Coke Turns Green, Combats Accusations

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Coke is one of the most recognized brands around the globe. Along with that recognition comes responsibility, says Lisa Manley, director of environmental communications for the Coca-Cola Company, based in Atlanta. “Having a global presence escalates the expectations that we will play an active role in environmental stewardship,” she says. “We’ve been looking to align the expectations of how our company can and should engage in an environmental perspective with ways that make sense for our business.”


The company is involved in initiatives around the world in areas including water conservation and stewardship, packaging, and climate protection. Each year, Coca-Cola also releases an environmental report, available on its Web site. The 2006 report is due this summer.


But for all the good Coca-Cola is doing, there are entities that take issue with its strategies—and the company has been cited for several environmental violations, most recently in India.


So what does Coca-Cola do that’s environmentally friendly—and not so friendly?


 


Water.


One of its biggest action areas involves the key ingredient in its products: water. On June 5, 2007, Coca-Cola announced a $20 million, multi-year partnership with the World Wildlife Fund (WWF) to replace the water Coca-Cola uses in its beverages and production. E. Neville Isdell, Chairman and CEO of the Coca-Cola Company, said the project focuses on three areas: 1) reducing the water used in production, 2) recycling water used for manufacturing and 3) replenishing water in communities and nature.


As part of the partnership, Coca-Cola also will work with WWF to help conserve seven freshwater river basins, support more efficient water management in Coca-Cola operations and its global supply chain, and reduce the amount of carbon dioxide emissions Coca-Cola produces.


Coca-Cola executives “hit upon this idea that … if we stretch a little bit in terms of thinking and commitment, we can continue to have enough water for all of us into the foreseeable future,” Manley explains. “If given the right amount of global attention within our operation, we have the ability to return the water we use.”


And Coca-Cola uses a lot of water. In 2006, the company and its franchised bottlers used approximately 290 billion liters of water—approximately 114 billion liters in its products and 176 billion liters in manufacturing.


But it’s not enough to reduce, recycle, and replenish, says Manley. Each year, an estimated three to five billion episodes of diarrheal diseases in Third World countries kill more than two million people—more than 90 percent of them are children. According to the World Health Organization, some 88 percent of the sickness is due to bad water, sanitation, and hygiene. “Water challenges have become more complex,” Manley explains. “There’s a need for all of us in business and government to think seriously how we can continue to be responsible users of what is, in some ways, an unlimited resource, but, from a freshwater perspective, a resource highly under stress.”


In 2005, Coca-Cola—along with other corporations, non-profits, and NGOs—formed the Global Water Challenge to “deliver clean water and sanitation and hygiene education projects … share best practices and raise global visibility and support” for the issue, according to its website. Through GWC, Coca-Cola funds and supports more than seventy clean water projects in forty countries.


 


Packaging.


Within Coca-Cola’s Environment and Water Resources Division, a team of researchers uses a computer model to examine how to use less packaging in Coke products. “They shave away tiny corners or reconstitute a cap on a bottle or a lid on a can,” says Manley. “Those kinds of little things may save a tiny fraction of material, but if you’re producing 1.4 billion beverages a day, every bit can make a pretty significant difference.”


With all those containers, Coca-Cola also focuses on recycling, both within the company and through funding outside programs, says Manley. Coca-Cola has invested in bottle-to-bottle recycling facilities in Mexico, Austria, and the Philippines and plans to build more, she adds. The company also invests in programs such as the Recycle Bank in the Northeast, which offers consumers incentives to recycle.


Consumers at the New World of Coke Museum in Atlanta can benefit from Coca-Cola’s recycling efforts; the museum features a new line of merchandise made of recycled material including T-shirts, bags, and notebooks made of recycled bottles. Manley says the company expects to grow the line and eventually sell at other retailers.


 


Climate.


Coca-Cola’s impact on our climate comes in large part from its equipment, mainly its nine million coolers and vending machines, explains Manley. The company has partnered with Greenpeace and the United Nations Environmental Program to invest in technology to make coolers up to 50 percent more energy efficient, she says. Coca-Cola also has invested $30 million to test gases other than the potent greenhouse gasses for refrigeration. “We’ve identified carbon dioxide as a technology that can work for the kind of equipment we use, so we are testing that technology and will roll it out in different areas around the world,” says Manley.


Coca-Cola also reduces its “climate footprint” through its vehicles. In 2006, the company completed a two-year test run of its bottling partner Coca-Cola Enterprises’ new diesel-electric hybrid truck, which improved fuel economy 32 percent, according to the company’s 2005 Environmental Report.


 


Problem Areas.


That report did not mention any of the company’s environmental woes, though. In June, an independent team led by the India Resource Center, a San Francisco-based non-profit, found several violations at a bottling plant in Sinhachawar in the state of Uttar Pradesh, including:


  • dumping of hazardous waste;
  • discharging wastewater; and
  • non-disclosure of the amount of hazardous waste being generated, a requirement of the Supreme Court of India. 


 


The company has been reported for environmental concerns in India before: in 2003, the Central Pollution Control Board of India found excessive sludge at eight Coca-Cola bottling plants to contain excessive levels of dangerous substances such as lead. Also that year, the British Broadcasting Corporation (BBC) tested another Indian plant and found toxic levels of chemicals, some of which had seeped into groundwater, according to the India Resource Center website.


As a result of its Indian environmental issues—as well as allegations of impropriety with its unions in Columbia—the University of Michigan in January 2006 suspended thirteen contracts with Coca-Cola worth $1.4 million annually. 


How does Coca-Cola respond to these charges? “A lot of the allegations have since been refuted by government panels and other organizations,” Manley says, adding that due to the press coverage and findings, the company has become more transparent about its practices in India.


“We’ve made great strides to improve water efficiency and have invested in many environmental programs in India,” she continues. (Click here for more information on these programs.) Late this summer, an independent Indian organization will issue its report to Coca-Cola about its India operations, Manley says.


“Even though we feel these assessments done by the Indian government have shown we are not doing these things various organizations have said we were doing,” she adds, “it’s been our responsibility to do a better job to engage communities in India about the way we do business.”


Responsibility is the operative word when it comes to Coca-Cola and the environment, says Manley. “It’s a key part of the future of our business and a direct link to the kind of business we have.”


Related Story: A New, Green World of Coke

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