2003 ENVIRONMENTAL REPORT - SocialFunds.com:...

28
2003 ENVIRONMENTAL REPORT

Transcript of 2003 ENVIRONMENTAL REPORT - SocialFunds.com:...

2003 ENVIRONMENTAL REPORT

Summary of 2003 Impacts From ManufacturingPlants in The Coca-Cola System

AVERAGE RATIOS FOR ESTIMATED TOTAL PLANTS SUPPLYING DATA percent SYSTEMWIDE IMPACT percent2003 2002 change 2003 2002 change

Table of Contents

A Letter from Doug Daft 1

A Letter from Jeff Seabright 2

Our Business at a Glance 4

Environmental Governance and Accountability 6

2003 in Review 10

Our Environmental Performance 12

Performance Data 21

Verification Statement 22

Water1 2.90 3.12 (7)% 297 307 (3)%

(liters/liter of product) (billion liters)

Energy2 0.54 0.57 (5)% 55 56 (2)%

(megajoules/liter) (billion megajoules)

Solid waste3 12.22 12.54 (3)% 1.25 1.24 1 %

(grams/liter) (million metric tons)

Recycling Rate 74% 76% (3)% 925 947 (2)%

(thousand metric tons)

1 Ratios vary depending on plant activity2 Estimated carbon dioxide emissions (direct and indirect) of 5.2 million tons3 74 percent of all solid waste was reused or recycled, leaving 3.2 grams per liter discarded

The Coca-Cola Company reported record finan-cial and operating results in 2003. We achievedthis performance through a strong commercialfocus and a commitment to continuous improve-ment in every aspect of our business. Even so, weknow that the full measure of success for aninternational enterprise such as ours is not justwhat we do but how we do it.

For The Coca-Cola Company, sustainablesuccess means creating economic value whilenurturing and protecting the people and naturalresources that are essential to our future.Consistent with this, we understand that thenatural resources we require for our business arenot infinite and that, in many instances, weshare them with others. Quite simply, we mustmake the most of them.

Environmental stewardship—our commitmentto protecting and preserving the environmentthrough the way we conduct our business—has been part of The Coca-Cola Company’sphilosophy for more than 30 years. Over thatperiod, it is fair to say that we have not alwayscommunicated about such stewardship as clearlyas we should have. But for a beverage producercommitted to using the finest of natural ingredi-ents and to maintaining consistently high quality,such considerations have been a constant, ifunderstated, part of our business framework.

We have long believed that we must conductour business in ways that make the least impacton the environment, consistent with deliveringwhat our customers demand. We know, too, thatour business practices are part of the value peopleassociate with our brands.

The past two years especially have seen impor-tant progress both inside the Company andamong our bottling partners. Best practices in keyareas are increasingly becoming standard practiceseverywhere. And throughout the system, we aresteadily institutionalizing concern for environ-mental issues as ordinary commercial factors.

We do not pretend to be there yet, but weare making real and tangible progress. This, oursecond systemwide report on environmentalstewardship, sets out what we have been doing

over the past year and records some specificachievements.

In two areas in particular, our system hasmade significant progress. First, we haveimproved our performance on the main envi-ronmental impacts— water, energy and solidwaste. Second, we have sharpened our focus ongovernance by creating a newly invigoratedEnvironment & Water Resources Departmentand appointing a Vice President to lead ourcorporate responsibilities in this area. In addition,our internal environmental council is helpingdrive environmental programs and implementimprovements throughout the system.

2003 also brought some notable challenges,principally in India and Panama. The systemsought to deal with these in an objective andopen manner, and the issues involved are outlinedin this report. Ours is a dynamic business, and, inkeeping with our vision of constant improvement,we accept that there will always be lessons to learnfrom such incidents that will help inform businesspractices and decisions in the future.

As I contemplate my retirement fromThe Coca-Cola Company, I am confident thatwe have in place the building blocks for atruly sustainable company—in environmentalstewardship no less than in other aspects of thebusiness. I am proud to pass on a solid foundationof environmental stewardship backed by stronggovernance.

Sincerely,

A Letter from Doug Daft

Douglas N. DaftCHAIRMAN, BOARD OF DIRECTORS, AND

CHIEF EXECUTIVE OFFICER

Constant improvement in environmental per-formance for our Company is both an enormouschallenge and a critical business imperative. Ourbrands and our reputation are the foundations ofour business, and environmental excellence in allthat we do is an investment that strengthens thoseassets. It also drives improvement in operationalefficiency and effectiveness.

By creating the new Environment & WaterResources Department last year, The Coca-ColaCompany is demonstrating its determination tostrengthen environmental governance throughoutour system. This Atlanta-based team providesleadership, governance and support for environ-mental stewardship among our own employeesand operations and those of our partners.

Given the nature of our business, threeenvironmental priority issues demand ourattention: water resource management, energyand climate change, and solid waste andrecycling. We must strive to continually improvein each of these areas.

Working with our bottling partners throughthe Coca-Cola Environment Council, we aremaking real and demonstrable progress. In 2003,we used 7 percent less water per unit of productand 5 percent less energy per unit of productthan in 2002, resulting in cost avoidance of$58 million as well as significant environmentalbenefit. Our recycling rate in operating plants,however, declined by 3 percent compared with2002 levels, and this is an area where we willfocus our efforts. Going forward, we will worktowards doing a better job in capturing envi-ronmental performance data and goal-settingat the local facility level and throughout ourentire system.

Of all the environmental issues we face,water presents the greatest challenges and

opportunities. Water is our primary ingredientand is itself a growing product category in thebeverage industry. It is also a critical naturalresource and community asset in all our markets.

We are already doing a lot of constructivework around the world on water, such as ourcollaboration with the World Wildlife Fund inEurope on water efficiency (page 13) and theRoundabout Playpumps program in Africa(page 14). However, we can and must do more.

To this end, in late 2003 we launched acollaborative effort with our entire system andour stakeholders to assess the water challengeswe face more clearly and to identify potentialsolutions. These must reach across the entirewater cycle, from watershed protection to internalefficiency to community access. We believe wehave an enormous opportunity to leverage ourexpertise, our investments and our people to beleaders through implementation of programs thatwill ensure we use water in a sustainable fashion.

To fulfill this objective, the involvement ofour bottling partners will be as essential asthat of employees in our plants. So too, will bethe support and cooperation of our suppliers.In the past few years we have reaffirmedthese bonds through our Supplier GuidingPrinciples, and this year we have initiated clos-er ties with their environmental managers in thekey areas of packaging, sweeteners, juice andother ingredients.

In the area of energy and climate, we aredirecting significant effort towards our signa-ture program to phase out hydrofluorocarbons(HFCs) and improve energy efficiency by 40 to50 percent in cold-drink equipment. We takethe issue of global climate change seriously andare focused on reducing greenhouse gas emis-sions that result from our business activities. We

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT2

A Letter from Jeff Seabright

have made significant technical progress towardidentifying HFC-free alternatives for futurenew sales and marketing equipment, and haveidentified carbon dioxide as the HFC-freetechnology of choice for our system.

Thanks to the ongoing commitment ofconsumers, recycling rates for beverage containerscontinue to be among the highest of anyconsumer products packaging. Our system isworking harder than ever to reduce the environ-mental impact of packaging by integratingenvironmental considerations into our packagingdesign process, advancing the development ofrecycling collection and processing programs,promoting cost-effective and efficient localsolutions to litter abatement, and supportingthe development of end use markets.

