COCA-COLA: MORE THAN A SOFT DRINK

N Coca Cola is considered to be the top soft drinks manufacturer in the world, with sales in over 200 countries.
N In 2002, Coca Cola had revenues of US $19 billion - up 12% from 2001. [i] Net profits for the company were US
$3 billion.

N While sodas still make up about 85% of Coca Cola’s business, it has begun entering the global water market with
force. According to the Atlanta-Journal Constitution, Coca Cola’s global water business grew by 68% in 2002. [ii]

N While still a small player compared with other water bottling companies, it is quietly buying up smaller water
companies all over the world and starting to gain monopolies in local markets (e.g. South Africa and Mexico).

N In the United States and Canada, Coca Cola distributes three water brands: Dasani (owned by Coca Cola),
Dannon and Evian (both owned by French companies and distributed by Coca Cola). Their strategy in the water
industry is to offer a variety of prices depending on the needs of local markets – a $20 million water strategy
according to the New York Times. [iii] Most of Coca Cola’s water, including their bottled water, is sourced from
municipal water supplies – tap water.




“The Coca-Cola Company exists to benefit and refresh everyone it touches.”


QUALITY MATTERS


“Nothing is more important to our success than integrity. This begins with insisting on absolute quality for all of our products, and acting with a strong sense of accountability in everything we do.”*

“More than a billion times every day, thirsty people around the world reach for Coca-Cola products for refreshment. They deserve the highest quality—every time. Our promise to deliver that quality is the most important promise we make.”


United States: A former finance director of Coca-Cola’s Atlanta headquarters has filed a lawsuit alleging that Coca-Cola had engaged in deceptive accounting and marketing, and knowingly sold contaminated products. Mathew Whitley claims that he was fired in March 2003 for bringing these issues to the attention of management, including reporting a problem with metal shavings being found in Frozen Ice Drinks. He also claims to have reported a $65 million marketing fraud involving Burger King and reporting several employees who were reporting false information in an effort to boost profits, whom Coca-Cola has recently “reprimanded.” Coca-Cola denies Whitley’s claims and says it fired him as part of a corporate restructuring program. As a result of Whitley’s allegations, the US Department of Justice has recently launched their own investigation and, unlike Whitley’s private civil suit, the government department can file criminal charges if Coca-Cola is found guilty. [iv]


Taking Care of the Coca-Cola Family



“Our policy is to foster an inclusive environment that encourages all employees to develop and perform to their fullest potential. Our workplace must be a place where everyone's ideas and contributions are valued. Our employees deserve equal treatment under our policies governing compensation, advancement, health, safety and other aspects of workplace life. We understand that fairness in the workplace, coupled with the opportunity to develop individual capabilities, fosters our collective success.”


Colombia: SINALTRAINAL, the National Food and Beverage Worker’s Union, has accused Coca-Cola of working in conjunction with right wing paramilitaries to quell union activities in their Colombian bottling plants. In December 1996, paramilitaries entered the Bebidas y Alimentos bottling plant – a subsidiary of Coca-Cola – killing union leader Isidro Segundo Gil and forcing employees to sign union resignation forms with death threats. The Panamco plant – another Coca-Cola subsidiary – in the city of Bucaramanga was the site of harassment as well when union members went on a 120-hour strike to protest the loss of employee medical insurance. Five union leaders were subsequently accused by the plant’s chief of security of planting a bomb and were imprisoned for six months until the regional prosecutor concluded that the allegations were false.

A U.S. lawsuit for human rights violations was filed in 2001 by the United Steelworkers of America and the International Labor Rights Fund on behalf of SINALTRAINAL. The lawsuit falls under the Alien Torts Claims Act allowing non-U.S. citizens to file against Americans for violations of international law. In March 2003, U.S. District Court Judge Jose E. Martinez ruled that the cases against Panamco and Bebidas y Alimentos could go forward. The ruling did not, however, permit the lawsuit against Coca-Cola itself. Coca-Cola has remained adamant that it had no operational control over its subsidiary plants and no knowledge of planned paramilitary actions. [v]


A leader in environmental stewardship


“By preserving and enhancing our natural world, we brighten the future for our planet and for each other.”

“We operate our business as stewards of the environment, with a commitment to continually move our business toward sustainability: striving to consume fewer natural resources, and to recover and reuse resources more extensively.”

Of its operations in India, Coca-Cola says:

“The company supports a rainwater harvesting project as part of a major government initiative to combat water scarcity and reduced ground water tables across the country.”

“Several of our bottling plants provide safe drinking water to local villagers through the organization of water tankers, bore wells and hand pumps.”

