Environmental Reporting as a Communications Tool - Coca-ola Company - Case Study Example

? Business Report of Coca-cola Introduction Environmental consciousness and awareness among the general population has led many firms to reflect and review their respective corporate environmental responsibilities. This has led companies to adopt environmental communication and social accountability that is aimed at the promotion of active and voluntary disclosure of environmental information concerning various environmental activities. Environmental reporting is an effective communication tool that can be used by companies to raise environmental awareness both internally and externally (Bubna-Litic, 2008:69). The external functions of environmental reporting include disclosing of information based on the social accountability of organizations, to provide useful information to interested parties and other stakeholders for decision-making and to promote environmental awareness between organizations and the public. On the other hand, the internal functions of environmental reporting include to establish or revise or review existing environmental policies, objectives, and programs of organizations and to motivate the management and employees in organizations so as to encourage environmental activities of them. There is a general consensus that excellent environment report should explicitly acknowledge and explain environmental impacts that arise as a result of organizations operations and products and should further demonstrate the commitment of organizations to reduce such environmental impacts by publicly disclosing its policies, targets and long-term objectives (ACCA, 2010). This paper explores environmental reporting in companies with Coca Cola as a case study. Environmental Reporting in Coca Cola Company Coca Cola Company is the largest beverage company in the world and it responsible for the production of more than 500 brands of beverages that refreshes its consumers. Coca-Cola Company produces sparkling beverages, ready-to-drink coffees, juices ant juice drinks. The most popular and major beverage brands that are produced by the Coca Cola company include Coca-Cola, diet coke, fanta, sprite, coca-cola zero, vitamin water, powerade, minute maid, simply, Georgia and del valle (Coca-Cola-Enterprises., 2012). Coca Cola Company currently operates in more than 200 countries and has established markets across the world. The increasing sensitivity and awareness towards social and environmental issues and the concerns of stakeholders has prompted companies to enhance their images by endeavoring to become better corporate citizens and Coca Cola has not been left out in this trend. It is evident that Coca Cola Company has a wide array of stakeholders who have influence and interests on the company due to its global presence inn terms of market share and operations. Since the stakeholders are diverse and posses different interests and influence, any engagement and interactions that Coca Cola Company has with the stakeholders has the potential of shaping its current market share and future investment. The role that such stakeholders play has prompted Coca Cola Company to adopt environmental sustainability reporting as part of its strategic management goals. Another key feature that has caused Coca Cola Company to adopt environmental reporting is the economic, social and environmental impacts that are associated with the operations of the firm (Cross & Miller, 2009). There exist direct and indirect environmental impacts that originate from the operation of Coca Cola Company business. Examples of direct environmental impacts that are associated with Coca Cola business include greenhouse house gas emissions that emanate from the manufacturing site and distribution chain, emissions from cool drinks equipment, consumption of water and waste disposal from manufacturing site (Coca-Cola Company, 2011). The type of environmental reporting Company adopts is based on the guidelines that are given by the United Nations Global Compact framework. Environmental Reporting Strategies and Systems in Coca Cola Company Energy conservation / Climate change Coca-Cola Company is aware of the impacts that are caused by man-made greenhouse gas emissions and the global threats that such emissions pose. The company is also cognizant of the potential impacts of climate change on its business and supply chain such as reduced water availability, increased energy prices and regulation and other additional costs (Coca-Cola-Company, 2011:14). Man-made greenhouses and subsequently climate change has the potential of reducing the ability of Coca Cola Company to manufacture and distribute its products. Coca Cola Company has therefore adopted various strategies that are geared towards the minimization of climate impacts. Examples of the strategies include reduction of its greenhouse gas emissions, increasing energy efficiency and shift from the conventional ways in which the company source and use energy. A scrutiny of the Coca- Cola Company operational carbon footprint since 2007 to 2010 shows a remarkable decrease in the amount of carbon-dioxide produced. The operational carbon footprint of Coca-Cola company between 2007 and 2010 is as follows; in 2007 the company released 795,760 metric tonnes of carbon-dioxide, 2008(850,000 metric tonnes of carbon-dioxide, 2009 (830,000 metric tonnes of carbon-dioxide and 2010 9795,181 metric tonnes of