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WORD COUNT
660
MAY 31, 2006
CORPORATE DEMOCRACY
NOT IN THE CARDS – by Patricia Lynn
Coca-Cola
shareholders gathered this April in the elegant ballroom of Wilmington,
Del.’s historic Hotel du Pont. They mingled amidst crystal chandeliers
and wallpaper adorned with gentle angels trailing banners saying “wealth
and luxury” unaware that they had been segregated into two lots:
Shareholders were given cards bearing Coke’s favored color, red, while
money managers, attorneys, friends and social justice activists
representing shareholders were given cards of a cautionary color,
yellow.
Over the last several
years Coke’s business practices have made it a magnet for questions and
protests by those concerned about the impact of corporate behavior on
people and their communities. Coke has been challenged on an array of
abuses, ranging from draining community wells in Indian villages to
complicity in the murders of Colombian union leaders. It has met these
charges with denial and defensiveness.
At Coke and many
other companies, annual meetings have become the one day a year when
corporate executives and boards of directors can be challenged
face-to-face. Over the last several years, Coke meetings have been
two-hour sessions of vigorous debate of the corporation abuses. Seeking
to quell dissenting voices, Coke took several actions to try to contain
democratic discussions and to control those with critical questions or
comments. Initially, Coke tried to insist that shareholders appointing
others to represent them would first have to acquire legal proxies, a
cumbersome process and one not listed in the annual proxy statement that
states the agenda and rules of the meeting. Coke bowed to shareholder
protest acknowledging that they could not just make up the rules as they
go, but then instituted the card system to exert control over who spoke
at the annual meeting.
Like those at most
large public corporations, Coke’s shareholders have for many years lined
up at a microphone to ask questions in a first-come, first-recognized
format. This year Coke abandoned that format and instead asked
shareholders to wave their cards and await recognition by CEO Neville
Isdell before speaking. In his opening remarks, Isdell promised the
selections would be random and fair.
Throughout the early
part of the meeting, Coke allowed both yellow cardholders and red
cardholders to speak. This changed when the New York City pension fund
introduced a shareholder proposal that put a spotlight on Coke’s
controversial Colombia operations by asking for an independent
commission to investigate persistent allegations of Coke complicity in
anti-union violence. Suddenly, Mr. Isdell had eyes only for the few red
cards in a sea of waving yellow ones that included activists from the
Campaign to Stop Killer Coke and United Students Against Sweatshops.
Rather than speak to the issue of Coke’s behavior in Colombia, Mr.
Isdell recognized invited red-card holding guests of the company. The
speakers included the director of the American Indian College Fund,
which receives Coke funding; a Coke bottling employee from Colombia; and
a member of the industry-friendly Hispanic Association on Corporate
Responsibility. Finally, a young Coca-Cola Scholar who received a
Coke-sponsored scholarship to Georgetown encouraged her fellow students
to do their homework and learn the facts about Coke leadership. With
that, the time allotted for discussion of Colombia expired.
Coke is not alone in
its attempt to inhibit debate. Chevron not only changed the rules of
access in midstream, insisting that shareholders go through the extra
hoops to gain legal proxy forms (no mention of this was made in the
company’s proxy materials) but also moved the venue of its meeting from
its traditional location in suburban San Francisco to Houston. Another
controversial company, Halliburton, found even Houston too accessible to
protestors and a curious media, and moved its meeting to the small,
hard-to-get-to town of Duncan, Oklahoma.
In a democracy,
corporations must be accountable to the societies that grant them
license to operate. If we gamble our democracy on corporate card games,
disappearing acts and other attempts to make democratic engagement more
difficult, society will continue to be stuck holding the bag for
corporations’ irresponsible and dangerous actions.
--
Patricia Lynn is the
Campaign Director for Corporate Accountability International—formerly
Infact—a membership organization that protects people by waging and
winning campaigns challenging irresponsible and dangerous corporate
actions around the world.
www.stopcorporateabuse.org
– A photo of Patricia Lynn is available
CLICK HERE
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