2018 Business & Sustainability Report - The Coca-Cola ...

 
2018 Business & Sustainability Report - The Coca-Cola ...
2018 Business & Sustainability Report
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board        Our              Priority            Portfolio        World Without   Water   Sustainable    People &           Partnerships        Climate           Regional     Data
          Letters          Company          Issues              Transformation   Waste                   Agriculture    Communities                            Change            Highlights   Appendix

                                                                                                                  Letter from James Quincey                3
                                                                                                                                                                   SUSTAINABLE AGRICULTURE           30
                                                                                                                  Letter from
                                                                                                                  Our Board of Directors                   5       Shared Opportunity: Agriculture
                                                                                                                                                                   Sustainable Growth for
                        Across the globe and around the clock,                                                    OUR COMPANY                                      India’s Smallholder Farmers
                                                                                                                                                                   and Our Portfolio                 32
                                                                                                                  At A Glance                             6
                        we never stop working to give people                                                      The Coca-Cola System                     7
                         the drinks they want and to improve                                                      Total Beverage Portfolio                8
                                                                                                                                                                   CARING FOR PEOPLE
                                the world we all share.                                                           Business Transformation
                                                                                                                  Timeline                                9
                                                                                                                                                                   AND COMMUNITIES                   33
                                                                                                                                                                   Human Rights                      34
                                                                                                                  Selected Financial Data                 10
                                                                                                                                                                   Women’s Economic
                          We turn our passion for consumers                                                       Progress Against Our
                                                                                                                  Sustainability Goals                    11
                                                                                                                                                                   Empowerment                       35

                        into the brands people love, and create                                                   Our System in Context                   12
                                                                                                                                                                   Workplace                         36
                                                                                                                                                                   Diversity & Inclusion             37
                          shared opportunity through growth.                                                                                                       Giving Back                       38
                                                                                                                  PRIORITY ISSUES
                                                                                                                  Our Approach to Managing
                                                                                                                  Our Priorities                          13       PARTNERSHIPS                      39

                               That’s the essence of                                                              Priority Issues:                                 Stakeholder Engagement            40
                                                                                                                  Risks & Opportunities                   15       Sustainable

                   our transformation.
                                                                                                                                                                   Development Goals                 41
                                                                                                                  PORTFOLIO TRANSFORMATION                17
                                                                                                                  Providing Choice to Consumers           18       A GLOBAL PERSPECTIVE
                                                                                                                                                                   ON CLIMATE CHANGE                 43
                                                                                                                  Reducing Calories—
                                                                                                                  Expanding Portfolio                     19
                                                                                                                                                                   REGIONAL HIGHLIGHTS               46
                                                                                                                  Shared Opportunity:
                                                                                                                  Sugar Reduction
                                                                                                                                                                   ABOUT THIS REPORT                 51
                                                                                                                  Refreshingly Less Sugar             20

                                                                                                                                                                   DATA APPENDIX                     52
                                                                                                                  WORLD WITHOUT WASTE                     21
                                                                                                                                                                   ASSURANCE STATEMENT               67
                                                                                                                  Shared Opportunity: Waste
                                                                                                                  PRAISE: Transforming Waste
                                                                                                                                                                   GLOBAL REPORTING
                                                                                                                  into Value in Indonesia                 25
                                                                                                                                                                   INITIATIVE INDEX                  71

                                                                                                                  WATER LEADERSHIP                    26

                                                                                                                  Shared Opportunity: Water
                                                                                                                  Replenishing Cape Town
                                                                                                                  in a Time of Drought                    29

The Coca‑Cola Company   2018 Business & Sustainability Report                                                                                                                                        2
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board         Our                 Priority         Portfolio        World Without   Water        Sustainable   People &       Partnerships      Climate       Regional       Data
          Letters           Company             Issues           Transformation   Waste                        Agriculture   Communities                      Change        Highlights     Appendix

         Letter from       Letter from Our
         James Quincey     Board of Directors

                                                                                                          On May 8, 1886, a store                          Lifting, shifting and scaling
                                                                                                                                                           brands around the world:
                                                                                                          in Atlanta served the first
                                                                                                          Coca-Cola.                                       •	We used the strength of our
                                                                                                                                                              distribution system to help launch
                                                                                                          Today, that now-famous drink forms                  brands like Fuze Tea, smartwater
                                                                                                          the foundation for a total beverage                 and AdeS across multiple markets
                                                                                                          company that offers more than 500                   with increased speed and agility.
                                                                                                          brands and 4,300 products worldwide.             •	Worldwide, we expanded 165
                                                                                                                                                              products into additional markets
                                                                                                          While many brands have come and                     in 2018.
                                                                                                          gone during the past 133 years,
                                                                                                          our success is based in part on our
                                                                                                          history of investing in the success              Making strategic investments
                                                                                                          and sustainability of the communities            for the future:
                                                                                                          we call home, from our hometown of
                                                                                                          Atlanta to more than 200 countries               •	We strengthened and expanded
                                                                                                          and territories where you can find our              our portfolio through mergers
                                                                                                          products today.                                     and acquisitions, including
                                                                                                                                                              Costa Limited, which closed in
                                                                                                          In 2018, we continued to transform our              early 2019 and gives us a global
                                                                                                          portfolio and, in turn, our company.                coffee platform.
                                                                                                          We delivered strong, geographically              •	We invested in a strategic
                                                                                                          balanced revenue growth and value                   partnership with the premium
                                                                                                          share gains in line with our strategy.              sports hydration brand
                                                                                                          There are many highlights, including:               BODYARMOR, one of the fastest-
                                                                                                                                                              growing beverage trademarks in
                                                                                                                                                              the U.S.
                                                                                                          More innovation, including options
                                                                                                          with less sugar:
                                                                                                                                                           Investing in the Coca-Cola system
                                                                                                          •	Globally, sparkling soft drink                advantage:
                                                                                                             volume was up 2% in 2018, fueled
                                                                                                             by double-digit volume growth of              •	We are aligned with our bottling
                                                                                                             Coca-Cola Zero Sugar, along with                 partners to capture growth
                                                                                                             strong performance from new, low-                opportunities. Since 2010, we’ve
                                                                                                             and no-calorie versions of sparkling             invested—with our system—more
                                                                                                             beverages such as Sprite and Fanta.              than $125 billion to strengthen

                                    Letter from                                                           •	Our innovations included Coca‑Cola               our platform for growth, including
                                                                                                             Plus Coffee, now available in                    technology, such as connected

                                    James Quincey
                                                                                                             multiple markets around the world,               coolers; and in new plants and
                                                                                                             and a restage for Diet Coke in                   route-to-market innovation.
                                                                                                             North America that included new               •	For example, our bottling partner
                                                                                                             packaging, marketing and flavors.                Arca Continental, the first Latin
                                                                                                          •	We launched about 600 new                        American bottler to operate in the
                                    Chief Executive Officer                                                  products. Of those, more than 250                U.S., announced a $250 million
                                                                                                             were low- or no-sugar, and more                  investment in a new facility in Texas
                                                                                                             than 400 were juices, teas, waters               to help us get more drinks to the
                                                                                                             and other non-sparkling beverages.               market faster.

