Global Transparency Report
RESOLVED: Shareholders request the Company annually issue a transparency report on global public policy and political influence, disclosing company expenditures and activities outside of the United States. Such report should disclose company funding and in-kind support directed to candidates or electioneering, lobbying, and charitable donations for the preceding year including:
• Recipients and amounts.
• The Company’s membership in or payments to nongovernmental organizations including trade and business associations, scientific or academic organizations and charities.
• The rationale for these activities.
The Board and management may, in its discretion, establish a de minimis threshold, such as contributions to an individual or organization totaling less than $250, below which itemized disclosures would not be required.
Supporting statement
Coke statements indicate that our Company values transparency:
“Public Disclosures: We strive to be as transparent as possible, in all aspects of our business. This includes our public policy engagement activity.”
However, our Company’s spending to influence and engage on public policy outside of the United States is not consistently disclosed. A truly global corporation, Coke is the world’s largest beverage company and operates in approximately two hundred countries.1 As of 2019, Coke products were sold in all countries but Cuba and North Korea.2 Despite the global scope of operations, our company does not currently comprehensively disclose its involvement in politics and advocacy on public policies outside of the United States.
Coke scores low regarding international disclosures of corporate political activities, according to a recently published transparency index.3 Despite the corporation’s expansive global operations, there is minimal disclosure of and transparency around international political activity.
In 2021, Vanguard cautioned “poor governance of corporate political activity, coupled with misalignment to a company’s stated strategy or a lack of transparency about the activity, can manifest into financial, legal, and reputational risks that can affect long term value”.4
In the food industry, a particular arena of abuse is support for scientific advocacy intended to shape policy maker perceptions and influence policy making, regulations and rule setting. Coke funded the global industry lobby group International Life Sciences Institute to produce research that has helped slow, or stall altogether, public health policy in India, Mexico, China, and Brazil.5
Other company sponsored advocacy that may interfere with public health policies occurs through national trade associations. Example: A Coke supported trade association, ConMexico, lobbied the Mexican government to postpone food labeling regulations generating widespread criticism due to negative impacts on public health.6
Food corporations like Coke rely heavily on consumer trust, brand affinity and public goodwill. These days, public officials, journalists, non-governmental organizations, and social media can quickly and publicly reveal corporate activity that seems highly oppositional to a company’s image, brand or stated values.
We urge you to vote FOR this proposal. Adopting this resolution would position the corporation globally to again lead on political transparency
1 https://answerstoall.com/technology/how-many-countries-does-the-coca-cola-company-operate-in/
2 https://www.businessinsider.com/what-coca-cola-ads-look-like-around-the-world-2019-8
3 https://feedthetruth.org/wp-content/uploads/2021/08/FeedtheTruth_FACT_Index_report_v3.pdf
4 https://about.vanguard.com/investment-stewardship/perspectives-and-commentary/INVSPOLS_032021.pdf
5 https://www.corporateaccountability.org/wp-content/uploads/2020/09/Partnership-for-an-unhealthy-planet.pdf
6 https://ojo-publico.com/1702/mexico-empresas-ponen-de-pretexto-la-pandemia-para-aplazar-etiquetado
Details…
After focusing on sugar and public health in the previous 2 years, we decided to address the lack of disclosure surrounding KO’s corporate funds spent to influence public policy around the world. This “Global Transparency Report” is one of 3 resolutions we have introduced at major food and beverage companies this year, including McDonald’s and PepsiCo, requesting an annual report disclosing international corporate funding including political contributions, charitable donations, and lobbying.
KO is literally the largest beverage company in the world, operating in and selling products in roughly 200 countries, yet the company fails to be transparent about all their financing to influence public policy, internationally. The food and beverage industry has been notorious for spending large amounts of money to shape policymaking and regulations across the world – a notable example is KO’s financial support for the global industry lobby group International Life Sciences Institute which produced research that negatively impacted public health policy in places such as India, Mexico, China, and Brazil.
Once again, we have been fortunate to have the help from our colleagues at Corporate Accountability in drafting the resolution, and they will be participating in any engagement we might have with the company. Some public information exists related to KO’s political donations in the U.S., however, the disclosure from the company is limited, and the money the corporation spends in foreign countries is virtually unknown.
Though Coca-Cola acknowledged receipt of our proposal, we did not have any engagement with the company. We received KO’s opposition statement, and the proposal appeared in the company’s 2022 proxy material.
The exempt solicitation for Coca-Cola can be accessed here.
- Coca-Cola’s Annual Meeting of Shareholders – April 26th, 2022, at 5:30am PT.
- The proposal received 13% support from shareholders.