Ethical issue in Costa Coffee Free Essay Example, 1000 words

Ethical Issues in Costa Coffee Ethical Issues in Costa Coffee Research the ethical issue affecting the company: The coffee industry is one of the largest industries in the global market. Indeed, now a flourishing $30 billion industry, coffee retailers are seen as the owners of one of the most lucrative businesses in the world (THE COFFEE ADDICTION). Such profits however also cause deeper concern amongst social activists who wish to ensure that such firms do not compromise on their social responsibility towards Mother Earth. Costa Coffee, one such profitable venture by Whitbread (PRATLEY, 2011). To understand the ethical issue affecting Costa Coffee, it is first imperative to look into detail into the ethical issues that affect the coffee industry in general. The coffee retailing industry is haunted by what is known as the coffee paradox. Coffee production for the larger part takes place in developing countries. According to statistics, 90 percent of the world’s coffee production takes place in developing countries, the leading coffee producers being Vietnam, Brazil and Columbia (BUSINE SS INSIDER). However, the world’s greatest coffee consumption takes place in industrialized and developed countries like the United States of America and the United Kingdom. We will write a custom essay sample on Ethical issue in Costa Coffee or any topic specifically for you Only $17.96 $11.86/pageorder now This gives rise to a situation what Benoit Daviron and Stefano Ponte call the coffee paradox. The coffee paradox refers to the existence of a coffee crisis in the countries that produce it, and a coffee boom in the countries that consume it (DAVIRON, 2005). Low wages, poor living standards and poor infrastructure is a regular feature of countries that supply the world with a commodity with a high demand. The producers get low prices, while the same coffee is sold at a substantially higher price. To offset the negative impact of the coffee crisis, coffee retailing firms consider it a part of their business ethics to employ measures that ensures prosperity for the producers of coffee in the developing countries as well. According to Geoff Riley, it is fair-trade that has helped in reducing the widening gap between the producer and consumer prices in the coffee industry (RILEY). Coffee production in the international market is increasingly pressurized by social activists to abide by fair-trade regulations. Fair-trade refers to the social movement whereby producers in developing countries are encouraged to trade their produce at terms that favor their own economy. Another feature of fair-trade is encouraging sustainability in order to conserve resources for the generations to come.