Ethics and Compliance Paper Essay

Starting in Seattle with one store, Starbucks has grown across the country and has set about a household name delivering one of the best tasting hot chocolates in existence. The first Starbucks opened in 1971, serving fresh roasted c finishees. Today, more(prenominal) than 15,000 stores in 50 countries, Starbucks atomic number 18 the premier roaster and retailer of specialty coffee in the world (Starbucks, para. 7, 2010). The plaque has been successful because of excellent managerial skills and implementing vowelize note decisions. Starbucks mission statement reads as follows to inspire and nurture the forgiving spirit one person, one cup and one neighborhood at a clock (Starbucks, 2010, p. 1). The beau monde values its relationships with communities, its stores, business partners, shareholders, and employees. Responsible honest character and compliance helps the Starbucks brand protect its news report. This paper will pardon the role of moral philosophy, procedures, Securities and Exchange Commission ( siemens) compliance, and evaluate the financial performance of the Starbucks geological formation. ethics and Compliance PoliciesA successful organization builds its reputation on veracity and trust displayed to customers and business partners. Starbucks conducts business in an honourable manner that protects reputation and supports its culture by unceasingly striving to do what is right. Starbucks has a payload to company values that successfully employs a Business Conduct Helpline and a Business Conduct Web-line for questions and guidance. Starbucks has incorporated an Anti-Retaliation Policy and does not tolerate requital against anyone reporting misconduct. The organization is an equal opportunity employer and use best examples in the hiring process.Business practices include and are not limited to accurate and lawful business transactions and comply with laws and regulations in any country the company operates in, and encourage partn ers to understand and adhere to the rules. Starbucks has an outside agent who facilitates and ensures an honest and honorable relationship with government officials throughout the international arena. Partners associated with the Starbucks brand must(prenominal) practice honest conduct in sales, services, and promote fair competition. Matters dealing with conflicts of interest, gifts and entertainment, and securities are also addressed and implemented by the company. The company closely monitors copyrighted information such as new ideas, company records including financial and audit details.Starbucks explains the Ethical Decision-Making Framework to identify ethical issues, give any contingent solutions, pursue ideas from others, and take for the best approach to resolve unethical matters and apply on results. The aforementioned framework empowers each Starbucks associate and affiliate to take responsibility to help maintain Starbucks ethical and honest reputation. Ethical b earing is doing the right thing, and ethical dilemmas are everywhere in finance (Keown, Martin, tiny & Scott, para. 1, 2005).Securities and Exchange Commissions RegulationsAccording to Ethisphere.com, (2010), Starbucks is one of the most ethical companies in the world for 2010. One of the key points to being an ethical business is to file reports for investors, government bodies, and the public to view. Starbucks complies in one way with the ethics policies set in place by the directors and organization by providing accurate data. The financial records of Starbucks are addressable to the investors, public and government in a timely manner via the website. The requirement set by the Securities Exchange delegacy for a public business is to provide accurate reports in a timely manner.Starbucks publishes an annual report to the Starbucks website for anyone to find via the Internet. The annual report contains immediate payment flow statements of income and expenses. The reports show that Starbucks is performing well even during a problematical economic time. The annual report also contains a statement of Starbucks full of life accounting policies. Starbucks believes that critical accounting practices are important. Starbucks considers its policies an asset impairment, stock-based compensation, operating leases, egotism insurance reserves and income taxes to be the most critical in brain the judgments which are involved in preparing the consolidated financial statements, as express in the annual report on Starbucks website, (2010). monetary proportions for the Past deuce YearsStarbucks financial records allow investors, the government, and the public to have a firsthand quality into the financial stability of the company. The financial records are acquirable for several years this allows the long-term financial success of the company to be easily accessible and available anyone unavoidablenessing to know about the company. As an investor with interest in expanding into Starbucks there are several things the investor should look for.The live ratio allows investors the ability to measure how well a company apprize pay back short-term debt (Keown, Martin, Petty, & Scott, 2005). Starbucks ability to pay back debt in 2009, increased over 2008. In 2008 Starbucks closed several unprofitable locations (Starbucks Investor Relations- pecuniary Release, 2009) resulting in the reduce of overhead be for those locations allowing for additional funds and change magnitude the ability for Starbucks to pay back short-term debt.This increases the stability of Starbucks. The availability of special funds allows Starbucks the opportunity to invest those funds in profitable time value investments. The funds could be invested in the company for improvements or costs for innovate new products. The extra funds could also pay demand expenses outright. This allows the company to have land amounts of outstanding ascribe or loans. The lower the amoun t of outstanding loans and credit allows for lower credit fees and lower costs.