Introduction
Coca Cola Company being one of the largest producers of beverages and non-alcoholic drinks in the world has witnessed a continuous growth of sales from the time of its inception. The company can be considered as an aristocrat in terms of its dividends aspect as they have been increasing for he last half century or so. This can be attributed to the effective and efficient nature of its dividends policy.
Before any dividend can be declared or paid by the company, they are subject to approval by the FEMSA’S A and D shareholders. This is through a singular or a block voting process that generally follows the director’s board recommendation. The process itself is influenced by a variety of factors that include financial position, requirements of capital, operating results and the overall conditions of business (Schirf 12).
The company’s dividends are usually paid quarterly in a year and this is usually in the months of October, December, April and July. The recipients of the dividends have the option to receive them electronically or through checks written in their preferred currency.
In the year 2012, the company’s director’s board passed a resolution for a repurchasing of shares program that would increase the company’s total number of shares by 500.This is a compliment to the standing share repurchase program that had been in effect for three decades and that allowed for the periodical repurchasing of shares (Schirf 12).
The company’s dividends policy has not changed significantly over time as evidenced by the annual financial reports released by its accounting divisions. These reports that include financial statements have shown relative similar sales to dividends ratio throughout the years and therefore proving the dividends policy has been constant.
In my opinion, dividends policy adopted by this organization is appropriate for its kind due to many reasons. The main is that it is a huge global organization with a lot of shareholders and thus an appropriate policy like the current one that caters for the huge number of shareholders is efficient. Moreover, the constant increase in dividends proves that the policy employed is indeed successful.
Works cited
Schirf, Lisa, Lagos, Theresa. Analysis of the Coca-Cola Company. New Jersey, NY: Valanium Associates.2012.
