BUSINESS ETHICS AND CORPORATE GOVERNANCE -CORPORATE SOCIAL RESPONSIBILITY CASE OF COCA COLA
SR NO. ENROLLMENT NO NAME
1 128050592001 AMBER THAKUR
2 128050592004 PRIYANKA BACHKANIWALA
3 128050592013 RAKSHIT BHAVSAR
4 128050592024 KOSHA DOSHI
5 128050592051 SONAM LALWANI
6 128050592060 VINAY MODI
BUSINESS ETHICS AND CORPORATE
“COCA COLA CSR CASE STUDY IN INDIA
According to World Business Council for
‘Corporate Social Responsibility is the continuing
commitment by business to behave ethically and
contribute to economic development while
improving the quality of life of the workforce and
their families as well as of the local community and
society at large’.
Creating a self supportive business platform
Building social investment and goodwill
Building trust and transparency in the business
Meeting public expectations from the business
Engaging in public policy
Understanding the basics and fundamental
To appreciate the impact of CSR on businesses
To discuss how CSR initiatives can benefit
START OF CSR ACTIVITIES IN INDIA
Corporate social responsibility can be defined as ethical
payback of corporate house towards the society‗. Oldest
of Indian corporate are still leading CSR activities in
Indian society with TATA itself contributing to an extent of
Indian CSR activities were driven by the ethical beliefs of
the founding fathers and their philanthropic ideas in pre-
liberalization era. These activities had very less
accountability and transparency in them. The level of
commitment towards the projects that were conducted
was less and so were allocation of resource and planning
for the same.
TYPES OF CSR ACTIVITIES IN POST
LIBERALIZED INDIAN SCENARIOS
After opening up of Indian economy in 1990, Indian
corporate houses were exposed to threat of external
competitors for the first time.
Global competitors had deep pockets and were able to
pay high so the concern of employee satisfaction and
happiness increased among Indian corporate house
thus leading to sudden surge of private sector
companies who were profit makers pre 1990 into
social/employee concern affairs like CSR.
Local community development projects and
Improvement and maintenance of environment
Safe drinking water
Nutrition of mother and child
Hygiene and Sanitation
Sustainable & Social Development
Senior Citizens & Geriatric Care
According to Lord Holme and Richard Watts, ―CSR is the
continuing commitment by business to behave ethically
and contribute to economic development while
improving the quality of life of the workforce and their
families as well as of the local community and society at
CSR is an idea that refers to a business‘ responsibilities
towards different groups of the society in which it exists
To rehabilitate the children withdrawn from work, the
Government of India is implementing the National Child
Labor Project (NCLP) Scheme in 266 districts of the
country. This is a major scheme for the rehabilitation of
The special schools/Rehabilitation Centres provide non-
formal education, vocational training, supplementary
nutrition, stipend etc. to children withdrawn from
Sesa Sterlite under its developmental activities has tried
for the development of society at a Large.
This time Company under its corporate social
responsibility has aimed to strengthen the women group
through tailoring training. Inaugurating the tailoring
training center at Paikarani Pinda in Muniguda Block,
K.R Kundu Head HR , Sesa Sterlite addressed the
community to earn more by your leisure time and this is
a initiative of company to strengthen the women groups
in the society.
CRY – Child Rights and You and BBH India, CRY‘s
creative partner have joined hands to spread awareness
about the importance of voting for child rights in India as
part of CRY‘s nationwide campaign ‗Vote for Child Rights‘.
‗Vote for Child Rights‘ campaign aims to pursue political
candidates to ensure due emphasis is given to child rights
in their party manifestos. The mission was to make
politicians stand up and take notice.
CSR ACTIVITIES OF CORPORATE
TATA set some 66 percent of profits of Tata Sons go to
charity. Tata Consultancy Services (TCS) has set up a
fully-equipped computer training laboratory for children
from the ‗Society for the Welfare of the Physically
Handicapped and Research Centre‗, in Pune for
imparting basic computer knowledge.
Aviva, a life insurance firm have launched street school
to educate the under privilege students.
Unilever is using micro enterprises to strategically
augment the penetration of consumer products in rural
The Coca-Cola drink, popularly referred to as ‗Coke‘, is
a kind of cola, a sweet carbonated drink containing
caramel and other flavouring agents. It was invented by
Dr. John Smith Pemberton (Pemberton) on May 8, 1886,
at Atlanta, Georgia, in USA.