This also typifies another aspect of

our approach: using innovation whereverpossible to achieve environmental benefits.The Coca-Cola Company moved a long timeago from seeing the environment as mainly alegal compliance issue. Environmental manage-ment is embedded in the Company ’s qualitymanagement system in order to achieve opera-tional excellence. We are now going a stepfurther by aligning our environmental valueswith our drive for innovation so that packaging,production facilities, equipment and otherdevelopments incorporate elements of “green”design and value.

I am excited about the opportunities andchallenges before us. Working with our worldwidecolleagues, our operating divisions, our businesspartners, suppliers and bottlers, we will continueto improve environmental performance.

3A LETTER FROM JEFF SEABRIGHT ::

Sincerely,

Jeff SeabrightVICE PRESIDENT

ENVIRONMENT & WATER RESOURCES

The Coca-Cola Company andour Business SystemThe Coca-Cola Company is the world’s largestbeverage company. We manufacture, distributeand market nonalcoholic beverage concentratesand syrups in more than 200 countries. Ourproducts include some of the world’s most valu-able brands—nearly 400 in all. Information onour brands, sales and financial performance isavailable in our 2003 Summary Annual Reportat www.summaryannualreport.coca-cola.com.

The Company operates through fivegeographic segments (Africa; Asia; Europe,Eurasia and Middle East; Latin America; andNorth America) called strategic business units,plus a corporate segment. Approximately49,000 people are employed worldwide byThe Coca-Cola Company.

At the end of 2003 we owned, held a majorityinterest in or operated:• 30 beverage concentrate and/or syrup

manufacturing plants• 36 operations with 92 principal beverage

bottling and canning plants outside the United States

• 10 noncarbonated beverage productionfacilities located throughout the United States and Canada

• 1 facility that manufactures juice concentratesfor food service use

• 5 production facilities in the United States belonging to CCDA Waters, L.L.C., a joint venture with Danone Waters of North America, Inc.

For the most part, our concentrates and syrups,as well as some finished beverages, are sold tobottling and canning operations, distributors,fountain wholesalers and some fountain retailers.

This business system—The Coca-Cola Companyand our bottling partners— is referred to as “theCoca-Cola system,” or just “the system.” Thisreport covers the environmental performance ofthe system as a whole, although the system isnot a single entity from a legal or a managementpoint of view.

Our relationship with bottling partners wedo not own or control is one of collaboration andmutual support. These businesses have inde-pendent management, policies and governance

Our Bottling RelationshipsWe have three types of bottling relationships.The corresponding number represents the percentof worldwide unit case volume that each type ofbottler produced and distributed in 2003:

Bottlers in which the Company has anon-controlling ownership interest (58%).

Independently owned bottling operationsin which the Company has no ownershipinterest (24%).

Bottlers in which the Company has acontrolling ownership interest (8%).

The remaining approximately 10 percent ofour worldwide unit case volume in 2003was produced and distributed by our fountainoperations plus our juice, juice drink,sports drink and other finished beverageoperations (10%).

58%24%

8%

10%

Our Business at a Glance

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT4

structures. Many are publicly traded companieswith independent share-owner structures.Some are involved in businesses outside thenonalcoholic beverage sector. We do not controlthe policies and programs of these bottlingpartners, but we have mutual self-interests andtherefore work together to find commonground and take common action in many areas.This includes our environmental activities.

At the end of 2003, the Coca-Cola systemowned, leased or operated 961 manufacturingfacilities around the world.

Our PrincipalEnvironmental ImpactsBecause we believe that global businessesshould lead, and because the economic value ofour brands can be affected by everything we do,we take the environmental impacts of our busi-ness seriously. The following illustration depictssome of the key actions and relationships thatmake up our business system, along with theirenvironmental impacts. With this report, we arecommitted to providing as full a picture as wecan of these impacts.

5OUR BUSINESS AT A GLANCE ::

Ingredientse.g., lemon oil,vanilla &cherry flavor

Warehouses

Ingredientse.g., water,sweeteners & CO2

& Packaging

& BulkPackaging

Greenhouse Gas EmissionsFrom energy used in manufac-turing operations, either directly(e.g., in-plant boilers fueled bygas or oil) or indirectly (powerplants producing the electricityused in bottling plants)

From energy use and refrigerantleaks associated with themanufacture, operation anddisposal of cold-drink equipmentsuch as coolers and vendingmachines

From fuel used to power thefleets that deliver our productsto retailers

WasteWaste from our system’sproduction facilities includesingredient containers, damagedproduct containers, shrink orstretch film that holds palletizedproducts together, biosolidsfrom wastewater treatmentplants, wood from damagedpallets and compostable materialfrom ingredients such as tealeaves, etc.

Waste arising from the disposalof sales and marketing equipmentat the end of its useful life

Packaging waste arisingafter consumers have enjoyedour products

Our Manufacturing Process and Its Primary Environmental Impacts

BottlingPlants

ConcentratePlants

Customers

Vending Machines& Coolers

ConsumersTransport

WaterUsed in our system’s plants asa product ingredient, as wellas in operations for processessuch as purification, washingand rinsing of packaging,cleaning of product mixing tanksand piping, steam productionand cooling

Wastewater from plants requiredby Company policy to be eithertreated on-site or dischargedinto public or private sewagesystems for treatment beforebeing returned to rivers andother natural bodies of water

1.

2.

3.

1.

2.

3.

1.

2.

Environmental Governance and Accountability

Environmental management at The Coca-ColaCompany is a function of governance andaccountability. At its most basic level, thisrequires regularly updating environmentalpolicies and operating procedures, along withmanagement controls to ensure their implemen-tation. In addition, environmental governanceand accountability requires alignment with ourbottlers and other business partners. Engagementwith certain outside stakeholders also improvesour understanding of external expectations, aswell as our ability to respond to them.

Internal Management ControlsOur Company ensures environmental account-ability at every level of our organization byimplementing environmental policies andprograms, and by measuring and auditing ourenvironmental performance.

The Audit Committee of The Coca-ColaCompany’s Board of Directors has responsibilityfor environmental governance.

In 2003, the Company created the role ofVice President, Environment & Water Resources.The principal responsibility of this position is tomonitor and manage environmental governanceand performance across the business system.The position reports to the Chief Innovationand Technology Officer, who reports to theChairman and Chief Executive Officer.

The Vice President is supported by theEnvironment & Water Resources Department,which provides technical and policy expertiseon our system’s operations and environmentalimpacts. Among other things, the departmentdevelops policies, guidance and programs onenvironmental compliance and performance, aswell as leadership initiatives.

At the regional level, our strategic businessunits, divisions and production facilities have

dedicated environmental coordinators. Theseenvironmental coordinators are responsible forensuring that environmental compliance andperformance in their operations are consistentwith Company environmental policy andstandards. Environmental coordinators collabo-rate on a regional level and gather yearly for aglobal meeting.