The Coca‑Cola Company    2018 Business & Sustainability Report                                                                                                                                     3
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board         Our                 Priority          Portfolio        World Without   Water        Sustainable    People &         Partnerships      Climate       Regional       Data
          Letters           Company             Issues            Transformation   Waste                        Agriculture    Communities                        Change        Highlights     Appendix

         Letter from       Letter from Our
         James Quincey     Board of Directors

                                                           Building leadership for success                 •	establishing or joining 10 global                and metrics. This is an idea born from
                                                           and a growth culture:                              recycling/packaging partnerships;                stakeholder engagement and our belief
                                                                                                           •	announcing four packaging                        that, working together, we can create a
                                                           •	We announced several key                        technology advancements including                positive impact and respond effectively
I n 2018, we continued                                       leadership appointments, including              the opening of our PlantBottle TM IP             to the collective challenge of the
 to transform our portfolio                                   Brian Smith as president and chief              for use across the industry; and                 UN Sustainable Development Goals.
                                                                                                           •	launching bottles made from
 and, in turn, our company.                                   operating officer, John Murphy as
                                                                                                              100% recycled materials in                       We are pleased with our progress
                                                              chief financial officer, and new group
 We delivered strong,                                         and business unit presidents.                   multiple markets.                                against some of our goals, while
 geographically balanced                                   •	Our new Global Ventures group,                                                                   recognizing that more needs to be
                                                              led by Jennifer Mann, was created            We replenished 155% of the water                    done in other areas. We will continue to
 revenue growth and value                                     to ensure we connect and globally            we use in our finished beverages                    take action and grow our business the
 share gains in line with                                     scale key acquisitions, investments          to communities and nature in 2018,                  right way—not the easy way.
 our strategy.”                                               and brands such as Costa, innocent,          continuing to exceed our 2020 goal. We
                                                                                                           also economically empowered more                    Sincerely,
                                                              Dogadan and Monster.
                                                           •	These changes will help us continue          than 865,000 women in 2018, adding
                                                              to build a culture that fuels our            an additional 17 countries.
                                                              transformation and supports
                                                              growth worldwide.                            We don’t just recognize our
                                                                                                           responsibility to be a part of the
                                                                                                           solution to challenges we all
                                                           Creating Shared Opportunity                     face—we embrace it.
                                                           through Growth
                                                                                                           For us, that means using our size,
                                                                                                           scale and success to create shared                  James Quincey
                                                           While we’re proud of our business
                                                                                                           opportunity through growth—creating                 Chief Executive Officer
                                                           results in 2018, companies like ours
                                                                                                           real opportunity for our communities,               April 24, 2019
                                                           have a responsibility as leaders. As
                                                           we grow, we will continue to support            our customers, our employees and
                                                           local economies and help create                 our shareowners.
                                                           economic opportunity.

                                                           Our commitment to doing business the            Leveraging Data to Help Us Grow
                                                           right way continued in 2018, as we set          Our Business the Right Way
                                                           out to show the world that the drinks
                                                           they love can make life more enjoyable,         Finally, I am a firm believer in the
                                                           without harming our planet and the              importance of data. In a digital and
                                                           natural resources we all depend on.             data-driven world, good information
                                                                                                           helps us make better decisions.
                                                           In early 2018, we announced our World           When we share our data, we can help
                                                           Without Waste initiative with a clear,          drive collective accountability for us
                                                           simple goal: to help collect and recycle        and others.
                                                           a bottle or can for each one we sell by
                                                           2030. The company’s progress during             In this year’s report—our first combined
                                                           the first year included:                        business and sustainability report—
                                                                                                           we created a detailed Data Appendix
                                                                                                           to share more details on our progress

The Coca‑Cola Company    2018 Business & Sustainability Report                                                                                                                                       4
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board         Our                 Priority         Portfolio        World Without    Water            Sustainable   People &               Partnerships        Climate          Regional                    Data
           Letters           Company             Issues           Transformation   Waste                             Agriculture   Communities                                Change           Highlights                  Appendix

          Letter from       Letter from Our
          James Quincey     Board of Directors

Letter from Our Board of Directors
Our company’s heritage of innovation, growth and                  In 2010, we launched our 5by20 program with
value creation includes 133 years of creating beverage            the goal of helping to empower 5 million women
brands loved and shared by people around the world.               entrepreneurs by the end of the year 2020.
                                                                  The program is considered one of the most ambitious
Today, The Coca‑Cola Company is continuing to                     women’s economic empowerment initiatives ever
build on this heritage by opening new horizons for                undertaken by a commercial enterprise. By the end
growth as a total beverage company. Our portfolio                 of 2018, we had empowered more than 3.2 million
is evolving and expanding to meet the changing                    women across 92 countries. From the Philippines to
tastes of people around the globe. Our board of                   South Africa to Poland and beyond, we have provided
directors strongly believes in the bright future of               training, mentorship and other support.
our brands, our business and the positive impact
we have, and should have, on local communities.
                                                                  Looking beyond 2020
New Horizons for Growth                                           Sustainability will of course remain a central focus for
                                                                  our company and our board well beyond 2020. Our
Since becoming CEO in May 2017, James Quincey                     longstanding belief is that our business can only be as          Herbert A. Allen        4, 5, 6
has led the company in exciting new directions and                strong and successful as the communities we serve.
assembled a strong leadership team with extensive                                                                                  President, Chief Executive Officer and
                                                                                                                                   Director, Allen & Company Incorporated
system experience, robust industry and consumer                   There is an inextricable connection between building
knowledge, and an enhanced focus on innovation                    a thriving business and strengthening communities.               Ronald W. Allen         1
                                                                                                                                                                                    Muhtar Kent         4

and growth. He has also continued our legacy of                   That is one reason we decided to publish a combined              Former Chairman of the Board,                    Chairman of the Board,
sustainability with the introduction of the global                business and sustainability report this year. After all,         President and Chief Executive Officer,           The Coca‑Cola Company
World Without Waste initiative.                                   business and sustainability are not separate stories             Aaron’s Inc.
                                                                  for The Coca‑Cola Company—but different facets of                                                                 Robert A. Kotick            5, 6

James has demonstrated that he is the right leader                the same story.                                                  Marc Bolland       1
                                                                                                                                                                                    Chief Executive Officer and Director,
to serve as our next board chairman. Our world and                                                                                 Head of European Portfolio Operations,           Activision Blizzard, Inc.
our industry are changing rapidly and, as chairman                As we look to our future leadership, we remain a                 The Blackstone Group L.P.
and CEO, James will help The Coca‑Cola Company                    brand business. As a board and a business, we                                                                     Maria Elena Lagomasino                2, 3, 6

                                                                                                                                   Ana Botín   2, 5
                                                                                                                                                                                    Chief Executive Officer and
continue to innovate for long-term growth and                     continue to believe that, just as a brand is a promise,
                                                                                                                                   Executive Chair,                                 Managing Partner, WE Family Offices
value creation.                                                   a great brand is a promise kept. And we think these              Banco Santander, S.A.
                                                                  words speak to the heart of The Coca‑Cola Company                                                                 Sam Nunn     2, 7

                                                                  and what we’re all about.                                        Richard M. Daley            2, 7
                                                                                                                                                                                    Co-Chairman and Former Chief Executive
Accountability for Sustainability                                                                                                  Executive Chairman,                              Officer, Nuclear Threat Initiative
                                                                  Our entire board of directors thanks you for your                Tur Partners LLC; Of Counsel,
The board’s Public Issues and Diversity Review                    interest in The Coca‑Cola Company and for joining                Katten Muchin Rosenman LLP                       James Quincey
Committee keeps us abreast of the ways broad                      us in our ongoing journey of innovation, growth                                                                   Chief Executive Officer,
societal and environmental trends may impact the                  and value creation. Together, let’s raise an ice-cold            Christopher C. Davis                3, 5
                                                                                                                                                                                    The Coca‑Cola Company
interests of shareowners and other stakeholders.                  Coke to the bright future ahead!                                 Chairman, Davis Selected Advisers—
Throughout the year, the committee receives detailed                                                                               NY, Inc.                                         Caroline J. Tsay        1

briefings and updates about progress against our                                                                                   Barry Diller   2, 4, 5, 6                        Chief Executive Officer,
sustainability goals. This is critical to fulfilling its          Very best regards,                                                                                                Compute Software Inc.
                                                                                                                                   Chairman of the Board and
responsibility to provide oversight of the company’s                                                                               Senior Executive, IAC/InterActiveCorp            David B. Weinberg              1, 6
sustainability commitments, actions and results.                                                                                   and Expedia Group, Inc.                          Chairman and Chief Executive Officer,
                                                                                                                                                                                    Judd Enterprises, Inc.
As we look back on the past decade, we’re proud                                                                                    Helene D. Gayle         3, 7

of the Coca-Cola system’s sustainability progress.                                                                                 Chief Executive Officer,                         1
We particularly want to note our progress on water                                                                                 The Chicago Community Trust                        	 Audit Committee
                                                                  Muhtar Kent                                                                                                       2
replenishment and women’s empowerment.                                                                                                                                                 	Committee on Directors
                                                                  Chairman of the Board of Directors                               Alexis M. Herman             3, 7                     and Corporate Governance
                                                                                                                                                                                    3
In 2015, we reached our 2020 target of returning to                                                                                Chair and Chief Executive Officer,                  	 Compensation Committee
                                                                                                                                                                                    4
communities and nature an equivalent amount of the                                                                                 New Ventures LLC                                    	 Executive Committee
                                                                                                                                                                                    5
water used in our finished beverages, and we have                                                                                                                                      	 Finance Committee
                                                                                                                                                                                    6
exceeded our goal every year since. In fact, we have                                                                                                                                   	Management Development Committee
                                                                                                                                                                                    7
replenished more than 1 trillion liters of water to               Alexis Herman                                                                                                        	Public Issues and Diversity
                                                                  Director and Chair of the Public Issues                                                                                Review Committee
communities and nature over the past decade.
                                                                  and Diversity Review Committee

