DAE Systems: Utterly Daft?

Private Eye
August 17, 2007

How wise was it of BAE Systems to appoint former Coca Cola chairman Douglas Daft to sit on its new whitewash panel ("rigorous ethics committee", shurely? Ed).

As the arms firm faces past allegations of bribery, corruption and spying on its protesters, the new committee, under Lord Woolf, is charged with examining the company's current anticorruption and ethical business policies.

Daft left Coca Cola with a $36m payoff; and under his chairmanship the drinks giant itself faced numerous allegations of abuses of workers' rights, environmental pollution and racial discrimination.

The most shocking allegations come from members of the Colombian trade union, Sinaltrainal, who complain that workers at a Coca Cola bottling plant in the country were subjected to harassment from, and even assassination by, right-wing paramilitary groups. Coca Cola vigorously denies that it colludes with or benefits from anti-union violence in Colombia.

Under Daft's lead Coca Cola was also forced to let an Indian bottling plant close after locals complained that the soft drinks firm stole their water and polluted their land. The firm also paid out $192m to settle a race discrimination case.

What is most relevant to Daft's forthcoming work for BAE Systems, however, is not just the nature of the charges he faced at Coca Cola but the way he responded to them.

Private Eye spoke to Ray Rogers of Corporate Campaign Inc, the group which leads the anti-Coke campaign in the US. Rogers had personal experience of Daft's ethical style in 2004 when he tried to address the Coca Cola annual general meeting. Daft asked Rogers to stop his speech on Coke's labour abuses, and when he didn't, security stepped in. Shocked Coca Cola shareholders watched aghast as the activist was hit, put in a chokehold and wrestled to the floor by half a dozen security staff. Even Daft, it seems, must have realised this was a PR disaster. His microphone picked up his comment: "Uh, we shouldn't have done that."

When in 2004 Coca Cola claimed that an independent report had "exonerated" it from the accusations of complicity in attacks on Colombian trade unionists, it refused to release the report. Only under pressure did it admit that it had been prepared by the law firm White & Case - the same firm that was defending Coca Cola in the lawsuit brought against it by supporters of the Colombian trade unionists.

The anti-Coke campaigner Rogers believes Daft was "part of the problem, not part of the solution" at Coca Cola and that he failed to deal with "widespread labour, human rights and environmental abuses". So perhaps his appointment by BAE Systems as an anti-corruption watchdog isn't quite as daft as it seems ...

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