The Coca-Cola Company

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The Coca-Cola Company
Type of Company	Public (NYSE: KO[1])
Founded	1892 by Asa Griggs Candler
Headquarters	Atlanta, Georgia, USA
Key people	E. Neville Isdell, CEO & Chairman
Industry	Beverage
Products	Beverages
Revenue	$23.1 billion USD (2005)
Operating income	$6.1 billion USD (2005)
Net income	$4.9 billion USD (2005)
Employees	55,000 (2005)
Slogan	Always Coca-Cola.
Website	www.cocacola.com

The Coca-Cola Company (NYSE: KO) is the largest manufacturer, distributor and marketer of nonalcoholic beverage concentrates and syrups in the world. Coca-Cola's headquarters are in Atlanta, Georgia, in the United States of America. It is best known for its flagship product, Coca-Cola, and is one of the largest corporations in the United States. The company is listed on the NYSE and is part of DJIA and S&P 500.

Coca-Cola was invented by druggist John Stith Pemberton in 1884. According to the 2005 Annual Report, the company sells beverage products in more than 200 countries. In general the Coca-Cola Company (TCCC) only produces syrup concentrate which is then sold to various bottlers throughout the world who hold a Coca-Cola franchise. The Coca-Cola Company offers nearly 400 brands in over 200 countries, besides its namesake Coca-Cola beverage.

Contents 1 History 2 Revenue 3 Bottlers 4 Products and brands 5 Corporate citizenship 5.1 Promoting Diversity 5.2 HIV / AIDS in Africa 5.3 Charitable Giving 6 Criticism 7 Corporate Governance 7.1 Current Board of Directors 7.2 Historical List of Chief Executive Officers 8 See also 9 References 9.1 External links

[edit] History

Columbus, Georgia druggist John Stith Pemberton invented a cocawine called Pemberton's French Wine Coca in 1884. He was inspired by the formidable success of French Angelo Mariani's cocawine, Vin Mariani. The following year, when Atlanta and Fulton County passed Prohibition legislation, Pemberton began to develop a non-alcoholic version of the French Wine Coca. He named it Coca-Cola, because it included the stimulant coca leaves from South America and was flavored using kola nuts, a source of caffeine. Pemberton ran the first advertisement for the beverage on May 29 that year in the Atlanta Journal. In 1887, while suffering from an ongoing addiction to morphine, Pemberton sold a stake in his company to Asa Griggs Candler, who incorporated it as the Coca Cola Corporation in 1888.^[2] In the same year, Pemberton sold the rights a second time to three more businessmen: J.C. Mayfield, A.O. Murphey, and E.H. Bloodworth. Meanwhile, Pemberton's alcoholic son Charley Pemberton began selling his own version of the product. Three versions of Coca-Cola — sold by three separate businesses — were on the market.^[3]

When the United States entered World War II, The Coca-Cola Company began providing free drinks for soldiers of the United States Army. The United States Army permitted Coca-Cola employees to enter the front lines as "Technical Officers" where they operated Coke's system of providing refreshments for soldiers. Coca-Cola set up bottling plants in several locations overseas to assure the drink's availability to soldiers, setting the stage for the company's post-war overseas expansion. The popularity of the drink exploded as American soldiers returned home from the war with a taste for the drink.^{[citation needed]}

Before the United States entered World War II, the difficulty of shipping Coca-Cola concentrate to Germany and its occupied states led to the creation of a new drink by a Coca-Cola employee, Fanta.

In the 1930s, Robert W. Woodruff became president of the Coca-Cola Company, presiding over the drink and its destiny until his death in 1985. Although he eventually stepped down from his post due to stress, he retained control over the company despite holding positions with an ostensibly low profile. ^{[citation needed]}

[edit] Revenue

According to the 2005 Annual Report^[4], the company sells beverage products in more than 200 countries. The report further states that of the more than 50 billion beverage servings of all types consumed worldwide every day, beverages bearing the trademarks owned by or licensed to Coca-Cola account for approximately 1.3 billion. Of these, beverages bearing the trademark "Coca-Cola" or "Coke" accounted for approximately 55% of the Company's total gallon sales.