The Coca-Cola Company     2018 Business & Sustainability Report                                                                                                                                                                     5
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board            Our              Priority            Portfolio          World Without         Water             Sustainable          People &             Partnerships      Climate          Regional               Data
            Letters              Company          Issues              Transformation     Waste                                   Agriculture          Communities                            Change           Highlights             Appendix

           At A          The Coca-Cola   Total Beverage      Business Transformation      Selected Financial       Progress Against Our     Our System
           Glance        System          Portfolio           Timeline                     Data                     Sustainability Goals     in Context

At A Glance                                                                                                                   $31.9B                     $202.1B                                 500+                4,300+
                                                                                                                                Net Operating                   Market                            Brands                   Products
                                                                                                                                  Revenues                   Capitalization
As a total beverage company, we have been creating shared opportunity                                                          (2018, as Reported)           (As of 12/31/2018)

through growth since 1886.

                                                                                                                          2018 GLOBAL UNIT CASE VOLUME BY REGION

                                                                                                                                    20%                             27%                          30%                  23%
                                                                                                                                      North                           Latin                 Europe, Middle                  Asia
                                                                                                                                     America                         America                 East & Africa                 Pacific

  133 YEARS OF REFRESHING                 GLOBAL HEADQUARTERS                 PRODUCTS SOLD IN 200+
         CONSUMERS                          ATLANTA, GEORGIA                 COUNTRIES & TERRITORIES

THE COCA-COLA SYSTEM                                                                                                      2018 GLOBAL UNIT CASE VOLUME BY CATEGORY CLUSTER*

                              ~225                                                     ~900
                            Bottling Partners                                             Bottling
                               Worldwide                                                   Plants

                                                                                                                                    JUICE, DAIRY AND PLANT-BASED                                  8%

                            >700K                                                      ~28M
                                                                                                                                    SPARKLING SOFT DRINKS                                        70%
                                                                                                                                    TEA AND COFFEE                                                4%
                     Employed by the Company                                           Retail Customer                              WATER AND SPORTS DRINKS                                      18%
                       and Bottling Partners                                               Outlets
                                                                                                                               *	Excluding energy drinks cluster

                                                                                                                                                                                                               Regional: Global Unit Case Volume b
OUR SUSTAINABLE BUSINESS PRIORITIES                                                                                       VOLUME GROWTH
                                                                                                                          Total Company Unit Cases (in Billions)

                                                                                                                                                                                                              29.3                     29.6
                                                                                                                                                                                                       29.2            29.2
                                                                                                                                                                                  28.2    28.6
                                                                                                                                                                    27.7
                                                                                                                                                     26.7
                                                                                                                                          25.5
                                                                                                                             24.4
      SUGAR                      WORLD WITHOUT                     WATER                       COMMUNITY
    REDUCTION                       WASTE                       STEWARDSHIP
                                                                                            We create value for
  We are expanding               We believe a World           We replenish water            everyone connected
reduced-, low- and no-            Without Waste is            back to nature and            to our business, and
 sugar options across                 possible.                 communities.                  we economically
    our portfolio.                                                                           empower women.                 2009          2010       2011           2012       2013       2014         2015   2016     2017            2018

The Coca‑Cola Company         2018 Business & Sustainability Report                                                                                                                                                                           6
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board          Our                 Priority           Portfolio          World Without        Water            Sustainable     People &       Partnerships   Climate   Regional     Data
            Letters            Company             Issues             Transformation     Waste                                 Agriculture     Communities                   Change    Highlights   Appendix

           At A        The Coca-Cola     Total Beverage       Business Transformation    Selected Financial      Progress Against Our   Our System
           Glance      System            Portfolio            Timeline                   Data                    Sustainability Goals   in Context

How We
Operate
                                                                                       THE                                                                     THE COCA-COLA
The Coca‑Cola Company
                                                                                    COCA-COLA
                                                                                                                                                                 COMPANY

markets, manufactures                                                                                                                    CONCENTRATES        INNOVATION, CREATION

and sells:                                                                           SYSTEM*                                                                     & MARKETING

• beverage concentrates and syrups
•	finished beverages (including
                                                                                                                                                                  FINISHED
   sparkling soft drinks; water and                                                                                                                              PRODUCTS
   sports drinks; juice, dairy and plant-
   based drinks; and tea and coffee).                                                                           BOTTLERS

In our concentrate operations,
The Coca‑Cola Company typically
generates net operating revenues by
selling concentrates and syrups to
authorized bottling partners.                                              Approximately
                                                                           225 bottling
                                                                           partners
Our bottling partners combine the
                                                                           worldwide
concentrates with still and/or sparkling
water, and/or sweeteners, depending
on the product, to prepare, package,
sell and distribute finished beverages.

                                                                           More than
Our finished product operations
                                                                           1.9 billion                                                       DISTRIBUTION
consist primarily of company-owned
                                                                           servings
or -controlled bottling, sales and
                                                                           a day
distribution operations.

                                                                                                                                        CUSTOMERS & CONSUMERS
*	The Coca‑Cola Company and its bottling partners
    are collectively known as the Coca-Cola system.
    The Coca‑Cola Company does not own, manage or
    control most local bottling companies.

The Coca‑Cola Company       2018 Business & Sustainability Report                                                                                                                                          7
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board            Our            Priority            Portfolio              World Without        Water            Sustainable      People &          Partnerships     Climate         Regional            Data
             Letters              Company        Issues              Transformation         Waste                                 Agriculture      Communities                        Change          Highlights          Appendix

            At A     The Coca-Cola      Total Beverage      Business Transformation         Selected Financial      Progress Against Our   Our System
            Glance   System             Portfolio           Timeline                        Data                    Sustainability Goals   in Context

Total Beverage Portfolio                                                                         #1 VALUE SHARE ACROSS ALL CATEGORY CLUSTERS
                                                                                                                                                                                                           500+
                                                                                                                                                                                                                       BRANDS
                                                                                                 (EXCEPT ENERGY)

SPARKLING SOFT DRINKS                         JUICE, DAIRY & PLANT-BASED                         WATER AND SPORTS                               TEA AND COFFEE                            ENERGY2

>50%                                          ~10%                                               ~15%                                           ~15%                                      ~15%
2018 Retail Value Share                       2018 Retail Value Share                            2018 Retail Value Share                        2018 Retail Value Share                   2018 Retail Value Share

Coca-Cola                Fresca               Del Valle juices         fairlife                   Dasani waters           smartwater            G eorgia coffee      Ayataka green        Burn                    Full Throttle
                                              and nectars              ultra-filtered milk1                                                                           tea

Diet Coke                Coca-Cola            Odwalla                  Minute Maid                Aquarius                vitaminwater          Gold Peak teas        Honest Tea           NOS
                         Zero Sugar                                                                                                             and coffees

Fanta                    Sprite               Simply                   Chivita                    ILOHAS                  ZICO coconut
                                              Juices                                                                      water

                          Schweppes                                                               Powerade
                                                                                                  sports drinks

Coca-Cola Plus Coffee                        innocent Smoothies and Juices                       Ciel Water                                                                               Monster Energy

Globally, sparkling soft drink               In 2018, we further lifted, shifted                 In 2018, we introduced the                                                               In 2018, we announced a new
volume was up 2% in 2018, fueled             and scaled on-trend brands like                     new bottle made from 100%                      Fuze Tea                                  operating group, Global Ventures,
by double-digit volume growth                innocent across markets.                            recycled material for the purified,                                                      to ensure we connect and globally
of Coca-Cola Zero Sugar, strong                                                                  noncarbonated water brand                      We launched Fuze Tea across               scale key brands and partnerships
growth in the low- and no-calorie
                                             1	The  fairlife® brand is owned by fairlife
                                                                                                 Ciel in Mexico.                                major European markets in 2018.           like Monster.
                                                LLC, our joint venture with Select Milk
offerings of Sprite and Fanta and               Producers Inc. Products from fairlife are                                                                                                 2	Energybrands are owned by Monster
supported by innovations such                   distributed by our company and certain
                                                                                                                                                                                            Beverage Corporation, in which
as Coca-Cola Plus Coffee.                       of our bottling partners.
                                                                                                                                                                                            The Coca‑Cola Company has a
                                                                                                                                                                                            minority investment.

