2u.net. 7 Dec. 2011.
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 US Coffee Shops. FoodEditorials.com. 7 Dec. 2011.
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 Business Ethics and Compliance. 1 Sep. 2011. Starbucks. 8 Dec. 2011.
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 Community. 2011. Starbucks. 7 Dec. 2011.
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 Drink of the month and giving to charity. 2011. Starbucks. 7 Dec. 2011.
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 Engaging Young People. 2011. Starbucks. 7 Dec. 2011.
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 Environmental Stewardship. 2011. Starbucks. 7 Dec. 2011.
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 Ethnical Sourcing. 2011. Starbucks. 7 Dec. 2011.
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 Ethos Water Fund. 2011. Starbucks. 7 Dec. 2011.
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 Idea Launched: Stop wasting so many pastries. 2011. Starbucks. 7 Dec. 2011.
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many-pastries.aspx>

Gaining sustainable competitive advantages through CSR engagement and communication

Gaining sustainable competitive advantages through CSR engagement and communication

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