Here we will see about the Is Costco ethical?
Costco often delivers the best bargain for the goods that you need, but is it always done ethically?
For a simple answer, Costco is one of the most ethical companies in the United States and worldwide. It tries to be accountable to its employees, customers and vendors and is positively regarded in that aspect. It has not been free from controversies in the past, but its responses have been mostly positive. Overall, it does try to live by its code of ethics.
The ethics of Costco
For a more thorough answer; while Costco is a relatively ethical company and it tries to maintain that reputation, it is no stranger to controversy. It has a well deserved reputation for affordability and employee welfare, but it has drawn criticism from animal and human rights activists on a number of issues. What separates it from other companies that face such issues is that it legitimately tries to improve with criticism. It is not the best, but is far from the worst.
For further details please keep reading:
Relations between Costco and its employees:
The relations between Costco and its employees can be summed up as mostly positive. The majority of locations are not unionised but locations in the north-east and California are staffed by Teamsters. The average wage is 17$/hour and in general, the minimum wage is the best that such companies offer. Also, in terms of health-insurance, it ranks ahead of its competitors with 85% of its employees. Overall, it ranks quite well in that regard.
The code of ethics:
The code of ethics for staff and members is as follows:
- Obey the law
- Take care of our members
- Take care of our employees
- Respect our suppliers
The code of ethics for suppliers is as follows:
- Adhere to set levels of supplier diversity
- Be anti-human trafficking
- Be anti-abuse of workers
- Uphold safety labour standards
- Uphold food safety standards
Stewardship goals:
Costco also boasts some robust stewardship goals.
They are presented below in-verbatim from the website:
- Avoiding deforestation and conservation of natural resources
- Conserving or restoring natural resources
- Protecting High Conservation Value (HCV) and High Carbon Stock (HCS) forests
- Ensuring free, prior and informed consent of indigenous people
- Respecting basic human rights
- Avoiding pollution
- Protecting water resources
- Protection from harmful chemicals
- Protecting, restoring and promoting soil health
- Supporting the increased health production-efficiency of lands currently in production.
Controversies:
The recent controversies of Costco are tabulated below:
| Year | Accuser | Accused | Accusation | Response |
| 2010 | Mercy for Animals | Buckeye Veal Farm | Using crate-and-chain method | Method banned by Costco |
| 2012 | Mercy for Animals | Christensen Farms | Using gestation crates | Costco begins phasing out |
| 2014 | The Guardian | Charoen Pokphand Foods | Using slave labor in prawn harvesting | Condemnation |
| 2015 | The Humane Society of the United States | Hillandale Farms | Battery cage | Shifted to cage-free systems |
| 2016 | Direct Action Everywhere (DxE) | Pleasant Valley Farms | Animal cannibalism | Denial |
| 2017 Aug | Customers | Costco | Deceptive labelling | Compensations |
| 2019 | Natural Resource Defence Council & SumOfUs | Costco | Deforestation for toilet paper | N/A |
| 2020 Sep | CBS News | Palmetto Cheese | Owner labeling BLM as a “terror organization” | Banned from Costco |
| 2020 Oct | PETA | Theppadungporn Coconut Co. | Using forced monkey labour | Stopped purchases |
Costco vs.
The quality of a man can be judged by the quality of his enemies.
This has been phrased and re-phrased by countless people and it holds true for companies like Costco.
Let’s go over them:
Apple vs. Costco: The two companies are near polar opposites in terms of aesthetics and working. The former is the face of consumer elitism, where small changes in design lead to new launches of shiny gizmos. They are sold in futuristic glass and steel temples to near fanatical consumers that would pay an arm and a leg for them. The latter is a no-nonsense retailer where membership is a matter of convenience. Apple’s tactics of purchase are antithetical to Costco’s policies,so it is no wonder that there is so much animosity between them.
Tiffany’s vs. Costco: Costco doesn’t look good in this regard as brand-name theft is a serious business. Costco has no excuse for using the former’s brand name without actually selling their products and the customer’s and Tiffany’s response to it was justified. This is the type of enmity that Costco does not need.
Costco vs. Coca-Cola/Starbucks: This is a case of policy vs. profit. Costco’s low-price, consumer-friendly policy does run into conflict when Coca-Cola doesn’t give them an acceptable price or Starbucks cuts costs on their end without passing it down to Costco and its members.
Costco vs.Wall St.: Nothing defines the Wall Street image like the search of profit, regardless of how many people get trampled in the way. So it is no wonder that they can be defined as the arch-enemy of Costco. Of all the examples listed here, this is the one that Costco can be proud to have.
Conclusion
In the end, Costco is mostly ethical. It is still far from perfect and it would take the influence of customers who care for it to maintain its edge.
Frequently asked questions:
- If I see something wrong, where can I bring it up?
Simply visit the URL: https://secure.ethicspoint.com/domain/media/en/gui/28417/index.html
- Why does Costco exactly have such a code of conduct?
By letting employees act ethically, it improves morale, reputation and productivity.
- Is there any aspect that Costco needs to improve upon?
It’s carbon footprint, in terms of deforestation and plastic recycling.
- Is it worth it?
Yes.
