Coca-Cola Shareholders Spurred by Conscience or Profit?
April 26th, 2010. By janem
Coca-Cola shareholders know if their coke glass is half-full or half-empty. By that comment I mean they are aware of public concern regarding the safety of Bisphenol-A (BPA), a chemical used in the epoxy lining of Coca-Cola’s canned beverages. Yet at the same time, if something isn’t done about it, sales could potentially drop and so would their dividends. So the shareholders voted last week on a measure that will force the company to go public on plans to rid their beverage cans of BPA.
The Coca-Cola company already eliminated BPA from their plastic bottles, but the plastic used to line aluminum cans still contains BPA. Did the company think this measure would satisfy their shareholders and the public, and they would get away with just a bit of BPA? Apparently not. Shareholders say the company has “failed to provide investors or consumers with sufficient evidence that it is taking steps to address these public health concerns”—and 22% of them voted for a resolution asking the company to publish a report on how it is responding to the “public policy challenges” related to BPA and what they’re doing to come up with alternatives for their beverage cans.
Meanwhile, as reported by Business Wire, Coca-Cola’s Board of Directors today approved the quarterly dividend of 44 cents per common share, up from 41 cents. Coca-cola returned $5.3 billion to shareowners in 2009, through $3.8 billion in dividends and $1.5 billion in share repurchases.
BPA is an endocrine disruptor that interrupts hormones and has been linked with breast cancer, prostate cancer, hyperactivity and other metabolic and behavioral problems in lab animals. Even with a number of scientific studies that have detected low-dose effects on animals, plastics and chemicals industries insist its use is safe and accuse critics of misleading the public by referring to industry-funded studies involving animals that have shown no harmful side effects.
It’s no secret that Coca-Cola uses BPA. “We use BPA in the linings of our cans,” said a spokeswoman for Coca-Cola UK. “Our top priority is to ensure the safety and quality of our products and packaging through rigorous standards that meet or exceed government requirements… All available scientific evidence and testing shows that drinks in [beverage cans] are safe.”
Of course Coca-Cola can’t be singled out. BPA is the standard lining material for almost every metal food or beverage can worldwide. But given their humungous profits, you’d think the biggest soft drink company in the world could spend more R&D money on a safer product.
And maybe the public would be more supportive if they come clean with shareholders and tone down their ‘do-good’ message that says the following:
“With an enduring commitment to building sustainable communities, our Company is focused on initiatives that protect the environment, conserve resources and enhance the economic development of the communities where we operate.” Oh yeah, and remember that jingle about summers and picnics and the new generation? Seems their ad campaigns are totally disconnected with reality.
The company proudly boasts that its “consumers in more than 200 countries enjoy the Company’s beverages at a rate of 1.6 billion servings a day.” That’s a whole lot of BPA.
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Janem, You might want to check a few things on this.
First, what plastic bottles did Coke ever use that contain BPA? Are you referring to their PET bottles? Nope. HDPE? Nope. PP? Nope.
2nd. If you look at who sponsored the resolution (Pax, Domini etc) you would see that they are activist shareholder groups who get their street cred in the social responsible mutual fund circles by acting tough. They have never won on these resolutions and never will and they know this. But they have to act tough to differentiate themselves for their money-wary liberal customers. Its not like they know enough on the background either way.
3rd. The science isn’t so cut & dry. It isn’t just industry that says BPA is safe. It’s every food safety and regulatory authority in the world! Europe, Australia, Japan, US, Germany, UK, Canada, NewZealand, France. Even Canada and the FDA scientists say its safe despite what their political appointees say. Don’t believe this? go check the actual FDA risk assessment @ http://www.regulations.gov/search/Regs/home.html#docketDetail?R=FDA-2010-N-0100
In document 1 you will see that the lowest no-observable effect level is 5 mg/kg/day and in document 4 you will see that the highest consumption rate is 1.1 MICROgram/kg/day. so almost 5000 times lower consumption than risk.
The fact of the matter is that some politicians are either running scared or eager show ‘enviro’/health&safety cred. and step over the science. Either way BPA is safe and legally speaking any attempt to restrict its use doesn’t have a scientific leg to stand on.
Hi Greg J, Thanks for your comments. It speaks to the difficulties even the FDA has had in assessing the risk–or lack thereof–of BPA. Agreed the science is not so cut and dry. However, the very fact that the FDA back peddled earlier this year and now states…
“… that recent studies provide reason for some concern about the potential effects of BPA on the brain, behavior, and prostate gland of fetuses, infants and children. FDA also recognizes substantial uncertainties with respect to the overall interpretation of these studies and their potential implications for human health effects of BPA exposure. These uncertainties relate to issues such as the routes of exposure employed, the lack of consistency among some of the measured endpoints or results between studies, the relevance of some animal models to human health, differences in the metabolism (and detoxification) of and responses to BPA both at different ages and in different species, and limited or absent dose response information for some studies.
FDA is pursuing additional studies to address the uncertainties in the findings, seeking public input and input from other expert agencies, and supporting a shift to a more robust regulatory framework for oversight of BPA to be able to respond quickly, if necessary, to protect the public.
In addition, FDA is supporting reasonable steps to reduce human exposure to BPA, including actions by industry and recommendations to consumers on food preparation. At this time, FDA is not recommending that families change the use of infant formula or foods, as the benefit of a stable source of good nutrition outweighs the potential risk of BPA exposure.”
tends to give us here at LawyersAndSettlements.com pause.
As for your comment re: the activist groups’ sponsorship, I look at this in a non-partisan manner–when it comes to public safety, I don’t care whose agenda or interests are at stake (and no, I’m not naive about such); if at the end of the day it spurs on additional–conclusive–research in the name of the greater good and the safety of our infants, children and selves, so be it. I’m sure we’ll all be staying tuned to this topic…
There is so much hidden from consumer have you ever read on any pepsi or coke product that it is addictive the harm and health issue that results from drinking their dark sodas , they call diet ,when you try to stop drinking it you go into witdraw has anyone every bother to fully research what really is in their products fda where are they??