One of the leading non-alcoholic beverage selling companies, Coca-Cola, has a lengthy history of doing social work as part of its CSR activities. Being a business of its scale, they realized that a strong Corporate Social Responsibility had to be a crucial part of their business agenda. Therefore, they decided to incorporate a varied range of CSR initiatives that would benefit the society, improve the quality of life of its workforce, and bring positive change in the environment. If you want to understand the Coca Cola CSR activities in India and around the world, keep reading!
Coca Cola began its journey in 1886 by producing nine soda bottles a day. By the end of the 20th century, it sold its beverage products in almost every country on the face of the Earth. They became the world’s largest non-alcoholic beverage seller, marketer and distributor in the world in 2005. Considering the pace of growth and scale of business, Coca-Cola was aware of its social and environmental impact.
Live Positively: Coca Cola CSR Basis
Let us begin with what is the basic concept that Coca-Cola takes into consideration when it talks about Corporate Social Responsibility. At the core, the CSR policy formed by Coca-Cola is about sustainability. In the year 2007, Coca-Cola instituted its CSR sustainability under the framework ‘Live Positively’. This concept covered seven core areas:
- Beverage benefits
- Active, healthy living
- The community development
- Energy and climate
- Sustainable packaging
- Water stewardship
- The workplace
From production to distribution, the company tried to incorporate this framework in the system at every level. Coca-Cola made it a point to set measurable goals and fulfil them to enhance sustainability practices.
Coca Cola CSR Problems
The Conflict of Presence of Pesticides
In 2003, a report was published by the Indian NGO Centre for Science and Environment after numerous demonstrations and campaigns. The report tested a sample of a dozen beverage companies, including Coca-Cola beverages sold in India. Research and testing concluded that the presence of pesticides in the samples exceeded European Standards.
With the proof of the same, CSE got in touch with the Indian government. Once this reached India, the report gained enormous attention from the public as well as media. People also started boycotting Coca-Cola.
The Indian government established a Joint Committee that investigated the case by performing various tests of their own. The committee found out that though the beverage failed to meet the European Standards of the presence of pesticides, it was still considered safe under the local standards.
It was concluded that Coca-Cola had not violated any national laws. After almost three years, the CSE published another report on Coca-Cola beverages that proved the presence of pesticide residue was 24 times higher than the European Union standards. These were the standards that were implemented in India.
Finally, in 2008, an independent study was performed by TERI – The Energy and Resource Institute. This ended all the allegations about Coca-Cola. Though the institute didn’t do the test on the final product, it concluded that the water used in the manufacturing of Coca-Cola is free of pesticides.
Water Pollution and Over-extraction of Groundwater Allegation
Another allegation on Coca-Cola was to cause a water shortage in Southern parts of India (Kerala). It was also accused of water pollution due to discharging wastewater into the surrounding areas of the Coca-Cola’s plant. This didn’t just ruin the soil; it also made the groundwater coming from wells and pumps completely unfit for human consumption. Proceedings were held against Coca-Cola in 2003, and it was directed to stop over-extracting groundwater. However, the company argued that the leading cause of the shortage was decreasing rainfall and drought conditions experienced in the area. In 2006, Kerala banned the manufacture and sale of this beverage. However, the ban did not last for long.
The Effect of the Allegations
Immense damages were caused to Coca-Cola’s brand image in India as well as internationally. Loyal customers lost trust in the brand. It suffered massive losses; annual sales witnessed a 15% loss in 2003. Within 15 days of the release of the CSE report, 40% overall sales were affected. Post the report publication, CSR-related conflicts raised in other parts of the world as well. In a case study, Pirson and Malhotra said that the reason why this controversy ended so badly was because they denied the allegations and got defensive. They kept the need for protecting the company’s integrity above the concern regarding public health.
The Coca-Cola India Foundation – Anandana
Over the years, the company realized that they should have handled the controversy diligently. Though even years later, Coca Cola company denies most of its allegations, they understand the perception of local communities matter. The leading beverage company started taking action towards reputation control and published its environmental performance and sustainability report that covered activities from 2004 to 2007. The Coca Cola India Foundation, Anandana, was formed in 2008 that focused solely on environmental sustainability in India. This foundation takes care of the following systems in various states of India:
- Watershed management development and protection
- Purification of riverine systems
- Creation of integrated water bodies
- Restoration of old water bodies
- Rural electrification through solar energy and other similar areas.
Since 2009, Coca Cola India foundation, Anandana, has planned and successfully executed projects worth more than INR 600 million. IT has covered over 500 villages in India and has impacted the lives of more than 666000 people. Few of the approved and funded projects are:
- Dhanora village, Dholpur District – Rajasthan – In association with Eco Needs Foundation, Anandana would be looking after groundwater replenishment and infrastructure needs. Cost approved for the project is Rs. 50.6 lakhs.
- Five villages, Dewas District – Madhya Pradesh – Water conservation projects at the cost of Rs. 178.28 lakhs in partnership with the Development Support Centre.
- Three districts in Rajasthan – In partnership with PHD Rural Development Foundation, water conservation projects were taken up the worth of Rs. 119.25 lakhs.
Coca Cola CSR Activities in India
With an initial amount of USD 10 million, the Coca-Cola Foundation was initiated with prime focus on water management, environment, social advancement and betterment of the quality of life. Over a period of almost a decade of its operations, the foundation has already collaborated with most credible Indian NGOs. Some of them being with:
- HARITIKA – a water sustainability project in Uttar Pradesh.
- Self Employed Women’s Association (SEWA) – Solar electrification project in Rajasthan.