carbon-dioxide (Coca-Cola-Company, 2011:14). The company has endeavored to reduce its green house gas emissions and this can be supported by the massive investment that it has directed towards emission reduction programs. For instance, in 2010, Coca Cola Company allocated $10.4 million of its capital expenditure on carbon reduction projects (Coca-Cola-Company, 2011:15). Greater percentage of emissions from Coca Cola emanates from its manufacturing operations from energy use, manufacturing and distribution. In 2010, Coca Cola Company achieved a two (2) percent reduction in energy use in its manufacturing operations and this was majorly attributed to through effective monitoring of energy use, planning and training, energy efficient technologies and increased investment in renewable energy. The energy use monitoring involved the improvement of energy use systems and the regular review of environmental data in various facilities by senior management team. In addition, the company has installed energy meters on production lines and on equipment that require more energy such as bottle blowers, compressors and chillers. Coca Cola Company also has adopted training of its employees in matters of energy use efficiencies so as to reduce its emission rates. The company has held numerous training workshops for environmental, maintenance and engineering managers at its manufacturing facilities. The trainings majorly focus on the use catalogue-energy use assessments and the identification of future energy efficiencies opportunities at the firm. The training of personnel has also contributed to efficient energy use at Coca Cola Company (Coca-Cola-Company, 2011:16). Another strategy that has resulted in the reduction of carbon footprint of Coca Cola Company includes the use of energy efficient technologies. The use of compressed air in bottling manufacturing plants for purposes of running machinery and drying of bottles and cans before addition of labels has contributed in efficient energy use. Coca Cola Company has also installed energy efficient bulbs and sensors, intelligent lighting systems and light emitting diodes in order to cut its energy use. The company projects that that the installation of the above energy efficient lighting systems will save 560 tonnes of carbon-dioxide per year (Coca-Cola-Company, 2011:16). Coca Cola Company is currently piloting the use of heat recovery techniques in its operations so as to reduce the use of its natural gas. Renewable energy technologies are other core emission strategies that Coca Cola Company uses at its facilities. Despite the fact the Company has noted the costs disparities between traditional fossil energy sources and renewable energy sources with the latter being expensive, the Company has embraced the use of renewable energy sources at its facilities. The company is currently adapting the use of renewable energy technologies so as to help meet the carbon reduction targets. The Company is currently exploring and investigating the potential use of water turbines and wind turbines at it facilities located in Belgium and Great Britain respectively. Furthermore, Coca Cola Company is currently using solar panels at their manufacturing factories located in Edmonton (Great Britain) and Marseille (France). The company is also exploring the potential use of combined heat and power in order to tap the heat that is often lost during energy generation processes (Coca-Cola-Company, 2011:17). According to Coca Cola Company, transportation of its products accounts for 16 percent of its overall business emissions. The company is currently piloting various engine and fuel technologies across the globe and assessing their viabilities and capabilities before they are rolled out to various geographical locations where its facilities are situated. For instance the Company has introduced five new ‘Eco-Combi’ trucks in Netherlands. The introduction of the trucks are aimed at the improvement of carbon efficiency of Coca Cola Company deliveries by transporting 38 pallets and not the conventional 26 pallet at once thus reducing carbon-dioxide emissions by 20 percent per pallet (Coca-Cola-Company, 2011:14). The Company is also piloting the use of biogas powered vehicles in Great Britain, the use of hybrid vehicles using Renault technologies in Belgium and the application of eco-driving techniques in its conventional vehicle fleets. Cold drinks equipment that is used by Coca Cola Company is responsible for the production of 62 percent of its core business emissions. These include equipment such as coolers, vendors, and fountain machines. Coca Cola Company is currently working on ways and strategies of improving the efficiency of its exiting coolers by retrofitting or refurbishment so as to reduce carbon emissions. The Company aims at fitting the doors of its coolers thereby reducing energy use by fifty percent and replacing the standard fluorescent lighting in the coolers with long life light emitting diodes (LEDs ) so as to make them more efficient. The use of energy management devices in the recognition of energy use pattern and hence regulating lights and temperature when the coolers are not being used has also been adopted by the company. Coca Cola Company also envisages the use of vending machines that are programmed to use certain amount of energy. Water stewardship Apart from being the main ingredient of Coca Cola Company products, the uses of water at the manufacturing plants