On Tuesday, the compensation committee of Coke’s Board of Directors adopted 'equity stewardship guidelines' for the company’s existing 2014 equity plan insisting it would better align executive pay with the long-term interests of shareholders, a plan that was warmly welcomed by Warren Buffet, who heads up Coke's largest shareholder Berkshire Hathaway.
Wintergreen Advisers owns 2.5m+ shares in Coke on behalf of clients and CEO David Winters wrote to the soda giant's board in March attacking the remuneration proposal for executives including CEO Muhtar Kent.
He warned that the plan, outlined in Coke’s 2014 proxy statement , would significantly erode the per-share value of Coke shares by an estimated 14.2% - by handing management a mix of 60% options and 40% shares.
“In effect, the board is asking shareholders for approval to transfer approximately $13bn from all of our pockets to the company’s management over the next four years,” Winters writes.
In response to Coke's Wednesday statement, Winters said: "Coca-Cola has finally conceded that the equity compensation plan it put to a vote of shareholders in April was outrageously excessive and inconsistent with past plans.
"This has been Wintergreen Advisers’ publicly expressed view since we first read Coca-Cola’s proxy statement in March of this year," he added.
"No amount of backtracking by the Coca-Cola board of directors can hide the fact that we believe it tried to sneak one by shareholders in Coca-Cola’s proxy materials and statements at the April shareholder meeting," Winters said.
"Today's statement by Coca-Cola only calls into question the competence and leadership of the board of directors and management. Much more work has to be done to revitalize Coca-Cola and restore trust in the company," he added.