2016 Sustainability Report
Total Page:16
File Type:pdf, Size:1020Kb
PERFORMANCE 2025 AGENDA PepsiCo Sustainability Report 2016 + WITH PURPOSE SUSTAINABILITY REPORT 2016 2025 Agenda 2025 CONTENTS About This Report 1 A Letter from Indra Nooyi 3 About PepsiCo 6 Global Performance 8 PEPSICO IS WORKING TO CREATE A HEALTHIER FUTURE Perspectives from Dr. Mehmood Khan 10 GRI Material Aspects 12 PwP Performance Dashboard 14 FOR PEOPLE AND OUR PLANET. PRODUCTS 20 PLANET 36 PEOPLE 54 Governance 70 OUR PERFORMANCE WITH PURPOSE 2025 AGENDA IS DESIGNED GRI Index 71 TO DELIVER NEEDED CHANGE ACROSS OUR COMPANY, VALUE CHAIN, INDUSTRY AND WORLD. ABOUT THIS REPORT ON THE COVER: Inaugural progress on our 2025 Agenda is reported in the following pages in the Quaker 3 Minutos, a whole-grain, context of shared global challenges and coordinated industry action. We profile oat-based product fortified with thought leaders and spotlight promising solutions around the world. We also high- vitamins and minerals, is helping consumers in several countries light the primary United Nations Sustainable Development Goals to which our across Latin America get the company’s efforts are intended to contribute. daily nutrition they need. Detailed information on our governance, management, programs, progress and next steps on sustainability issues of importance to our stakeholders, as well as additional 2016 performance data, is conveniently cataloged in our new, interactive A–Z Topics on pepsico.com — replacing a separate Global Reporting Initiative report. This information is also summarized in our GRI Index on pages 71–76 of this report. At a typical barbecue, Brazilians enjoy grilled entrées, salad, Elma Chips — zero-added-salt potato chips that are often sprinkled on rice dishes — and refreshing beverages. A LETTER FROM INDRA NOOYI SUSTAINABILITY As I sat down to write my letter for this year’s Sustainability Report, I began reflecting on the meaning of sustainability. It’s been used so often, and in so many contexts, that I wanted to start this year’s report by returning to first principles and defining what sustainability means to me — and all of us at PepsiCo. The root of the word sustain is defined as “cause to continue for an extended period or without interruption.” 2 | 3 PepsiCo Sustainability Report 2016 When it comes to our Products, we’ll continue making great- tasting treats to be enjoyed in moderation as part of a balanced diet. At the same time, we need to continue finding new, innovative That definition informs how I think That belief in acting responsibly is ways of offering more nutritious foods WE ARE ALL IN. about sustainability: what led all of us at PepsiCo to embark and beverages without compromis- on our sustainability journey — what ing taste. How can we keep ourselves, our planet SUSTAINABILITY IS we call Performance with Purpose — and our communities healthy for an When it comes to our Planet, we’ll more than 10 years ago. It’s what led WHO WE ARE. IT’S WHAT extended period of time? need to continue investing in new us to reduce the added sugars, sodium solutions to curb emissions and cut FUELS OUR BUSINESS. How can we ensure we’re consuming and saturated fat — and dial up the water use — especially in areas like the right foods and beverages, so that nutrition — in many of our foods and agriculture — while also taking steps to AND IT’S WHY I BELIEVE we thrive into our senior years? beverages; curb our environmental continue reducing packaging materials footprint, saving more than $600 million and waste without asking consum- PEPSICO’S BEST DAYS ARE How can we ensure we’re responsible between 2011 and 2015; and reinvest in stewards of our planet, so it will con- ers and communities to sacrifice YET TO COME. our workforce, farmers and communi- convenience. tinue to provide its bounty of resources ties, creating opportunities for people for ourselves, our children and our across the markets we serve. When it comes to our People, we’ll grandchildren? need to continue enhancing the skills Today, we’re more dedicated to we ultimately fall short, it won’t be When we started on this journey in How can we ensure we’re growing and diversity of our workforce even as Performance with Purpose than ever we navigate a period of unprecedented for lack of research, or investment or 2006, PepsiCo was among the first in our careers, while also meeting our before. Because we know that while collaboration. It won’t be for lack of movers in our industry to embrace