The Coca‑Cola Company       2018 Business & Sustainability Report                                                                                                                                                                  8
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board          Our              Priority           Portfolio         World Without        Water            Sustainable         People &         Partnerships     Climate             Regional      Data
             Letters            Company          Issues             Transformation    Waste                                 Agriculture         Communities                       Change              Highlights    Appendix

            At A       The Coca-Cola    Total Beverage      Business Transformation   Selected Financial      Progress Against Our    Our System
            Glance     System           Portfolio           Timeline                  Data                    Sustainability Goals    in Context

Business                                                                              Total Beverage Company: Our Accelerated Transformation
Transformation
Timeline

1886
                                                                                      Announced our support         Coca-Cola invested in        Introduced                 Developed new Gold           Launched more
First Coca-Cola sold
                                                                                      of the recommendation         Nigerian beverage            Coca-Cola Zero Sugar—      Peak bottled coffee          than 500 new
in Atlanta, Georgia.
                                                                                      by several leading            leader Chi Limited,          a reformulated and         beverages, expanded
                         1992                                                         health authorities,           maker of popular value-      rebranded version          Honest Tea into              products globally
1899                     Powerade                                     2016            including the World           added dairy and juice        of Coke Zero—              Western Europe,              in 2016. That’s
                         introduced as a
                                                                                      Health Organization,          beverages, and fairlife      in Belgium, France,        and in partnership           more than one
Large-scale                                                                           that people should            milk captured over one-      Ireland, the               with Dunkin’ Donuts
Coca-Cola bottling       hydration offering.                                                                                                                                                             a day!
                                                                                      limit their intake of         third of the retail value    Netherlands and the        announced a line of
begins.                                                                               added sugar to no more        growth in value-added        United Kingdom.            branded iced coffee
                         2005                                                         than 10% of their total       dairy in its second year.                               beverages.
                                                                                      energy/calorie intake.
1955                     Coca-Cola Zero
Fanta Orange             introduced.
introduced in
Italy, the first new
product distributed      2007
by the company           Acquisition of
since 1886.              Energy Brands Inc.
                         (glacéau), maker of
                         vitaminwater and
1960                     smartwater.
The purchase
of Minute Maid
                         2009
                                                                    2017
marks the first
venture outside          Coca‑Cola Freestyle,
of carbonated            an innovative                                                                                                           Announced Topo                                          Lifted and shifted
                                                                                      Scaled glacéau                Along with our bottling                                 Reduced sugar in
beverages.               fountain dispenser                                                                                                      Chico®, a premium
                                                                                      smartwater®, ZICO®            partners, acquired                                      more than 300 of             new formula for
                         that allows                                                  coconut water and             AdeS®, the leading soy-      sparkling mineral water,   our drinks globally,
                         consumers to select                                          Appletiser® into              based beverage brand         and Barrilitos Aguas       while introducing
                                                                                                                                                                                                         Coca-Cola Zero
1961                     from more than 100                                                                                                                                                              Sugar into 20
                                                                                      new markets.                  in Latin America, now        Frescas™, a flavored,      more than 500 new
Sprite lemon-            beverages, unveiled.                                                                       being rolled out across      noncarbonated water        products across a total      markets in 2017.
lime beverage                                                                                                       key markets in Europe.       beverage, as part of the   beverage portfolio.
introduced.                                                                                                                                      company’s portfolio in
                         2012
                                                                                                                                                 the United States.
                         Select Milk
1963                     Producers entered
Tab introduced,          into a partnership
the first diet drink     with the company to
produced by the          form fairlife, LLC.
company.
                         2013
1975                     Coca-Cola Life,
Georgia Coffee           naturally sweetened

                                                                          2018
introduced               with cane sugar and
in Japan.                stevia, introduced in
                         Argentina and Chile.
                                                                                          Scaled successful          Invested in the             Grew tea and coffee by     Diet Coke mounted a          Announced
1982                                                                                      brands like Fuze           premium sports              1% for the year, largely   successful comeback          plans in 2018 to
Diet Coke                                                                                 Tea, smartwater and        hydration brand             driven by innovation       in North America, with
introduced as the                                                                         AdeS across more           BODYARMOR in the            and new product            new marketing and            acquire the global
first extension                                                                           markets, helping to        United States.              launches including         new flavors.                 operations of
of the Coca-Cola                                                                          aggressively expand                                    Georgia Craftsman in                                    Costa coffee, which
trademark.                                                                                our portfolio.                                         Japan and Authentic
                                                                                                                                                                                                         helps us get into
                                                                                                                                                 Tea House in China.
                                                                                                                                                                                                         hot beverages.

The Coca‑Cola Company       2018 Business & Sustainability Report                                                                                                                                                            9
2018 Business & Sustainability Report - The Coca-Cola ...
CEO/Board          Our                Priority             Portfolio           World Without         Water             Sustainable        People &           Partnerships       Climate            Regional               Data
                Letters            Company            Issues               Transformation      Waste                                   Agriculture        Communities                           Change             Highlights             Appendix

              At A        The Coca-Cola      Total Beverage      Business Transformation        Selected Financial      Progress Against Our     Our System
              Glance      System             Portfolio           Timeline                       Data                    Sustainability Goals     in Context

                                                                 Table Title

Selected                                                         Year ended December 31,
                                                                 (In millions except per share data)
                                                                                                                                                                                            2016                    2017                     2018

Financial                                                        Summary of Operations1

Data
                                                                 Net operating revenues                                                                                             $     41,863            $     35,410              $    31,856
                                                                 Net income from continuing operations                                                                                     6,550                    1,182                   6,727
                                                                 Net income attributable to shareowners of The Coca‑Cola Company                                                           6,527                   1,248                    6,434

                                                                 Per Share Data
                                                                 Basic net income from continuing operations                                                                        $        1.51           $       0.28              $        1.58
                                                                 Basic net income                                                                                                            1.51                   0.29                        1.51
                                                                 Diluted net income from continuing operations                                                                               1.49                   0.27                       1.57
                                                                 Diluted net income                                                                                                          1.49                   0.29                       1.50
                                                                 Cash dividends                                                                                                              1.40                   1.48                       1.56

                                                                 Balance Sheet Data
                                                                 Total assets                                                                                                       $     87,270            $    87,896               $    83,216
                                                                 Long-term debt                                                                                                           29,684                  31,182                   25,364

                                                                 Organic Revenue Growth                        Operating Income Growth                        Diluted Net Income Per Share                 Adjusted Free Cash
                                                                 (Non-GAAP)2                                   (Non-GAAP)3                                    from Continuing Operations                   Flow Conversion Ratio
                                                                                                                                                              Growth (Non-GAAP)4                           (Non-GAAP)5

                                                                                        5%                                           11%                                           13%

                                                                                                                                                                                                                         75%
                                                                                                                               8%                                                                                               70%

                                                                                 3%

                                                                                                                                                                             1%

                                                                                 ′17    ′18                                    ′17   ′18                                     ′17   ′18                                    ′17   ′18

                                                                        Organic Revenue Growth                          Income Continuing Operations                 Diluted Net Income                            Cash Flow Conversion

1                                                                                                                             4	Reflects
    	The financial statement line items in Summary of Operations were unfavorably impacted by the refranchising of                     comparable currency neutral diluted net income per share from continuing operations, which is a non-
      bottling territories in North America as well as the divestitures of certain company-owned bottling operations. In        GAAP financial measure. Reported diluted net income per share from continuing operations grew 474 percent and
      addition, net income attributable to shareowners of The Coca‑Cola Company for the year ended December 31, 2017            declined 82 percent for the years ended December 31, 2018 and 2017, respectively.
      was unfavorably impacted by a net provisional tax charge of $3,610 million recorded by the company as a result of
                                                                                                                              5	Adjusted
      the U.S. Tax Cuts and Jobs Act signed into law in December 2017.                                                                   free cash flow conversion ratio = free cash flow adjusted for pension contributions divided by net
                                                                                                                                income from continuing operations adjusted for noncash items impacting comparability. Adjusted free cash flow
2   	Organic revenue is a non-GAAP financial measure. Reported net operating revenues declined 10 percent and                  conversion ratio is a non-GAAP financial measure.
      15 percent for the years ended December 31, 2018 and 2017, respectively.
                                                                                                                              Note: See pp. 54–57 for a reconciliation of non-GAAP financial measures to our results as reported under GAAP.
3	Reflects   comparable currency neutral operating income (adjusted for structural items and accounting changes),
     which is a non-GAAP financial measure. Reported operating income grew 14 percent and declined 12 percent for
     the years ended December 31, 2018 and 2017, respectively.                                                                For more information about our performance, see the Data Appendix.