Also according to the 2005 Annual Report, Coca-Cola had gallon sales distributed as follows:

• 27% in the United States
• 27% in Mexico, Brazil, Japan and China
• 46% in spread throughout the world

[edit] Bottlers

In general, The Coca-Cola Company (TCCC) only produces syrup concentrate which is then sold to various bottlers throughout the world who hold a Coca-Cola franchise. Coca-Cola bottlers, who hold territorially exclusive contracts with the company, produce finished product in cans and bottles from the concentrate in combination with filtered water and sweeteners. The bottlers then sell, distribute and merchandise the resulting Coca-Cola product to retail stores, vending machines, restaurants and food service distributors.

One notable exception to this general relationship between TCCC and bottlers is fountain syrups in the United States, where TCCC bypasses bottlers and is responsible for the manufacture and sale of fountain syrups directly to authorized fountain wholesalers and some fountain retailers.

In 2005, Coca-Cola had equity positions in 51 unconsolidated bottling, canning and distribution operations which produced approximately 58% of volume. Significant investees include:

• 36% of Coca-Cola Enterprises which produces (by population) for 78% of USA, 98% of Canada and 100% of Great Britain (but not Northern Ireland), continental France and the Netherlands, Luxembourg, Belgium and Monaco.
• 40% of Coca-Cola FEMSA, S.A. de C.V. which produces (by population) for 48% of Mexico, 16% of Brazil, 98% of Colombia, 47% of Guatemala, 100% of Costa Rica, Nicaragua, Panama and Venezuela, and 30% of Argentina.
• 24% of Coca-Cola Hellenic Bottling Company S.A. which produces (by population) for 67% of Italy and 100% of Armenia, Austria, Belarus, Bosnia-Herzegovina, Bulgaria, Croatia, the Czech Republic, Estonia, Greece, Hungary, Lativa, Lithuania, Macedonia, Moldova, Nigeria, Northern Ireland, Poland, Rep. of Ireland, Romania, Russia, Serbia and Montenegro, Slovakia, Slovenia, Switzerland and Ukraine.
• 34% of Coca-Cola Amatil which produces (by population) for 98% of Indonesia and 100% of Australia, Indonesia, New Zealand, South Korea, Fiji and Papua New Guinea.
• 27% of Coca-Cola Bottling Co. which is the second largest Coca-Cola bottler in the United States. The company was incorporated in 1980, and "its predecessors have been in the soft drink manufacturing and distribution business since 1902."[1]

[edit] Products and brands

Main article: Coca-Cola brands

The Coca-Cola Company offers nearly 400 brands in over 200 countries, besides its namesake Coca-Cola beverage.

This includes other varieties of Coca-Cola such as Diet Coke (introduced in 1982), which uses aspartame, a synthetic phenylalanine-based sweetener, to eliminate the sugar content of the drink; Caffeine-free Coke; Cherry Coke (1985); Diet Cherry Coke (1986); Coke with Lemon (2001); Diet Coke with Lemon (2001); Vanilla Coke (2002); Diet Vanilla Coke (2002); Coca-Cola C2 (2004); Coke with Lime (2004); Diet Coke with Lime (2004); Diet Coke with Splenda (2005), Coca-Cola Zero (2005), Coca-Cola Black Cherry Vanilla (2006), Diet Coca-Cola Black Cherry Vanilla (2006), and Coca-Cola BlāK

Tab was Coca-Cola's first attempt to develop a diet soft drink, using saccharin as a sugar substitute. Introduced in 1963, the product is still sold today, however its sales have dwindled since the introduction of Diet Coke.

