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environmental report
table of contents
Our Commitment
1
Introduction
2
Our Business
3
Environmental Governance
4
Our Environmental Performance
5
Conclusion
6
Data
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Our Commitment
Douglas N. Daft Chairman and Chief Executive Officer
At The Coca-Cola Company we are aware that owning leading brands such as Coca-Cola brings responsibilities, and that our success in the market will be sustained only if we operate responsibly. Our Companys size and reach make us global citizens. But our products are in shops and kiosks and kitchens everywhere; as such, we are local citizens as well. We need to address global issues such as water scarcity and climate change, while also understanding how they affect local communities and how we can help those communities build prosperity. Our business success depends on the prosperity and sustainability of the communities where we operate. Increasingly, the true measure of a well-managed company is not just whether it is financially successful, but how it achieves that success. Corporations have to be both profitable and accountable. Our corporate citizenship framework addresses this through four principlesproviding quality in the marketplace, enriching the workplace, strengthening the community and preserving the environment.
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Our goal is to reduce our environmental impact while increasing our efficiency and long-term profitability.
The Coca-Cola Company is the worlds largest beverage company. We cannot sustain that success without considering the individuals, communities and natural environments where we do business. We believe that being a responsible steward of the environment is essential to The Coca-Cola Companys successful future as a commercial enterprise. Our environmental policies and initiatives are more than just a commitment to protecting natural resources. They are also a fundamental part of our competitiveness as a commercial organizationreducing risks and operating costs, improving quality and nurturing our brands. Most environmentally beneficial practices improve business efficiency. Minimizing waste, for example, usually results in lower costs and higher yields. Solid waste, wastewater and emissions represent inputs that have been paid for but which are too readily thrown away, often with a disposal charge. Our aim is to minimize waste production in the first place, to reuse or recycle as much as we canwhether it is solid waste or used waterand dispose of what is left in an environmentally responsible way. Legal compliance is, of course, essential; and we have always tried to conduct our business with responsibility to the environment. In the 1950s, we were one of the first members of Keep America Beautiful, and in 1969 we were using a precursor to Life Cycle Analysis to evaluate environmental impacts related to our products. In 1993, we were among the first to receive recognition for our policy statement phasing out chlorofluorocarbons (CFCs) from refrigeration equipment and in 2000 we committed to do the same with hydrofluorocarbons (HFCs) as cost-efficient alternatives become available.
We developed the systemwide Environmental Performance Measurement (EPM) initiative in 2000 to help operations evaluate their progress and to collect the data in this report. EPM allows us to assess the environmental impacts of our business system. We use the data to encourage individual plants and our bottling partners to benchmark their current performance. This is a key management tool that allows us to highlight best practices, build training programs and drive environmental improvements. Today, we are implementing systems to ensure we minimize risks and capitalize on opportunities for our business and for the environment. Continuous improvement in efficiency and environmental performance is an essential component of our business strategy. We will demonstrate leadership in areas where we are able to have a positive influence, especially in our key areas of environmental impact: water, energy/greenhouse gas emissions and waste. Businesses have a duty to find new ways to operate so that the economic wealth we create is sustainable in the long term and contributes to an improved quality of life. We must not consume resources at the expense of future generations. This is a huge task, and there is a limit to what we can achieve on our own. However, we are committed to doing our best and to encouraging members of our supply chain and others in the food and beverage industry to join us. The initiatives in this report and others illustrate our approach to environmental issues reducing our environmental impact while increasing our efficiency and long-term profitability.
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chapter 1 : Introduction
1
Introduction
As part of our commitment to environmental stewardship, this report details the worldwide environmental impacts of the Coca-Cola system The Coca-Cola Company and our bottling partners around the world. It also sets out our environmental policy and commitments and explains our environmental governance structures and management systems. Performance data in this report focuses mainly on our manufacturing plants and those in the Coca-Cola system, including independent bottlers. We also discuss other environmental impacts over which we have varying degrees of influence: such as distribution, marketing and suppliers and customers operations, although data is less readily available for these areas of the supply chain. Data covers 711 plants, producing 78.8 billion liters of nonalcoholic beverage products, equivalent to 74 percent of the 2002 end-product sales volume of the brands owned by our Company. We have estimated the overall impacts of our system by extrapolating from this data to our total volumes. The figures published here will form the baseline for future reporting.
the coca-cola company 6
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2
Our Business
The Coca-Cola Company is the largest manufacturer, distributor and marketer of nonalcoholic beverage concentrates and syrups in the world. Finished beverage products bearing our trademarks, sold in the United States since 1886, are now sold in more than 200 countries and include the leading soft drink products in most of these countries.1
OUR COMPANY
The Coca-Cola Company manufactures a variety of beverage concentrates and syrups, as well as some finished beverages, which we sell to bottling and canning operations, distributors, fountain wholesalers and some fountain retailers. Our products include some of the worlds most valuable brands more than 300 in all. The Company operates through five geographic segments (Africa; Asia; Europe, Eurasia and Middle East; Latin America and North America), which we call strategic business units, plus a corporate segment. Approximately 56,000 people worldwide are employed by The Coca-Cola Company.
