Jennifer Howell 9/2/2011 BA 470

Coca-Colas Water Neutrality Initiative Case Study Analysis

This case is concerns the issues that The Coca-Cola Company (TCCC), one of the worlds largest beverage companies, faced regarding its impact on water around the world in the mid to late 2000s. At the time, TCCC had operations in over 200 countries, provided 1.6 billion servings of beverages a day and had partnerships with around 300 bottlers (Woo Liu). Their worldwide production used around 80 billion gallons of water each year, with only about twofifths of that going into actual products and the rest being used in the manufacturing process (Lawrence 43). Beginning in the early 2000s it became apparent to Coca-Cola and the public how much of an impact TCCCs water usage had on the communities they operated in around the globe. In 2003, an organization in India claimed that Coca-Cola products in the area contained dangerous levels of pesticide residue (Lawrence 43). Other activist groups in India were declaring that the companys bottling plants used too much water from surrounding communities (Hwang 2). In 2004, these allegations led to the shut down of a bottling plant due to its role in the depletion of groundwater, and new law required all soft-drink makers to list any pesticide residues on their labels (Lawrence 43). Acknowledging that water issues were a growing concern worldwide, TCCC conducted a comprehensive study on their water usages, management practices and their impacts and reached out to organizations like the World Wildlife Fund, and the Nature Conservancy for advice (Lawrence 44, Hwang 2). In 2007, TCCC announced a goal of becoming water neutral by returning as much water to the world as it uses and utilizing the method of reduce, reuse, recycle & replenish (Lawrence 44, Shapiro). Coca-Cola also announced a partnership with the World Wildlife Fund (WWF) in which it gave an initial $20 million to support water conservation projects that would align with their new water neutral goals (Lawrence 43, Business Wire).

Jennifer Howell 9/2/2011 BA 470 The publics issue facing TCCC in this case was two-fold: the prescience of pesticides in Coca-Cola products and the depletion of ground water caused by the manufacturing process. The initial stakeholders who brought up the concerns were a think tank organization in India and an Indian court. The information soon spread to the U.S. where a grassroots organization began a public campaign to boycott Coca-Cola products (Lawrence 43). These stakeholders wanted CocaCola to address and correct the problems by providing information about pesticide levels on their product labels and to reduce their water intake and use a more sustainable method to eliminate the depletion of ground water in communities (Lawrence 43, Woo Liu). Coca-Cola went above and beyond the expectations of its stakeholders by pledging to become water neutral and partnering with the WWF. Using the strategic radar screens model, the most significant environment affecting this case would be the geophysical environment, since the physical surroundings and usage/impact of the natural resources are being directly affected (Lawrence 30). Multiple steps in the issue management process were easily identifiable in this case. While stakeholders and Coca-Cola identified the issues, TCCC was quick to analyze the issue by utilizing both internal and external resources (Lawrence 32-33, 43-44). It can be assumed that Coca-Cola generated multiple options with the help from its business partners, which is how it came about deciding to take action in the form of going water neutral and partnering with the WWF (Lawrence 33, 44). The evaluation aspect of the cycle is not present in the case, but this is a rather recent initiative and it will take a while for the effects to be seen and evaluated (Lawrence 34). Coca-Cola was very proactive in engaging select groups of stakeholders in deciding how to respond to the water quality and usage issues it was facing. TCCC reached out to multiple environmental conservation organizations and academic experts to identify ways to improve their manufacturing processes. The companys water stewardship initiative group also sat down with each of [their] top bottlers, all of [their] operating groups (Lawrence 44) Through a very

Jennifer Howell 9/2/2011 BA 470 deliberate process they were able to reach a consensus on the best practices to move forward with (Lawrence 44). By engaging the stakeholders that would be directly impacted in any changes TCCC would make, Coca-Cola benefited from more reciprocal relationships and didnt have to deal with any pushback from those who disagreed with the new methods. Coca-Cola also benefited from seeking advice of experts in the environmental and conservation fields by knowing that the actions that they would be taking would not only have the greatest impact on their company, but also the greatest and most sustainable impact on the environments they worked in. I think that Coca-Cola appropriately responded the issue in this case. They reacted to and addressed the stakeholders concerns and took it one step further by creating a new initiative to tackle water conservation on a global level.

Works Cited

Business Wire. "The Coca-Cola Company Pledges to Replace the Water It Uses in Its Beverages and Their Production Press Releases on CSRwire.com." Corporate Social Responsibility Newswire. CSR, 5 June 2007. Web. 02 Sept. 2011. Details on the Water Neutral goals of TCCC Hwang, Linda, and BSR's Environmental Research & Development Team. Rep. Drinking It In: The Evolution of a Global Water Stewardship Program at The Coca-Cola Company. Business for Social Responsibility, Mar. 2008. Web. 2 Sept. 2011. History of the issue, initiatives taken by TCCC to address them Lawrence, Anne T., and James Weber. Business and Society: Stakeholders, Ethics, Public Policy. New York: McGraw-Hill Irwin, 2011. Print. Shapiro, Andrew L. "Coca-Cola Goes Green." Forbes.com. Forbes.com, 29 Jan. 2010. Web. 2 Sept. 2011. Details on the Water Neutral goals of TCCC Woo Liu, Ling. "Water Pressure - TIME." Time.com. Time Magazine, 12 June 2008. Web. 02 Sept. 2011. Background information, stakeholders concerns