Coca-Cola's depletion of water supplies in developing countries has long been a contentious issue. Last week, it set out to make amends through a tie-up with environmental group WWF.
Criticism of Coca-Cola's heavy water usage, which equates to almost 300bn litres a year, has been serious enough to drive protesters to the streets. In 2005, thousands of activists gathered near Coke factories in India, claiming it was draining ground water in poor rural areas. While Coca-Cola said the claims were unfounded and politically motivated, it has since been forced to close its plant in Kerela on the orders of the state's pollution control board.
The partnership is not without danger for both Coca-Cola and the WWF. The soft-drinks company could be accused of belated, cosmetic gesturing, while the WWF risks tainting its reputation by aligning itself with a global US corporation.
As part of the $20m (£10m) initiative, Coca-Cola is investing in eight fresh-water programmes overseen by WWF in regions where it has bottling operations. These include seven of the world's most critical river basins, including the Danube, the Yangtze and rivers in East Africa and South America.
In return, WWF will advise the drinks firm how to improve its use of water, make its bottling operations more efficient and reduce its carbon footprint. It will also work on reducing the amount of water used in its supply chain, beginning with sugar, where it will expand its existing collaboration on the Better Sugar Initiative, an international scheme committed to developing international standards for producing sugar cane in a sustainable manner.
The first phase of the initiative will involve establishing a local water-offsetting methodology, as well as setting carbon, energy and water efficiency targets for Coca-Cola by 2008, a condition of the partnership.
But is it too little too late? The tie-up is part of Coca-Cola's focus on 'giving back to nature' this year but some experts argue that it should have confronted the effects its operations have on the environment a long time ago. 'It has been forced to do it now in response to the attacks it has encountered in recent years,' says one industry insider.
'It is just a PR stunt,' agrees David Goudge, managing director at agency Brand Development. 'The PR value Coke will get from the pledge is fantastic'. Goudge adds that the $20m investment is minimal considering the firm's financial standing. 'It is pocket money to Coke compared with how much it cost it to launch Coke Zero last year.'
Coca-Cola also faces criticism over the omission of India from its environmental pledge, although it is evident that it needs to tread carefully in a country where its water usage has generated massive media coverage. 'Its money probably is not welcome there,' says a spokesman for WaterAid, an international charity
dedicated to the provision of safe water. Despite its reputation there, Coke recently outlined its long-term plans to turn the country into its third-biggest market, which is not as implausible as it sounds, having bought India's biggest cola brand, Thums Up.
The spokesman adds that WaterAid, like many non-governmental bodies, is wary of involvement with big global brands, and warns that WWF risks damaging its brand if the partnership emerges as nothing more than a greenwash.
WWF defends the collaboration, saying it will inspire other brands to consider their water footprints. 'Coca-Cola is one of the most recognised brands in the world,' says Dax Lovegrove, head of business and industry relations at WWF. 'We think the programme will inspire other industries to conserve fresh water.'
This would certainly be a benefit concedes Goudge. 'Big companies have to be extremely careful about their green credentials, so I would be surprised if others didn't follow Coca-Cola's lead.'
WWF believes that the initiative will also communicate to consumers that water offsetting is as important as carbon offsetting. 'The world's water crisis is as important as climate change but the public doesn't get it,' says Lovegrove.
Coca-Cola will be mounting a joint promotional campaign next year, incorporating the strapline 'Make every drop count', which it already uses in the UK as part of corporate activity for its health and wellness initiative.
But with fresh allegations that the company is illegally seizing land communally owned by small farmers and dumping untreated waste water onto the surrounding community, it is clear that Coca-Cola faces ongoing negative publicity. Recent
findings by the India Resource Center claim that Coca-Cola's operations in some parts of its country are still in breach of the country's environmental rules and regulations.
The danger for Coca-Cola is that if it doesn't produce measurable results under the WWF initiative, it will face a new charge of hypocrisy.
This article was first published on Marketing