CASE 143
Whole Foods: 365 Degrees of Commitment to
Stakeholders Strive to Be an Ethical Corporate
Citizen
CASE NOTES FOR INSTRUCTORS
This Whole Foods case examines how Whole Foods has applied a set of core values to create strong
relationships with a variety of stakeholders. Whole Foods has adopted a stakeholder orientation. While it
considers consumers to be the most important stakeholder, the firm also considers other primary
stakeholders such as employees, suppliers, and shareholders as well as secondary stakeholders such as the
environment and special-interest groups.
Whole Foods was co-created by John Mackey, now the company’s CEO, in 1978. The founders
recognized the need for a natural foods store, and Whole Foods adopted the mission statement: 1) whole
foods; 2) whole people; 3) whole planet. The company has adopted a number of core values to turn its
mission into a reality. These values help to guide the company’s operations. For instance, its emphasis on
whole foods and whole people has resulted in the company offering many food products that are
sustainable and do not contain genetically-modified ingredients. For those products that do contain
genetically-modified ingredients, their labels inform the customer of this fact. Whole Foods strives to
keep customers informed so they can make the best purchasing choices. Whole Foods has been listed as
one of the top supermarkets in terms of customer satisfaction.
Even Whole Food, however, has had its share of controversy. For instance, Whole Foods received
criticism when it purchased rival chain Wild Oats, especially after it was revealed CEO John Mackey had
posted negative postings under a pseudonym on Wild Oats’ blog. Some critics claim the company highly
discourages unions. Mackey’s outspokenness over topics like global warming and healthcare has also
created controversy for the firm.
An even greater threat for Whole Foods recently has been the growing competitiveness in the organic
food industry. Stores like Walmart and Kroger are selling organic food at lower prices. As a result, Whole
Foods has lost customers from the Baby Boomer and Gen X generations. In 2017, Amazon finalized its
purchase of Whole Foods for $13.7 billion. With Whole Foods now part of Amazon, it may be
challenging to maintain Whole Foods’ values and ethical culture as Amazon takes more control in the
long run.
This case demonstrates how a company based on strong values can develop a reputation for ethics and
integrity. On the other hand, this case should also show students that all companies—no matter how
popular or ethical—must still actively manage ethical risk areas.
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QUESTIONS AND DISCUSSION
1. How has a commitment to corporate values contributed to Whole Foods’s success?
The commitment that Whole Foods has to their values has allowed the firmit to succeed because it
gives them a direction to follow. Their values include all their stakeholders: customers, employees,
2. Describe how Whole Foods’s adoption of a stakeholder orientation has influenced the way it
operates.
In terms of their customers, Whole Foods creates a welcoming environment with friendly staff where
people feel comfortable spending time after shopping. They are given free samples and are offered a
variety of high quality products at different price points to choose from. Whole Foods has also
In terms of their employees, Whole Foods ensures that they are treated equally, are paid well, and
receive generous discounts on their Whole Foods purchases. Full-time and part-time employees are
eligible for health care coverage and stock options after working a certain amount of hours. Another
Other programs that address stakeholders are the Whole Planet Foundation (which offers microloans
to people in developing countries to start their own businesses) and the Whole Kids Foundation
3. What are some ways that Whole Foods might have neglected certain stakeholders in the past?
They neglected stakeholders in some of their acquisitions. When acquiring some of the smaller
grocery stores in the neighborhoods they were entering, they did not always adequately consider their
The actions of the CEO in the Wild Oats case as well as in the health care and global warming
discussions caused some negative attention because the opinions of the CEO were seen as reflections
ADDITIONAL RESOURCES
Whole Foods values and mission:
http://www.wholefoodsmarket.com/our-mission-valueshttp://www.wholefoodsmarket.com/career
s/our-values-and-mission
Whole Foods and pricing scandal:
http://www.wsj.com/articles/whole-foods-results-add-to-growth-concerns-1438202546
Whole Foods versus Trader Joe’s:
http://college.usatoday.com/2015/08/19/trader-joes-vs-whole-foods/
Whole Foods opens new chain:
http://www.usatoday.com/story/money/2015/05/07/whole-foods-cheaper–millennial-chain/709343
02/Amazon’s purchase of Whole Foods:
https://www.forbes.com/sites/gregpetro/2017/08/02/amazons-acquisition-of-whole-foods-is-about
-two-things-data-and-product/#fd11fa2a8084