SIPA Defends Decision to Honor Coca-Cola Executive

By: Jacob Gross

On May 9, SIPA will host its Global Leadership Awards 19th Annual Gala at New York’s Mandarin Oriental Hotel. According to event literature, the awards honor “individuals who have made innovative or extraordinary contributions to the global public good.” Past honorees have included former United Nations Secretary General Ban Ki-moon, former Secretary of State Madeleine K. Albright, as well as organizations such as Human Rights Watch.

Among this year’s honorees is Muhtar Kent, Chairman and former CEO of the Coca-Cola Corporation.

In response to an inquiry, the SIPA administration defended honoring the executive of a global food brand that has faced numerous criticisms over its practices, including those with respect to the environment, labor, and public health.

On the environmental front, Coca-Cola produces 3 million tons of plastic packaging each year. The company has vigorously opposed deposit system policies that require bottlers at their own expense to reclaim the packaging. The company instead promotes recycling schemes, even though reusing bottles is much more environmentally friendly, and only 30% of plastic containers are recycled.

Then, there is the water use. Coca-Cola bottles 80 billion gallons of water each year. Although the company invests in water returning projects that, according to its commissioned study, produce slightly more than that amount in potable water,  the total water it uses in manufacturing amounts to 8 trillion gallons.

Another issue is Coca-Cola’s contributions to poor public health. Besides the negative health outcomes associated with drinking its sugar-sweetened beverages, Coca-Cola promotes dubious public health campaigns arguing obesity should be combatted exclusively through exercise without any change in caloric intake.

Coca-Cola also faces controversies over its labor practices, particularly in Latin America, where trade unionists attempting to organize bottling plant workers are regularly murdered by paramilitaries. Coca-Cola has defended its treatment of labor and notes that evidence for the most egregious accusations is generally inconclusive.

Kent personally faced a scandal in 1996, when the Australian Securities Commission ruled he engaged in insider trading in regional bottler Coca-Cola Amatil Ltd. While an executive at the bottler, he short sold 100,000 shares mere hours before the company announced lower than expected profits. Kent asserted he had no prior knowledge of the announcement and the trade was a coincidence. He reached a $354,000 settlement without admitting guilt. Kent later resigned from the bottler and had no position in Coca-Cola until 2005.

SIPA’s administration emphasized Kent’s positive work in its reasoning for honoring him.

“Under Mr. Kent’s leadership, Coca Cola established various initiatives aimed at promoting women’s advancement and entrepreneurship, both at Coca Cola and within the larger global business community,” said Marcus Tonti from SIPA’s office of communications in an email, responding to a request for comment directed to gala organizer Emily Keneston. “He also has been a leader on issues involving pressing environmental challenges, such as global water scarcity, and initiatives that expanded Coca Cola’s commitment to water conservation and replenishment, and environmental sustainability more generally.”

Besides the gala honoring, Kent serves on the advisory board of Columbia Global Centers. Both Coca-Cola and the Coca-Cola Foundation have made donations to SIPA of a few hundred dollars.

Kent will not be the first corporate executive to be a gala honoree. He will join a group that includes CNN founder Ted Turner and Unilever CEO Paul Polman.

The 2019 gala will also honor Nobel Peace Laureate Leymah R. Gbowee, and former World Bank president Jim Yong Kim.