Emerging Roles for Global Corporations
During USF event, Coca-Cola’s sustainability chief talks about his company’s presence in water-stressed nations.
TAMPA, Fla. (May 7, 2012) – Coca-Cola is one of the world’s most iconic American brands and built on a formula that is one of the world’s greatest guarded secrets save for one essential ingredient: clean water.
So in a world where an estimated 1 billion people do not have access to clean drinking water, Coca-Cola’s ambitious business growth model must accommodate for not only providing water to produce its product but building new markets in which to sell it. That’s where Joe Rozza, Coca-Cola’s Global Water Resource Sustainability Manager, comes in.
“We know our business is only as sustainable as the communities we operate in,” Rozza said Monday, opening a University of South Florida conference on water, energy and mining issues in Afghanistan.
The three-day conference Water: the Key to Regional Stability thru Sustainable Partnerships is exploring efforts to bring security to Afghanistan and the larger region through water, health and economic development partnerships. The free event runs through May 9 at USF’s Joint Military Leadership Center.
Rozza, the lead keynote speaker at the event, said as an iconic American brand Coca-Cola is pursuing what will become the norm in the next decade or so: a social contract between government, business and civil society to create stable, sustainable, productive communities.
In 2006, Coca-Cola reopened its bottling plant in Kabul – a $25 million investment that signaled a new era in multinational corporations’ willingness to engage in the Afghan economy. While not speaking directly to Coca-Cola’s presence in the Afghan market, Rozza told the gathering of about 100 people that the soft drink giant is taking a broader view of market development that doesn’t look like what most people would expect.
It’s not purely about philanthropy – although good things like sustainable water systems and schools can come out of it. It’s a strategic business decision that’s essential in emerging markets in stressed areas of the world, Rozza said matter-of-factly.
Coca-Cola’s sustainable water efforts have provided clean water for more than 1.6 million people over the last five years. The company has invested more than $250 million in its global efforts.
The concern is in the long-range projections for what the world’s growing population and continued water crisis might mean in terms of commodity supplies, he said, citing figures that 27 percent of global agriculture production is now in areas with significant water stress. By 2025 it will be 49 percent.
“I need a sustainable community in order to sell my product,” Rozza said. “If they are unsustainable or in states of stress, they are not buying my product.”
Coca-Cola buys 5 percent of the world’s sugar and depends on a global agriculture supply chain where instability can cause a domino-effect of bad outcomes for the company. So the company pays close attention to stabilizing communities as a way of minimizing supply chain and market disruptions, he said.
For example, he said, women make 80 percent of the household purchasing decisions across the globe. In working to shore up agricultural production, Coca-Cola also might work on creating a female-led farming cooperative or building a clean water supply. Since girls, who do most of the water gathering for their families in developing nations, no longer have to spend their days traveling long distances to provide water, Coca-Cola has supported new girls schools to provide them an education to be better providers for their families.
”For us we see opportunity to connect these different cultures from a common sustainability issue and a common platform,” Rozza told the group. “You are part of something bigger. Down the road strategically, when you drink one of our beverages, that’s going to be part of the beverage experience.”
The goal for Coca-Cola is to produce more clean water than it consumes in its production facilities, as well as find a way to recycle or dispose of its factory wastewater in a productive manner. Admittedly, the approach is a new way of looking at business, but Rozza contends it’s a necessary one for multinational corporations seeking to grow in difficult parts of the world.
“The local community will say, ‘How does this business access this water and I can’t get a clean glass of water to drink?’” he said. “That hurts my business. When we get this right, people’s lives really do improve.”
To learn more about Coca-Cola global sustainability water programs, click here.
Vickie Chachere can be reached at 813-974-6251.