Coca-Cola backs Olympic torch relay
The Coca-Cola Co. believes the torch relay as part of the run-up to the Summer Olympics in Beijing should continue and it stands by its sponsorship of the event, Chief Executive Neville Isdell told shareholders Wednesday amid concerns about China’s human rights record.
The torch relay has been disrupted in Greece, Istanbul, London and Paris by protesters opposed to China’s policies in Tibet.
Atlanta-based Coca-Cola (KO, Fortune 500) is a corporate sponsor of the torch relay.
At the company’s annual meeting in Wilmington, Del., a shareholder asked Isdell how Coca-Cola planned to address the concerns raised. Another said the relay should not go through Tibet because it could cause bloodshed.
"I don’t believe that stopping the torch run is in any way over the long-run going to be the right thing to do," Isdell said.
He said Coca-Cola supports the torch relay and the Olympic Games.
"It has symbolized openness. It has symbolized hope," Isdell said of the torch relay.
The IOC has said it will review plans for the remainder of the Beijing Olympic torch relay and consider scrapping the international portion of the event for future games.
International Olympic Committee officials have expressed concern about the disruption caused by anti-Chinese protests during the relay.
The IOC has said there are no plans for canceling the rest of the relay, which has been a magnet for protests since the flame embarked March 24 on its 85,000-mile journey from Ancient Olympia in Greece as part of its 21-stop, six-continent tour.
The torch relay is expected to end in mainland China on May 4. The Beijing Olympics start Aug. 8.
At Coke’s annual meeting, Isdell was interrupted several times by several shareholders who questioned the company’s business practices in India and Colombia. The company has been accused of depleting water resources in India and not protecting workers in Colombia. Coke has denied the allegations.
Isdell said Coca-Cola has supported independent inquiries on the issues and those inquiries have shown no evidence to support the allegations.
Outside the hotel where Coke’s annual meeting was being held, protesters standing on a sidewalk across the street represented groups called Corporate Accountability International (CAI), Reporters Without Borders and the Zionists Organization of America (ZOA).
CAI is challenging Coke’s marketing of Dasani bottled water, saying it’s no better than tap water and is less regulated than tap water but sold at thousands of times the price.
The ZOA is challenging Coke’s refusal to compensate a Jewish Egyptian refugee, Rafael Bigio, whose property was confiscated by Egyptian government in the 1960s bad credit payday loans. He had a bottling plant leased to Coca-Cola. According to the group, the government seized the property and expelled the Jews, and Coke purchased an interest in the property.
Leonard Getz of Marion, Pa., said: "I’m saying the company has benefited from a campaign of anti-Semitism. … All we’re asking for is a reasonable compensation for them." He said Coke has refused to negotiate in good faith with the Bigio family.
Reporters Without Borders is asking Coke to sign a "declaration of responsibility" as a sponsor of the 2008 Beijing Olympic Games.
"China is a big market to them," said Clothilde Lecoz, 25, from Paris. "We want them to be aware that there are some problems." The group wants Coke to respect the freedom of expression and human rights in China.
Corporate Accountability International offered taste tests to passers-by, pitting Dasani against tap water. A group of students from the University of Delaware helped conduct the taste tests, wearing waitress uniforms and holding platters with plastic cups of water.
Protesters carried signs reading "Corporate control of water," "Thou Shalt not Steal" and "Please ask the real thing to do the right thing."
At the meeting, shareholders were asked to vote on the election of 14 directors, ratification of Ernst & Young LLP’s appointment as Coca-Cola’s independent auditors, approval of a stock option plan and three shareholder proposals.
The shareholder proposals included one that sought to allow shareholders an advisory vote on the compensation of several senior executives. Isdell received total compensation valued at $21.6 million in 2007, a more than 3 percent increase from the year before. President and Chief Operating Officer Muhtar Kent has been named to succeed Isdell as CEO on July 1. Isdell will remain as chairman until Coke’s annual meeting in April 2009.
Coca-Cola reported earlier Wednesday that first-quarter profit rose 19% because of acquisitions and overseas growth, offsetting unimpressive results in North America.
The results beat Wall Street expectations, and its shares edged up 16 cents to $61.09 per share in midday trading.
The world’s biggest beverage company said its profit was $1.50 billion, or 64 cents a share, in the three-month period ended March 28.