Audit Program

Since 1993, the Company’s Legal Division, inpartnership with the Environment & WaterResources Department (and its predecessors),has managed a corporate environmental auditprogram. All Company-owned facilities areperiodically audited to assess compliance withapplicable legal and Company requirements.The program also assesses the effectiveness ofenvironmental management of all operations.As part of our management review process,audit reports are provided by the Legal Divisionto executives responsible for audited facilities oroperations. Issues identified during an audit areaddressed through a corrective action program.In 2003, more than 40 environmental, safetyand loss prevention audits were conducted atCompany-owned facilities.

eKOsystem and Company Environmental

Standards and Guidelines

Our environmental management system,eKOsystem, provides common operating stan-dards for the Company and operating guidelinesfor our bottling partners. It incorporatesenvironmental concerns into our day-to-dayoperations, even in those regions where regula-tory standards do not exist or may not be fullyenforced. In practical terms, eKOsystem mitigatesour environmental impacts, and reduces costsand increases efficiencies.

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT6

As forecast in our 2002 Environmental Report,in 2003 we launched an enhanced version ofeKOsystem that is more closely aligned with theinternational environmental management systemstandard, ISO 14001. The revised eKOsystemdocumentation includes both managementsystem standards and environmental perform-ance standards.

In addition to eKOsystem, our Company’sEnvironmental Standards and Guidelines (ESGs),formerly known as Good EnvironmentalPractices (GEPs), set out specific requirementsand guidelines for significant environmentalaspects of our operations. In addition torequired standards, ESGs also include guide-lines to help operations improve performance inkey environmental areas.

Since 1993, ESGs have been developed for:• auditing environmental and safety systems• biosolids• energy management• environmental due diligence• fleet management• managing hazardous materials• measuring and reporting

environmental performance• ozone protection• wastewater quality• water-resource management

Along with eKOsystem and ESGs, we offerperiodic environmental training for associatesand bottling partners alike. Waste$MART(Systemwide Minimization and ReductionTechniques) trains employees to identify envi-ronmental performance improvement andcost-saving opportunities in the areas of water,energy and waste reduction.

Engaging with our Bottlers andOther Business PartnersBecause so much of the economic value—andthe environmental impacts—of the Coca-Colasystem are created by our bottling partners, theCompany’s interest in environmental manage-ment extends well beyond the facilities we own.

We work constantly with our bottling part-ners to develop consistent policies, and toachieve continuous improvement in our system’senvironmental performance. We also work withsuppliers and customers to minimize theupstream and downstream impacts from ourbusiness system.

Coca-Cola Environmental Council (CCEC)

In 2003, the Company and five bottling partners,accounting for approximately 40 percent ofthe system’s global unit case volume, continuedto work together to improve environmentalmanagement across the business system bypromoting best practices and developing andvalidating environmental standards.

One of CCEC’s first objectives was to estab-lish an environmental policy-setting frameworkfor the system that would include business unitsand key bottling partners. This process is nowbeing followed for all environmental policydevelopment.

Supply Chain and Responsible Procurement

Packaging and vending machines, coolersand fountain dispensers account for a significantpart of the Coca-Cola system’s environmentalimpacts. As such, the Company has concentrateda significant portion of its environmentalpurchasing efforts on those areas.

An emerging area for our system is utilitiesprocurement. Water and energy are key inputsin our production processes. We believe thereare opportunities to realize environmental benefitsand cost savings by leveraging the purchasingpower of our system, while at the same timeoptimizing utility efficiency.

Our commercial relationships with suppliers

7ENVIRONMENTAL GOVERNANCE AND ACCOUNTABILIT Y ::

are governed by our Supplier Guiding Principlesprogram, which requires compliance with allapplicable environmental laws and regulations.We are also working with suppliers to developenvironmentally beneficial technologies. Todate, our collective efforts have produced lowerweight packaging, higher recycled contentpackaging and greater energy efficiency forcooling equipment.

Moving forward, we expect to continue toexpand our understanding of the completelifecycle of our products— from ingredientprocurement to production, to delivery, to post-consumer recycling. And we are committed toreducing environmental impact at every step.We will continue to work with our supplypartners to extend our environmental valuesthroughout our supply chain.

Engaging with Outside StakeholdersWe believe many environmental issues arebest addressed through partnerships betweencompanies, governments, nongovernmentalorganizations and local communities. Ourbusiness and environmental performancebenefits from listening to others, engaging inconstructive and honest dialogue with externalstakeholders and respecting their opinions.

At the international level, we belong to severalorganizations dedicated to addressing globalenvironmental problems. These include theWorld Business Council for SustainableDevelopment, where we participate in a waterproject and a working group on accountabilityand reporting; the Global EnvironmentalManagement Initiative, where we co-lead thewater sustainability initiative; the Society forOrganizational Learning’s SustainabilityConsortium, where we are contributing to amaterials-pooling working group currentlyexamining packaging issues; and Business forSocial Responsibility, where we participate in a“green” freight working group addressing theenvironmental impacts of transportation.

At the national and regional levels, we aremembers of many organizations dedicated topackage recycling and anti-litter campaigns.These include European Partners for theEnvironment, ASSURRE in Europe; KeepAmerica Beautiful; the Buy Recycled BusinessAlliance in Australia; and CEMPRE in Brazil.

In 2003, our Environmental Advisory Board(EAB) held two major meetings. Established in2002, the EAB is composed of outside expertswho inform our Company on existing andemerging environmental and sustainabilityissues. Through this stakeholder group, ourChairman and Chief Executive Officer, theExecutive Committee and other members ofthe senior leadership team receive candid,independent advice on environmental mattersand on our environmental policy, programsand performance.

In addition to the organizations we engageproactively, we try to be responsive to groupsthat engage us on key environmental issues:We maintain an ongoing dialogue with a numberof socially responsible investor groups andenvironmental activist organizations dedicatedto water, energy and climate, and solidwaste/resource management issues.

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT8

9ENVIRONMENTAL GOVERNANCE AND ACCOUNTABILIT Y ::

1) Absence of performance targets

The Coca-Cola Company has establishedinternal environmental performance goals forour core business operations (concentratemanufacturing). These goals cover water use,energy use, solid waste generation and recy-cling. In addition, plants representing morethan 40 percent of our volume have estab-lished plant-specific water-efficiency targets.

2) Absence of trend data

The 2002 Environmental Report establishedthe baseline for data. The 2003 report has twoyears’ worth of data, thus we are beginning toestablish trends.

3) Absence of fleet/transportation data

Although we still lack fleet information for alarge part of our system, our data set does rep-resent at least half of our distribution system.We have extrapolated to estimate our globalfleet impacts.

4) Absence of issues which received

unfavorable media attention in 2003

Our first Environmental Report coveredcalendar year 2002. The most significantissues or challenges we faced in 2003 areaddressed in this report. These include productsafety and water resource issues in India andunauthorized discharge of pollutants into awater body in Panama.

5) Limited verification statement and

stakeholder review

Statements, data and case studies presented inthe report are subjected to a rigorous internaland external verification process.

Consistent with other companies’ environ-mental reports, this year’s report includes a3-page verification statement.

6) Absence of a “vision for the future” in terms

of reporting mechanisms and the role of envi-

ronmental practices at The Coca-Cola Company

We will continue to increase our understand-ing of the complete lifecycle of our productsand to improve our environmental perform-ance measures and goals. We intend to makecontinuous progress every year. Specifically,we have initiated a systemwide strategicassessment of our access to, and use of, waterresources around the world. We will use thisprocess to evaluate how we can best ensuresustainable use and adequate protection ofthis limited resource.

Stakeholder Feedback on our 2002 Environmental ReportThis Environmental Report plays an important role in our efforts to improve environmentalaccountability. The following themes were identified by external stakeholders as areas toaddress in future reporting.