include cooling, washing and rinsing. Water quantity and quality issues at various manufacturing facilities located in different countries are currently facing Coca Cola Company. The company has endeavored to act as a responsible water steward in order to reduce the impacts of water scarcity in its business and the community. Water use reduction strategies that have been adopted by Coca Cola Company include the water use ratio concept where water efficiency of operations are measured through the calculation of the amount of water used to make one liter of a product. This is has led to the successful reduction in the amount of water used to produce one liter of a product. For instance, in 2009 1.51 liters of water was used to produce one liter of a product while in 2010,1.42 liters of water was used to produce one liter of a product (Coca-Cola-Company, 2011:22). The company has also adopted various new technologies that aimed at reduction of water use in its operations. The new technologies entail the use of dry lube in the movement of containers along production lines rather than the use of soapy water, the use of air rinsers to rinse pre-blown bottles and cans and the recycling and reclamation of loops in order to recover and reuse rinsing water which is further used for cleaning purposes. Other water use reduction strategies that Coca Cola Company uses includes the installation of water use monitoring systems and installation of new bottle washers that have improved spraying systems and water flow management systems (Coca-Cola-Company, 2011:22). The company also carried out various water replenishment activities in the past year by focusing on the protection of aquifers in areas where it operates. Sustainable Packaging and Recycling Packaging materials from Coca Cola company products results in serious negative environmental impacts. Most packaging materials that Coca Cola uses for its products can be recycled but its packages are often disposed in landfills. Emissions from Coca Cola packaging accounts for nearly fifty percent of carbon emissions across its value chain and this has necessitated the company to adopt the use of sustainable materials (Dalessandro, 2001). The company is endeavoring to use recyclable materials in its packaging where it possible. The focus of packaging and recycling value chain for Coca cola Company entails the use of sustainable materials, reduce and redesign, influence of consumer behavior, recovery and reuse and recycling (Coca-Cola-Company, 2011:26). Commitment of Coca-Cola Company towards Environmental Sustainability Energy Conservation and climate change Coca-Cola Company has committed to reduce its overall carbon footprint that arises from its business operations by an absolute 15 percent by 2020. The company also aims at reducing its site energy consumption b y close to three percent in the following year (Jain & Kedia, 2011). Water Stewardship Coca-Cola Company is committed to ensuring water sustainability and water conservation and management its operations. In view of the above, the Company has committed to establish water-sustainable operations by protecting water catchment areas and sources, minimizing its waste and replenishment of the amount of water used in its operations through recycling and other innovative approaches (Morrison, 2007). The company has set a target of 1.38 liters/liter for year 2011 excluding Norway and Sweden which have a target of 1.44liter/liter. The company targets to achieve water use ratio of 1.3 liters of water to produce one liter of a beverage by 2020 (Coca-Cola-Company, 2011:22). Sustainable packaging and Recycling It is evident from the preceding paragraphs that great amount of wastes from Coca-Cola Company operations originates from its packaging materials. The Company has taken cognizant of the environmental impacts that the packagings contribute and has therefore committee to reduce the impact of its packaging. In order to reduce environmental impacts that are associated with packaging, The Company has to remain committed to maximize the use of renewable, reusable and recyclable resources for packaging (Reeve, 2000). In addition, Coca Cola Company has committed to recover the equivalent of 100 percent of its packaging through recycling and reuse. Community Coca Cola has also committed to ensure that its make a positive social, economic and environmental contribution to communities that they operate in. Conclusion Environmental reporting has become an integral component for various companies as it is an effective internal and eternal communication tool. Coca Cola Company has embraced environmental reporting as part of commitment to reduce environmental impacts that arise from its business operations and distribution. Environmental reporting in the company is majorly focused on emission reductions, efficient water management and reuse and recycling of packaging materials. The environmental reporting is based on the frameworks of United Nations Global Compact which Coca Cola company is a signatory. References Bubna-Litic, K. (2008). Environmental Reporting as a Communications Tool: A Question of Enforcement? Journal of Environmental Law , 20 (1), 69-85. Cross, F. B., & Miller, R. L. (2009). The legal environment of business: text and cases : ethical, regulatory, global, and e-commerce issues (7th ed.). Mason, OH: South-Western Cengage Learning. Coca-Cola Company. 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