The beverage was named Coca-Cola because at that
time it contained extracts of Coca leaves and Kola nuts.
Pemberton later sold the business to a group of
businessmen, one of whom was Griggs Candler
In 1894, a fountain seller named Joseph A. Biedenharn
introduced the concept of selling the prepared drink in
bottles. He thus became the first bottler for Coca-Cola.
The period 1940 to 1970 was one of rapid international
growth and Coca-Cola became a symbol of friendliness
and refreshment across the world.
Coca-Cola entered India during the 1970s. Rather than
dilute its stake, Coca-Cola India opted to close down its
operations in India and exited the market in 1977.
In 1993, as part of India‘s liberalization policy, the market
was opened up to foreign companies to establish their
operations in India. The same year, Coca-Cola India
staged a re-entry into the country through a strategic
alliance with Parle Exports (Parle). The alliance gave
Coca-Cola India ownership of five of Parle‘s popular
brands (Thums Up, Limca, Maaza, Citra, and Gold Spot)
with a market share of around 60 percent, and a well
established network of 56 bottlers.
In 2006, E. Neville Isdell (Isdell), Chairman and Chief
Executive Officer, Coca-Cola, said, ―As we create value for
our shareowners and other stakeholders by running a
successful business, we must also be a force for positive
global change — one community at a time. We must help
create economic and social value, protect the
environment, and contribute to the long-term sustainability
of every community we serve.‖
On February 18, 2008, leading beverage company in
India, The Hindustan Coca-Cola Beverages Pvt. Ltd
(Coca-Cola India), was awarded the Golden Peacock
award4 for Corporate Social Responsibility (CSR) for the
several community initiatives it had taken and its efforts
toward conservation of water.
A report released by the Center for Science and
Environment7 (CSE) in 2003 revealed that 12 soft drink
brands sold by Coca-Cola and PepsiCo. Inc.8 (Pepsi) in
India had pesticide levels far higher (almost 36 times
more) than what was permitted by the European
Economic Commission (EEC). It was believed that the
use of groundwater which had high pesticide residues
and which had not been properly treated by the
companies was the main reason for such high pesticide
levels.The same study stated that no such residues were
found in the same brands sold in the US.
The company was vehement in its denial of all the
criticism and described the charges as completely false.
In addition to increasing the amount to be spent on CSR
initiatives and initiating several projects like rainwater
harvesting, watershed protection (globally) for restoring
the groundwater it had utilized for beverage production,
and other community development initiatives, Coca-Cola
India made an endeavour to communicate to the public
that it was a socially responsible company.
And by overcome of all these problems company still able
to manage additional investment of US$ 25 to 30 million
to install water conservation projects that included
checking and cleaning of dams and rainwater harvesting.
Coke has extensive bottling operations in Latin America.
The Colombia page states only that Coke has ―bottler
agreements with independent companies that own and
operate bottling plants that manufacture and distribute
Coca-Cola products‖, while the other country sites
disclose the number and names of the bottling
companies used by Coke to manufacture their products.
• First Coke bottling-plant worker in Colombia killed,
with a shot to the head, during a strike for better
working conditions in Narino, in the southwest. The
victim was on the local union board of directors.
• Three more coke workers killed, all of whom were
employed at the Carepa plant in northwestern
• Right-wing paramilitaries storm the Carepa plant,
killing a worker, then kidnap a union leader from his
home and torch the union‘s offices. They return to the
plant the next day, demanding that workers sign a
statement resigning from the union-or else-and order
top union leaders to leave town ―if you want to live
• The united Steelworkers and the International Labor
Rights Fund file suit in Miami on behalf of the
SINALTRAINAL union in Colombia, naming Coca-
Cola and two of its Colombian bottlers as
defendants. A judge later dropped coke from the suit,
leaving the bottlers as defendants.
• Labor activity Ray Rogers launches his ―Killer Coke‖
campaign at Coca-Cola‘s annual meeting in
Houston. Months later, Bard College in New York
becomes the first U.S. school to not renew its
beverage contract with coke because of the
• Coca-Cola releases a study it commissioned by
consultant Cal Safety Compliance that found no
instances of anti-union violence or intimidation at
Coke bottling plants in Colombia.