AchievementsThe Coca-Cola system’s environmental per-formance demonstrated solid improvement in2003. Our overall water use declined in 2003,even as unit case volume increased 4 percent.Water-use ratios continued to improve in 2003,as did energy and solid waste generation ratios.Full comparisons are provided in the PerformanceData section of this report (page 21).

To ensure that environmental performancecontinues to improve, the Company took thefollowing steps in 2003:

Appointment of Vice President and Enhanced

Environment & Water Resources Department

For many years, The Coca-Cola Companyhas invested financial and human resourcesspecifically toward the objective of improvingthe Coca-Cola system’s worldwide environmentalperformance. In 2003, the Company consoli-dated these resources in a new Environment &Water Resources Department, and created aVice President position to lead the Department.

Jeff Seabright was appointed to this positionin November 2003. Jeff brings considerablebusiness, environment and public policy expertiseto the Company including previous experiencewith the environmental consultancy GreenStrategies, Texaco and the United Statesgovernment. He served as executive director ofthe White House Task Force on Climate Changeand as director for the United States Agency forInternational Development (USAID).

First Systemwide Environmental Report

Although some of our bottling partners andoperating divisions had already publishedenvironmental reports, in 2003 we published

our first systemwide report on environmentalperformance. The report, covering calendar year2002, established benchmarks for assessing theenvironmental performance of the Companyand its bottling partners around the world. Inthis and future reports, data from the 2002Environmental Report will be used as a baselinefor measuring our environmental performance.

ChallengesThe Company also faced a number of environ-mental challenges in 2003. These were the mostsignificant.

Water Resources in India

Situation: In 2003, our Company was part of anational discussion in India regarding the socialresponsibility of multinational companies.Local nongovernmental organizations accusedthe Company of not operating as a responsiblecorporate citizen. Three specific accusationswere made against our Company:

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT10

2003 in Review

Our overall water usedeclined in 2003, even asunit case volume increased4 percent. Water-use ratioscontinued to improve in2003, as did energy and solidwaste generation ratios.

• an allegation that a local aquifer wasnegatively impacted by the rate and manner in which our local bottling plant was with-drawing groundwater;

• an allegation that wastewater treatment operations at our local bottling plants were generating biosolids that contained heavy metals above prescribed limits; and

• an allegation that our local carbonated soft- drink products contained unsafe levels ofpesticide residues.

Response: Testing and analysis by the Company,independent laboratories and the Indian govern-ment confirmed that our products are safe andthat our business operations are not the cause ofsignificant,negative environmental impacts.As partof our commitment to continuous improvementwe also undertook the following:

• Through a series of innovations, includingincreasing levels of rainwater harvesting foruse in our manufacturing operations, we achieved a water use reduction of about22 percent since 2001 at our plant in the state of Kerala. Our average usage in 2003 was approximately 400 cubic meters per day.

• We re-evaluated our characterization andhandling of biosolids, and issued a newCompany-wide biosolids standard. The new standard governs handling and disposal of biosolids worldwide in order to ensureresponsible environmental performance.

• We initiated a Company-wide assessment ofour access to, and use of, water resourcesaround the world. Specifically, we are evaluatingways to ensure sustainable use and adequateprotection of this limited resource.

Panama “Red Bay” Incident

Situation: In May, our Panamanian bottlingpartner discharged more than 1,000 gallons ofbeverage concentrate into a canal that flowedinto the Matasnillo River. The River flowed

into the Bay of Panama, which turned a reddish-pink color for approximately 24 hours. ThePanama National Environmental Authorityfined the bottler $300,000.

Response: Our Panamanian bottling partner hasreaffirmed its commitment to, and implemen-tation of, the Coca-Cola system’s environmentalstandards and safeguards. The Company andour bottling partner are taking the steps necessaryto ensure that a similar incident does not occuragain. The plant’s standard operating procedurefor disposal now requires that containerizedliquid waste be disposed of by a pumping service,and the plant’s employees are receiving appro-priate training for liquid disposal. In addition, anew wastewater treatment facility has beendesigned for the plant, with operation scheduledfor 2005.

11::2003 IN REVIEW

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT12

Our Environmental Performance

Scope and Coverage of the report Unless otherwise noted, this report coversmanufacturing plants owned by the Companyand our bottling partners. Offices, laboratories,research and development laboratories andwarehouses are not included. Data contributedby our bottling partners enable us to offer amore comprehensive picture of the environ-mental impacts of our business system. Althoughwe do not have data from all our bottlingpartners, we are able to estimate full systemimpacts based on the data set we do have.

Data has been collected from:• 30 out of 30 Coca-Cola concentrate and

syrup plants• 10 out of 10 plants in our juice and

juice-drink production facilities• 1 out of 1 food service juice concentrate plant• 639 out of 915 bottling and canning

plants throughout the world• 5 out of 5 CCDA water plants in

North America

Total: 685 plants

Collectively, the end-product volume coveredby these 685 plants is 83.6 billion liters ofnonalcoholic beverage products, and represents76 percent of the 2003 end-product sales volumeof brands owned by the Company.

Our 2003 data on distribution fleet perform-ance represents 53 percent of total systemwideunit case volume.

For each main impact category, we haveestimated the impacts of our Company’s opera-tions and those of our bottling partners byextrapolating the data to our system’s totalproduction volumes.

Because the operation of sales and marketingequipment is usually beyond the control of theCompany or our bottling partners, we have verylittle energy consumption data for this equip-ment. However, as with energy consumption ofappliances or automobile emissions, we are ableto estimate related environmental impacts usingenergy consumption data, laboratory testingand simulation models.

There are other environmental impacts overwhich the Coca-Cola system has limited control.We explain upstream and downstream impacts,but because this data is controlled by suppliersand customers, we are not able to provide it.

Water

Water is our largest ingredient and an increas-ingly important product category. It also is acritical resource for the well-being of thecommunities and watersheds where we operate.Given its priority, we believe that water and itsstewardship are critical to the long-termsustainability and growth of our business.

Water enters our manufacturing plants first asan input to production. Our operations obtain

AVERAGE WATER USE

2.90 liters of water per liter of product

ESTIMATED SYSTEMWIDE WATER USE

297 billion liters of water

76%of the 2003 end-product sales volume

of brands owned by the Companyis covered by these 685 plants

water from various sources including municipalwater supplies, wells, lakes, rivers and oceans.Some operations also get water from privatewater companies.

Water Use

The average total water use of the operationscovered in this report is 2.90 liters of water per literof product. The plants covered by this report useda total of 208 billion liters of water to produce71.8 billion liters of product. These productsinclude carbonated and noncarbonated softdrinks, teas and coffees, and juices in cans and bot-tles which are directly sold to consumers as well asfountain syrup, which must be mixed with waterand carbonation in retail fountain equipmentbefore being sold to consumers. Extrapolation toproduction volumes not directly covered by ourreport suggests a total water consumption of297 billion liters. This represents a reduction of10 billion liters, or 3 percent, from 2002.