But what it doesn’t say…


India
Kerala: In Plachimada in the State of Kerala, a Coca-Cola plant has been contaminating the water supply and depleting limited groundwater sources. Soon after the plant’s inauguration in 1998, local residents noticed their water was becoming discoloured. For the past year, local women have had to walk over five kilometres every day to collect water from sources far enough away from the plant. In April 2002, during a severe period of water scarcity, more than 2,000 peaceful protestors descended upon the Coca-Cola plant demanding that it leave and compensate villages and farmers for the loss of water. The company’s response was to send a truckload of water to two villages everyday – an action that was both grossly inadequate and, to many of the protestors, an admission of guilt. After 49 days of at least 50 protestors standing outside the plant, police intervened, arresting 130 men and women. The protest continued through until August when another 1000 people marched to the plant.

The Plachimada Panchayat – a locally-elected village council – exercised their authority to refuse to renew Coca-Cola’s industrial license in the area in April 2003 on the grounds of “protecting the public interest.” Their decision was partly in response to the Kerala State Health Department’s recent study concluding that wells near Coca-Cola’s plant were highly contaminated with chlorides and Total Dissolved Solids, and tested high for hardness. To date, this is the only official government document supporting villagers’ claims that their water supply is threatened, although many technical errors have been found in the research supporting Coca-Cola. Another recent study commissioned by environmental NGO groups concluded that the plant had eight bore wells with a capacity to withdraw 1 million litres of water per day – as the India Resource Centre reports, “a quantity of water equivalent to what is needed to meet the minimum requirements of around 20,000 people.” This is contrary to Coca-Cola’s claim that they only have 6 bore wells withdrawing from 0.3 to 0.6 million litres of water per day. According to the researcher’s estimates, “Coke’s water mining has parched the lands of more than 2000 people residing within 1.2 miles of the factory.” Although the local Panchayat had the authority to revoke Coca-Cola’s license, Coca-Cola has appealed to the Government of Kerala on the grounds that the water shortages and subsequent water pollution was a result of poor rainfall. A decision is to be reached in July 2003. [vi]

Uttar Pradesh: In May 2003, Coca-Cola was found guilty of illegally occupying a portion of Common Property Resources of a village near Varanasi and failing to pay land revenues of approximately US $31,406. The land they have been occupying is agricultural land and thus also enjoys a subsidized electricity rate. The plant is also reportedly disposing of toxic waste into neighbouring farms including mango groves, and has allegedly contributed to lowering groundwater levels from 15 feet to 40 feet below ground. Over 100 local activists, incensed with the loss of their common land and their water supply, protested outside the plant in May 2003 but were violently broken up by over 200 police and armed security guards. [vii]

Tamil Nadu: A protest of 7,000 people in April 2003 led to the arrest of 1,900 for defying a ban order to take part in a rally against Coca-Cola. Activists, including the Communist Party of India, the Campaign for Right to Livelihood and Food Security, and women’s, Dalit and community groups, were protesting a recent agreement between Coca-Cola and the local Sakthi Sugar Mill for the latter to package Coca-Cola products. The agreement requires the withdrawal of 75,000 litres of groundwater per day in a severely water-stressed region. [viii]

Himachal Pradesh: Coca-Cola (and Pepsi Co.) were ordered by the Supreme Court of India to pay $62,000 each for damage they caused in the Himalayas. The company had illegally had advertisements painted onto rocks in ecologically sensitive areas of the Himalayas along a 56 kilometre stretch of highway.

Giving back to the community and being a good neighbour


“We support education because of its power to expand opportunities for individuals and increase understanding between cultures. We partner with national and international organizations to alleviate economic disadvantage and help improve the quality of life in local communities. Together with our local bottling partners, we strengthen communities by giving with our hands and our hearts, as partners in the promise of a better life.”


United States
Philadelphia: Lancaster City Council signed a 10-year agreement with Coca-Cola in June 2003 to make Coke the official city beverage. For a cost of $10,000 per year and 32% commission on every bottle sold, Coca-Cola was granted exclusive rights to sell their products at all city functions and facilities. [ix]

Coca-Cola signs many of these types of contracts with institutions, such as schools, and often they stipulate a minimum quantity of bottles that must be sold, guaranteeing a constant consumer base and freeing Coke from the responsibility of investing in advertising.

