THE COCA-COLA COMPANY | Political Contributions Misalignment at THE COCA-COLA COMPANY

Status
29.08% votes in favour
AGM date
Previous AGM date
Proposal number
7
Resolution details
Company ticker
KO
Lead filer
Clean Yield Asset Management
Resolution ask
Report on or disclose
ESG theme
  • Social
ESG sub-theme
  • Corporate purpose
  • Lobbying / political engagement
  • Public health
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Consumer Staples
Company HQ country
United States
Resolved clause
Resolved: Shareholders request that Coca-Cola publish a report, at reasonable expense, analyzing the congruency of its political and electioneering expenditures in the U.S. during the preceding year against its publicly stated company values and policies, listing and explaining any instances of incongruent expenditures, and stating whether the Company plans to make changes in contributions or communications to candidates as a result of the identified incongruencies.
Supporting Statement:
The proponents recommend, at Board discretion, that such report also include management's analysis of risks to our Company's brand, reputation, or shareholder value of expenditures in conflict with the Company’s publicly stated values. “Expenditures for electioneering communications" means spending directly, or through a third party, at any time during the year, on printed, internet, or broadcast communications, which are reasonably susceptible to interpretation as being in support of or in opposition to a specific candidate.
Whereas clause
Whereas:
Coca-Cola Company has stated “[t]here is overwhelming evidence that achieving equality and empowerment for women has broad ripple effects that are good for society.”
Criteria for political contributions to candidates from the Coca-Cola PAC include the recipient’s “support for workforce equality and inclusion” and demonstration of “a strong record for environmental sustainability.”
However, several of Coca-Cola’s politically focused expenditures in the U.S. appear to be misaligned with these stated criteria and other organizational values otherwise conveyed through its activities and statements:
In 2021, Coca-Cola faced boycotts and social media censure when it was perceived as being supportive of legislation in Georgia restricting voting rights. This perception was linked to Coca-Cola’s donations to 29 co-sponsors of the legislation (https://bit.ly/3G1prgc). CEO James Quincey later stated that Coca-Cola viewed voting as a “foundational right,” yet the Company donated to state officials who voted for laws restricting access to voting in the 2022 election cycle (https://bit.ly/3Tog6lQ).Coca-Cola committed to recover for recycling all the bottles it sells and to use 50% recycled content by 2030. Yet, the company has spent millions of dollars to oppose passage of container deposit laws, which have proven to significantly increase recycling rates.In the 2020-22 election cycles, the Proponent estimates that Coca-Cola has given more than $1.8 million to politicians and political organizations seeking to limit access to reproductive health care.Following the storming of the U.S. Capitol, Coca-Cola stated, “We are all stunned by the unlawful and violent events that unfolded in Washington, D.C.,” and declared a pause in political giving of unknown duration. Yet Coke subsequently donated to federal lawmakers who opposed creating a Congressional January 6th investigation.The Company and its investors would benefit by strengthening its policies and reporting systems to avoid future missteps in corporate electioneering and political spending that contrast with its stated diversity and environmental policies. Such an approach is likely to reduce risk to Coca-Cola’s brand and reputation.

How other organisations have declared their voting intentions

Organisation name Declared voting intentions Rationale
Rothschild & co Asset Management For
Anima Sgr For Despite the company’s related political disclosures and current cessation of all political donations, the company is still exposed to risks related to funding organizations that take positions contradictory to those of the company. Greater disclosure of the company's related political oversight, policies, and expenditures would allow shareholders to better assess the company's management of related risks and benefits.

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