Effluent

Like most manufacturing operations, our plantsgenerate effluent, or wastewater that is producedas a by-product of production. Once it has beenused, our policy states that the water be cleanedbefore it is discharged back into the naturalenvironment. Company standards require thateffluent discharged from our facilities into anatural body of water be treated consistent withapplicable law at least to a level capable ofsupporting fish life. Where municipal treatmentfacilities are not able to meet that standard, theCompany requires effluent treatment systemson-site. To demonstrate the effectiveness of ourtreatment—and in addition to laboratorytests—we maintain fish habitats (ponds andaquariums) filled with our treated effluent atmore than 152 plants throughout the world.In some cases we reuse treated effluent forirrigation or to wash trucks. As of the end of2003, about 78 percent of our system’s facilitiesmet our effluent standard, and we are workingto achieve global compliance in the near future.

13OUR ENVIRONMENTAL PERFORMANCE ::

As in many coastal regions around the world,water conservation is a serious matter on theSpanish Mediterranean. In 2003, the Company’sIberian Division partnered with WorldWildlife Fund (WWF) Spain and bottlingpartner COLEBEGA to create AH2ORRA, aprogram intended to promote water conserva-tion and reduce water consumption.

As part of the initiative, schoolchildren werepresented with educational materials featuring“Gotilde,” a cartoon water drop. The materials,which were developed by WWF Spain,delivered the messages that water is essential,and that children can help conserve it.

COLEBEGA leveraged its strong relation-ships with housewife associations to reachSpanish homes. Women were invited to visitbottling plants, where they were given aneasy-to-use water conservation device thatreduces water flow. Housewives were also givena pamphlet that included tips for additionalwater savings.

The Spanish Coca-Cola system and WWFSpain reached out to the private sector bysending jointly developed brochures highlight-ing the seriousness of the water conservationissue. These materials also included suggestionsfor improving water use in their businesses.

case study: AH2ORRA

spain

Energy and Emissions

Investigation into our climate change footprintrevealed that the three largest components ofour system’s impact on global climate changeare manufacturing, sales and marketingequipment, and fleet/transport. Each of theseis predicated on energy consumption asdescribed below.

Manufacturing

In 2003, our system consumed 37.4 billionmegajoules (MJ) of energy to produce 68.6 billionliters of products in the plants coveredby our reporting exercise. Average energy usewas 0.54 MJ per liter of product. Extrapolationof the energy use ratios to production volumesnot directly covered by our data suggests anestimated energy consumption of 55 billion MJin 2003 by all system production facilities.Improvements in energy efficiency in 2003represent a systemwide reduction in energyconsumption from 2002 of approximately1 billion MJ, or 2 percent.

We estimate that this energy consumptionleads to direct and indirect emissions of5.7* million metric tons of carbon dioxide.

Energy consumption ratios are a function ofspecific manufacturing operations. For example,because of pasteurization, juice manufacturinguses more energy than fountain syrup manufac-turing. A variety of local factors such as climate,plant size, packaging type and use of plasticbottle-making equipment also determine energyuse. Plants in our system use a variety of energysources, depending on specific needs and localconditions.

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT14

According to the World Health Organizationand UNICEF, 300 million people in Africahave no access to water. To help address thisissue, South Africa’s Department of WaterAffairs & Forestry entered into a public-privatepartnership with Roundabout Outdoor. Thislocal company invented the Playpump, a play-ground roundabout that powers a conventionalborehole water pump. The Playpump is capableof producing approximately 1,400 liters ofwater per hour at 16 revolutions per minutefrom a depth of 40 meters, and is effective upto a depth of 100 meters.

Roundabout Outdoor and the SouthAfrican government work together to identifyareas with a sufficient groundwater table andwater quality. After sites have been identified,Roundabout Outdoor locates corporatesponsors to underwrite installation of thePlaypumps, with full ownership transferringto communities.

In 2002, The Coca-Cola Companysponsored nine Playpump installations inSouth Africa’s Eastern Cape province. In 2003,the Company committed to 50 more, with thefirst 25 in Limpopo province. With estimatesthat each Playpump can provide water forseveral thousand people or so, at least 200,000rural South Africans will now have reliableaccess to safe drinking water.

AVERAGE ENERGY USE

0.54 megajoules per liter of product

ESTIMATED SYSTEMWIDE ENERGY USE

55 billion megajoules of energy

case study: Roundabout Playpump

south africa

15OUR ENVIRONMENTAL PERFORMANCE ::

Coca-Cola Enterprises’ (CCE) Los Angelesproduction facility was in need of a new roof.In an effort to address rising energy demandsat the facility, CCE investigated the possibilityof installing a photovoltaic solar-paneled roofat the plant.

Despite California utility rebates, the initialquotes were too expensive for serious considera-tion. Throughout 2002 and 2003, CCE partneredwith Solar Integrated Technologies (SIT) tofind a mutually beneficial solution. SIT agreedto cover all costs associated with the installationof a new, lighter-weight, integrated roofingmembrane and solar photovoltaic array that canlower the per watt cost of the facility. In return,SIT is allowed to lease the roof space fromCCE and to own, operate and maintain thesystem. CCE has agreed to split the cost savingsequally with SIT.

The 325 kilowatt solar roof at the Los Angelesproduction facility began generating electricityon February 13, 2004. The roof can produceabout 1,600 usable hours—equivalent to 67days—of power annually, with an approximatecost savings of more than $60,000 per year. Inaddition, the cost of a new roof was avoided,and CCE does not anticipate significant roofmaintenance for 25 years.

case study: Los Angeles Solar Roof

eKOfreshmentIn June 2000, The Coca-Cola Company announcedits intention to no longer purchase new cold-drinksales and marketing equipment (SME) usinghydrofluorocarbons (HFCs) where cost-efficientalternatives are commercially available. To beginpreparing for the transition deadline, the Companylaunched eKOfreshment to evaluate the commercialpotential of alternative SME technologies.

A worldwide cross-functional team representingour bottling partners and our Environment, Finance,Legal, Marketing, Procurement, Public Affairs andCommunications, and Research and Developmentfunctions worked to define the business case forthe new technology and to establish an energyefficiency baseline. The team also considered theimplications of new technologies for our system’ssupply chain partners, as well as equipmenttransition strategies for customers.

The eKOfreshment team examined a varietyof refrigeration alternatives including ammonia,carbon dioxide, hydrocarbon, magnetic, Peltier,Stirling and thermoacoustic technologies. Afternarrowing down the number of alternatives underconsideration to three—carbon dioxide, hydrocarbon,and Stirling— the team evaluated the technologieson the bases of environmental performance,price, application coverage, operational cost andregulatory compliance issues. Extended lab andfield testing began in the latter half of 2003.

Carbon dioxide-based refrigeration is theHFC-free technology that has emerged as the bestoption for our system. Announcements regardingthis technology are scheduled for later this year,and will be discussed in more detail in our nextenvironmental report. As it becomes available, moreinformation will be posted in the environmentalsection of our website, www.coca-cola.com.

15

5.7*

1.8

2003 Estimated Systemwide GreenhouseGas Emissions(million metric tons of CO2 or its equivalent)

Sales and Marketing EquipmentManufacturing OperationsFleet

0 10 20

los angeles, ca

Sales and Marketing Equipment.

Our system utilizes an estimated 9 millioncoolers, vending machines and fountain dis-pensers worldwide. Most of these machineskeep products cold, but some also contain hotproducts, such as ready-to-drink coffee or tea.

The environmental impacts of coolers, vendingmachines and fountain dispensers are related toenergy as well was the gases used for refrigera-tion/insulation and the solid waste generatedat disposal. We estimate that greenhouse gasemissions related to sales and marketing equip-ment are almost three times those from ourproduction facilities.