At the end of 2002 we owned, held a majority interest in or operated:
33 beverage concentrate and/or syrup manufacturing plants 39 operations with 103 principal beverage bottling and canning plants outside the United States 8 juice and juice drink production facilities in the United States and Canada 1 facility in Florida that manufactures juice concentrates for food service use 51 percent of CCDA Waters, L.L.C. a joint venture with Danone Waters of North America, Inc. and Danone Holdings, Inc. which has five production facilities in the United States
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Our relationship with bottlers we do not own or control is one of collaboration and mutual support. These businesses have independent managements, policies and governance structures. Many are publicly traded companies with independent shareowner structures. Some are involved in businesses outside the nonalcoholic beverage sector. We do not control the policies and
programs of these bottlers, but we have mutual self-interests and therefore work together to find common ground and take common action in many areas. This includes our environmental activities. Our ownership interests in Company bottling operations around the world are subject to change over time, depending on business and other considerations.
Manufacturing Facilities
Number of manufacturing facilities owned, leased or operated by companies comprising the Coca-Cola system
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water
1. used in our systems plants as a product ingredient, as well as in operations for processes such as purification, washing and rinsing of packaging, cleaning of product mixing tanks and piping, steam production and cooling 2. wastewater from plants required by Company policy to be either treated on-site or discharged into public or private sewage systems for treatment before being returned to rivers and other natural bodies of water
Ingredients & Bulk e.g., lemon oil, Packaging vanilla & cherry flavor
Concentrate Plants
Bottling Plants
Warehouse
Transport
Consumers
Customers
Ingredients & Packaging e.g., water, sweeteners & CO2
1. from energy used in manufacturing operations, either directly (e.g., in-plant boilers fueled by gas or oil) or indirectly (power plants producing the electricity used in bottling plants) 2. from energy use and refrigerant leaks associated with the manufacture, operation and disposal of cold-drink equipment such as coolers and vending machines 3. from fuel used to power the fleets that deliver our products to retailers
waste
1. waste from our systems production facilities includes ingredient containers, damaged product containers (typically refillable ones), shrink or stretch film that holds palletized products together, bio-solids from wastewater treatment plants, wood from damaged pallets and compostable material from ingredients such as tea leaves, etc. 2. waste arising from the disposal of sales and marketing equipment at the end of its useful life 3. packaging waste arising after consumers have enjoyed our products
This picture is an over-simplification of our manufacturing and distribution process. Please see endnote number 2 for details.
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3
Environmental Governance
This section explains our Companys approach to managing environmental issues the governance and management systems that provide accountability, develop and implement policies and programs, measure performance and provide assurance. We also report how we engage on environmental matters with stakeholders and throughout the supply chain, especially with bottling partners.
ACCOUNTABILITY
Everyone in the Coca-Cola system is responsible for stewardship of the environment.
At the local level, environmental coordinators in our strategic business units, divisions and production facilities are responsible for ensuring compliance and performance in their operations consistent with our environmental policy and standards. The Senior Vice President of our Quality Division has direct responsibility for environmental governance, supported by departmental staff who include environmental experts. This officer reports directly to the Chairman and Chief Executive Officer. The Board of Directors of The Coca-Cola Company has an Audit Committee, which is responsible for environmental governance and which oversees compliance with environmental policies. Our environmental management system, eKOsystem,3 establishes common operating standards for our Company on environmental stewardship and provides guidelines for our bottling partners around the world. It also ensures that environmental concerns are incorporated into our day-to-day operations, even in those regions where regulatory standards do not exist or may not be fully enforced. Our Company uses eKOsystem to reduce our environmental impacts, and for achieving environmental gains, reducing costs and increasing efficiencies.
ENVIRONMENTAL MANAGEMENT
Environment and safety are integral parts of The Coca-Cola Quality System. Our environmental policy is based on a simple overarching principle:
We will conduct our business in ways that protect and preserve the environment.
e nv i r
onm e
nt
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qual i t
In 2002, we focused on developing a simplified, modular management system that is better aligned with the international environmental standard ISO 14001. This structure was launched in 2003. Along with eKOsystem, our Companys Good Environmental Practices documents (GEPs) set out specific requirements and guidelines for significant environmental aspects of our operations. GEPs have been developed for: auditing environmental and safety systems energy management environmental due diligence fleet management managing hazardous materials measuring and reporting environmental performance ozone protection wastewater quality water resource management We also provide guidance to employees, operations and facilities on managing specific environmental issues. In addition to technical manuals addressing specific environmental activities, our Company also offers environmental training programs. For example, Waste$MART (Systemwide Minimization and Reduction Techniques) trains employees to identify cost-saving opportunities in the areas of water, energy and waste reduction.
