Corp-Ethics.com - Report: Coca Cola director's role questioned

Company	Coca Cola [Company Info]
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Date	Issue	Title
13th Apr 2004	Questionable Practice	Coca Cola director's role questioned

Report

An advisor to shareholders on corporate governance issues has questioned Warren Buffett's independence as a director of soft drinks giant Coca-Cola.

Institutional Shareholder Services (ISS) has urged investors not to re-appoint Mr Buffett, citing his business links to the company.

Coca-Cola dismissed the complaint and called Mr Buffett "a man of unimpeachable integrity".

It added that Mr Buffett's position was in line with stock exchange rules.

The problem, according to ISS is that companies controlled by Mr Buffett's Berkshire Hathaway investment firm buys millions of dollars of products from Coca-Cola every year.

A subsidiary called McLane, for example, last year purchased $104m of syrup and other goods from Coca-Cola.

The drinks maker, meanwhile, buys services such as advertising from companies controlled by Mr Buffett.

ISS argues that because of these relationships, Mr Buffett - one of the world's most successful investors - is far from independent and has compromised his position on the company's audit committee.

Coca-Cola, however, are keen to retain Mr Buffett's services.

The company says that his position as the company's biggest shareholders gives him a unique position and it would be a waste not to benefit from his experience.

It also said that ISS was basing its complaint on rules that applied only to the Nasdaq index and not the New York Stock Exchange. Coca-Cola shares are not traded on the technology-dominated Nasdaq.

In a statement the company said: "We think our investors would seriously question our judgement if we were to forfeit Mr Buffett's counsel based only on a definition of independence promulgated by a stock exchange where our shares are not listed."

ISS also called on shareholders to split the roles of chief executive and chairman, which are currently held by Douglas Daft.

Separately, Deval Patrick resigned as Coca-Cola's general counsel amid a probe into the company's accounts.

It has been alleged that Coca-Cola artificially inflated sales.

Other Reports on Coca Cola
Date	Issue	Company	Report
2nd Aug 2006	Other Issue	Coca Cola	Pepsi and Coke under fire again
3rd Mar 2006	Questionable Practice	Coca Cola	Coca-Cola threatens UK government over schools
19th Aug 2005	Other Issue	Coca Cola	Coke told to close Indian plant
20th Jan 2005	Questionable Practice	Coca Cola	Indians protest against soft drink companies
19th Mar 2004	Other Issue	Coca Cola	Coca Cola recalls Dasani amid cancer fears
21st Jan 2004	Other Issue	Coca Cola	Indian parliament bans Coke from Cafeteria

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