Fleets/Transport

Our bottling partners’ distribution systemsdeliver our brands to customers and consumers.This distribution system is driven by the need todeliver products to consumers as efficiently aspossible: Efficiency benefits the environment aswell as our cost structure.

Our 2003 fuel economy ratio suggests that,on average, the fleet consumes approximately7 liters of diesel per 1,000 liters of productdelivered. It is difficult to estimate the numberof distribution vehicles employed by the

Company, bottlers and contract distributors,but we believe the system owns or operatesapproximately 180,000 vehicles. In addition toenergy consumption, fleet-related environmentalimpacts include exhaust emissions. We estimatethat greenhouse gas emissions from our system’stransportation fleet are roughly one-third ofthose generated in system plants, approximately1.8 million metric tons.

Solid Waste

To some outside stakeholders, solid waste fromour product packaging is our most visibleenvironmental impact. Many observers alsobelieve that the health of recycling programs—recycling of beverage containers, other consumerproduct packaging and materials—reflects con-sumers’ commitment to the environment.

Packaging facilitates consumption of our bev-erages and plays a critical role in our marketing

One of our Japanese bottling partners, ChukyoCoca-Cola, Central Japan Group, producesGEORGIA Coffee and canned tea products atits Tokai plant. Rather than landfill the waste

generated by the facility, Chukyo Coca-Colabegan composting its waste stream.

A natural by-product of composting ismethane—a greenhouse gas. In order toaddress this issue, the Tokai plant launcheda pilot study using a bio gas recovery methane-fermentation system. This process fermentsthe plant’s waste and uses the resulting methanegas to help power boilers, and for heating andcooling. The technology was field-tested in2001 and 2002 and resulted in an 85 percentreduction in solid waste volume, while producing20,000 GJ of energy. The system is expected tobe fully operational in late 2004.

case study: Bio Gas Recovery System

japan

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT16

AVERAGE SOLID WASTE GENERATED

12.22 grams per liter of product

ESTIMATED SYSTEMWIDE SOLID WASTE GENERATION

1.25 million metric tons

In November 2001, The Coca-Cola Companyand the National Association of PET ContainerResources launched a pilot recycling collectionprogram at Atlanta Motor Speedway duringthe NAPA 500 stock car race. This initial effortutilized bags, bins, kiosks and other collectionmechanisms to collect more than 6,000 poundsof bottles and cans. This pilot also helpedimprove our understanding of waste composition

at NASCAR tracks.The next NASCAR recycling initiative, the

Samsung/RadioShack 500 at Texas MotorSpeedway in March 2003, was expanded toinclude the speedway campground.Approximately 45,000 campers received bluerecycling bags to facilitate collections at ninerecycling trailers located throughout camp-ground areas. In all, 6,760 pounds of aluminumbeverage containers and 3,360 pounds of PETwere collected.

In May, 2003, we launched a more ambitiouseffort at Lowe’s Motor Speedway (LMS) inCharlotte, North Carolina. The LMS projectencompassed two races held over two weekendswith 50 collection kiosks along the main con-course and 20 in the campgrounds. Over thetwo-week period, 25,901 pounds—nearly 13tons—of recyclable beverage containers wererecovered.

case study: NASCAR recycling

17OUR ENVIRONMENTAL PERFORMANCE ::

around the world. But, of course, it also createsan obvious environmental challenge: What todo with the package after the beverage hasbeen consumed.

In our business, the environmental impact ofour product packaging is an important issue,one where we spend focused time and effort.More broadly, solid waste is an issue in variousparts of our supply chain. For the purposes ofthis report, we focus on the area of production,where the most concentrated volumes of wastematerial are generated.

Waste in Production

In 2003, the production of 61.81 billion liters ofproducts in the plants covered by our reportingexercise yielded 755,600 metric tons of solidwaste. On average, each liter of product gener-ated 12.22 grams of solid waste. Our systemreused or recycled almost three-quarters, or74 percent, of all solid waste produced in theseplants. We discarded an average of 3.2 grams of

solid waste per liter of product.Extrapolation of waste ratios suggests an esti-

mated total generation of industrial solid wasteby our business system of 1.25 million metrictons in 2003, an increase of 1 percent from2002. Of this total, 925,000 metric tons werereused or recycled, and 329,000 metric tonswere discarded. Compared with 2002, this repre-sents an increase of 38,000 metric tons of solidwaste discarded in 2003.

As with energy consumption, the range ofsolid waste production ratios throughout oursystem is heavily influenced by local conditions.These include product mix and packaging mix.In general, though, our system’s solid waste is afunction of production, packaging and design.

Production waste includes materials such as:• empty ingredient containers (e.g., drums,

pails, jugs);• cardboard slip-sheets that separate layers of

palletized cans as they arrive;

nascar sites: tx, ga, nc

• shrink or stretch film and/or plastic strappingthat holds palletized products together;

• biosolids from wastewater treatment plants;• glass or plastic from damaged bottles;• wood from damaged pallets; and• ingredient waste, such as tea leaves.

Our system uses a wide range of packagingmaterials. Thirteen percent of our volume issold as concentrated syrup in fountain outlets.Syrup packaging is usually “bag in the box” or5-gallon, refillable stainless steel containers.Stainless steel and polyethylene plastics in sizesfrom 1 gallon to more than 1,000 liters are usedto supply concentrate and beverage bases tobottling plants. Our bottling partners, in turn,deliver our products in refillable bottles—23 percent of our volume—or in bottles, cans orother packaging that generally is recyclable—63 percent. (Numbers do not add to 100 percentdue to rounding.)

Package Waste

Packaging is a key point of differentiation and asource of competitive advantage for us. For thatto continue, our stakeholders must have confi-dence in the environmental integrity of thepackages we offer. We are working harder thanever to maintain this trust by systematicallyintegrating environmentally sound practicesacross the entire lifecycle of our packages.

DesignWe work closely with our packaging teams tominimize the environmental impact of packagingby institutionalizing design criteria into ourdevelopment and commercialization process.This means maximizing the raw materials used toproduce our packaging, exploring opportunitiesfor reuse of packaging materials, designingpackaging with its end use in mind, maximizingrecycled content materials as appropriate, andsupporting new eco-packaging innovations.

RecoveryWorldwide recovery rates for beverage containersare among the highest of any consumer productspackaging. Our system is actively involved innumerous programs designed to further increasethese rates by advancing our understanding ofsustainable solutions for diverting packagingmaterials from the waste and litter streams.Because community waste streams and manage-ment approaches vary from one country toanother, we typically tailor our recovery effortsto national and local conditions.

End UseWe work to support development of end-usemarkets for recycled packaging material. Mostnotably, our efforts to obtain regulatory approvalin various countries across the world haveencouraged and facilitated development oftechnologies for providing beverage companieswith recycled-content packaging material.While our use of recycled material varies frommarket to market, we are committed to using itwhere cost-competitive with virgin material.We also work with recycling companies toencourage the use of products and materialsmade from recycled packaging.

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT18

19OUR ENVIRONMENTAL PERFORMANCE ::

In 1996, the Brazil Division launched theCoca-Cola Recycle and Win program to helpbuild a recycling infrastructure and encourage aculture of recycling in the country.