AUDIT PROGRAM
Since 1993, the Companys Legal Division has managed a corporate environmental and safety audit program. All Company-owned facilities are periodically 4 audited to assess compliance with applicable legal and Company requirements. The program also assesses the effectiveness of the operations environmental management. As part of our management review process, audit reports are provided by the Legal Division to those executives responsible for the audited facilities or operations. Issues identified during an audit are addressed through a corrective action program that provides a defined, systematic process to ensure prompt and effective resolution. The status of corrective actions is regularly tracked. To date, we have undertaken more than 200 audits of our Company-owned facilities.
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In early 2002, we established an Environmental Advisory Board of outside experts to inform our Company on existing and emerging environmental issues. Through this Board, our Chairman and our Executive Committee receive candid, independent advice on environmental matters and on our environmental policies, 8 programs and performance. The following are currently members of the Environmental Advisory Board:
The Right Honorable John Gummer, MP Chairman
Chairman Sancroft
Supply Chain
We will continue to work with our partners to extend our environmental values throughout our supply chain. Our commercial relationships with suppliers are governed by our Supplier Guiding Principles program5, which requires compliance with environmental laws and regulations. We are also working with many suppliers to develop new environmentally beneficial technologies. To date our collective efforts have yielded reduced packaging weight, higher recycled packaging content and greater energy efficiency for cooling equipment.
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4
Our Environmental Performance
This section of the report covers the worldwide environmental impacts of The Coca-Cola Company and our bottling partners. It provides an overview of our current performance data, and details some of the steps we are taking to address our impacts.
SCOPE AND COVERAGE OF THIS REPORT
As this is our first global environmental report, we do not have reliable comparative figures from previous years. The data published here will form the basis for future comparisons. Unless otherwise noted, this report covers manufacturing plants owned by the Company and our bottling partners. Offices, laboratories, research and development facilities and warehouses are not included. Data provided by our bottling partners offers a more comprehensive picture of the environmental impacts of our business system. This more difficult approach has resulted in less than 100 percent data collection. The numbers and ratios in this section relate to the plants that have participated in our exercise.9 For each main impact category, we have estimated the overall impacts of our Companys operations and those of our bottling partners by extrapolating the 10 data to our total system production volumes. At time of publication, allegations concerning our environmental business practices in India had been raised. We intend to address these issues in 11 a future report.
Data has been collected from:
Manufacturing Facilities
33 Coca-Cola concentrate and syrup plants 7 plants in our juice and juice-drinks production facilities 1 food service juice concentrate plant 670 bottling and canning plants throughout the world most of which are independent businesses in which we may or may not have a stake. Collectively, the end-product volume covered by these 711 plants is 78.8 billion liters of nonalcoholic beverage products, and represents 74 percent of the 2002 end-product sales volume of the brands owned by the Company, 106 billion liters.
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Ingredients & Bulk Packaging e.g., lemon oil, vanilla & cherry flavor Concentrate Plants Bottling Plants Warehouse
Transport
Consumers
Customers
Impacts by concentrate plants owned by The Coca-Cola Company scope of reported data Impacts by bottling plants, owned and operated by bottlers Impact by other bottling system operations (e.g., sales and marketing equipment and fleet) Impacts up/downstream, which we can influence (e.g., packaging manufacturing/recycling) Impacts up/downstream, where we have limited influence (e.g., home refrigeration, commodity ingredients)
This picture is an over-simplification of our manufacturing and distribution process. Please see endnote number 12 for details.
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[1 liter]
[3.12 liters]
[2.12 liters]
This picture is an over-simplification of our process. Please see endnote number 16 for details.
Water efficiency in plants depends on a variety of factors, including the kind of product produced and the packaging used. For example, plants exclusively producing products in refillable bottles, which have to be washed and cleaned, tend to use much more wateron average 4.4 liters of water per liter of product, compared to as little as 1.3 liters per liter17 of product where bottles are not reused. Product mix can have a decisive influence on the water use ratio, too. For example, plants that manufacture beverages such as teas and coffees tend to report higher water use ratios, due to the pasteurization and related processes needed for these products.
Wastewater
Our Company policy requires compliance with all applicable laws and regulations regarding wastewater treatment. Further, the policy requires that wastewater discharged from our facilities into rivers or other natural bodies of water be treated to a level capable of supporting fish life. This is achieved through on-site wastewater treatment or by discharging to a municipal or privately-owned treatment system that engages in adequate treatment. In 2002 more than three quarters, 76.5 percent, of plants in the Coca-Cola system achieved this standard, up from 69 percent in 2000. We aim for all plants to comply with this standard. We continue to seek additional opportunities to reuse treated waters.
