Drinks manufacturing giant Coca-Cola and eight bottling partners have closed a $137.7 million (£105m) venture capital fund focusing on sustainability investments that will be managed by VC firm Greycroft.
The bulk of the capital comes from Coca-Cola and the eight bottlers accounting for nearly half of the Coca-Cola system’s global volumes, who have each contributed $15 million (£11.4m).
The Greycroft Coca-Cola System Sustainability Fund will focus on technologies that can reduce the carbon footprint of the Coca-Cola system in areas including packaging, heating and cooling, facility decarbonisation, distribution, and supply chain.
“This fund offers an opportunity to pioneer innovative solutions and help scale them quickly within the Coca-Cola system and across the industry,” said Coca-Cola president and CFO John Murphy.
The plan is to invest in companies “at the point of commercialisation,” according to Coca-Cola and its bottlers, who have invested in several packaging tech startups in recent years.
These include Ioniqa, which seeks to transform mixed-colour, partly contaminated PET waste into clear, food-grade PET; and CuRe Technology, which uses polyester rejuvenation to target plastics that cannot be recycled by mechanical recycling methods and prevents them from being incinerated, downcycled or sent to landfill.
Several Coca-Cola bottlers have also issued green bonds.
“We expect to benefit from getting access to emerging technology and science for sustainability and carbon reduction,” said the company, which has committed to making 100% of its packaging recyclable by 2025. It also aims to have at least 25% of its beverages by volume sold in refillable/returnable bottles or in fountain dispensers with reusable packaging by 2030.
However, the world’s larger drinks company has a poor track record when it comes to meeting packaging sustainability pledges. In 1990 Coca-Cola and PepsiCo both announced plans to sell soda in bottles made from 25% recycled PET but phased them out shortly afterwards owing to high costs.
Coca-Cola’s sponsorship of the 27th annual United Nations Climate Change Conference (COP27) was also called into question after being labelled greenwashing by climate activists, arguing Coca-Cola produces 120 billion single-use plastic bottles a year, ranking the drinks company as one of the globe’s top plastic polluters.
According to its latest sustainability report, Coca-Cola’s PET bottles currently contain 15% recycled material, while PepsiCo’s plastic packaging contains just 7% recycled content. Both have set targets to use 50% recycled content by 2030.
Coca-Cola’s current system
Coca-Cola sells concentrates to authorised bottling partners, who combine them with still or sparkling water and sweeteners and then package, sell and distribute the finished beverages.
In 2021, five of its 225 bottling partners accounted for almost half (41%) of its global case volumes:
- Coca-Cola FEMSA, serving Latin America
- Coca-Cola Europacific Partners (CCEP), serving Western Europe, Australia, the Pacific and Indonesia
- Coca-Cola HBC AG, serving Eastern Europe
- Arca Continental, serving Latin America and parts of North America
- Swire Beverages, serving Asia and parts of North America
The eight bottlers contributing to the new fund are:
- Arca Continental
- Coca-Cola Bottling Company United
- Coca-Cola Consolidated
- Coca-Cola Europacific Partners (CCEP)
- Coca-Cola FEMSA, Coca-Cola HBC
- Reyes Coca-Cola Bottling
- Swire Coca-Cola
