Coca-Cola Co.
Coca-Cola is the world soft drink industry leader with a 2006 market share of 53%. Each day the company sells over 25 million plastic soda bottles (coded #1 PET, or polyethylene terephthalate) in the U.S. Every year, more 10 billion plastic Coke bottles containing over 900 million pounds of plastic are discarded.

As You Sow has been in dialogue with Coke and PepsiCo (see below) for several years to get them to incorporate recycled content in plastic bottles and to set high container recovery goals. We are concerned that despite the proliferation of beverage sales and waste, recycling of aluminum, glass and plastic bottles has plummeted in recent years from 53% in 1992 to 33% in 2004.

After opposing such actions groups for many years, the companies have made modest progress on incorporating recycled content, and Coke made dramatic strides with a bold recovery goal commitment in 2007.

As You Sow and our partner Walden Asset Management have joined in dialogue and filed shareholder proposals asking the company to use high levels recycled content in plastic bottles and to set a national container recovery goal in the range of 60-80%. As a result of the resolution and our dialogues, Coke and Pepsi began to incorporate recycled content in plastic beverage containers in their North America and U.S. operations respectively. By the end of 2005, both companies made good on a commitment to 10% recycled PET. We congratulate the companies on the progress made but believe still higher levels are achievable.

Major Commitments
On September 5, 2007 Coca-Cola announced a series of impressive commitments on environmental sustainability for product packaging that respond to requests in shareholder proposals filed by As You Sow and other shareholders.

Coke agreed to invest $60 million to build the world's largest plastic bottle recycling plant in South Carolina that will produce 100 million pounds of recycled PET annually. It also committed to recycle or reuse all PET plastic used by the company’s beverages in U.S. sales. It later included all of the aluminum cans it sells in the U.S. to the commitment.

Sandy Douglas, president of Coca Cola North America, acknowledged in a press conference that its commitments were partly the result of the work of social investment groups like As You Sow.

Coke’s actions move the company toward fulfilling our first goal of using higher levels of recycled PET by making a long-term investment in a more stable PET supply, which will allow it to acquire higher levels of PET in a cost effective manner.

The company also responded to our request to establish a beverage container recycling goal, although we had encouraged this to occur as an industry goal rather than an individual company goal. We encourage the company to extend this pledge to its other beverage containers and other operating regions, and will be encouraging other beverage companies to follow Coca-Cola’s lead. This is a unique, game-changing commitment and we look forward to learning how the company will achieve its 100% reuse/recovery goal, and over what timeframe.
The company also will make a multi-million dollar investment in RecycleBank, which offers incentive-based recycling in several large cities.

Coke received a grade of “C” in As You Sow’s container recycling scorecard and report issued in 2006; a second report and ranking will be issued in 2008.

PepsiCo
The Number Two soft drink maker has maintained its commitment to use 10% recycled PET content in plastic bottles sold in its U.S. market, but has not moved on container recovery commitments. In response, As You Sow filed a shareholder proposal in the fall of 2007 asking the company to work towards container recovery goals. It received the support of about 7% of shareholders at shareholders meeting in May 2008.

Pepsi received a grade of “C” in As You Sow’s container recycling scorecard and report issued in 2006; a second report and ranking will be issued in 2008.