The Coca-Cola Company also produces a number of other soft drinks including Fanta (introduced circa 1942 or 1943) and Sprite. Fanta's origins date back to World War II when Max Keith, who managed Coca-Cola's operations in Germany during the war, ran out of the ingredients for Coke, which could be supplied only from the United States. Keith resorted to producing a different soft drink, Fanta, which proved to be a hit, and when Coke took over again after the war, it adopted the Fanta brand as well. The German Fanta Klare Zitrone ("Clear Lemon Fanta") variety became Sprite, another of the company's bestsellers and its response to 7 Up.

During the 1990s the company responded to the growing consumer interest in healthy beverages by introducing several new non-carbonated beverage brands. These included Minute Maid Juices to Go, Powerade sports beverage, flavoured tea Nestea (in a joint venture with Nestle), Fruitopia fruit drink and Dasani water, among others.

In 2004, perhaps in response to the burgeoning popularity of low-carbohydrate diets such as the Atkins Diet, Coca-Cola announced its intention to develop and sell a low-carbohydrate alternative to Coke Classic, dubbed C2 Cola. C2 contains a mix of high fructose corn syrup, aspartame, sucralose, and Acesulfame potassium. C2 is designed to more closely emulate the taste of Coca-Cola Classic. Even with less than half of the food energy and carbohydrates of standard soft drinks, C2 is not a replacement for zero-calorie soft drinks such as Diet Coke. C2 went on sale in the U.S. on June 11, 2004, and in Canada in August 2004. C2's future is uncertain due to disappointing sales.

Coca-Cola is the best-selling soft drink in most countries. Nevertheless, there are some places like Quebec and Prince Edward Island, Canada, where Pepsi is the market leader.^{[citation needed]} In the Middle East, the only region in the world where Coca-Cola is not the number one soda drink, Coca-Cola nonetheless holds almost 25% marketshare (to Pepsi's 75%) and had double-digit growth in 2003.^[5] Similarly, in Scotland, where the locally produced Irn-Bru was once more popular, 2005 figures show that both Coca-Cola and Diet Coke now outsell Irn-Bru.^[6] In Peru, the native Inca Kola has been more popular than Coca-Cola, which prompted Coca-Cola to enter in negotations with the soft drink's company and buy 50% of its stakes.

Some claim Coke is less popular in India due to suspicions regarding the health standards of the drink. However, marketshare data does not back this view. Specifically, in 2005, Coca-Cola India's market share was 60.9%.^[7] However, Thums Up, a brand acquired by The Coca-Cola Company contributes a major part of this market share rather than Coke per se, which lags both Thums Up and Pepsi.

On July 6, 2006, a Coca-Cola employee and two other people were arrested and charged with trying to sell "highly classified" information to the soft drink maker's competitor, PepsiCo for $1.5 million. The recipe for Coca-Cola Classic, perhaps the company's most closely guarded secret, was never in jeopardy. Instead, the information was related to a new beverage in development. Coca-Cola executives verified that the documents were valid and proprietary. At least one glass vial containing a sample of a new drink was offered for sale, court documents said. The conspiracy was revealed by PepsiCo, which notified the authorities when they were approached by the conspirators.^[8]

Also in 2006, the company annouced a new "negative calorie" green tea drink, Enviga.

[edit] Corporate citizenship

Recent acts by the Coca Cola Company which are claimed to have had positive social implications include:

[edit] Promoting Diversity

• Coca-Cola ranked 26th on Fortune magazine's list of the "50 Best Companies for Minorities" in 2004. [2]
• Coca-Cola Bottling company was named one of "The Top 100 Employers for the Class of 2004" by Black Collegian magazine.
• Coca-Cola was named one of the "50 Best Companies for Latinas to Work for in the U.S." by Latina Style in 2004.
• Coca-Cola is among 32 companies that have filed "friend of the court" briefs in support of the University of Michigan's affirmative action policies.
• Coca-Cola offers domestic partner health benefits to employees' domestic partners of the same sex.
• Coca-Cola's non-discrimination policy includes sexual orientation.