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Energy
Roughly 95 percent of the energy consumed by our system powers bottling operations, including equipment such as boilers, chillers and air compressors. In some locations these operations also manufacture packaging, such as polyethylene terephthalate (PET) plastic blow molding. In 2002, our system consumed 38.5 billion megajoules (MJ) of energy to produce 67.1 billion liters of products in the plants 18 covered by our reporting exercise. Average energy use was 0.57 19 MJ per liter of product. Extrapolation of the energy use ratios to production volumes not directly covered by our data suggests an estimated energy consumption of 56 billion MJ in 2002 by our whole business system.20 We estimate that this leads to direct and indirect emissions of 5.7 million 21 metric tons of carbon dioxide. Energy consumption ratios are a function of specific manufacturing operations. For example, because of pasteurization, juice manufacturing uses more energy than fountain syrup. Energy use is also determined by a variety of local factors, such as climate, plant size, packaging type and use of blow-molding equipment. Plants in our system use a variety of energy sources, depending on specific needs and local conditions. Energy sources in our system, as related to production volumes of reporting plants, is explained in the picture below.
Kingdom
Energy Split
34% 37%
Fuel oil/ kerosene
Electricity
Our bottling partner in Great Britain, Coca-Cola Enterprises Ltd., participates in the British governments program for Climate Change reduction with all six of its manufacturing sites. This initiative encourages companies to enter voluntary agreements to reduce energy consumption over a 10-year period. Our bottler recognized that it could improve its energy efficiency performance by participating in the program. A team of experts from across the business was charged with examining opportunities and developing action plans to meet the first government target in 2002. Reducing the use of compressed air, which is produced by electric compressors, emerged as the best opportunity. Compressed air accounts for more than a quarter of all energy used in these bottling plants. Leakage detection and prevention programs were developed and implemented, and in some cases older, inefficient compressors were replaced with more efficient models. The bottler exceeded targets for energy reduction in 2002 by reducing overall energy consumption around 7 percent from 2001. Coca-Cola Enterprises Ltd. is on course to meet the 10-year targets and is reinvesting some of the savings made in new projects.
23%
5%
Natural gas/ propane
Coal
1%
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Coca-Cola Amatil (CCA), our bottling partner in Australia, installed a range of energy-saving devices, such as dimming systems, switching systems and energy-efficient lamps, which decreased electricity consumption for lighting by 30-40 percent. As a result of this initiative, CCA expects its energy saving program to reduce greenhouse gas emissions from its Australian sites by more than 2,000 tons of carbon dioxide a year. Lighting represents a significant cost for CCA, accounting for 15-20 percent of total electricity consumption. In 1999, lighting at CCAs plants was operated by an inefficient one on, all on system and therefore had potential for significant savings. The initial investment into this initiative was between $110,000 and $130,000 (AUD) per site. With anticipated savings of between $30,000 and $50,000 (AUD) per year at some plants, this program is now on its way to paying for itself. The CCA initiative was conducted under the Australian governments voluntary Greenhouse Challenge program, which encourages companies to reduce greenhouse gas emissions and make substantial savings in energy costs. CCA joined the initiative in 1999.
In 2002, the production of 58.87 billion liters of products in the plants covered by our reporting exercise22 yielded 738 kilotons of 23 solid waste. On average, 12.54 grams of solid waste per liter of product was generated.24 Our system reused or recycled more than three quarters, or 76 percent, of all solid waste produced in these plants. We discarded an average of 3 grams of solid waste per liter of product. Extrapolation of waste ratios suggests an estimated total generation of industrial solid waste by our business system of 1.24 million metric tons in 2002.25 Of this total, 947,000 metric tons were reused or recycled, and 291,000 metric tons were discarded. As with energy consumption, the range of solid waste production ratios throughout our system is a function of local conditions. These include product mix (e.g., tea leaves in tea plants) and packaging mix.
76% Reused or
recycled
24% Non-recycled
0%
Solid Waste
97 percent of our systems solid waste is generated during the bottling process. Our waste may include materials such as: empty ingredient containers (e.g., drums, pails, jugs) cardboard slip sheets that separate layers of palletized cans as they arrive shrink or stretch film and/or plastic strapping that holds palletized products together bio-solids from wastewater treatment plants glass or plastic from damaged bottles wood from damaged pallets ingredient waste, such as tea leaves
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In Ireland, one of our Companys concentrate manufacturing plants has implemented a waste minimization and recycling program that is a model for other production plants. This plant recycled approximately 87 percent of its packaging waste in 2002. This effort was a valuable contribution toward Irelands 50 percent packaging recovery target for 2005. A key element of the plants approach is to separate materials as soon as possible. This ensures that the material remains clean, therefore easier to recycle. Repak, the Irish Waste Management Compliance Scheme, has praised the plant for its well-planned and developed waste management program, and has cited it as an example of a recycling best practice.
Coolers
These are commercial refrigerators, typically in retail outlets, generally with glass doors, where product is displayed on the shelves. They represent 51 percent of all sales and marketing equipment in our system.