The Coca‑Cola Company          2018 Business & Sustainability Report                                                                                                                                                                            10
CEO/Board                 Our               Priority                    Portfolio           World Without         Water               Sustainable          People &                 Partnerships      Climate                Regional              Data
                 Letters                   Company           Issues                      Transformation      Waste                                     Agriculture          Communities                                Change                 Highlights            Appendix

                At A            The Coca-Cola       Total Beverage         Business Transformation           Selected Financial        Progress Against Our       Our System
                Glance          System              Portfolio              Timeline                          Data                      Sustainability Goals       in Context

2020 Sustainability Goals                                                                          Our publicly reported 2020 sustainability goals drive us to continually improve. We aim to achieve our goals through a
                                                                                                   concerted effort by The Coca‑Cola Company and approximately 225 bottling partners in more than 200 countries and
                                                                                                   territories. We have set ambitious goals to drive system-wide change beyond small operational improvements.

Packaging                                                          Water                                                                                                Giving Back                                              Women
Percentage of bottles and cans we refilled                         Percentage of water used in our                Percentage improvement in water                       Percentage of the company’s annual                       Cumulative number of women
or helped recover equivalent to what we                            finished beverages returned to                 efficiency since 2010                                 operating income invested back into                      entrepreneurs economically empowered
introduced into the marketplace 1, 2                               nature and communities 3                                                                             local communities                                        across our global value chain

                                                   2030
                                                   GOAL                                                                                                2020                                                                                                              2020
                                                   100%                                                                                                GOAL                                                                                                              GOAL
                                                                                           150%   155%                                                                                        1.6%
 WORLD WITHOUT WASTE                                                                                                                                   25%                                            1.5%                                                                5M
                                                                                   133%
                                                                           115%                                                                                                 1.2%   1.2%
                                                                                                                                                                                                                                                              3.2M
         59%     59%     59%      58% 56%          2020                                                    2020
                                                   GOAL     58%                                            GOAL                      15%     16%
                                                                                                                                                                                                               2020                                    2.4M
                                                    75%                                                    100%              13%
                                                            56%                                                        12%                                                                                     GOAL
                                                                                                                                                                                                                1%                              1.7M
                                                                                                                                                                                                                                       1.2M

          ′15    ′16      ′17       ′18                                    ′15     ′16      ′17   ′18                  ′15   ′16      ′17    ′18                                ′15    ′16    ′17      ′18                              ′15     ′16    ′17    ′18

Taking Packaging
       additional rev1
                  packaging types into                                     Water Return                                Water Imprvmt Efficiency                                 Giving Back                                            Women
consideration, our rate was 56% for 2018.1

Human Rights                                                                                       Agriculture                                                                                                                   Climate
Percentage of bottling partners                 Percentage of direct suppliers                     Percentage of ingredients sustainably sourced                                                                                 Estimated percentage reduction of
that achieved compliance with our               that achieved compliance with our                                                                                                                                                the carbon footprint of the “drink in
                                                                                                    2017       2018
Supplier Guiding Principles                     Supplier Guiding Principles                                                                                                                                                      your hand” since 2010 4

                                                                                                                                                                                                                      2020                                               2020
     90%        89%      87%     89%        2020      92%   90%      88%     89%         2020                                                                                                                         GOAL                                               GOAL
                                            GOAL                                         GOAL                                                                                                                         100%                                               25%
                                                                                                   76–100%
                                            98%                                          95%                                                                                                                                                                  21%
                                                                                                                                                                                                                                                       19%
                                                                                                    51–75%
                                                                                                                                                                                                                                                 14%
                                                                                                                                                                                                                                        12%

                                                                                                    26–50%

                                                                                                     0–25%

         ′15    ′16      ′17      ′18                 ′15    ′16     ′17     ′18                              APPLES    BEET       CANE     COFFEE    CORN    GRAPES   LEMONS   MANGOS ORANGES        TEA    SOY                        ′15      ′16    ′17    ′18
                                                                                                                        SUGAR      SUGAR

         Bottling Partner Compliance                  Direct Suppliers Compliance                                                                                                                                                       Climate
                                                                                                                    Agriculture
1	Our                                                                                                                                       3	As
     method to track our 58% packaging collection rate against our 2020 goal focused on our predominant                                           estimated working with our many external partners and using generally accepted, independently peer-
  package types (glass bottles, steel and aluminum cans, and PET plastic bottles), which make up approximately                                 reviewed scientific and technical methods. Finished beverages based on global sales volume.
  85% of our portfolio. Because of new data that we have available to us, our 56% collection rate against our
                                                                                                                                             4	The
  World Without Waste goal takes into account a more inclusive collection rate, representing all of our consumer                                    calculation of progress toward our “drink in your hand” goal has been internally vetted using accepted
  packaging—including beverage cartons, juice boxes and pouches, etc. (see p. 24).                                                             and relevant scientific and technical methodologies, which are aligned with GHG Protocol Scopes 1, 2 and 3.
                                                                                                                                               Due to the nature of our franchise bottling system, our manufacturing emissions are normally split between
2	Ourpercentage calculations of progress toward collection of 100% of the equivalent of the consumer                                          Scopes 1 and 2 for company-owned facilities and Scope 3 for bottling partner facilities. However, in our “drink
  packaging we sell has been internally vetted using relevant scientific and technical methodologies, but those                                in your hand” calculations, we consider the full Coca‑Cola system (including franchise bottling partners) in the
  methodologies are evolving as the industry learns more about calculating collection in different markets. We are                             calculation of our manufacturing, distribution and refrigeration emissions.
  working to improve our data collection and measuring systems. As systems and methodologies improve, we will
  revisit our prior estimates to ensure their accuracy and make any necessary corrections to our public reporting.
                                                                                                                                             For more information about our performance, see the Data Appendix.

The Coca‑Cola Company                   2018 Business & Sustainability Report                                                                                                                                                                                             11
CEO/Board        Our              Priority                       Portfolio          World Without         Water            Sustainable     People &        Partnerships        Climate             Regional     Data
          Letters          Company          Issues                         Transformation     Waste                                  Agriculture     Communities                         Change              Highlights   Appendix

         At A     The Coca-Cola    Total Beverage                  Business Transformation     Selected Financial      Progress Against Our   Our System
         Glance   System           Portfolio                       Timeline                    Data                    Sustainability Goals   in Context

Our System in Context
                                                                                                                                       SHARED OPPORTUNITY
Our business operates within
a wider context. We consider
this context carefully, and we
continuously apply what we learn
to manage our impacts, aiming
                                                                                     INPUTS                                                                        OUTCOMES
                                                                                     What We Depend On                                                             What We Create
to create shared opportunity
as we transform into a total
beverage company.

