content in beverage containers.

Industry beverage leaders like Coca-Cola must take more responsibility for the solid waste caused by discarded beverage containers and the small level of recycled content in its plastic bottles.

Coke sells more than 25 million plastic bottles and 70 million aluminum cans of Coca-Cola every day. An estimated two-thirds of the used plastic bottles and nearly one-half of the cans end up in incinerators or landfills. This is an enormous waste of raw materials.

Last year, a group of socially responsible investors including the Educational Foundation of America (represented by As You Sow) and Walden Asset Management filed a resolution with the company asking it to adopt an average of 25 percent recycled content in all plastic beverage containers, and a recovery rate of 80 percent for its beverage containers bottled in the United States. The resolution received the support of 88 million company shares (5.2%).

At its annual meeting, the company announced it would increase the level of recycled content to 10% in all of its PET plastic beverage containers by 2005. We are pleased with the progress made to date on recycled content but are concerned with the lack of substantive, public goals for container recovery.

Coca-Cola recently took part in a collaborative study with environmentalists and other businesses to document the costs and benefits of alternative recovery programs. Coke committed to also participate in a follow-up process to try to achieve consensus on a container recovery program. Regrettably, Coca-Cola withdrew in February 2002 from the follow-up process to achieve consensus on a recovery program, calling into question its commitment to setting container recovery goals. Click here for a summary of the report and link to the full text.

This year we have changed the language of the resolution to ask for a study of the feasibility of achieving a recovery rate of 80% for its beverage containers bottled in North America. Please note that the resolution asks for a study, not a policy change. This should enable additional institutional investors to support the resolution in 2002.

Goals are an essential element of every business activity. Without goals, Coke would founder. And so will recycling efforts. Setting substantive container recovery goals will help to reverse the decline in national recycling rates, protect Coke’s brand value, reduce risk by diversifying container feedstock sources, and allow Coke to gain competitive “first-mover” advantage.  (See accompanying fact sheet).

Unless the Coca-Co. establishes goals or significantly boosting the level of container, its valuable brand name and reputation will be at risk.

Our resolution was endorsed last year by the Atlanta Journal Constitution, the home-town newspaper of Coca-Cola in Atlanta. Go to the News section to view the editorial.

Vote YES on Item 4 to send a message to management to use its considerable innovation, resources and creativity to complete a study to resolve this urgent problem.

For a more information, go to Issue Analysis.