Vending Machines
These machines are used for self-service purchases. They typically have a coin mechanism or other automatic payment system, and are usually located in offices, railway stations, airports, sport venues, etc. They represent 38 percent of sales and marketing equipment.
Fountain Dispensers
Fountain machines are typically located on counters in restaurants. When used for carbonated soft drinks, they mix syrup with chilled carbonated water to supply product into cups or glasses for immediate consumption. They represent 11 percent of our sales and marketing equipment.
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The environmental impacts of coolers, vending machines and fountain dispensers are related to the refrigerants used, the energy consumed and the solid waste generated at disposal. Our Company launched its ozone protection strategy in 1992. Since January 1995, Company policy requires that our operations no longer purchase new equipment containing or made with chlorofluorocarbons (CFCs)because they are strong ozone depleting substances. We also implemented a robust capture/recovery program for all refrigerants. Because sales and marketing equipment can remain in use between 10 and 20 years, some CFC-containing equipment is still being utilized. However, the proportion has fallen steadily over the last few years, and we expect the phase out and decommissioning of existing CFC-containing machines to be essentially complete by 2007, consistent with the Montreal Protocol which governs CFC phase-out. We estimate that by phasing out CFCs we have thus far reduced the overall global warming impact of our systems sales and marketing equipment by over 640,000 metric tons of carbon dioxide equivalent. When the Montreal Protocol was adopted, industry identified
hydrofluorocarbons (HFC-134a) as suitable substitutes for CFCs. However, HFC-134a is now included in the list of greenhouse gases targeted under the Kyoto Protocol addressing global climate change. In June 2000, we announced our intention to no longer purchase new cold-drink equipment containing HFCs wherever cost-efficient alternatives are commercially available by the 2004 Olympic Summer Games in Athens. This initiative applies to refrigerant gases and insulation foam. We also intend to have new equipment that will be 40-50 percent more energy efficient than machines in 2000 by the end of the decade. By the end of 2002, we spent approximately $10 million on research and development to find suitable refrigeration alternatives, in cooperation with technology providers and sales and marketing equipment suppliers. We are testing three new refrigeration technologies: hydrocarbon refrigeration for small and medium-sized coolers; helium-based Stirling-cycle technology for small and medium-sized commercial equipment; and carbon dioxide refrigeration for large-sized equipment. Our system continues to explore other technological developments.
Percent of CFC-Containing Sales and Marketing Equipment Remaining in the Marketplace Worldwide
100% 90 80 70 60 50 40 30 20 10 0 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07
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Transport
Due to the complexity of our system, it is difficult to estimate the number of distribution vehicles that we, our bottlers and contract distributors use. However, we believe the system uses approximately 180,000 vehicles. Environmental impacts result from exhaust emissions and maintenance, which is usually carried out at system facilities or by third-party specialists. Road transportation is the predominant delivery mode for our finished products; however, the delivery of concentrate from The Coca-Cola Company to our bottling partners depends substantially on marine transport. We work with our bottling partners to reduce the environmental impacts of fleets wherever possible. Steps taken so far include evaluating new technologies and modes of transport and delivery, vehicle retrofits and improving existing fleets through better maintenance and route scheduling. We intend to concentrate more effort on the transportation area and to provide more data and analysis in future reporting initiatives.
The remaining 14 percent of our volume is sold as concentrated syrup in fountain outlets. Syrup packaging is usually bag in the box or 5-gallon stainless steel containers. Over the last 30 years our system has made packaging significantly lighter, reducing the amount of raw materials needed and making transport more efficient.
Environmental Design
Lightweighting
Glass Bottles
We have reduced the weight of our 250 ml nonrefillable glass bottle from 225 grams to 190 grams in certain markets. A 170 gram bottle we are using in Mexico is nearly 25 percent lighter than the standard weight of a 250 ml bottle, 225 grams. We have also been working to incorporate lightweight technology in our refillable glass packages. Recently, ABI/SABMiller and SABCOtwo of our African bottlershave been using a new 300 ml bottle that is almost 20 percent lighter than the older bottle (from 380 to 305 grams per bottle).
Packaging
In addition to facilitating handling and delivery for consumers, packaging provides other important benefits: maintaining product safety and integrity protecting products during transportation providing convenience for consumers marketing and advertising communicating product values communicating information on nutrition and on recycling Packaging can have a substantial environmental impact because it becomes waste after use and can cause litter problems. Manufacture of packaging also consumes energy and natural resources and produces waste. Our system is working to reduce its environmental impact by: using lighter weight and less energy-intensive packaging (including use of recycled content) improving recycling in our operations using materials that make recycling easier and more economically sound supporting cost-effective and efficient local solutions to litter abatement and to recovery and recycling of packaging waste
Aluminum Cans
When Coca-Cola bottlers first used aluminum in 1965, a 12-ounce can weighed 24.9 grams. By 2002, we had developed a 12-ounce aluminum can weighing 13.2 grams, a reduction of 47 percent.
