February 7, 2017 – Napa, CA — Harrington Investments, Inc., (HII) a socially responsible investment advisory firm based in Napa, California, announced today that it has convinced PepsiCo, Inc. (PEP) to create a Public Policy and Sustainability Committee of the board and convinced the Coca-Cola Company (KO) to add sustainability as a fiduciary duty.
The PepsiCo board of directors has established a new Public Policy and Sustainability Committee consistent with a shareholder resolution introduced for three years by Harrington Investments.
The Harrington proposal consistently won enough votes by shareholders to be reconsidered for the third year of introduction, following dialogues with PepsiCo corporate governance staff. On February 2, 2017, PepsiCo announced that it had established a Public Policy and Sustainability Committee of the Board and assigned specific fiduciary duties to its independent members of the Committee.
PepsiCo’s action creating a Public Policy and Sustainability Committee in response to the Harrington proposal followed Coca-Cola’s response to an identical Harrington shareholder resolution calling for a Coke Sustainability Committee. Coke responded by amending the corporation’s Public Issues and Diversity Review Committee Charter to add new fiduciary language to include a committee duty to “… the review of the nature and scope of the Company’s sustainability and the Company’s progress toward achieving those goals.”
“We have been working for years to convince PepsiCo and Coca-Cola’s management that fiduciary obligations are more important than meaningless words and public relations slogans to implement sustainability and respond to climate change,” said John Harrington, President and CEO of HII. “Now fiduciary obligations and commitment have been made at PepsiCo and Coca-Cola. We look forward to corporate management’s implementation in the years ahead,” Harrington concluded.
Upon changes made by both PepsiCo and Coca-Cola, HII withdrew its resolutions from consideration.
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