The initiative began with local schools andtoday includes more than 4,500 partner insti-tutions in 19 of Brazil’s 26 states. Since 1996,Recycle and Win has collected and recycled

more than 2,800 tons of post-consumptionpackages, including more than 1,300 tons ofPET bottles and 1,200 tons of aluminum cans.

Along with minimizing the environmentalimpact of post-consumer waste, one importantaspect of recycling is building a market forrecycled materials. Recycle and Win has madean important contribution toward this objective.For example, the Rio de Janeiro recyclingcooperative, RioCoop 2000, has increased itsmonthly collection from 10 tons to 90 tonssince its establishment in 2000.

case study: Recycle and Win

brazil

In October 2001, The Coca-Cola Companypartnered with the Greek nongovernmentalorganization, Elliniki Etairia (HellenicCompany for the Protection of the Environmentand Cultural Heritage), to sponsor Panhellenicresearch on Greek awareness of environmentalissues. The project, conducted by the researchcompany Focus, revealed that despite environ-

mental awareness among young people,schoolchildren lacked information andopportunities about how to contribute to ahealthier environment.

In response to the research findings,The Coca-Cola Company and Elliniki Etairiaagreed on a three-year action plan—2002through 2004— to improve environmentaleducation in Greece.

For the 2002-2003 school year, the Companyworked with Elliniki Etairia to sponsor anenvironmental education program for highschool students. The curriculum was developedby an environmental educator and supervisedby Elliniki Etairia. In the initial phase, theprogram was implemented in 16 schools—12in Athens and 4 in Salonica—with materialsdelivered to approximately 700 students.

case study: GreekEnvironmental Education

greece

In Mexico, the Coca-Cola system is improvingits environmental performance by creatingrecycling opportunities inside and outsideits facilities.

At the Pacabtum bottling plant in southernMexico, an analysis revealed that more thanone-third of the waste generated by the facilityin 2001 was not being recycled. To considerwhether this performance might be improved,the plant conducted a detailed study of thewaste it created over a one-week period inJanuary 2002. The analysis determined that ofthe 35.9 tons of waste generated during theweek, 30.5 tons—about 85 percent—could berecycled. After additional analyses showed thatthe main causes of the recycling shortfall werea poorly developed segregation infrastructureand limited knowledge of segregation processes,

the plant built a segregation infrastructure fromused postmix containers and developed atraining course. By June 2002, nonrecycledwaste had fallen to 1,150 kilograms per monthfrom 2,050 kilograms in December 2001—a decrease of almost 44 percent.

The Mexican Coca-Cola system is workingto increase post-consumer recycling. In 2002,the Coca-Cola system and a number of otherMexican beverage industry companies—including several competitors—createdECOCE, a nonprofit association charged withcreating a market for post-consumer PETbottles. In 2003, the Company joined FEMSA,its largest Mexican bottling partner, and theplastics company Alpla Mexico in foundingIMER. Using ECOCE as its main supplier,IMER will recycle post-consumer PET bottlesinto food-grade flake for direct contact (bottle-to-bottle) recycling.

The PET recycling facility in Toluca iscurrently under construction and will be thefirst of its kind in Latin America. The plant isexpected to have a capacity of 17,000 tons peryear of food grade flake and 8,000 tons peryear of secondary products (labels, caps, sand,etc.). It is scheduled to open in late 2004.

case study: Recycling in Mexico

mexico

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT20

Performance Data: Impacts by type of production

21PERFORMANCE DATA ::

Concentrate & Beverage Base 0.014 0.015 (7)%(liters of water per liter of finished product equivalent)

Bottle/Can 2.95 3.16 (7)%(liters of water per liter of finished product)

Juices 1.76 2.43 (28)%(liters of water per liter of juice)

Fountain Syrup 1.34 1.12 20 %(liters of water per liter of syrup)

Packaged Water1 1.48 — —(liters of water per liter of finished product)

OPERATION WATER USE RATIO percent2003 2002 change

Concentrate & Beverage Base 0.007 0.007 —(megajoules per liter of finished product equivalent)

Bottle/Can 0.54 0.56 (4)%(megajoules per liter of finished product)

Juices 0.81 0.86 (6)%(megajoules per liter of juice)

Fountain Syrup 0.34 0.38 (11)%(megajoules per liter of syrup)

Packaged Water 0.31 — —(megajoules per liter of finished product)

OPERATION ENERGY USE RATIO percent2003 2002 change

Water

Energy

OPERATION SOLID WASTE RATIO percent2003 2002 change

Solid Waste

Concentrate & Beverage Base 0.1 0.1 —(grams per liter of finished product equivalent)

Bottle/Can 12.49 12.74 (2)%(grams per liter of finished product)

Juices 8.13 9.79 (17)%(grams per liter of juice)

Fountain Syrup 3.28 2.74 20 %(grams per liter of syrup)

Packaged Water 2.85 — —(grams per liter of finished product)

1 We began recording packaged water data in 2003, after our joint venture with CCDA Waters, LLC.

Verification Objectives and ScopeURS Verification Ltd (URSVL) was commis-sioned by The Coca-Cola Company (“theCompany”) to provide third-party verificationof environmental data and claims presented inits 2003 Environmental Report (“the Report”).

Key objectives of the verification includedreviewing the:• transparency and completeness of the

environmental information reported;• effectiveness of data collection, collation

and validation systems;• accuracy of environmental performance

data within a sample of divisions andbottlers; and

• implementation and communication ofenvironmental arrangements withinthe Company.

Responsibilities of Directorsand Verifiers The information contained in The Coca-ColaCompany 2003 Environmental Report is the soleresponsibility of the Company. This verificationstatement represents the independent opinionof URSVL. The URSVL project team membershave not been involved in the development ofthe Company 2003 Environmental Report orassociated environmental programs, and data orinformation collection systems.

Verification MethodThe approach followed by URSVL is alignedto ISO/IEC Guide 66 and InternationalAccreditation Forum (IAF) Guidance to thisdocument (IAF GD 6:2003). These are inter-national frameworks outlining the generalrequirements for bodies operating independentassessment and certification/registration of

environmental management systems.URSVL environmental auditors conducted

the verification process following the generalprinciples of environmental auditing and auditprocedures as contained within the internationalstandards, ISO 19011. We have also embeddedin our approach certain principles of the GlobalReporting Initiative (GRI) and the AA1000assurance framework.

The URSVL process has therefore involved:• review of the Report to identify material

information in the data and text thatconstitute claims or assertions made bythe Company;

• review of each identified claim or assertion against the supporting evidence to determineits accuracy and appropriateness;

• review of data management processes used for environmental performance data, focusingon the validation mechanisms to verify robustness and assess the potential for errors within the 2003 data set;

• interviews with key personnel involved in preparation and validation of the Report;

• interviews with key personnel involved in managing environmental performance at a corporate and division level, plus key bottler representatives as well; and

• review of a sample of corporate, division andbottler information, documentation, reports,guidelines and other relevant materialassociated with managing environmentalperformance.

The corporate and division interviews focusedon a sample of divisions from each of theCompany’s geographic operating segments(strategic business units), in Africa; Asia;Europe, Eurasia & Middle East; Latin

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT22

Verification Statement

America; and North America, together with arange of key bottler representatives.

OpinionAccuracy

The environmental performance reportingsystem is effective, generating data which, whenaggregated at a corporate level, is generallyaccurate, reliable and indicative of the overallenvironmental performance of the Coca-Colasystem. However, there continue to be minorinefficiencies in the systems and processes usedfor the collection and management of data atcorporate and division levels.