Packaging Material
Our system uses a wide range of packaging materials. Stainless steel and polyethylene plastics in sizes from 1 gallon to more than 1,000 liters are used to supply ingredients to bottling plants. Our bottling partners, in turn, deliver our products in either bottles, cans and other packaging that generally is recyclable, 52 percent of total sales, or in refillable bottles, 34 percent.
Steel Cans
The weight of steel cans in Europe, one of our key markets for this package, has dropped by more than 30 percent over the last two decades.
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Over the past few years improvements in syrup packaging for North America have reduced the impact on the environment. These include:
significantly reducing the use of shrink wrap from our single soft drink syrup bag in the box packaging (mid 1990s) removing metal spring out of the valve to make the bag in the box recyclable (1997) specifying 35 percent post-consumer recycled content in corrugated components (late 1990s/early 2000s) optimizing the dimensions of our bags for a 4-6 percent material reduction (2000)
to work with customer account managers to look for future opportunities to use the cups in locations where composting infrastructures exist. We also work to ensure that our packaging materials are compatible with recycling systems. In the United States, for example, we worked with recyclers to develop a light-blue Dasani bottle that can be recycled as clear plastic. This is important because clear plastic material is more common in the recycling system and therefore, more readily recyclable.
In Colombia, The Coca-Cola Company has helped establish a system for converting recycled plastic bottles into clothing. This is reducing waste and the impact of packaging on the environment. This project makes economic sense because it transforms waste plastic into a valuable product that can be sold for profit. Our system uses nearly 350 tons of PET bottles each month in Colombia. Used PET bottles are collected and sorted by a local recycling company, providing employment for approximately 300 people. Labels and other colored bottle parts are used to make brooms and roof tiles. The rest of the bottle is made into chips that are sold to textile manufacturers. The chips are then turned into a fiber used to make fabric. It takes about two PET bottles to yield one T-shirt. A uniform requires up to 10 PET bottles.
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Mission Antarctica
Our Company is working with Mission Antarctica, a not-for-profit organization, to help employees improve teamwork and leadership skills and to encourage them to take action for the environment. Mission Antarctica was founded by Robert Swan, the first person to walk both the North and South Poles. Mission Antarctica was born as a result of Mr. Swans participation at the first World Summit in Rio de Janeiro in 1992 where world leaders charged him to develop an inspirational project that involved young people, business and the environment. The project resulted in the cleaning and removal of many tons of scrap metal and other waste from the shores of Antarctica. Through our Companys partnership with Mission Antarctica, a number of employees have participated in a series of teamwork events building greater awareness and understanding of the complex issues relating to the environment. These included helping organize an awardwinning exhibit at the World Summit for Sustainable Development in Johannesburg and participating in a clean-up effort along a stretch of the Jukskei River in South Africa.
Supply Chain
The goods and services our system uses to manufacture, market, distribute and sell our brands originate from a diverse range of suppliers and sources. We encourage our suppliers to share our commitment to the environment. Our Supplier Guiding Principles communicate the high priority our Company places on workplace policies that comply with applicable environmental laws and with other areas of corporate responsibility. We believe the Supplier Guiding Principles help raise suppliers awareness and focus their attention on environmental practices that can directly benefit their operations and relationships with local communities.
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chapter 5 : Conclusion
5
Conclusion
The Coca-Cola Company believes our environmental initiatives are more than a commitment to protecting our natural resources. They are a fundamental part of our competitiveness as an organization enhancing productivity, reducing expense, improving quality and nurturing our brands. This 2002 Environmental Report the first of its kind for our Company at a global level is one element of our environmental efforts. In the years ahead we intend to continue collecting and reporting environmental impact data on our Company and our system, enabling us to highlight performance trends over time and to spell out targets for improvement. We also aim to demonstrate our commitment to continuous progress on the issues identified in this report, both in our plants and in the communities in which we operate. Working with our bottlers and with our partners we will strive to continuously improve our environmental performance, while increasing our efficiency and long-term profitability creating a stronger and more sustainable future for our business and for the communities we serve.