Colorado Springs: In 1997, the Colorado Springs school district signed with Coca-Cola, giving each of their schools from $3,000 to $25,000 per year, the contract required at least 70,000 cases of soda to be sold per year. After the first year, when only 21,000 cases had been sold, the district began an intensive marketing campaign, including encouraging principals to allow students to drink soda in classrooms. [x]

"Success alone isn't what makes us a trusted neighbour and a welcomed friend in communities where we sell our products. We earn that place only by being involved, concerned and committed citizens."
Douglas N. Daft
Chairman, Board of Directors and Chief Executive Officer

* all Coca-Cola quotes from:
 http://www2.coca-cola.com/ourcompany/ourbeliefs.html;
 http://www2.coca-cola.com/ourcompany/index.html;
 http://www2.coca-cola.com/ourcompany/aroundworld.html


N 1930: To encourage domestic consumption, bottlers send women door-to-door, installing free bottle opener’s in people’s kitchens.

N 1944: In the midst of World War II, President Eisenhower instructs Coca-Cola to send its product to Europe for all
American troops to enjoy…and for Europeans freshly devastated from war, to become Coca-Cola’s first overseas market.

N 1950: Coca-Cola is the first-ever product to appear on the cover of Time Magazine.

N 1978: Coca-Cola penetrates China, the only packaged cold drink allowed in the country. [xi]

N 1989: Coca-Cola becomes the first trademark to be displayed in Pushkin Square, Moscow.



Douglas Daft, Chairman and CEO, serves on the boards of 15 businesses, universities, and research organizations, and is also a member of the Trilateral Commission, The Business Council, and The Business Roundtable.

Executive Vice-President of Coca-Cola Company, and President and Chief Operating Officer of Coca-Cola Latin America, worked for the company in Mexico, under ex-Coke President and now Mexican President Vicente Fox.

Board of Directors includes representatives from: Delta Airlines, J.P Morgan, Home Depot, and Dow Chemicals, among others.


Coca-Cola says that its network of 20 bottling plants in Colombia employs some “10,000 persons directly and another 50,000 indirectly.” Does this include Death Squads?

In response to the deaths of 8 workers in the Coca-Cola bottling plants in Colombia, at the hands of death squads under orders from Coca-Cola, the National Food and Beverage Worker’s Union in Colombia (SINALTRAINAL) has called for an international day of action against Coca-Cola and an extended boycott of their products. For information on the campaign, visit:

www.colombiasolidarity.org.uk/cocacolacampaign.html

Coca-Cola products to boycott (in North America):

A & W Mello Yello
Barq's Minute Maid
Bacardi Mixers Nestle
Bonaqua Nescafe
Canada Dry Nestea
Chinotto PowerAde
Coca-Cola (diet, light, caffeine-free) Seagram's
Coke (diet, light, caffeine-free, vanilla, cherry) Schweppes
Dr. Pepper Sparletta
Dannon Sprite
Dasani Water Sunkist
Evian Squirt
Fanta Tuborg Beer
Five Alive Tahitian
Fruitopia Treat
Ice Mountain Vital Water
Wink


For a full list of products to boycott all over the world, see:
 http://www2.coca-cola.com/brands/brandlist.html

For other information on Coca-Cola and global resistance, visit:
www.corpwatch.org

www.corpwatchindia.org

www.cokewatch.org



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[i] Coca-Cola – Financials www2.coca-cola.com
[ii] Leith, Scott “Coca-Cola’s grip on water” Atlanta-Journal Constitution, June 11, 2003.
[iii] “Bottled water needs testing too” Scripps Howard News Service, July 10, 2003.
[iv] “Coca-Cola hit by lawsuit” CNN Money, May 19, 2003; Agence France Press, July 11, 2003.
[v] “USA: Coca-Cola sued over death squad claims” BBC, July 20, 2001; Leech, Garry M. “Coca-Cola accused of using death squads to target union leaders” July 23, 2001; Collingsworth, Terry and Dan Kovalik “Court rules that human rights case can go forward against Coca-Cola bottlers” www.CorpWatch.org, April 1, 2003; www.colombiasolidarity.org.uk/cocacolacampaign.html
[vi] Jayaraman, Nityanand “No Water? Drink Coke” Corpwatch India, May 28, 2002; C, Surendranath “Coca-Cola: Continuing Battle in Kerala” India Resource Centre, July 10, 2003. Both available at www.corpwatchindia.org
[vii] Aflatoon, “Coke in Varanasi: Facing Local Ire” India Resource Centre, July 10, 2003. www.corpwatchindia.org
[viii] Viswanathan, S. “Communities Protest Coca-Cola in Tamil Nadu” Frontline, June 20, 2003
[ix] Spidaliere, John M. “City becomes Coca-Cola country for $588,000” Lancaster New Era (Lancaster, PA), June 25, 2003.
[x] Star Tribune (Minneapolis, MN), April 20, 2003.
[xi]  http://www2.coca-cola.com/ourcompany/ourheritage.html