Our short- and long-term success
depends on a range of inputs,                                                                                                                                      CONSUMER &
such as ingredients, water                                                                                                                                         CUSTOMER DEMAND
and packaging from our many
                                                                                                                                                                   INCREASING TRANSPARENCY
suppliers, and the talents and                                                       CONSUMER, CUSTOMER &
                                                                                                                                                                   AND TRUST
passion of our global workforce                                                      STAKEHOLDER INSIGHTS
and system employees. And, of                                                                                                   THE                                PRODUCT CHOICES:

                                                                                                                             COCA-COLA
course, our business generates                                                       RAW MATERIALS:
                                              SHARED OPPORTUNITY

                                                                                                                                                                                                                                 SHARED OPPORTUNITY
                                                                                                                                                                   Total Beverage Portfolio
revenue from consumers who                                                           Water, Ingredients, Energy,

                                                                                                                              SYSTEM
provide us with their trust                                                          Raw Materials
and the financial resources to                                                                                                                                     COMMUNITY IMPACT:
operate, innovate and grow.                                                          TALENT:
                                                                                                                                                                   Local Community Support, Watershed
                                                                                                                                                                   Protection, Access to Safe Water and Sanitation,
As a result, we create a range                                                       Employees, Farmers, Partners
                                                                                                                                     PASSION FOR                   Recycling, Disaster and Humanitarian Relief,
of outcomes including diverse                                                        Around the World
                                                                                                                                     CONSUMERS                     Education, Arts & Culture
beverage products; economic
benefits such as jobs, taxes paid                                                                                                     INNOVATION
                                                                                     FINANCIAL RESOURCES:
and community investment;                                                                                                                                          ECONOMIC DEVELOPMENT:
                                                                                     Top-Line Revenue                                 MARKETING
ecosystem impacts and                                                                                                                                              Jobs, Women’s Empowerment, Taxes Paid,
                                                                                                                                                                   Community Investment, Value and Revenue
initiatives; and customer and                                                                                                        GOVERNANCE                    for Customers, Growth Opportunities
shareowner value.                                                                    RECYCLED MATERIALS,
                                                                                     REUSE                                        MANUFACTURING

                                                                                                                                    DISTRIBUTION                   PACKAGES, WASTE,
See the Coca-Cola system                                                                                                                                           CARBON EMISSIONS
                                                                                             REINVESTMENT
diagram.
                                                                                                                                                                          FINANCIAL RESOURCES,
                                                                                                                                                                          PROFIT, DIVIDENDS

                                                                                                                                        SHARED OPPORTUNITY

The Coca‑Cola Company   2018 Business & Sustainability Report                                                                                                                                                                   12
CEO/Board          Our              Priority           Portfolio        World Without   Water        Sustainable   People &       Partnerships     Climate        Regional       Data
          Letters            Company          Issues             Transformation   Waste                        Agriculture   Communities                     Change         Highlights     Appendix

         Our Approach to           Priority Issues:
         Managing Our Priorities   Risks & Opportunities

Our Approach to Managing Our Priorities

                                                         THE COCA‑COLA COMPANY                                                                             THE COCA-COLA SYSTEM

Our board’s role is overseeing the
company’s long-term business                             Corporate                                        Sustainability                                   Sustainability
strategy, which includes providing
review of and guidance for our                           Governance                                       Governance                                       Approach
ongoing transformation to a total
beverage company. I am pleased
with how this board works with                           At The Coca‑Cola Company, we set high            The Public Issues and Diversity Review           We aim to achieve our operating and
management toward the common                             standards for our people at all levels           Committee helps the board fulfill                sustainability goals through a concerted
goal of long-term value creation                         and strive to meet these standards               responsibilities relating to diversity,          effort by The Coca‑Cola Company and
for our shareowners and                                  consistently. Our sound business                 sustainability, corporate social                 approximately 225 bottling partners
other stakeholders.”                                     principles and practices foster a strong         responsibility and public issues of              in more than 200 countries and
                                                         innovative, and collaborative culture,           significance, especially with regard             territories. We have set ambitious goals
SAM NUNN                                                 which is committed to ethical behavior,          to ways in which these issues may                to drive system-wide change beyond
Lead Independent Director                                accountability and transparency.                 affect the shareowners, the company,             small operational improvements.
                                                                                                          communities in which we operate,
                                                         Information about the company’s                  and the general public. This entails             We have robust programs in place to
                                                         corporate governance, including the              evaluating and reviewing information             identify issues for our business and
                                                         company’s Code of Business Conduct,              pertaining to social, political and              stakeholders, and cross-functional
                                                         Corporate Governance Guidelines,                 environmental trends, with oversight             teams working across our system to
                                                         Certificate of Incorporation and Bylaws          over diversity and sustainability goals,         gather data and perspectives to inform
                                                         are on our website. Information                  as well as human and workplace rights.           our actions. Beyond our internal
                                                         about how to report concerns about                                                                Enterprise Risk Management team,
                                                         the company and our public policy                The committee reviews, at least                  this also includes the work of our
                                                         engagement and political contributions           annually, all shareowner proposals,              dedicated Stakeholder Engagement
                                                         policy can be accessed here.                     public policy advocacy efforts,                  function that partners with business
                                                                                                          political contributions and charitable           units, bottling partners, NGOs,
                                                         The company’s board of directors has             contributions to ensure alignment with           governments, and people in
                                                         established a number of committees               company policy and our overall values.           communities all around the world.
                                                         to assist in discharging its duties.
                                                         These include an Audit Committee,                The committee reports to the board
                                                         a Compensation Committee,                        regularly regarding actions and
                                                         a Committee on Directors and                     recommendations, and annually
                                                         Corporate Governance, an Executive               conducts a self evaluation, which it
                                                         Committee, a Finance Committee, a                presents to the full board.
                                                         Management Development Committee,
                                                         and a Public Issues and Diversity
                                                         Review Committee. The charter for
                                                         each committee can be viewed on
                                                         our website.

The Coca‑Cola Company    2018 Business & Sustainability Report                                                                                                                                   13
CEO/Board          Our              Priority                                       Portfolio           World Without       Water            Sustainable      People &           Partnerships   Climate   Regional     Data
          Letters            Company          Issues                                         Transformation      Waste                                Agriculture      Communities                       Change    Highlights   Appendix

         Our Approach to           Priority Issues:
         Managing Our Priorities   Risks & Opportunities

Priority Issues Matrix

Focusing on the highest-priority
environmental, social and governance                                                                                                          Obesity concerns and category perceptions
issues for our business and our
stakeholders is a foundational step                                                                                                                           Water stewardship
in how we conduct business and
develop our corporate strategy. It is
also foundational to how we build,
evolve and report on our business and
our sustainability efforts. For example,
since we conducted our priority issues                                                                                                                               Packaging
                                                     INCREASING CONCERN TO STAKEHOLDERS

analysis in 2015 (see chart to the right),
the company has launched strategic
global initiatives including Our Way                                                        Community engagement
Forward and World Without Waste,                                                                                                             Women’s economic empowerment
                                                                                               Climate change risks
and conducted a climate scenario
                                                                                            Responsible sourcing
analysis.                                                                                                                                                      Human rights
                                                                                                 Greenhouse gas emissions

During 2019, we will be undergoing                                                           Energy use and efficiency
a thorough review of our priority                                                                     Responsible supply
issues in collaboration with a cross-                                                                 chain management
functional internal team and key
external stakeholders. This will ensure                                                                                                                 Occupational health and safety
that we take into consideration the
                                                                                                                         Employee wellness,                 Product safety and ingredients
changing social, environmental and                                                                                          development
economic context as we evolve our                                                                                         and engagement
business, along with wider stakeholder
                                                                                                              Diversity and
expectations.                                                                                               equal opportunity

                                                                                                      Manufacturing waste
Learn more about our approach to
stakeholder engagement here.

                                                                                          *	This matrix represents the results of
                                                                                             our 2015 priority issues analysis.

                                                                                                 INCREASING CURRENT OR POTENTIAL IMPACT TO THE COCA-COLA SYSTEM

The Coca‑Cola Company    2018 Business & Sustainability Report                                                                                                                                                                        14
CEO/Board          Our              Priority           Portfolio        World Without   Water            Sustainable     People &            Partnerships      Climate             Regional            Data
          Letters            Company          Issues             Transformation   Waste                            Agriculture     Communities                           Change              Highlights          Appendix

         Our Approach to           Priority Issues:
         Managing Our Priorities   Risks & Opportunities