• New York University and the University Michigan
become the latest colleges in the U.S. and abroad to
ban Coke products from their campuses.
Acknowledge Underlying Facts.
Public Statements Denouncing Anti-Union Violence.
Human Rights Committee.
Investigation and Training.
Address Anti-Union Impact of Violence.
Cessation of Criminal Charges.
The company originally began selling its products during
the 1950s but was eventually kicked out of the country in
1977 for violating investment laws.
In 1993, in a new political and economic climate of
liberalized trade and investment policy, Coke was
allowed back into the country where they promptly
purchased the leading domestic soft drink brand. Since
then, Coke has invested more than $1 billion in India.
Since 2002, Coke has come face to face with strong
resistance to their ongoing water takings, their
environmental pollution and the discovery of high levels
of pesticides in their products.
Coke opened its plant in Plachimada in 1998, digging 65
wells with the capacity to extract 1.5 million litres of
water each day from the aquifer.
The company received 15% cash back on its
investment in the Plachimada factory by the
government of Kerala.
Since Coke set up shop in Plachimada and began
extracting vast amounts of water and adding polluting
sludge to farm fields, local farmers have seen their wells
dry up and crop yields shrink forcing many to abandon
The study also found that between May 2003 and May 2004
ground level dropped in 11 of the 16 wells.
Despite the region‘s extended droughts, Coke continued to
extract water from their boreholes, while 2000 families in the
area were being adversely affected by the lack of water.
When the suffering of the people in Plachimada reached a
limit, farmers and community members began to organize
resistance in order to regain control of their rights to the water
and soil which was being used extensively by Coke.
On December 16, 2003, the Court historically declared that
the local self-government body has the right to control the
water exploitation by Coke’s Plachimada plant. The
judgment rejected Coke‘s claims and forced the company
to stop exploitation of water reserves and find alternative
water resources within one month.
The water table has declined between 25-40 feet in the last
four years, and Coca-Cola has been discharging its waste
water into the surrounding fields, and now into a canal that
feeds into the river Ganges, a holy river for millions of Indian.
The movement to shut down the Coca-Cola plant has been
growing rapidly for the last year.
So far, not only have the authorities not cooperated at all,
they have consistently refused to make good on their
promises of inquiries and investigations to look into Coca-
Cola's practices that are depleting the groundwater and
polluting the water and soil.
In addition, the authorities have trumped up criminal
charges against some of the key leaders of the
struggle, and issued orders to these leaders preventing
them from "shouting slogans or making inflammatory
speeches … within 300 meters of the plant".
The communities are determined to close down the
factory in Mehdiganj, and the local organizers have
been extremely successful in garnering local support in
Kala Dera is a large village
outside the city of Jaipur.
Agriculture is the primary
source of livelihood.
Coca-Cola started its bottling
operations in Kala Dera in
2004, and within a year, the
community started to notice a
rapid decline in groundwater
The Central Ground Water
Board, a government agency,
not only confirmed the
declining water table as a
result of Coca-Cola's
indiscriminate mining of the
water, it also faulted Coca-
Cola for creating "ecological
imbalances" in the area.
The groundwater levels had dropped in the firsts even
years of the company‘s operations, from 1999 to 2006.
Even in 2008, the company continued to face mass
demonstrations from local communities who demanded
that the company shut down its bottling operations.
There were also allegations that the company had
seized land from farmers and that it had discharged
A few critics came down heavily on Coca-Cola‘s much
acclaimed TCCC standards for waste management.
In January 2004 the Indian parliament banned the sale
of Coke as well as Pepsi products in its cafeteria after
tests found high concentrations of pesticides and
insecticides, including lindane , DDT, malathion and
chlorpyrifos, in the colas, making them unfit for
consumption. Some test samples showed toxin levels 30
times the standard allowed by the European Union.
They must permanently shut down the bottling
facilities in Mehdiganj, Kala Dera and
They must compensate the affected community
They must recharge the depleted groundwater.
They must clean up the contaminated water and
They must ensure that workers laid off as a
result of Coca-Cola's negligence are retrained
and relocated in a more sustainable industry.
They must admit liability for the long term
consequences of exposure to toxic waste and
pesticide laden drinks in India.
