December 06, 2018 11:00 AM Eastern Standard Time
ATLANTA--(BUSINESS WIRE)--James Quincey was elected today as the 14th chairman of The Coca-Cola Company, succeeding Muhtar Kent, who plans to retire in April after a Coca-Cola system career that started in 1978.
Quincey, who currently serves as president and CEO, will become chairman following the company’s annual meeting in April 2019. He will then serve as chairman and CEO. As previously announced, Brian Smith will become president and chief operating officer of the company on Jan. 1, 2019.
Kent will remain as the company’s chairman through the 2019 annual meeting, where he will not stand for reelection as a director. Kent served as both chairman and CEO from 2009 until 2017 and continued as chairman after Quincey became CEO.
Nunn to retire
The company also announced that Sam Nunn will not stand for reelection at the 2019 annual meeting, closing a 22-year tenure as a Coca-Cola director, including the last five years as lead independent director. Nunn, a former U.S. senator who represented the state of Georgia from 1972 to 1996, has served as a Coca-Cola board member through a period of remarkable changes, including the successful transition of the CEO position from Kent to Quincey in May 2017 and the rapid diversification of the company’s beverage portfolio.
The board has elected Maria Elena “Mel” Lagomasino as Nunn’s successor as lead independent director. Lagomasino joined the Coca-Cola board in 2008.
The new roles for Quincey and Lagomasino are contingent on their reelections as directors at the 2019 annual meeting.
From delivery truck to chairman
Kent, whose early days with Coca-Cola included time working on a delivery truck, has held a wide range of roles over the years. Kent’s full bio is available at //www.coca-colacompany.com/our-company/board-of-directors-muhtar-kent.
“One of the most important jobs of a chairman is to ensure that a strong leadership succession plan is in place,” Kent said. “I’m delighted that the board has elected James as chairman. He is the right leader to take the Coca-Cola system to the next level and through the next decade.”
Quincey becomes the 14th chairman in the 132-year history of the company. He joined Coca-Cola in 1996 and has held a variety of positions around the world. Quincey’s full bio is available at //www.coca-colacompany.com/our-company/operations-leadership-james-quincey.
“I’m honored that the board of directors has asked me to serve as chairman of the company,” Quincey said. “I appreciate the years of mentorship, encouragement and insights I’ve gained from Muhtar. I also join my fellow directors in thanking Sam for his many years of service, and I look forward to working with Mel as she steps into an expanded role as lead independent director.”
New lead independent director
Nunn’s wide-ranging career includes serving as co-chairman and former CEO of the Nuclear Threat Initiative. He was also a director of Chevron Corp., Dell Inc., General Electric Co. and Scientific Atlanta. Nunn’s full bio is available at //www.coca-colacompany.com/our-company/board-of-directors-sam-nunn.
Lagomasino is CEO and managing partner of WE Family Offices, a global family office serving high-net-worth families. She has held a variety of business leadership roles. She serves on the board of The Walt Disney Co. and previously was a director of Avon Products Inc. Lagomasino’s full bio is available at //www.coca-colacompany.com/our-company/board-of-directors-maria-elena-lagomasino.
As lead independent director, Lagomasino’s duties will include executing all matters of the board as outlined in the company’s corporate governance guidelines. These include leading the board’s annual evaluation of the chair and CEO; having the authority to call meetings of independent directors; approving board agendas; and presiding over meetings of independent directors and non-employee directors. For more information on the role of lead independent director, visit //www.coca-colacompany.com/investors/corporate-governance-guidelines.
“Sam has had a remarkable career and has served as a valued voice on our board of directors,” Kent said. “As he steps down, I can’t think of a better person to succeed him than Mel.”
About The Coca-Cola Company
The Coca-Cola Company (NYSE: KO) is a total beverage company, offering over 500 brands in more than 200 countries and territories. In addition to the company’s Coca-Cola brands, our portfolio includes some of the world’s most valuable beverage brands, such as AdeS soy-based beverages, Ayataka green tea, Dasani waters, Del Valle juices and nectars, Fanta, Georgia coffee, Gold Peak teas and coffees, Honest Tea, innocent smoothies and juices, Minute Maid juices, Powerade sports drinks, Simply juices, smartwater, Sprite, vitaminwater and ZICO coconut water. We’re constantly transforming our portfolio, from reducing sugar in our drinks to bringing innovative new products to market. We’re also working to reduce our environmental impact by replenishing water and promoting recycling. With our bottling partners, we employ more than 700,000 people, helping bring economic opportunity to local communities worldwide. Learn more at Coca-Cola Journey at www.coca-colacompany.com and follow us on Twitter, Instagram, Facebook and LinkedIn.
