Chairman and Chief Executive Officer of the Coca-Cola Company Douglas Daft spoke yesterday about the ethical and moral responsibilities of businesses while around 20 Yale students and New Haven residents protested what they called Coke’s poor international labor practices.
Speaking to over 100 audience members at the 11th Annual Coca-Cola World Fund at Yale Lecture in Luce Hall Auditorium, Daft argued that good social policies are, in fact, in line with the principles of Adam Smith. He also discussed the interactions of businesses with local populations and the positive role such interactions can play in improving the quality of life for residents.
As Daft began his speech, protesters proceeded to the front of the room and removed their coats to reveal shirts stained with fake blood. The protesters lay on the floor as if they were dead and remained so throughout the talk. Other demonstrators passed out literature accusing members of Coke’s board of being complacent about the murders of union members at the company’s plants in Colombia. The group also unfurled two banners, one reading “Coke: Proud sponsor of Colombian Death squads.”
Though visibly disturbed by the protest, Daft said he would continue with his planned speech and that he would answer questions related to the demonstration afterwards.
If businesses fail to pay attention to ethical and moral responsibilities, the repercussions around the world could be serious, Daft said.
“By becoming more efficient and more profitable, it makes businesses better for the community,” Daft said. “But, I admit that some people may find this insincere.”
In response to this concern, Daft said businesses are wrong when they think that Smith was solely concerned with profit.
“Smith believed that businesses should play an important social and civilizing role,” Daft said. “Trust is the oxygen of business. Trust has to result from good business. Too many corporate leaders stopped trying to excite moral virtue in fellow men. The result, of course, has been a loss of confidence in businesses. Businesses have to remember both sides of Adam Smith; they have an obligation to the society as a whole.”
Introducing the speaker, Yale Center for International and Area Studies Director Gustav Ranis said Daft has worked to decentralize the operation of Coke.
“His motto is to think globally and act locally,” Ranis said. “This policy has allowed Coke to get closer to the consumer.”
Daft said he thinks that every business must be run like a local business. Coke has employed this principle by bottling all of its products at the local level. As a result, Daft said he believes that people have a close relationship with Coke.
“We want people to say Coke is ‘My Coke,'” Daft said. “Doing the right thing in that community is a real brand-builder for us. It is as good as a 30-second commercial.”
At a question and answer session after the speech, demonstrators repeatedly mentioned an allegation that Coke used a paramilitary group to assassinate a union leader. Thomas Frampton ’06 criticized Yale for inviting Daft.
“It is atrocious given Coke’s labor practices that this university would roll out the red carpet for the CEO,” Frampton said. “It is stunning that [Daft] would give a speech about good business practices.”
University Police initially tried to bar demonstrators from entering a reception after the talk. After the officers relented, the protesters surrounded Daft and peppered him with questions regarding Coke’s labor relations, causing him to leave the reception early.
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