Discrimination in evaluations: The lawsuit
stated that ―because of the undue discretion of
managers, African-Americans receive lower
evaluation scores than Caucasians and fewer
Discrimination in compensation: Differences between
salaries paid by Coke to African Americans and White
employees.In 1995 the average African- American
employee in the corporate headquarters received
$19,000 less than the average white employee, while in
1998 the disparity had risen to $27,000.
Discrimination in promotions: African-Americans are
denied the opportunity to advance to the same level and
at the same rate as equally qualified Caucasian
Glass ceiling: While African-American employees make
up 15.7 percent of the employees at corporate
headquarters, they are underrepresented at top pay-
Glass walls: African-Americans in senior positions are
concentrated in less powerful and non-revenue
Terminations: According to the lawsuit, African-
American employees at Coke are involuntarily
terminated at a much higher rate than white employees.
Case of a White Vice President
Coke‘s marketing strategy succumbs to racial
Case of a musician L.L.Cool J featuring a coke
One of the plaintiffs received a low evaluation after
making comments about racial discrimination, even
though she had always received positive evaluations.
Coke initially responded to the lawsuit saying that
actions toward the four African-American plaintiffs "were
in no way motivated by race...but instead were based
solely on legitimate, nondiscriminatory business
The CEO at the time, Douglas Ivester, sent an email to
all Coke employees a week after the suit was filed
saying that the suit had ―significant errors of fact‖ and
that the company does not systematically discriminate
In December 1999 when a Coke spokesperson,
commenting on the ongoing lawsuit said that the
company "will demonstrate that Coca-Cola has not, does
not and will not tolerate discrimination of any kind."232
In July of the same year, the company said that ―we're
confident it will be determined that Coca-Cola does not
In June 2000, a settlement was reached out to pay out a
record $192.5 million, the largest settlement in a US race
Coke agreed to pay $113 million in direct compensation
and another $43.5 million towards the elimination of pay
Coke‘s new CEO Doug Daft sent a contrite e-mail to all
of Coke‘s employees worldwide .
In 2002, two years after the settlement was reached, the
court appointed panel in charge of monitoring Coke‘s
human resources practices
In December 2003 , a report said that the company
failed to make recommended changes to its interview
process or to develop a diverse candidature for
On June 19, 2001, Eric Meissner, a 30- year employee
at the Auburndale, Florida plant that produces Coke‘s
Minute Maid and Hi-C products, was fired.
Since 1996, when Coke brought in Cutrale Citrus Juices
USA, a subsidiary of a Brazilian company, to produce
juice products in Florida.
Inspectors from the OSHA found 15 violations, including
13 that were considered ―serious,‖ in 1999 and 2000.
There were two major chemical leaks.
Coke‘s overall record on safety, as monitored by OSHA,
is both less than admirable and worse than many of its
competitors (such as Pepsi).
In 2002 ―The Coca-Cola Co. and its network of bottlers
were cited for 222 violations of federal OSHA standards
and fined $156,831.
In 2001, OSHA cited Coke and its bottlers for 212
violations and fined them a total of $170,091.
Over the past decade, the companies have been cited
for 2,264 violations.‖
In February 2003, OSHA identified 14,200 U.S. facilities
that had accident and illness rates at twice the national
average of about 3 illnesses or injuries for every 100
workers. 96 of these workplaces were owned by Coke
The Coca-Cola Company‘s endeavor for the last 126
years has been to make a positive and lasting difference
where our business touches communities. In a world of
many challenges and increased pressure on resources,
businesses need to play a part in ensuring sustainability
of resources and livelihoods.
As the world‘s largest beverage system has a presence
in thousands of communities, across more than 200
countries. This provides us a rare opportunity to make a
real and lasting difference to these communities.
In India also, we are working with communities and
stakeholders, to make a difference to the lives of people.
We call this the “Golden Triangle” approach – the
coming together of government, business and civil
society to attend to the larger issues of our Planet.
Golden Triangle approach
Indian School of Business, Hyderabad
Coca-Cola Cup Under -16cricket and Coca-Cola
Under - 16 football.
Millennium Development Goals
Project SANTUSHTI - A Drinking Water Project in
Sambhar Lake, Rajasthan
The Foundation for Rural Recovery & Development,
(FORRAD) in collaboration with MANTHAN