Coca-Cola's newest CSR initiative: Cleaning up the Yangtze
Sometimes I wonder if CSR can be entirely altruistic. Strategic CSR is one of the ways companies ensure their business interests are met through various socio-enviro improvements along their production line. Coca-Cola's partnership with WWF in China is a good case study.
The Yangtze is Asia's longest river and it is also one of the most polluted rivers in the world. Three Gorges Dam, the world's biggest hydel power station is being constructed on the river and has received an almost steady stream of criticism. The extinction of the Baiji or the Yangtze river dolphin is also another tragedy in conjunction with this mighty river. China's massive economic development has certainly taken a toll on this river and its biodiversity which is the lifeblood for millions of Chinese.
Coca-Cola operates 39 bottling plants along the river and in its newest strategic CSR initiative, has tied up with WWF to improve water quality. The partnership will engage in watershed management projects in two upper Yangtze tributaries. One of the projects involves working with farmers to encourage them to convert pig waste into bio-gas instead of dumping it in the river. It has alsoÂ launched an education program to engage with communities along the river basin about environmental issues.
WWF will also work with Coca-Cola's bottling plants in the Yangtze basin to develop best management practices for water use and water stewardship.Â The Yangtze still provide 35% of fresh-water to people in spite of its heavily polluted status.Â This ties in with the company's CSR initiatives to move their plants towards 'water neutrality'.Â As one of the largest beverage companies with operations in over 200 countries, Coke uses more than 290 billion litres of water a year. This is one of the key areas of CSR that is strategically important to the company. The company controls half the cola market share in China and sales increased 20% last year whilst falling 1% in the States. To ensure that its operations are sustained, water security must be address especially because its product line is composed almost entirely of water.
Coca-Cola is being especially prudent with water management as it does not want a scandal like the one in 2004 where itÂ was forced to shut down one of its largest bottling plants in the Indian state of Kerala after it was accused of causing water shortages.Â The cola giant is also extending its CSR activities toÂ help clean six other rivers on the 10-worst list with WWF. It is also investing $4.5 million to improve the water recycling equipment in all its plants.
Through the Better Sugar Cane Initiative, the company in partnership with WWF is finding an entry point to work with the Chinese sugar market. The company uses 4% of the world's sugar and it is working with sugar farmers toÂ improve production methods and reduce water use. By ensuring the reduction of water along its supply chains, the company is ensuring its strategic CSR interests.
Within China, the company also promises to improve packaging efficiency. They propose to reduce the weight of cola bottles which could reduce carbon emissions of over 16,000 tons if a billion bottles are sold annually. Where all those light-weight plastic bottles will finally go is anyone's guess.