* on-going Ratio 2009 2008Current AssetsCurrent Liabilities 599.81581.0 269.82189.737.93% 12.32%Investors can also look at the Debt Ratio of Starbucks. The debt ratio shows the amount of debt a company carries in relation to their assets (Keown, Martin, Petty, & Scott, 2005). Companies must carry few debt to do business effectively. However, the company does not want to carry too much debt. Starbucks has expenses that must be paid for some of these can be paid using credit. However, the company should ensure they are not charging unnecessarily. Starbucks must also show they are paying off their debt. Starbucks debt ratio decreased from 56.08% in 2008 to 45.38% in 2009 (Starbucks Investor Relations- monetary Release, 2009).Tends in the RatiosThis shows a positive financial trend. The company had larger debt in 2008 and was able to hark back a exhaustively portion of the debt without increasing debt som ewhere else in the company, in conclusion lower the overall debt of the company. This positive trend will increase the credit status of Starbucks. This will allow the company to have credit available if needed in the future.*Debt Ratio 2009 2008Total DebtTotal Assets 2531.15576.8 3181.75672.645.38% 56.08%Investors can also look at the devolve on candour Ratio. The Return on Equity Ratio measure the amount of net income returned as a pct of shareholder equity (Keown, Martin, Petty, & Scott, 2005). The main reason investors invest into companies is to take a shit specie If the investor does not make a sizable return on their investment, they may take their money and decide to invest elsewhere The investor wants to have self-reliance the company is going to make solid decisions that will increase the favourableness of the shareholders. Starbucks has seen a decrease in Return on Equity. In 2008 Starbucks Return on equity was 21.10% and in 2009 it fell to 19.64% (Starbucks Investo r Relations- Financial Release, 2009).This is a electro oppose trend for Starbucks. Investors do not want to lose money The decrease was minimal, yet it was a decrease. Overall the company has solid financials. This one negative issue can become a major problem if Starbucks continues to make decisions that allow shareholders equity to decrease.*Return on Equity 2009 2008Net Income coarse Equity 598.23045.7 525.82490.919.64% 21.10%*All numbers are in millionsConclusionIn conclusion, Starbucks has proven itself to be a good investment for any investor. The organization has been in the business for 30 years and has showed substantial growth throughout. The organization started out with one location and has grown to over 15,000, which are primed(p) throughout the globe. The organization as a whole strives to uphold ethical behavior, not scarce set by the SEC but as well as for them. Not only does the organization uphold a high ethical behavior for them but as well only does business with those who have the same mentality.This was proven by being ranked one of the most ethical places to work and this was according to Ethisphere.com. Even though there was a small decrease in the return on equity from 2008 to 2009, which consequently could be because of the recession that most businesses have been bear on by, Starbucks has still proven strong that the organization is still a good investment. The organization has shown an increase in profit and a decrease in debt. All and all, Starbucks is a good investment for anyone who is interested in acquiring into the business, which the organization has shown through good business decisions and ethical behaviors.ReferenceKeown, A. J., Martin, J. D., Petty, W. J., & Scott, D. F. (2005). Financial Management Principles and Applications. Pearson Prentice Hall. Retrieved online on November 22, 2010 located at https//portal.phoenix.edu/classroom/coursematerials/fin_370/20101109/.Starbucks Investor Relations- Financial Release. ( 2009, 11 4). Retrieved November 20, 2010, from Starbucks http//investor.starbucks.com/phoenix.zhtml?c=99518&p=irol-newsArticle&ID=1492291&highlight=SEC. Gov, (2010). The Investors Advocate How the SEC Protects Investors, Maintains Market Integrity, and Facilitates Capital Formation. Retrieved on November 22, 2010 online located at http//www.sec.gov/about/laws/sea34.pdfStarbucks. (2010). close Us. Retrieved online on November 22, 2010 from http//www.Starbucks.comStarbucks website, (2010). Investor relations. Retrieved on November 22, 2010 from Starbucks website http//www.starbucks.comStarbucks website, (2010). Annual Report. Retrieved from Starbucks website on November 20, 2010 http//www.starbucks.com