Multinational Corporations Pros & Cons of The Coca-Cola Company

Multinational Corporations Pros & Cons of The Coca-Cola Company

By Selin Kum & Eugene Ha

Introduction:

What Does The Coca-Cola Company Do?

The Coca Cola company manufactures, distributes and markets carbonated beverages world-wide.

They are one of the worlds most popular multinational companies and is affordable to everyone.

They own plenty of plants all over the world, but the central headquarters are located at Atlanta, Georgia.

History of Coca-Cola

* The Coca-Cola Company was invented by Atlanta pharmacist, John Stith Pemberton in 1886

* Since that time, The Coca-Cola Company has grown to represent over 400 different brands in 200 countries.

* Now there are two different branches in Canada, Coca-Cola Ltd. And The Coca-Cola Bottling Company.

* Coca-Cola Ltd. is responsible for developing and marketing the brands of The Coca-Cola Company, and various other brands, to consumers in Canada, and for the protection of the trademarks here in Canada.

* The Coca-Cola Bottling Company is the local primary Canadian bottler responsible for manufacturing, sales and distribution of most Coca-Cola brands in Canada.

THE PROS:

The Five Strategic Focus Areas & Goals

* On Coca-Colas website, there are certain goals that they hoped to achieve by 2010. These included:

* Establishing a water sustainable operation in which they use one litre of water for every litre of product that is produced

* Maximizing their use of renewable, reusable, and recyclable resources

* Reducing carbon emissions in manufacturing, fleet, sales, marketing equipment, and facilities.

* Offering every consumer the right product and package in the right place, at the right moment, in the right way

* Establish a diverse, winning and inclusive nature

Water Stewardship

* CANADA:

* Reduce plant water usage ratio by 10% by 2010

* Help protect watersheds in territories where plants operate

* Align the plants entire system regulating wastewater and filtering out bacteria so it can support aquatic life by the end of 2010.

* INDIA:

* Within approx 5 km of the Kerala plant, there are about 200 open shallow wells. Coca-Cola states that they use only 2 open shallow wells within the plant. In the same area there are nearly 150 bore wells. There are only 6 bore wells within the plant; the Coca-Cola plant uses no more than 3 bore wells at any one time

* The Kerala State Ground Water Department has said that any depletion in ground water was due to poor rainfall and could not be attributed to the plant.

Sustainable Packaging/Recycling

CANADA:

Avoid the use of 4,200 metric tons of packaging, or almost 3% of their planned usage, between 2008 and 2010

Recycle or recover more than 90% of materials at all Canadian production facilities by 2010

Lead the industry in package recovery (Compared to other competitors)

Increase recycled content in recyclable bottles to an average of 10% (where commercially viable) by 2010

INDIA:

* Aims to eliminate all waste over the life of the packaging through efforts to reduce, recover and reuse materials and conserve resources

* Aspire to safely return to communities and nature an amount of water equivalent to what they use in all of their beverages and their production

* Working to grow their business without growing the system wide carbon emissions from manufacturing operations

Energy Conservation/Climate Change

* CANADA:

* Calculate the carbon footprint in 2008 and set emission reduction targets

* Reduce absolute CO2 manufacturing emissions by 5% compared to 2004 level by 2015

* Ensure that all new sales and marketing equipment is on average 20% more energy efficient by 2010

* Expand hybrid electric technology in the company fleet

* INDIA:

* Recognized for its community programs and environmental practices by popular global organizations (such as the Red Cross and has won prestigious Indian environmental awards for environmental practices.)

* The rainwater harvesting technology it has established at many locations (including the plants at Plachimada in Kerala, Kaledera in Rajasthan and Varanassi in Uttar Pradesh).

* State Government figures have confirmed that since a Coca-Cola plant has been built, in some areas groundwater levels have shown lower levels of depletion than other areas and in some areas water levels have actually risen since the plants were built. It is believed this is partly due to the rainwater harvesting technology employed at these plants.

Other Pros * They were put in the top 10 for diverse workforce in 2004

* Coca-Cola is one of the worlds major sponsors in sports such as the Fifa World Cup and The Winter Olympics.

* Offer many contests and scholarships in almost every country around the world

THE CONS:

Water Stewardship * Inefficient use of water, requires at least 3L of water to make 1L of coke

* The Coca Cola plants uses about 15 million litres of water a day, especially in India where it drained tons of water from small villages preventing farmers from growing their crops and villagers to have access to potable water.

* After absorbing water from at least 65 wells, the water left was contaminated as a result from the chemicals used in the bottle washing, the leftover water contained a high source of cadmium and lead.

* Farmers also suffering from drought and lack of rain

* They refused to take the companies free fertilizer realizing it contains pesticides, therefore the company dumped its waste onto the grounds under the cover of night.

* Not only did this happen with the Coca Cola company, but with the PepsiCo as well

* Although the formula of Coca Cola will never be revealed and would probably never change, they say they would attempt to reduce the use of water yet this is putting its formula at risk

Energy Conservation/ Environment Change

India: * Pollutants are also released from the industry, polluting groundwater which contains a high component of phosphorus, presumably the reason for its promotion as a fertilizer. * As they gave these fertilizers away to the local farmers, Coca Cola believed they were helping them since the farmers couldnt afford their own brand-name fertilizers but instead it intoxicated the agricultural soil, and could have put a risk in the food chain.

* After charges from several lawsuits, Coca Cola still continued to dump its toxic sludge outside the Coca Cola bottling plant by violating environmental laws and regulations in India, proves that they still continue to break regulations.

Globally:

* According to the U.N, 2/3 of the worlds population could be suffering moderate to severe water shortages by 2025, taken by the Coca Cola website from the U.K.

Other Cons

* Abusing human rights, employers working more than 12 hours a day and taking advantage of developing countries

* Racial discrimination against black people, since they were underrepresented, fired more often and paid less than white people (US). There were also complaints of having all-white managers at plants in Africa.

* In Mexico, the Mexican Federal Competitive Commission charged Coca Cola and its bottlers for violation of anti-monopoly laws and indulging in anti-competitive business practices. These charges were leveled as a result of small business owners claiming that Coca-Cola had threatened sanctions against Big Cola

* Coca Cola was also accused of being responsible of the rape, murder, torture and kidnapping of 8 union leaders. Coca Cola has violated 179 major human rights in one country. (Colombia)

* Coca Cola is known for its anti-competitive and anti monopoly practices. The EU concluded that Coca Cola frequently entered into anti-competitive deals with restaurant and bar owners.

RUMORS: There are many rumors about The Coca-Cola Company, which they have a site for that indicates their side of the alleged stories. This proves that Coca-Cola has a hired team that is responsible to maintain a good image by rationalizing allegations.

IN CONCLUSION:

* Is the Coca Cola Company beneficial to the world?

* Economically: Yes

- It employs a large amount of workers in many different countries

- It supports demand and supply

- It sponsors many sports teams, organizations, scholarships and contests

- it also exploits developing countries; creating corruption within the company. Leaders from developing countries view it as a good idea since its providing jobs and opportunities for its people, but in the big picture, the rich benefit from the poor.

Environmentally: No

-It harms the water usage in dry countries (India) and produces a lot of waste to be dumped

- It is unhealthy for the body as Coca-Cola is mainly made up of water, sugar & caffeine

- We are unsure if the environmental goals that were set for 2010 have been accomplished