[edit] HIV / AIDS in Africa

• In September 2002 Coca-Cola announced it would spend up to $5 million per year to fund HIV/AIDS treatment for Africans who work within the company's bottling system. The company had previously offered treatment to its 1,200 corporate workers in Africa. The company's bottling system is made up of 40 independent companies and employs 58,000 people in Africa.^[9]
• Coca Cola Africa plans to support HIV/AIDS programs as part of a $50 million budget to be granted to African organizations by the end of the decade.

[edit] Charitable Giving

• The Coca-Cola Company and its bottling partners shipped more than 30 million donated 8-oz. servings to Hurricane Katrina Evacuees.^[10]
• Coca-Cola donated $10 million to tsunami relief efforts in Asia. Employees of Coca-Cola in the region also delivered bottled water, food and other supplies.
• After the September 11 terrorist attacks on the World Trade Center and the Pentagon, Coca-Cola its affiliates committed to a $12 million financial contribution to disaster relief efforts.

Sources: - Responsible Shopper ^[11]

[edit] Criticism

Main article: Criticism of Coca-Cola

The Coca-Cola Company has been involved in a number of controversies and law suits related to its perceived relationship with human rights violations and other perceived unethical practices.

In regards to its business practices, a number of law suits have issued in relation to its allegedly monopolistic and discriminatory practices, some of which have been dismissed, some of which The Coca-Cola Company agreed to change its business practices and some of which settled out of court. It has also been involved in a discrimination case. There have been continuing criticisms regarding the Coca-Cola Company's relation to the Middle East and U.S. foreign policy.

In regards to environmental issues in India, there has been a controversy over pesticides possibly showing up in the product, as well as the companies over-use of local water supplies in some locations. Packaging used in Coca-Cola's products have a significant environmental impact but the company strongly opposes attempts to introduce mechanisms such as container deposit legislation. [3]

Its labor practices have been criticised, starting with the assassinations of trade union-affiliated employees in Guatemala in the 1970's and more recently including allegations that Coca-Cola's bottler, Panamco, hired paramilitary mercenaries who assassinated trade union leaders in Colombia. Several court cases occurred, such as those by United Steelworkers of America and the International Labor Rights Fund in support of SINALTRAINAL, and boycott actions were taken against the company.

Coca-Cola has also been criticised for its interactions with Nazi-Germany during World War II and for the implications of doing business in Israel during the second half of the twentieth century and the early twenty-first century.

[edit] Corporate Governance

[edit] Current Board of Directors

• E. Neville Isdell (CEO since June 2004)^[12]
• Herbert A. Allen^[13]
• Ronald W. Allen
• Cathleen Black
• Barry Diller
• Donald Keough
• Donald McHenry
• Sam Nunn
• James Robinson
• Peter Ueberroth
• James B. Williams

[edit] Historical List of Chief Executive Officers

• Samuel C. Dobbs
• Douglas Daft
• Doug Ivester
• Roberto Goizueta

[edit] See also

• Criticism of Coca-Cola
• List of assets owned by The Coca-Cola Company
• List of Coca-Cola brands

[edit] References

• Pendergrast, Mark: For God, Country, and Coca-Cola: The Definitive History of the Great American Soft Drink and the Company That Makes It. New York: Basic Books, 2000 (second edition; ISBN 0-465-05468-4).
• Zyman, Sergio: The End of Marketing as We Know It. New York: HarperBusiness (1st edition (June 1, 1999) ISBN 0-88730-986-0).

[edit] External links

• Company website
• Coca-Cola company store
• Ronen Liwski's Coca-Cola Company cans collection
• CokeFacts.org - Page by Coca-Cola on its work in Colombia
• Coca-Cola Goes to War - Historical page about Coca-Cola
• Coca-Cola political contributions from BuyBlue.org
• Full List of Coca-Cola brands
• Coke Rewards Program