Proxy Blog

The Coca-Cola Company

April 8, 2019

The annual proxy for this nonalcoholic beverage company had the following proposals: 

  1. Proforma votes on directors, the appointment of auditors, and executive compensation 
  2. Votes on shareholder proposals covering independent chairman and report regarding sugar and public health 

Magni voted as follows: 

  1. For proforma proposals:
    -Directors  The board has a majority of independent directors and some have CEO/CFO experience with other companies. The compensation of directors is disclosed with a meaningful portion in equity where the equity has restrictions to align director incentives with long-term value creation. The compensation levels are set using a benchmarking process.
    -Auditors  There appear to be no controversies with the financial statements of the company.
    -“Say-on-pay” Advisory Vote – The shareholder engagement and peer group disclosures indicate good governance practices in executive compensation. 
  2. For and against shareholder proposals:
    -For proposal on independent chairman. Magni wrote a position paper regarding shareholder proposals for independent chairman. 
    -Against proposal on sugar and public healthThe topic of sugar is significant as the US, and increasingly around the globe there is a rapid increase in obesity and diabetes. Sugar-based drinks are part of the problem. That said, Magni voted against the proposal for two reasons: (1) the proposal is rambling and appears to try to tarnish Coca-Cola with a broad range of allegations, often unrelated to the proposal; and (2) the proposal covers the same ground as a group called ATNF produces. ATNF is funded by independent entities, such as the Bill & Melinda Gates Foundation, the Dutch Ministry of Foreign Affairs, and the Robert Wood Johnson Foundation. In the future, a more focused proposal that recommends a reasonable change to the company where something new and important is produced would warrant a favorable vote.