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chapter 6 : Data
6
Data 28
SUMMARY OF 2002 IMPACTS FROM MANUFACTURING PLANTS IN THE COCA-COLA SYSTEM29
average for plants supplying data
Water Energy 3.12 liters/liter of product 0.57 megajoules/liter
comments
Ratios vary depending on plant activity Estimated carbon dioxide emissions (direct and indirect) of 5.7 million tons 76 percent of all solid waste was reused or recycled, leaving 3 grams per liter discarded
Solid waste
12.54 grams/liter
Energy operation
Concentrate & Beverage Base32 Bottle/Can Juices Fountain Syrup
33
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chapter 6 : Data
glass
Austria 97.3
paper
87
metals
49.4
plastics
26.2
total
68.1
Belgium
79.7
82.1
70.3
25.5
62.5
Brazil
40
71
35/73
21
Not Available
France
49.7
59
49.2
11.2
42.2
Germany
83.6
90.5
76.7
55.2
78.1
Italy
46.9
45.5
44.6
16.1
38.4
Japan
82
Not Available
85.2/82.8
40.1
Not Available
Mexico
50
Not Available
55
13
Not Available
Netherlands
80.1
70.9
78.2
22.9
58.8
South Africa
20
Not Available
64
11
Not Available
Spain
31.3
58.2
33.9
17.2
39.3
United Kingdom
33.2
48.8
29.7
12.8
36.7
United States
32.8
Not Available
54.4
35.1
49.5
Figures in this chart come from different organizations that measure recycling levels in very different ways. They are therefore very difficult to compare. Please see endnote 36 for more information
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endnotes
This Environment Report may contain statements, estimates or projections that constitute forward-looking statements as defined under U.S. federal securities laws. Generally, the words believe, expect, intend, estimate, anticipate, project, will and similar expressions identify forward-looking statements, which generally are not historical in nature. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from The Coca-Cola Companys historical experience and our present expectations or projections. These risks include, but are not limited to, changes in economic and political conditions; changes in the nonalcoholic beverages business environment, including actions of competitors and changes in consumer preferences; foreign currency and interest rate fluctuations; adverse weather conditions; the effectiveness of our advertising and marketing programs; fluctuations in the cost and availability of raw materials; our ability to achieve earnings forecasts; regulatory and legal changes; our ability to penetrate developing and emerging markets; litigation uncertainties; and other risks discussed in our Companys filings with the U.S. Securities and Exchange Commission (the SEC), including our Annual Report on Form 10-K, which filings are available from the SEC. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. The Coca-Cola Company undertakes no obligation to publicly update or revise any forward-looking statements. References in this report to The Coca-Cola Company or the Company are intended to refer collectively to The Coca-Cola Company and its operating divisions and subsidiaries. References to the Coca-Cola bottling system or the system are intended to refer collectively to the several different types of beverage bottling entities and operations more completely discussed and explained in the report, including independently owned bottlers, bottlers in which the Company owns an investment but non-controlling ownership interest, and bottlers in which the Company owns a controlling ownership interest. Coca-Cola, Aquarius, Dasani, diet Vanilla Coke, Fanta, Fruitopia, Minute Maid, Powerade and Sprite are trademarks of The Coca-Cola Company. Nestea is a trademark of Socit des Produits Nestl, S.A. under license to Beverage Partners Worldwide, S.A., a joint venture between The Coca-Cola Company and Nestl, S.A. 2003 The Coca-Cola Company. All rights reserved.
For details on our brands, sales and financial performance, please refer to our 2002 Form 10-K Report, which you may access from www.coca-cola.com. The Coca-Cola Company recognizes that there are other environmental impacts associated with the business system. However, this graphic focuses on water, greenhouse gas emissions and waste. KO is the common stock ticker symbol for The Coca-Cola Company. The Coca-Cola Company policy is that production facilities are audited at least every three years. All other facilities are audited at least every five years. Our Supplier Guiding Principles may be found on www.coca-cola.com. Our Code of Business Conduct may be found on www.coca-cola.com. Member as of July 2003. Environmental Advisory Board members were consulted about this report. However, The Coca-Cola Company is solely responsible for its content. Data in this report relating to or attributable to the operations of independent bottlers, those in which the Company has no ownership interest and those in which the Company has a noncontrolling ownership interest, was contributed voluntarily by bottlers in the spirit of collaboration and mutual support described on page eight. The Company was not involved in or responsible for the generation, or site-specific verification of this data. Although this portion of the data set originates outside the ownership or control of The Coca-Cola Company, we consider the aggregated figures shown in the report to be indicative of the overall environmental performance of the Coca-Cola system. Our extrapolations were calculated by multiplying the water use ratio, energy use ratio, solid waste generation ratio and recycling ratio of reporting plants by the corresponding total production volumes for each category of production (concentrate and beverage base, bottle/can, juice, fountain syrup) and summing them. As most of these allegations occurred in 2003, they are not addressed in this 2002 Environmental Report. Please visit our India Division website, www.myenjoyzone.com/press1/index.htm, for more information. The Coca-Cola Company recognizes that there are other environmental impacts associated with the business system. However, this report focuses on water, energy and waste. Many companies issuing environmental reports express water use ratios as cubic meters per ton of product, which is equivalent to the liter/liter ratio we use here. Total production volumes by reporting plants vary between the Water, Energy and Solid Waste sections. This is because not all plants reported all environmental indicators. See endnote 10.