Priority Issues: Risks & Opportunities

As a company operating                                   Product Innovation                               Plastic Waste
with a growth mindset
and a presence in almost                                 Consumers are adopting healthier diets           Concern about plastic waste has
                                                         and lifestyles, which include eating and         risen sharply as waste collection and
every country and                                        drinking less sugar, creating demand             recycling infrastructure have not kept
territory in the world, we                               for a wider range of low- or no-sugar            pace with plastic manufacturing,
                                                         products, and new ingredients, such              causing an increase in plastic waste
consider our risks and                                   as plant-based protein. This trend               in the environment. Issues such
opportunities in a global                                presents a growth opportunity for                as changes in local regulations to
                                                         us, and we listen to consumers as we             discourage the use of plastic and the
context.                                                 evolve our long-term business strategy.          cost of material inefficiencies of linear
                                                                                                          production models all constitute risks
Many of the issues we face are                           Along with the business opportunity,             across our global operations. There are
interconnected and evolving quickly,                     there are also real risks. For example,          hotspots in regions where recycling
and we need to understand them to                        there is a growing concern among                 infrastructure is weakest and/or where
fulfill our long-term vision to grow in a                consumers, public health professionals,          ecosystem damage from pollution
way that creates value for all people—                   and government agencies about                    is most acute, including oceans and
consumers, customers, suppliers and                      the increased prevalence of obesity,             coastal areas.
communities—while working toward                         which is correlated to several non-
solutions that benefit us all.                           communicable diseases. The food and              Innovations in packaging materials,
                                                         beverage industry has a responsibility           such as plant-based raw materials
Throughout this report we reference                      to help adequately address these                 that substitute for petrochemical
our transformation to a total beverage                                                                                                                                Approximately 14% of plastic
                                                         challenges through innovation and new            feedstocks, as well as circular
company. There are many issues of                                                                                                                                     packaging—including beverage
                                                         product offerings.                               models that turn post-consumer
relevance to our company, both in                                                                                                                                     packaging as well as that of other
                                                                                                          plastics into new, economically viable
relation to this transformation, and                                                                                                                                  consumer products—is collected
                                                                                                          value streams, present multiple
more broadly as a global growth                                                                                                                                       for recycling globally.1 Our collection
                                                                                                          opportunities. These new plastic
business, which we explore in more                       We support the current                                                                                       rate for non-returnable PET plastic
                                                                                                          production models offer improved
detail in our key sustainability topics                  recommendation by several leading                                                                            bottles is approximately 52%, in part
                                                                                                          ecosystem impacts and carbon
and subsequent pages. The following                      health authorities, including the                                                                            because PET plastic has a high value
                                                                                                          footprint reductions, accelerate the
risk and opportunity areas help                          World Health Organization, that                                                                              relative to other types of plastics. 2
                                                                                                          shift away from single-use plastic,
provide a snapshot of the global                         people should limit their daily intake           and in some regions also create
context in which our transformation                      of added sugar to no more than                   new employment.
is taking place.                                         10% of their total energy/calorie
                                                         consumption.

                                                                                                          1 	
                                                                                                             New Plastics Economy—Ellen MacArthur Foundation          those methodologies are evolving as the industry
                                                                                                            2017 report, p. 16.                                       learns more about calculating collection in different
                                                                                                                                                                      markets. We are working to improve our data
                                                                                                          2	
                                                                                                            Our  percentage calculations of progress toward           collection and measuring systems. As systems and
                                                                                                            collection of 100% of the equivalent of the consumer      methodologies improve, we will revisit our prior
                                                                                                            packaging we sell has been internally vetted using        estimates to ensure their accuracy and make any
                                                                                                            relevant scientific and technical methodologies, but      necessary corrections to our public reporting.

The Coca‑Cola Company    2018 Business & Sustainability Report                                                                                                                                                            15
CEO/Board          Our               Priority          Portfolio        World Without   Water             Sustainable      People &      Partnerships   Climate   Regional     Data
           Letters            Company           Issues            Transformation   Waste                             Agriculture      Communities                  Change    Highlights   Appendix

          Our Approach to           Priority Issues:
          Managing Our Priorities   Risks & Opportunities

Water Resources                                            Climate Change

There are many threats to water                            There is growing concern that                   Innovations in ingredients and
quality and availability, including                        an increase in global average                   packaging materials are becoming
unsustainable agriculture practices,                       temperatures and the resulting                  more scalable, while access to
poor sanitation infrastructure, runoff                     changes to the climate will cause               renewable energy is increasingly
and industrial pollution, and overuse of                   significant disruptions in weather              mainstream. Companies that take
water resources. Additionally, climate                     patterns around the globe, creating             advantage of the significant potential
change is exacerbating water scarcity                      more frequent and severe natural                of these and other solutions have the
through increased droughts and floods,                     disasters, including fires, storms and          opportunity to improve the resilience
which in turn impact farmers and other                     floods. In addition to direct impacts           of their own supply chains, operations
water users who will need to adapt to                      on our operations and communities,              and distribution networks, while
water stress in many different regions.                    this may affect food security and               contributing to greater stability of the
Our products depend on the availability                    also decrease the agricultural                  planet we all share.
of high-quality water, as do the people                    productivity—and/or increase the
living in the communities where we                         cost—of key agricultural commodities.
do business.                                               Policies that incentivize emissions
                                                           reductions, and initiatives that reduce         Limiting global warming to
By bringing our expertise and other                        deforestation or other negative                 below 1.5°C will be required to
resources to bear, we can ensure that                      impacts through land-use changes for            remain below relevant global
our operations contribute positively                       food production, are also increasing.           risk thresholds—and this will entail
to healthy freshwater and marine                           These changes are important                     rapid and far-reaching transitions
ecosystems around the world. We can                        considerations for companies as                 in land use, energy, industry,
use these same resources to provide                        they assess CO 2 emissions in their             buildings, transport and cities. 2
access to safe drinking water and                          value chains as well as key supplier
sanitation while helping to restore                        relationships. These and other
natural water cycles, benefiting                           factors combine to create a growing
multiple aspects of our value chain and                    financial business risk, of which               For more information on our climate
the people and communities we serve.                       investors and other stakeholders                risks and opportunities, see p. 45.
                                                           are increasingly aware.

According to the World Economic
Forum, water crises have been
among the top five global risks in
each of the last seven years.1

1	CEO                                                                                                     2	IPCC
      Water Mandate report, The Business Case                                                                        2018 report summary.
 for Water Stewardship (2018).

The Coca‑Cola Company     2018 Business & Sustainability Report                                                                                                                                 16
CEO/Board           Our                    Priority          Portfolio        World Without   Water   Sustainable    People &      Partnerships     Climate          Regional     Data
             Letters             Company                Issues            Transformation   Waste                   Agriculture    Communities                    Change           Highlights   Appendix

           Overview       Providing Choice       Reducing Calories—
                          to Consumers           Expanding Portfolio

Taking Action and Expanding Choice
                                                                                                                                                               425,000
                                                                                                                                                               tons of sugar removed on
                                                                                                                                                               an annualized basis through
People’s tastes and                                                Using Data to Reduce                                                                        innovation such as new recipes
                                                                                                                                                               and smaller package sizes
preferences are                                                    Sugar and Calories                                                                          in 2017/2018
changing, so we’re
changing, too.                                                     Around the world, consuming less
                                                                   sugar is an increasingly important issue
Driven by our passion for consumers,                               for many people.
we have been shifting our mindset and                                                                                                                                      Total
culture, as well as the way we measure                             To meet these changing consumer                                                                         Reformulations
our success, resulting in bold action to                           needs, we have updated our approach                                                                     Globally
transform our portfolio.                                           to more effectively measure our sugar
                                                                   and calorie reduction efforts. Since our
                                                                                                                   18             20
                                                                                                                                                                           ~80
                                                                                                                                                                           2016
                                                                   CEO-led Our Way Forward initiative                    of our
Gradually reducing sugar                                           was launched in 2017, we have been
                                                                   aggressively reformulating recipes               top brands are
across our entire portfolio1
                                                                   to reduce sugar, using our marketing            low- or no-sugar
                                                                   muscle to promote low- and no-calorie           or have a low- or

                                                                                                                                                                           ~310
                                                                                                                                                                           2017
Making smaller, more                                               beverage options and investing along            no-sugar option
                                                                   with our system to make smaller
convenient packages so
                                                                   packages more available. We have also
controlling sugar intake is easier                                 been accelerating the expansion of

                                                                                                                                                                           ~400
                                                                   beverage options across our portfolio.                                                                  2018

Offering more new drinks                                           Just as we harness data and analytics
that provide benefits like                                         to inform and improve our growth
nutrition and hydration                                            efforts at scale, we also track our sugar
                                                                   and calorie reduction efforts from
                                                                   market to market.
Giving people the information
they need to make informed                                         We keep track of metrics resulting
                                                                   from the sugar reduction levers
choices
                                                                   we are using, such as total calories
                                                                   from sugar—both added and natural
                                                                   sugars—across all of our brands, 2
                                                                   sugar reductions from a combination
1	To                                                              of new recipes, 3 promotion of low- and
     maintain consumer acceptance and avoid
  moving so far that consumers substitute higher                   no-calorie beverages, and reduced
  sugar alternatives, it is widely accepted that                   package sizes.
  reformulation is a gradual process.

