Following PepsiCo’s introduction of Pep+, a policy that aims to improve the company’s agricultural footprint by addressing its packaging processes and greenhouse gas emissions;
Holly Inglis, Beverages Analyst at GlobalData, a leading data and analytics company, offers her view:
“Pep+ will keep PepsiCo ahead of the competition amid consumers’ ever-increasing demand for sustainability. The policy will be popular with the 70 %* of global consumers that stated they prefer ingredients that are sourced sustainably and ethically.
“GlobalData notes that consumers are yearning for drinks that are both better for them and better for the planet. Therefore, focusing on beverages that are thought of as ‘healthy’ and ‘sustainable’ such as dairy alternatives, flavoured waters and iced teas may be a good bet in the long term given their historical popularity in a number of markets across the globe. If PepsiCo continues to utilize these categories like Lipton, in combination with the new policies, the company will be able to get a big leg up on its competitors.
“It is clear that consumers are watching brands’ actions closely, as well as changing their purchasing habits based on how brands respond to the environmental crisis. GlobalData’s Q1 2021 global consumer survey reports that 33 %** of people worldwide like to see news about a brand’s sustainability initiatives.”
*GlobalData’s Q2-21 Consumer Survey – Global – Combined responses: “somewhat appealing” and ‘very appealing” for the question “how appealing do you find the following? Sustainably/ethically sourced ingredients” **GlobalData’s Q1-21 Consumer Survey – Global
PepsiCo, Inc. 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 a number of 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.
Positive Value Chain: PepsiCo will help build a circular and inclusive value chain through actions to:
Achieve Net-Zero emissions by 2040;
Become Net Water Positive by 2030; and
Introduce more sustainable packaging into the value chain.
PepsiCo announced new goals to cut virgin plastic per serving by 50 % across its global food & beverage portfolio by 20301, using 50 % recycled content in its plastic packaging and scaling the SodaStream business globally, an innovative platform that almost entirely eliminates the need for beverage packaging, among other levers.
The company will also progress its more than $570 million diversity, equity and inclusion journey; and
introduced a new global workforce volunteering program, One Smile at a Time, to encourage, support and empower each one of its 291,000 employees to make positive impacts in their local communities.
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 oils; 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.
“pep+ directly links the future of our business with the future of our planet, for the benefit of both – from how we source ingredients and make and sell our products; to how we inspire consumers through our iconic brands to make better choices for themselves and the planet; to how we support communities and improve livelihoods throughout our supply chain,” said Jim Andrew, Chief Sustainability Officer, PepsiCo. “Take SodaStream, for example. By rapidly expanding the SodaStream ecosystem, we are meeting the needs of consumers at home, away from home, and on-the-go. At the same time, we are also offering consumers positive choices that use less plastic, create fewer emissions, and are better for people. pep+ is our roadmap to create the food and drinks people love in a way that helps build the sustainable future we all must have.”
The company’s brands across its food & beverage portfolio are accelerating their efforts to realize PepsiCo’s sustainable packaging vision and leveraging their influence to educate consumers on recycling and the planetary impacts of their choices.
11 European markets are moving key Pepsi-branded2 products to 100 % rPET bottles by 2022. PepsiCo estimates that shifting to a 100 % rPET bottle will lower GHG emissions by approximately 30 % per bottle.
In the U.S., all Pepsi-branded products will be converted to 100 % rPET bottles by 2030, with Pepsi Zero Sugar beginning to be sold in 100 % rPET bottles by 2022. The brand is celebrating this important move to sustainable packaging with a new consumer-centric platform leveraging fall football and driving recycling awareness, education and advocacy, which are critical because rPET availability depends on consumers’ commitment to recycling.
PepsiCo has been investing in breakthrough food packaging technology and is now introducing a fully compostable bag made with plant-based materials. Starting with Off The Eaten Path, one of Frito-Lay’s plant-based brands, this industrially compostable packaging will be available to consumers in the U.S. at Whole Foods stores beginning this month. Notably, the company also announced today that it is willing to work with other companies to license the same technology at no cost given the importance of creating a circular food packaging system.