Coke Pledges to Step Up Water Conservation

BEIJING — Coca-Cola pledged on Tuesday to reduce the amount of water it uses to produce its wide range of beverages and to improve water recycling in bottling plants around the world.

"We are focusing on water because this is where the Coca-Cola Company can have a real and positive impact," said E. Neville Isdell, chief executive officer of the Atlanta-based beverage giant.

The initiative comes as the company — the world's top producer of non-alcoholic beverages — is facing increasing pressure over its use of water worldwide, particularly in drought-stricken countries.

In 2006, the company and its franchised bottlers used about 76 billion gallons of water to produce its beverages, with more than half of the water used for processes like cleaning, rinsing and cooling.

Speaking at a press conference hosted by the World Wildlife Fund in Beijing, Isdell said the company would set specific targets for water use from next year with the goal of becoming "the most efficient user of water amongst our peer companies." Coca-Cola announced a $20 million commitment to the WWF "to help conserve seven of the world's most important freshwater river basins, support more efficient water management in its operations and global supply chain, and reduce the company's carbon footprint."

By partnering with World Wildlife Fund, Coca-Cola will be able to improve its corporate image and reduce its environmental impact, said Qu Yongxiang, an analyst at China Pingan Securities who has followed the beverage industry.

"There's no big cost to them, since they can save money by reducing water use and they can improve their image," he said.

In India, groups and villagers have accused Coca-Cola of using too much water in drought-prone areas.

In 2003, a court in Kerala, a state in southern India, ordered the company to stop drawing groundwater for a bottling plant that supplied most of southern India.

The ruling followed protests by hundreds of local families that claimed the factory was causing desertification by drawing too much water from underground aquifers.

In his ruling, Indian Justice K. Balakrishnan Nair said that the bottling plant's use of 110,000 gallons of water each day was "breaking the natural water cycle," the Guardian newspaper reported.

Coca-Cola has argued that it should not be held responsible for falling water levels around the Kerala bottling plant.

"Every one of the responsible agencies of the Indian government and state government including the state supreme court has clearly indicated that the accusations made about our extraction of water in Kerala are inaccurate ... and the depletion of the water table has been entirely due to drought," Isdell said on Tuesday.

Coca-Cola suspended operations at the plant in 2004 and is continuing to evaluate whether or not the factory will be reopened, Isdell said.

Regardless of whether or not Coca-Cola contributed to water scarcity in Kerala, activists have used the incident to focus attention on the company's use of water.

Corporate Accountability International, a Boston-based activist group has publicly blamed water use by Coca-Cola bottling factories for severe water shortages in several Indian communities. The organization is best known for organizing a boycott of Nestle in the 1970s over sales of infant milk powder in countries without reliable access to clean drinking water.

"At least five Indian communities near Coca-Cola's bottling factories are facing severe water shortages and widespread health problems, thanks to the beverage giant's siphoning of massive amounts of local groundwater," the group stated on a "fact sheet" posted on its Web site.

Responding to the accusation, a Coke spokesman said that the belief that Coke contributed to the water shortages in India "is an issue of perception and not reality" and added that Coke is working with the communities to address the issue.

WWF officials stressed the environmental benefits Coca-Cola's decision could have.

Because Coca-Cola is the world's top buyer of sugar, for example, exerting pressure on suppliers to improve water conservation in agriculture "is crucially important," said James Leape, WWF director general. Agriculture accounts for 70 percent of global freshwater use, the environmental group said.

"Just sticking its head above the parapet and speaking to this issue ... has great promise," Leape said.

The partnership with WWF will focus on "measurably conserving" China's Yangtze, Southeast Asia's Mekong, the Rio Grande/Rio Bravo on the U.S.-Mexico border, the rivers and streams of the Southeastern U.S., the water basins of the Mesoamerican Caribbean Reef, the East Africa basin of Lake Malawi, and Europe's Danube River.

Coca-Cola sells more than 1.4 billion servings of its beverages daily in more than 200 countries. Over the past five years, the company improved water efficiency by 19 percent while sales volume increased by 15 percent, the company said.

In 2002, the company used 3.14 liters of water to produce one liter of beverage, while the company currently needs 2.54 liters, Isdell said.

To boost efficiency further, Coca-Cola will work with the WWF to set "water efficiency targets" by the end of next year and to improve wastewater recycling. Coke will also fund local conservation initiatives such as rainwater collection, education programs and tree planting to slow desertification.

"At a time when much of the world is facing water scarcity and far too many people suffer from a lack of access to safe water, we at the Coca-Cola Company have placed highest priority on being responsible water users," Isdell said.