Comprehensive Report on Starbucks Governance, Leadership, and Culture

This report delves into the governance, leadership, and cultural aspects of Starbucks, examining its board of directors, executive management, and stakeholder management practices. It highlights the importance of fairness, transparency, and employee engagement within the company's culture. The report analyzes Howard Schultz's servant leadership style and its impact on the company's success, emphasizing the significance of inclusion, diversity, and collaboration. It also explores the company's commitment to corporate social responsibility and its positive return on capital. The report offers recommendations to enhance employee engagement and increase the proportion of non-executive directors to improve efficiency. The analysis includes an examination of the company's support systems, code of conduct, and efforts towards gender and racial equity. The report references key academic sources to support its findings, providing a comprehensive overview of Starbucks' organizational structure and management strategies.

Running Head: STARBUCKS 1
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Institution
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Governance
Governance in Starbucks is strategy that ensures that there is accountability, effectiveness
and supervision in the company.
 Board of Directors. Governance in Starbucks is committed to maintaining their
uncompromising principles that are essential for their growth. In this regard, the board
has adopted governance principles, policies and committee charters which are the basis of
the Company’s practices.
 Board Autonomy .Starbucks has a corporate structure that is well governed. It uses
selected committees to run the organizational operations.
 Performance Measurement and Recognition. Employees at Starbucks are not recognized
by the number of sales they make but by what they do to fellow employees. This creates a
sense of responsibility while still remaining productive to the company. Employees
ensure that they do something special either to fellow workers, a customer or the
community at large (Claessens, 2019).
 Fairness. The company natures and inspires human spirit. Fairness in the company is
very crucial in ensuring that this is achieved. In this regard, Starbucks culture is to honor
employees’ availability by delivering weekly schedules as well as ensuring that there is
enough rest between shifts.
 Transparency. Transparency is one of the major factors that determine the growth or
failure of an organization. The employee and famer equity program is the main source of
transparency in the company. Through the program, the company ensures that coffee
quality is maintained while promoting both social and economic standards.

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 Executive Management and CEO team. Kelvin Johnson is the CEO of the company. The
main role of the CEO as per the company’s charter is to promote growth of the company
by ensuring that all the goals and objectives set by the company are achieved (Denis,
2019).
 Stakeholder Management. There are different programs that promote stakeholder
management in the company. The company promotes corporate social responsibility
which ensures that there is sustainability in the business.
 Return generated for investors. Starbucks has been experiencing a positive return on
capital in the past years despite stiff competition from other companies. This trend has
been attributed by its leadership structure.
Culture
One of the most distinct characteristics of the Starbucks is its culture. Behaviors,
traditions and believes play significant roles on the performance of the employees.
 Inclusion and Diversity. The main aspects evident the Starbucks’ culture is inclusion and
diversity. Its board of directors is made up of people from diverse ethnic cultures.
 Leadership. Leaders ensure that the company’s culture is always promoted. They act as
roles as models by ensuring that they care for their coworkers (Erkens, 2016).
 Collaborations. Openness in the company ensures that employees are free to speak out
their views to the managers. This is a strategy that the company has adopted to ensure
that employees are free give out their contribution without fear.
 Openness. The employees are open to speak to their seniors. This is mainly facilitated by
the leadership structure in the company (Acharya, 2017).

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 Relationship Driven Approach. One of the main objectives of the company is promote
team spirit. Employees are recognized based on the things they do to their co-workers
thus improving relationships between different stakeholders in the company as well as
ensuring that there is no discrimination in the company.
 Support System equality and Code of Conduct. In 2018, Starbucks announced that had
reached 100% gender and racial equity pay (Filatotchev, 2017). This was intended at
improving productivity and ensuring that there was no discrimination in the company.
Recommendations
Increase Employee Engagement:
Starbucks can decide to engage employees in the company’s decision making process
through participative leadership style. This can increase motivation and loyalty among
employees.
Increasing Non-Executive Directors:
Starbucks should ensure that non-executive directors’ proportions are more than the
directors, this increasing efficiency in the company.

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References
Acharya, V.V., Gottschalg, O.F., Hahn, M. and Kehoe, C., 2017. Corporate governance and
value creation: Evidence from private equity. Review of Financial Studies, 26(2), pp.368-
402.
Claessens, S. and Yurtoglu, B.B., 2019. Corporate governance in emerging markets: A
survey. Emerging markets review, 15, pp.1-33.
Denis, D.K., 2019. Corporate Governance and the Goal of the Firm: In Defense of Shareholder
Wealth Maximization. Forthcoming in the Financial Review.
Erkens, D.H., Hung, M. and Matos, P., 2016. Corporate governance in the 2007–2008 financial
crisis: Evidence from financial institutions worldwide.Journal of Corporate
Finance, 18(2), pp.389-411.
Filatotchev, I., Jackson, G. and Nakajima, C., 2017. Corporate governance and national
institutions: A review and emerging research agenda. Asia Pacific Journal of
Management, 30(4), pp.965-986.