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The water use ratio picture has been simplified to give readers an easy understanding of our main water flows: readers should not rely on it to have detailed information about our performance, but rather should look at the main text for precise data. In particular, note the following: 1. The picture represents several examples of packaging, therefore it does not represent the amount of product made with 1 liter of water. 2. The quantity of water that goes into 1 liter of Coca-Cola is not 1 liter, but slightly less; the rest is due to other ingredients dissolved in the product (such as concentrate, sweetener, etc.). 3. Not all plants wastewater goes through a wastewater treatment plant, (for details, see page 15). Some plants producing exclusively packaged water exhibit ratios less than 1.3 liters per liter. However, they have been excluded from this comparison. See endnote 14. Environment reports by other companies use various measurement units. Gigajoules per ton of production is common and is equivalent to our MJ/l ratio. When applied to electricity production only, the numerator is often expressed in kWh. 1 kWh is equivalent to 3.6 megajoules See endnote 10. This estimate is computed using estimation factors published by the Intergovernmental Panel on Climate Change and other recognized sources. Some companies only report direct CO 2 emissions (i.e., on-site burning of fossil fuels). Our figure also includes indirect emissions of CO 2 from the power plants from which we purchase electricity. See endnote 14. Reported figures were based on standardized average conversion factors between volume and mass, in order to allow comparability between different measurement practices (e.g., 150 kg for 1m3 of loose waste and 450 kg for 1m3 of compacted solid waste). Many environmental reports express the waste generation ratio in kg per ton of production, which is equivalent to the ratio we use here. Some only measure waste that is sent for disposal and do not include waste that is reused or recycled. This is equivalent to our figure of 3 grams/liter. See endnote 10. Our bottlers currently use recycled-content PET bottles in the following markets: Australia, Belgium, Chile, Fiji, Luxembourg, The Netherlands, New Zealand, Papua New Guinea, Sweden, Switzerland, United States. The PET bottle cooperative system is unique within our North America business. The coops, as we call them, are owned by our bottlers and supply around 90% of our PET bottles within North America. This enables close collaboration on packaging design, development and commercialization.
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Ratios in this section have been calculated by measuring separately water and energy use and solid waste generation in all reporting plants of a specific type and comparing them with the production volumes of plants of that type. The ratios related to overall volumes by reporting plants, explained in chapter four, are not a simple arithmetic average of these four values. The overall ratios are weighted according to the relative production volumes of the four categories of products. See endnote 12. We measure concentrate and beverage base production by using an internal measure known as a Standard Unit of Concentrate. The denominator in the ratios for concentrate and beverage base production is calculated on the basis of the average amount of finished product (e.g., carbonated soft drink) that can be made using a Standard Unit of Concentrate (the exact amount may vary from one product to another). The numerator indicates the amount of water used in concentrate manufacturing only; the amount of water used to transform concentrate into a final packaged product is accounted for in the line item bottle/can. The Fountain Syrup figure includes the performance of the dedicated fountain syrup manufacturing (and juice concentrate for food service) plants in the United States. Fountain syrup in other markets, produced by the bottlers, represents only 6 % of the volume and is consolidated into the bottle/can results. See endnote 30. See endnote 31. See endnote 30. See endnote 31.
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There is no single source of post-consumer packaging recycling statistics in the world and existing national or regional statistics differ widely in the way data are collected and computed. Data in our chart should therefore not be compared with each other without checking what those numbers represent and how they were calculated. We urge readers to refer to the original sources of our data for more information. Data from EU countries are taken from ASSURRE, Analysis of Trends of Packaging and Packaging Waste 1998-2000, June 2003 (available on www.assurre.be); they are based on official 2000 data provided by EU member states to the EU Commission and cover all packaging (including industrial packaging). Brazil data are from CEMPRE (www.cempre.org) and are related to 1999; metal data refer to steel/aluminum; the number for plastic is related to PET only. Japan data concern beverage containers only and are from 2001; figures for metals are steel/aluminum; the plastic figure only concerns PET; sources are the following: Japan Steel Can Recycling Association (www.rits.or.jp/steel can/), Glass Bottle Recycling Promoter Association (www.glass-recycleas.gr.jp), Japan Aluminum Can Recycling Association (www.alumcan.or.jp), The Council for PET Bottle Recycling (www.petbottle-rec.gr.jp). Mexico data are from APREPET (www.aprepet.org.mx) and INARE; plastic figure only concerns PET. South Africa data are from Collect-A-Can (www.collectacan.co.za) and www.glassrecycling.co.za; the PET figure is an estimate by The Coca-Cola Company; the metal figure only concerns beverage cans. United States data are a collection of 2001 statistics from various sources, collected by NSDA (www.nsda.com); they refer to soft drink containers only; the plastic figure only refers to PET.
The Coca-Cola Company has asked URS Verification Limited (URSVL) to undertake limited third party verification of this 2002 Environment Report. For information on the scope of URSVLs verification activities and their opinion on this report, please contact us through the Environmental Report feedback button, which may be accessed in the web version of this report at www.environmentalreport.coca-cola.com.
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