The fairlife® brand is owned by fairlife LLC, our joint venture with Select Milk Producers Inc. Products from fairlife are distributed by our company and certain of our bottling partners.
When James Quincey took the helm of Coca-Cola in May 2017, he vowed to turn the business into a "total beverage company" and move further beyond its namesake sodas.
In more than two years overseeing the Atlanta-based company, Quincey has done just that through acquisitions and innovations in many of the more than 500 brands in its global portfolio.
To be sure, Coca-Cola and other manufacturers of sugary drinks face challenges to their core beverages as some consumers move away from these products. But Quincey's decision to increase the company's exposure to better-for-you teas, waters, sports drinks and coffees, while expanding the offerings of its core sodas, has better positioned the beverage company to withstand — and even thrive — despite headwinds in the industry.
"What it means to be a total beverage company is always going to evolve because people's tastes and needs will continue to evolve," Quincey wrote in response to questions submitted by Food Dive. "Five to 10 years from now, many brands may be different or might not exist. New ones will take their place. This journey doesn't end."
Timeline of big events in James Quincey's tenure
Quincey, who has been with Coca-Cola since 1996, said much of the recent success is tied to the fact that the company "has been putting aside what we think is best for consumers and making everything we do about listening and responding to them." He pointed to the company's decision to make products such as smaller cans or Coca-Cola Zero Sugar to reflect the fact that people want less of the sweetener. Coca-Cola also has added vitamins and protein to some drinks and dropped products people weren't buying in order to invest in others.
"We're changing in the ways we need to change," he said.
Since Quincey took over, Coca-Cola has done more to improve the sustainability of its products, an increasingly important concern for consumers when deciding what products to buy. Coca-Cola has pledged to collect and recycle the equivalent of all of its packaging and to use at least 50% recycled content in its bottles by 2030.
It also has overhauled it portfolio mix by adding more coffee, energy drinks, sports drinks and sparkling water options.
Coca-Cola acquired Topo Chico premium sparkling mineral water. It also teamed up with McDonald's to introduce a line of ready-to-drink McCafe Frappes in grocery stores, and purchased a minority stake in premium sports drink maker BodyArmor. In October, Coca-Cola announced it would launch the first Coke-branded energy drink in the U.S. in 2020. Its biggest deal, however, was the $5.1 billion purchase of Costa Coffee, a U.K brand with shops and retail products, in 2018. This positions Coca-Cola to be a bigger player in the hot and ready-to-drink coffee markets.
But Coca-Cola's transformation has gone beyond just M&A. Innovation also has played a major part. With soda still a lucrative part of the company's business, Coca-Cola has taken steps to refresh its drinks to better reflect what people want in their beverages.
Coca-Cola announced its first new flavors under the trademark in more than a decade — Orange Vanilla Coke and Orange Vanilla Coke Zero Sugar — in February. It overhauled its Diet Coke empire nearly two years ago with a taller, slimmer can and rolled out several new varieties that have turned around sales. In 2017, Coca-Cola replaced Coke Zero with Coca-Cola Zero Sugar by adjusting the blend of flavors to make it taste more like the original Coke.
John Boylan, a senior equity analyst with Edward Jones, told Food Dive these products are reflective of Coca-Cola's keen ability to reposition its portfolio in a way that reaches consumers at more points throughout their day.
"The organization seems a lot more nimble internally in that they're getting a lot more innovations to market quicker that seem more impactful. It's not just incremental line extensions anymore," Boylan said. "We've been pleased with what we've seen with Coke over the past couple of years."
The acquisitions and innovations appear to be paying off. Quincey told The Wall Street Journal in October that Coca-Cola Zero Sugar has grown 14% by volume globally so far this year, while unit sales of the company's 7.5 ounce mini cans have increased 15% this year in the U.S. During its recent third quarter, Coca-Cola said organic revenue rose 5% from the same period a year earlier, helped by a 4% jump in volume for its namesake beverage.
In an interview with The Wall Street Journal, Quincey said Coca-Cola's new offerings are bringing young adults back to soda who previously didn't drink it.
"I think what you're starting to see is, yes, some reconsideration of the category," he said.
Quincey told Food Dive that despite its recent success, Coca-Cola still has plenty of work ahead.
"We're not a total beverage company in every country and territory today, and we absolutely can be. There's so much room for us to grow in new categories in markets around the world," he said. "The key is figuring out how to give consumers the drinks and experiences they want in convenient, affordable, culturally relevant ways. That alone is going to keep us busy for years to come."