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US: Coca-Cola Faces Boycotts Over Colombia Murders

by Steve MatthewsBloomberg
March 2nd, 2005

Coca-Cola Co., the world's largest soft- drink maker, is facing boycotts at U.S. college campuses including New York University by students who allege the company has ignored the murder of labor organizers at bottling plants in Colombia.

"We have to take action and the action available to us is a boycott,'' said Erin Keskeny, a 19-year-old NYU drama student, rallying about 100 students and administrators at an event sponsored yesterday by the Campaign to Stop Killer Coke, an activist group formed in April 2003. "If we do take action, we can save lives.''

The University Senate may vote March 3 whether to join six U.S. universities and three in Ireland banning Coke products. As students at about 90 other campuses urged bans, investors say the boycotts could hurt the company's image among young people, who are heavy drinkers of soft drinks and just forming brand loyalties at a time when Coca-Cola's sales are slowing.

"From a public perception standpoint, you never like to see boycotts,'' said Walter Todd, who manages $1 billion at Greenwood, South Carolina-based Greenwood Capital Associates, including 375,000 Coca-Cola shares. "Companies try to promote brand awareness (to children) early on in life. Kids are a very important segment where sales are growing faster than older segments.''

The Campaign to Stop Killer Coke claims eight union leaders at bottling plants in Colombia have been murdered since 1989. Ray Rogers, the group's director, said he singled out Coca-Cola because of its ``gross human rights abuses.''

Organizing Campaigns

Coca-Cola spokeswoman Lori Billingsley said the allegations are false and investigations, including one by the Colombia Attorney General, have found no evidence of wrongdoing. "We are disappointed in the student boycotts because the campaigns are based on inaccuracies,'' she said.

Students at the Ann Arbor-based University of Michigan, which has 40,000 students, and Rutgers University in New Jersey are among those organizing campaigns calling for bans on Coke products. The students say Coca-Cola should be held responsible for anti-union violence, including the murder of a union manager in December 1996 in Carepa at a bottling plant.

Shares of Coca-Cola rose 47 cents to $43.27 in New York Stock Exchange composite trading yesterday. Before today, they had declined 13 percent in the past year.

Schools boycotting Coca-Cola products in the U.S. include Bard College in New York, Carleton College in Minnesota, Lake Forest College in Lake Forest, Illinois, College of DuPage also in Illinois, Oberlin College in Ohio, and Salem State College in Massachusetts, according to the Campaign to Stop Killer Coke based in New York.

Overseas Boycotts

In Ireland, University College Dublin, Trinity College and National College of Art and Design have also banned Coca-Cola products, said Rogers.

At the 1-hour NYU gathering, held in a lecture hall festooned with anti-Coke banners, the speakers, including a Columbian labor activist, a New York City council member and a human rights lawyer, all drew enthusiastic applause.

Afterward, Celeste Orangers, an administrator in one of the dean's offices, and an alternate on the university body that is expected to consider the boycott, said she would vote in favor.

Coca-Cola's Billingsley said the company "has publicly condemned violence in Colombia on multiple occasions.'' Coca-Cola acknowledged deaths have taken place and said its bottlers are increasing security.

`Dangerous Place'

"Colombia is a dangerous place because of its violent internal conflict, which affects union activists and other civilians from all walks of life,'' the company said.

Amnesty International and Human Rights Watch haven't endorsed the boycotts, Rogers said. Human Rights Watch on June 10, 2004, called on Coca-Cola to stop using sugar from El Salvador because of child labor. Coca-Cola said its direct suppliers don't employ children and it's working with industry groups to monitor growers.

Younger consumers have been a focus for Coca-Cola and rival PepsiCo Inc. in the U.S. as overall sales have risen less than 1 percent a year the past five years, said beverage consultant Tom Pirko, president of Bevmark in Santa Barbara, California.

``This business is pitched to youth,'' said Pirko. "Cola has been in decline for over five years and both Coke and Pepsi are sweating. The last thing they want is protests saying they are evil.''

`We Are Many'

Camilo Romero, 23, a University of California sociology student who translated for the Columbian labor activist Javier Correa, at the NYU meeting, told the gathered students: "We are many. We can occupy buildings. There are many things we can do.''

Consumers from 18 to 30 years old drink about 20 percent more than he average U.S. consumer, said John Sicher, editor and publisher of Beverage Digest, which tracks the soft-drink industry.

Dave DeCecco, a spokesman for Purchase, New York-based PepsiCo, declined to comment.

On Feb. 16, Coca-Cola reported fourth-quarter sales increased 1.6 percent to $5.26 billion, led by a 4 percent gain in international revenue, after declining in the prior quarter for the first time in more than two years. Its North American sales fell 1 percent.



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