                                                                   The cumulative effect of these actions
2	Thisdoes not include calories from non-sugar
  ingredients such as protein or fat.
                                                                   is lowering the average calories per
3	Due to regulations affecting 100% natural juices,               package in our portfolio.
  natural sugars must be left intact to be classified
  as 100% juice.

The Coca‑Cola Company        2018 Business & Sustainability Report                                                                                                                                   17
CEO/Board         Our              Priority           Portfolio        World Without   Water        Sustainable    People &       Partnerships   Climate   Regional     Data
         Letters           Company          Issues             Transformation   Waste                        Agriculture    Communities                   Change    Highlights   Appendix

        Overview     Providing Choice   Reducing Calories—
                     to Consumers       Expanding Portfolio

Putting Consumers First

We’re exploring and bringing to market                                                                  Responding to
new sugar alternatives that help us
keep the great tastes people love but                                                                   Local Conditions to
with less sugar and fewer calories. For                                                                 Reduce Sugar
example, Coca-Cola Zero Sugar realized
double-digit volume growth in 2018
globally as we continued to invest as                                                                   We are taking action on sugar
a system in marketing and promotions                                                                    reduction even where it means
of this zero-calorie sparkling                                                                          changes to our most popular,
product innovation.                                                                                     time-tested products—putting our
                                                                                                        strength in innovation to work for our
We’re also heavily promoting our                                                                        consumers’ evolving needs.
low- and no-sugar drinks, making
them more visible and easier to find.                                                                   Coca-Cola Chile’s portfolio is now
And we’re bringing drinks like organic                                                                  composed of 95% low- and no-
tea, coconut water, juices, purified                                                                    calorie beverages representing a
water and beyond to more people in                                                                      significant reduction in sugar and
more places.                                                                                            calories. The Coca-Cola system
                                                       Smaller, More                                    removed the equivalent of 33,000
                                                                                                        tons of sugar from the market through
                                                       Convenient Packages                              recipe changes across our Chilean
                                                                                                        beverage portfolio.

                                                       Smaller, more convenient packaging               Coca-Cola Singapore launched new
                                                       helps people control sugar intake more           Sprite and Fanta Orange recipes in
                                                       easily for themselves and their families.        2018, which contain more than 40%
                                                                                                        less sugar without compromising on
                                                       •	Today, about 44% of our sparkling             taste. In Japan, we continued to offer
                                                          soft drink brands come in convenient          no-sugar product varieties including
                                                          packages of 250 mL (8.5 oz.) or less.         Ayataka FOSHU tea and Japan
                                                       •	Smaller packages of sparkling soft            Craftsman Black (no-sugar) coffee.
                                                          drinks in North America again posted
                                                          double-digit growth led by 7.5-ounce          The commitment we made along with
                                                          mini cans of sparkling soft drinks like       the European soft drinks industry
                                                          Coca-Cola and Sprite.                         to reduce the average added sugar
                                                                                                        content of still and carbonated soft
                                                                                                        drinks by 10% has led to 16 national
                                                                                                        sugar reduction pledges in the EU to
                                                       More than 30% growth for                         date, and counting.
                                                       mini cans in North America
                                                       in 2018.*
                                                                                                        For information about our innovative
                                                                                                        sugar reduction in Mexico, see p. 20.

                                                       * Nielsen AMC.

                                                                                                                                                                                       18
CEO/Board         Our              Priority           Portfolio        World Without   Water        Sustainable   People &       Partnerships      Climate        Regional       Data
          Letters           Company          Issues             Transformation   Waste                        Agriculture   Communities                      Change         Highlights     Appendix

         Overview     Providing Choice   Reducing Calories—
                      to Consumers       Expanding Portfolio

                                                        Offering More                                                                                     Responsible Marketing
                                                        New Drinks
                                                                                                                                                          We do not target our advertising to
                                                                                                                                                          children under age 12, anywhere in the
                                                        We’re looking for ways, whenever we
                                                                                                                                                          world. Examples of this longstanding
                                                        can, to make many of our beverages
                                                                                                                                                          policy in action include:
                                                        better and more nutritious by providing
We’re making reduced-sugar                              vitamins, minerals and electrolytes,
                                                                                                                                                          •	We do not place advertising in media
products more available through                         while also introducing more dairy,
                                                                                                                                                             where the audience is comprised
reformulation. We’ve reformulated                       plant-based beverages and different
                                                                                                                                                             of over 35% children under 12 years
hundreds of products around                             sweetness level options to meet an
                                                                                                                                                             old, including television shows,
the world. We’re also making our                        increasing range of consumer choices.
                                                                                                                                                             print media, websites, social media,
zero-sugar products taste better.                       With this in mind, we launched more
                                                                                                                                                             movies, SMS/email marketing,
and promoting them more. As we                          than 600 products in 2018 including:
                                                                                                                                                             animation, third-party characters,
take these actions, consumers are                                                                                                                            celebrities/games/contests, branded
responding positively in the sense                      •	Sprite Fiber+, a no-sugar drink
                                                                                                                                                             toys/merchandise, talent selection,
that they are accepting sugar-                             with dietary fiber and the flavor
                                                                                                                                                             point of sale, and merchandise items.
reduced products at a good rate.                           and refreshment consumers expect
                                                                                                                                                          •	We do not design our marketing
We also see growth in our zero-                            from Sprite, was launched in China.           Giving People                                       communications in a way that
sugar portfolio as well as in smaller                   •	Coca-Cola Batch Blends Coffee
pack sizes.”                                               and Chocolate, a no-sugar beverage            Information                                         appeals primarily to children under 12.
                                                                                                                                                          •	We work with industry platforms
                                                           combining refreshing Coca-Cola
                                                                                                                                                             such as the International Food &
ROBERT LONG                                                taste with chocolate and real
                                                                                                         We continue to put clear, easy-to-find              Beverage Alliance (IFBA), World
Chief Innovation Officer                                   coffee from Brazil, was launched
                                                                                                         nutrition information right up front to             Federation of Advertisers (WFA), the
                                                           in Vietnam.
                                                                                                         support informed choices, without the               EU Pledge initiative, Children’s Food
                                                        •	smartwater alkaline, which is ionized
                                                                                                         guesswork.                                          and Beverage Advertising Initiative
                                                           to ensure the pH level is 9+, was
Delivering Strategic                                       launched in select U.S. markets.
                                                                                                                                                             (CFBAI) and others to put meaningful
                                                                                                                                                             actions in place to reduce the
Growth                                                                                                                                                       exposure of children to advertising of
                                                                                                         We lead the food and                                all products high in fat, salt or sugar.
                                                                                                         beverage industry in                             •	We evolve our commitments to
Prioritizing consumers’ preferences                                                                                                                          respond to changing societal
means identifying strategic
                                                                                                         voluntary front-of-package
                                                                                                                                                             concerns, including advertising
acquisitions and investments in                                                                          calorie labeling. For example,                      on digital platforms, and work
emerging brands. In 2018, we                                                                             in Europe, we are introducing                       with local industry to join these
announced the definitive agreement                                                                       trials of color-coded nutrition                     framework commitments and scale
to acquire Costa Limited. Costa is                                                                                                                           collective actions.
the leading coffee company in the
                                                                                                         labelling to help people
                                                                                                                                                          •	We openly participate in audits by
United Kingdom and has a footprint                                                                       know exactly what is in the                         external organizations that monitor
in more than 30 countries in the                                                                         drinks they enjoy. Our labels                       our advertising to demonstrate
fast-growing coffee category. We                                                                         build on a scheme that is                           compliance with our standards and
also acquired a minority ownership                                                                                                                           all relevant authorities.
stake in BODYARMOR, a sports
                                                                                                         already familiar to more than
drink that contains potassium and                                                                        500 million people across
other electrolytes, vitamins and                                                                         the European Union, adding                       See more information on our approach to
coconut water, with no artificial colors                                                                                                                  responsible marketing here.
                                                                                                         red, amber and green colors
or flavors.
                                                                                                         to the numbers for key
                                                                                                         nutrients (fats, saturated fat,
                                                                                                         salt, sugar).

The Coca‑Cola Company   2018 Business & Sustainability Report                                                                                                                                     19
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