In the sample of data and informationchecked by URSVL some minor inconsistencieswere identified, which have, wherever practical,been addressed by The Coca-Cola Company.However, a greater degree of confidence in dataaccuracy would be achieved from an improvedresponse rate and checking of source data ata site level.

The approach to data validation and theidentification of systemic errors is generallyappropriate when applied to the Company-owned plants but continues to provide a lowerlevel of assurance for sites outside the directcontrol of the Company. As a result, thereremains potential for material errors to occur inthe aggregated figures.

In this second Environmental Report there isevidence of maturing internal validation systemsand, therefore, textual claims and statementsmade by The Coca-Cola Company are generallysupported by evidence obtained during the veri-fication process.

Transparency and Completeness

URSVL understands that The Coca-ColaCompany’s Environmental Report is intendedto cover only its key environmental strategies,processes and performance indicators. It isURSVL’s opinion that the text and data pre-sented in this report reflect the Company’s keyenvironmental impacts. However, the depth and

emphasis of coverage may not reflect the level ofinvestment and management focus for a numberof topic areas.

URSVL welcomes the Company’s movetowards greater transparency in disclosure ofenvironmental challenges and trend data. As thereport develops, deeper coverage of how theCompany intends to improve its environmentalperformance would present a more representativeview of the Company’s response to current andfuture challenges facing the business.

The Company has made an encouragingstart to the inclusion of stakeholder opinions inthis report. We look forward to increasingresponsiveness to stakeholders and their moredirect influence on the issues covered in thiswritten report.

Environmental Arrangements

Environmental programs across the Coca-Colasystem have continued to progress in the past year.There remains, however, considerable progressto be made on alignment of these programs to ahigher-level Company vision and strategy. Thiswould provide a more coherent framework thatcan drive future environmental performance andreporting. This strategic framework wouldenable easier development of specific objectivesand targets against which performance could bebenchmarked and more transparent reportingcould be achieved.

URSVL identified that environmental issuesare considered in a number of decision-makingprocesses, however, these are not currentlystrategically aligned to a systemwide risk controlframework. A more systematic and integratedapproach to identification and control of sys-temwide environmental risks into core businesssystems should provide mechanisms for effectivecommunication and management of key envi-ronmental risks.

URSVL recognises the substantial effortmade towards introducing a new governancestructure for managing environmental issues ata corporate level, including initiating a process

23VERIFICATION STATEMENT ::

for reporting on environmental issues to theBoard. There continues to be evolution in rolesand responsibilities and we look forward to theseshowing benefits in environmental controls.

The Company engages with a wide range ofstakeholders on environmental issues, however,greater benefit could be achieved through moreformal programs and mechanisms to identify,understand and engage with key stakeholders.

URSVL commends the ongoing commit-ment to working with key bottlers on a range ofbusiness issues including the environment, and inparticular the Coca-Cola Environment Council.We look forward to seeing further progress asthis forum expands and develops.

Suggestions for ImprovementsBased on the above opinion and scope of workthe following suggestions should enable continuedimprovement in the Company’s environmentalprogrammes and reporting:

• identify and implement possible mechanismsand/or incentives that could facilitate furtherimprovements in data collection and validationat corporate, division and site levels, includingsource data checking;

• develop emerging stakeholder programs to increase responsiveness to stakeholder

opinion and directly influence issues covered in the report;

• establish and report on targets to enable tracking of performance associated with the environmental strategy implementation; and

• develop systems and processes in response tonew roles and responsibilities to ensure that operational and decision making structures are aligned, to improve the effectiveness of environmental controls.

:: THE COCA-COLA COMPANY 2003 ENVIRONMENTAL REPORT24

David WestwoodDirectorFor and on behalf of URS Verification LtdLondon, May 2004

URSVL has carried out its services by checking samples of data,information and documents which have been made available toURSVL by The Coca-Cola Company. Accordingly, URSVL hasnot checked or reviewed all of the company’s data, information anddocuments. The verification statement provided herein by URSVLis not intended to be used as advice or as the basis for any decisions,including, without limitation, financial or investment decisions.

An online version of this report can be foundat www.environmentalreport.coca-cola.com.

Legal Statement: This Environment Report may contain statements, estimates or projections that constitute “forward-lookingstatements” as defined under U.S. federal securities laws. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,”“project,” “will” and similar expressions identify forward-looking statements, which generally are not historical in nature. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from The Coca-ColaCompany’s historical experience and our present expectations or projections. These risks include, but are not limited to, changes ineconomic and political conditions; changes in the nonalcoholic beverages business environment, including actions of competitors andchanges in consumer preferences; product boycotts; foreign currency and interest rate fluctuations; adverse weather conditions; theeffectiveness of our advertising and marketing programs; fluctuations in the cost and availability of raw materials or necessary services;our ability to avoid production output disruptions; our ability to achieve earnings forecasts; our ability to effectively align ourselveswith our bottling system; regulatory and legal changes; our ability to penetrate developing and emerging markets; litigation uncer-tainties; and other risks discussed in our Company’s filings with the Securities and Exchange Commission (the “SEC”), includingour Annual Report on Form 10-K, which filings are available from the SEC. You should not place undue reliance on forward-lookingstatements, which speak only as of the date they are made. The Coca-Cola Company undertakes no obligation to publicly updateor revise any forward-looking statements.

References in this report to The Coca-Cola Company or the Company are intended to refer collectively to The Coca-Cola Companyand its operating divisions and subsidiaries. References to the Coca-Cola system or the system are intended to refer collectively tothe Company and several different types of beverage bottling entities and operations more completely discussed and explained in thereport, including independently owned bottlers, bottlers in which the Company owns an investment but non-controlling ownershipinterest, and bottlers in which the Company owns a controlling ownership interest.

Environmental Statement: Our Company’s commitment to environmental issues is guided by a simple principle: We willconduct our business in ways that protect and preserve the environment. Throughout our organization, our employees at all levels areproactively integrating our Company’s environmental management system (eKOsystem) throughout all business units worldwide.We use the results of research and new technology to minimize the environmental footprint of our operations, products and packages.We seek to cooperate with public, private and governmental organizations in pursuing solutions to environmental challenges. We directour Company’s skills, energies and resources to activities and issues where we can make a positive and effective contribution.

This report was printed on 100 percent post-consumer waste recycled paper that is also process chlorine free (PCF). The paper,paper mill and printer are all certified by The Forest Stewardship Council, which promotes environmentally appropriate, socially ben-eficial and economically viable management of the world’s forests. The report was produced in a totally enclosed printing facility thatresults in nearly zero volatile organic compound (VOC) emissions. Anderson Lithograph’s certification number is SCS-COC-0533.

Coca-Cola is a registered trademark of The Coca-Cola Company.

© 2004 The Coca-Cola Company. All rights reserved.

Des

ign:

VS

A P

artn

ers,

Inc.

E

xecu

tive

Pho

togr

aphy

: Art

hur

Mey

erso

n an

d G

uerr

y R

edm

ond

P

rintin

g: A

nder

son

Lith

ogra

ph

Pub

lishe

r: C

ompa

ny Im

age

Com

mun

icat

ions

The Coca-Cola CompanyOne Coca-Cola PlazaAtlanta, Georgia 30313

www.coca-cola.com