How Coca Cola is Deep into Sustainability and yet Manage to Stay Profitable

You would think that by now, major corporations would be in drove into sustainability because of climate change and other environmental risks that could have an impact on companies sustainability. But, that’s not the case. However, Coca Cola, walk-to-walk on sustainability. They go deep into sustainability. Sustainability is at the core of their business strategy. 

“The strengths and sustainability of our brands are directly related to our social license to operate, which we must earn daily by keeping our promises to our customers, consumers, associates, investors, communities and partners.” – from 2008/2009 Sustainability Review

Company snapshot

Vision: “a world where all people have access to safe water, where packaging has a life beyond it’s original use, and where communities are healthy and prosperous.”

Established in 1886. Operates in more than 200 countries and markets. A $56 billion brand company. In 2009 joined the rank of Dow Jones Sustainability Indexes

Brand portfolio: 500 brands and more than 3,300 beverage products. They have four of the world’s top five nonalcoholic sparkling beverage brands: Coca Cola, Diet Coke, Sprite, and Fanta. Simply trademark became the company’s 12th brand, in addition to Coca Cola, to have annual retail sales of $1 billion.

Number of employees worldwide: 92,800

Market capitalization: $135.36 billion. 

In the company wide system, which comprises the Company and more than 300 bottling partners around the world. The bottling partners are local-based. They manufacture, package, merchandise and distribute the finished beverages to customers and vending partners, who then sell the products to consumers. That’s how Coca Cola becomes a global business that act locally

Sustainability at its core

This is why to get the full benefit for a business, sustainability needs to be integrated into business strategy. Coca Cola and their bottling partners are committed to keep innovating to keep their products affordable and make their business more environmentally and economically beneficial to the communities they serve. They do believe that investing in the economic, environmental and social development of communities will help our business grow.” Need not say more. And that is sustainability at its core.

Based on the information provided on their corporate sustainability and annual reports, this is how I see their success formula of sustainability:

SUSTAINABILITY = RISK MANAGEMENT >  “that leads to” > INNOVATIONS

For them not embracing sustainability, exposed them to their biggest risk that they have no control over the supply, unless they do something about it to preserve and conserve.

Think about this for a moment. Water, as a resource, is ‘very’ vital to their business. They are in the business of selling water-based products. Water is also used in their manufacturing process. 70% of the world’s water is used for agriculture and yet only 3% of the earth’s fresh water is fit for human consumption via lakes, rivers and streams. The rest is locked in glaciers, snow and ice.

Continue reading “How Coca Cola is Deep into Sustainability and yet Manage to Stay Profitable”

Advertisements

Business with a Purpose Business Models

I stumbled into Business Model Alchemist via Holy Kaw. If you’re into social entrepreneurship – looking into business models that has something to do with social and environmental impact, like I am – take a look at this presentation below for inspirations.