Coca-Cola's $1bn aid to minorities

Company say the move makes sound business sense

The Coca-Cola company says it intends to spend $1bn to boost business opportunities for ethnic minorities and women in the US.

The plan comes as the company is embroiled in a racial discrimination lawsuit brought by former and current employees.

The largest soft drinks company in the world says its initiative aims to strengthen local economies.

Daft wants to strengthen grassroot relationships in markets around the world

The company has promised to increase spending with minority and female-owned businesses by more than 50% to an average of $160m per year during the next five years.

The project also includes the setting-up of a mentoring programme for smaller firms to help them develop ties with Coca-Cola.

The company intends to expand its economic partnerships with about 50 urban communities across the US, and says it will provide money for non-profit organisations and scholarships.

'Business sense'

"This is a logical extension of our 'think local, act local' strategy and our desire to become a model citizen in the communities we serve," Coca-Cola Chairman Douglas Daft said.

This is a logical extension of our 'think local, act local' strategy

Douglas Daft

As well philanthropic motives, company executives also say the move makes sound business sense.

Mr Daft, who has introduced decentralisation measures since taking over the company in February, has highlighted the need for Coca-Cola to strengthen "grassroots relationships" in its roughly 200 markets around the world.

Court case

The effort to foster diversity comes as Coca-Cola deals with a legal case brought against it by a group of former and current black employees.

The group of African Americans alleges that the company tolerates a pattern of racial discrimination in pay and promotions.

Coca-Cola, which has denied the charges, said the new diversity programme was not prompted by the case.

An Atlanta-based lawyer involved in the case says the plaintiffs demand that Coca-Cola resolves the lawsuit within the next two weeks.

If it does not, they are threatening to ask the court to grant the suit a class-action status that could add hundreds of litigants to the case.