PepsiCo announces strategic end-to-end transformation to shape how the company will create growth and value

Mihai Cristea 16/09/2021 | 10:58

PepsiCo, Inc. today introduced pep+ (pep Positive), a strategic end-to-end transformation with sustainability at the center of how the company will create growth and value by operating within planetary boundaries and inspiring positive change for the planet and people. pep+ will guide how PepsiCo will transform its business operations: from sourcing ingredients and making and selling its products in a more sustainable way, to leveraging its more than one billion connections with consumers each day to take sustainability mainstream and engage people to make choices that are better for themselves and the planet.

 

“pep+ is the future of our company – a fundamental transformation of what we do and how we do it to create growth and shared value with sustainability and human capital at the center. It reflects a new business reality, where consumers are becoming more interested in the future of the planet and society,” said Ramon Laguarta, PepsiCo’s Chairman and CEO. “pep+ will change our brands and how they win in the market. For example, imagine Lay’s will start with a potato grown sustainably on a regenerative field, and then be cooked and delivered from a Net-Zero and Net Water Positive supply chain, sold in a bio-compostable bag, with the lowest sodium levels in the market. That’s a positive choice. That’s the best tasting, #1 potato chip of the future. That’s how pep+ will be better for people, for the planet, and for our business. Now, imagine the scale and impact when applied to all 23 of our billion-dollar brands.”

pep+ drives action and progress across three key pillars, bringing together several industry-leading 2030 goals under a comprehensive framework:

·        Positive Agriculture: PepsiCo is working to spread regenerative practices to restore the Earth across land equal to the company’s entire agricultural footprint (approximately 7 million acres), sustainably source key crops and ingredients, and improve the livelihoods of more than 250,000 people in its agricultural supply chain. These goals are already being brought to life in Europe through the company’s use of precision agriculture technology and innovation in fertiliser. PepsiCo in the UK is trialing technology to convert waste potato peelings from making PepsiCo’s Walkers crisps into low-carbon, nutrient-rich fertiliser. An initial pilot resulted in a 70% reduction in emissions from growing potatoes and so in 2022, PepsiCo will broaden its trials across more markets in Europe.

·       Positive Value Chain: PepsiCo will help build a circular and inclusive value chain through actions to:

  • Introduce more sustainable packaging into the value chain including a new global goal to cut virgin plastic per serving by 50% across its food & beverage portfolio by 2030[1]; and
  • Today, introduced a new global workforce volunteering programOne Smile at a Time, to encourage, support and empower each one of its 291,000 employees to make positive impacts in their local communities.

A critical focus of driving a positive value chain has been on building a circular economy for packaging in Europe. Denmark and Finland recently announced they will join another nine Europe markets to switch to 100% recycled plastic bottles for brand Pepsi by 2022. This follows a similar move for other brands last year, including Lipton Iced Tea and is backed by the company’s continued support for well-run, industry-led Deposit Return Schemes in many European markets, to enable over 90% collection of beverage packaging.

PepsiCo is also continuing to drive towards a circular economy for flexible packaging though a series of collaborations and innovation investments.  This includes PepsiCo’s participation in various sorting and recycling technologies, including the next phase of the Holy Grail digital watermarks initiative, with trials taking place on PepsiCo’s food packaging in France and Germany in 2022.  The company also continues to invest in the creation of infrastructure for the recycling of flexible packaging, through Extended Producer Responsibility schemes in different markets, as well as direct investment in schemes like the Flexible Packaging Fund in the UK.

·     Positive Choices: PepsiCo continues to evolve its portfolio of food & beverage products so that they are better for the planet and people, including by:

  • Incorporating more diverse ingredients in both new and existing food products that are better for the planet and/or deliver nutritional benefits, prioritizing chickpeas, plant-based proteins and whole grains;
  • Expanding its position in the nuts & seeds category, where PepsiCo is already the global branded leader, including leadership positions in Mexico, China and several Western European markets;
  • Accelerating its reduction of added sugars and sodium through the use of science-based targets across its portfolio and cooking its food offerings with healthier oilsAlready, PepsiCo Europe has announced its commitment to reduce the average level of added sugars in its beverage portfolio by 50% and to build a $1 billion portfolio of foods rated Nutri-Score B or better by 2030; and
  • Continuing to scale new business models that require little or no single-use packaging, including its global SodaStream business – an icon of a Positive Choice and the largest sparkling water brand in the world by volume. SodaStream, already sold in more than 40 countries, is bringing PepsiCo flavor options like Pepsi Zero Sugar, Lipton and bubly to 23 markets, and its new SodaStream Professional platform will expand into functional beverages and reach more than 10 additional markets by the end of 2022, part of the brand’s effort to help consumers avoid more than 200 billion plastic bottles by 2030.
  • As part of its vision, the company is also looking to increase transparency for consumers and help them to make sustainable choices. PepsiCo recently announced its participation in the front-of-pack environmental scoring project led by Foundation Earth. The project is aimed at assessing the ability of different labelling schemes to promote more sustainable buying choices for consumers, as well as driving environmental progress for food producers.

 

“This is a major transformation for our business. It is the right thing for our planet and for people as we evolve our portfolio and provide positive choices for consumers. This requires long-term investment, new ways of engaging across our value chain and a culture shift to do things differently,” commented Silviu Popovici, PepsiCo Europe’s CEO. “However, making these changes alone won’t be enough. We need to collaborate with governments and other stakeholders to help us go faster and ensure we have the right infrastructure and eco-systems to succeed as we reimagine the way food is grown, made and enjoyed.”

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