- Institute of Rural Rehabilitation & Development (IRRAD) – In hope to explore water sustainability projects in Mewat district, Rajasthan
- Foundation for Rural Recovery & Development (FORRAD) – in order to implement Water Sustainability and Drinking Water projects in Bundelkhand and Ajmer, Rajasthan.
As for the year 2016-17, the following are some of the critical CSR activities Coca-Cola was to undertake:
- VEER – It is a CSR initiative that aims to improve the quality of life of the differently-abled people in India. The focus is to give them a voice, recognition and an opportunity to prove themselves and live the life of their dreams. Launched on 26th January 2014, the foundation, in association with the “Being Human Foundation”, pledged to do good for the differently-abled. Through the campaign, they provide enhanced vocational skills training and employment training.
- Parivartan – This is an enhanced employment vocational skills training program for women retailers. Through this program, women can get help in developing their business skills and capability. This was launched in 2007 and trains people by better finance management, stock and customer handling and merchandising in the retail scenario.
- Support My School – A CSR campaign aimed at providing better quality education by fixing studying the environment (sanitation), especially for the girl child. This is along the lines of the “Swacch Bharat, Swachh Vidyalaya” initiative by the Honorable Prime Minister of India, Mr Narendra Modi. It is now supported by a leading actress in the Indian film industry – Mrs Vidya Balan.
- Donations are made under the “Employee Volunteering Programme”.
- Aid in the protection of flora and fauna in Gurgaon’s Aravali Bio-Diversity Park. An NGO, I AM GURGAON, in association with the Municipal Corporation of Gurgaon, have converted this once a waste dumping ground into a beautiful bio-diversity park. The foundation CCIPL has been supporting it since the year 2011 and never looked back. They have contributed towards setting up of “The Coca-Cola Vanaja Nursery”. About 130000 saplings have been planted in the park through this CSR initiative. A funding of about Rs. 13.5 lakhs was issued for the project.
- Doh Bin – It is in alignment with CCIPL’s better waste management system. Based on recycling and proper waste management technology, a 3-year-project is to be implemented in Gurgaon city. It would happen in partnership with NGO Saahas, GIZ and Tetra Pak. The plan is focused on establishing more efficient waste segregation, recycling and management system. The total budget allocated for the same is Rs. 25 lakhs. The outcomes of quantified and estimated are Implementation in 9000 households that segregate waste at the source, Getting at least 50 schools on board and Getting at least 50 commercial institutions on board.
- Sukhrali Lake Rejuvenation Project – In order to strengthen development and increase community engagement around its Gurgaon Corporate Office, a water rejuvenation plan was implemented. Previously, a massive amount of unchecked waste has been discharged into the lake Sukhrali and has been exploited due to city expansion and weather conditions. The project would take care of the Lake Sukhrali in Gurgaon as it is an integral part of the Sakhalin village. The project will have an immensely positive impact on the 30000 villagers residing in the Sakhalin Village. A total expenditure of Rs. 14.51 lakhs was made for this cause.
- Reverse Vending Machine – a pilot project Keeping long term environmental sustainability in mind, 10 RVM machines will be placed in public places (schools, malls, residential societies, etc.). These machines will accept empty bottles that will be crushed inside the machine and transported to the recycling facility. This technology will be tested for three months. Initially, his project will be tested out in Gurgaon and a total budget fixated in Rs 28 lakhs.
- Marine Waste Management plans – Held in crucial locations like Mumbai, the project was supported by:
- Continuous Beach Clean-up Drives from Bandra to Worli. It collected over 700 tons of dry waste over 14 months.
- Fifteen beach clean-up drives were conducted involving citizens and corporates.
- Five strategically located Ganesh Pandals were set up that would involve waste management technology.
Coca-Cola CSR in the World
Not just in India, The Coca-Cola Foundation takes its CSR seriously in all the 200 countries it does business in. It makes sure to give at least 1% of its operating income to its CSR programs.
- In the middle east, as a part of their CSR campaign, they launched ‘Ripples of Happiness’. Through this program, they support university students that want to become entrepreneurs. Through “Arwa – Price of Water”, they’ve been providing clean drinking water to refugees since 2014.
- In Africa, since its inception in 2010, The Coca-Cola Foundation Africa has provided safe drinking water for more than 2.4 million people through WASH. It has also focused on providing better education and learning environment for over 217000 children.
- In Chile, the foundation was established in 1992. It launched “Healthy Schools” in 2006 and is aimed at reducing obesity in primary school children by implementing various physical activities workshops and nutrition education programs in public schools.
- The Coca-Cola Foundation Mexico has rehabilitated 85 shelters and 46 schools since its establishment in 1997. The foundation has also planted over 46 million trees, performed reforestation activities over the land of 47 thousand acres and constructed nine rainwater catchment pots.
- In Atlanta, The Coca-Cola Foundation Atlanta has established The Coca-Cola Scholars Foundation. It is the most extensive merit-based scholarship program that runs in the United States.
- The Coca-Cola Australia Foundation, running since 2001, is focused on improving the quality of life of the youth that come from a financially challenged and socially or econol=mically disadvantaged background.
- The Coca-Cola Foundation, Indonesia, which was established in 2000, runs several programs across the country. They have a learning centre and scholarship programs, community water programs, micro-enterprise development programs and disaster relief and reconstruction programs.
- The Coca-Cola Korea Youth Foundation is in action since 2004 and is focused on its youth. They promote physical activities through encouraging sports, extracurriculars and related activities. Their key program is “Gunzzang Bus”, which means “very healthy and active” in Korean. It is a mobile health centre that organizes health check-ups that measure body statistics like blood pressure, breathing capacity and body composition.