Dear Fellow Shareowners,
If you own shares in The Coca-Cola Company – or any company – you probably value these shares as you do each dollar in your bank account. As stewards of The Coca-Cola Company’s stock and as fellow shareowners, we share your appreciation for the current and future value of each share and are guided by this in every decision we make. This is why we welcome open dialogue with shareowners and consider all constructive feedback about compensation.
I would like to point out a few things in particular:
- Last year, we adopted Equity Stewardship Guidelines, under which we committed to enhance transparency about equity awards and to use substantially fewer shares. Consistent with those guidelines, the value and number of shares underlying long-term equity awards granted to executives in February 2015 were significantly lower than last year.
- We adopted new metrics tied directly to our business strategy and improved “line of sight” for employees in business units, so that long-term incentive awards are tied more directly to results that employees can influence.
- In keeping with our fundamental principle that compensation programs should pay for performance, the Company’s 2014 performance directly impacted compensation with below-target annual incentives to executives and two recent performance share unit awards not expected to pay out.
You will also see that Muhtar Kent, Chairman and Chief Executive Officer, respectfully requested to forgo any annual incentive award for 2014 in light of the difficult but necessary decisions being taken as the Company implements strategic actions to accelerate growth. The Compensation Committee respects Muhtar’s decision.
Our continued commitment to you is that we will encourage open dialogue with shareowners, welcome constructive feedback and approach compensation decisions with great care, mindful of our stewardship role. As always, thank you for the trust that you have placed in us to oversee the compensation programs of The Coca-Cola Company.