responsibilities as family members, change and disruption from new tech- our financial results will always be a nologies and trends like automation. heart. Because we are committed to sustainability. Today, more and more friends and members of diverse commu- critical measure of our success, the sustainability. businesses are joining us, lending nities, so that the places we call home But I’m absolutely confident that we their voices and acting more respon- way we’ll sustain our company, not only We are all in. Sustainability is who we can continue to support generation can deliver on the Performance with sibly around the world. That’s good from year to year but decade to decade, are. It’s what fuels our business. And it’s after generation? Purpose 2025 Agenda we announced news. Together, we can align around is by offering our consumers the kinds why I believe PepsiCo’s best days are last year. The goals we’ve set are not a common vision and work together to These are big questions, and I don’t of more nutritious choices they need to yet to come. claim to have any easy answers. grow and thrive. only ambitious and aspirational — achieve it, bringing our world closer to But I believe corporations, large and they’re also achievable, so long as we’re Stakeholders — from investors, to non- the definition of sustainability I cited The way we’ll sustain our business willing to work for them. And we’re governmental organizations (NGOs), to earlier, and creating a virtuous cycle small, have a significant role to play and maintain our license to operate in in addressing them. leveraging all of the know-how and tools governments — are closely watching that can sustain our way of life, without today’s resource- strained world is by at our disposal — from developing new our progress to make sure we continue interruption, over the next generation From the goods and services we reducing and replenishing the water packaging technologies, to applying the to lead, and in many cases, they’re and beyond. produce, to the energy and natural we use, while also cutting back on our science behind behavioral economics helping us along the way. Ultimately, Sincerely, resources we use, to the lives and energy use, carbon emissions, packag- to nudge consumers toward healthier however, we’re taking the steps out- livelihoods we support, corporations ing and waste. SUSTAINABILITY IS A options, to investing $100 million to help lined in these pages not simply because have a big impact on our communities. The way we’ll sustain a world-class millions more women and girls enter the someone else wants us to take them, And when we act responsibly, we workforce is by empowering all of our workforce ready to succeed. but because we know they’re the right can contribute to the sustainability associates — no matter what they look thing to do for our business and the right of our way of life around the world. BYWORD FOR LEADERSHIP The pages that follow are a report card like, where they come from or who on our progress over the past year. I’m thing to do for our world. We know that they love — to build not only a career, proud of the strides we are making and sustainability is a byword for leadership but a life. in the 21st century. INDRA K. NOOYI IN THE 21ST CENTURY. the way we’re harnessing the power CHAIRMAN AND CEO Of course, doing all of this won’t be of our global scale to drive meaningful easy. While we’ve achieved some good change across countries and conti- progress, much work lies ahead. nents. And if there are any goals where 4 | 5 PepsiCo Sustainability Report 2016 Wang Xuezheng works at our LEED®-certified Quaker facility in Beijing, China, supporting the introduction of new PEPSICO and nutritious oatmeal products for Chinese consumers. PepsiCo has a portfolio of 22 billion-dollar Performance with Purpose is PepsiCo’s vision PRODUCTS ARE PRODUCTS ARE SOLD IN >200 brands that generated more than $1 billion to deliver top-tier financial performance over > each in estimated annual retail sales in 2016, the long term by integrating sustainability ENJOYED BY CONSUMERS 250,000 COUNTRIES AND TERRITORIES spanning Beverages, Snacks and Nutrition. into our business strategy. >1 BILLION TIMES A DAY EMPLOYEES AROUND THE WORLD REACH PEOPLE SCALE 6 | 7 PepsiCo Sustainability Report 2016 GLOBAL PERFORMANCE CUMULATIVE TOTAL SHAREHOLDER RETURN* Return on PepsiCo stock investment (including dividends) and the S&P 500 250 2016 FINANCIAL HIGHLIGHTS* $62.8 BILLION 200 NET REVENUES 150 >$7 >$1 BILLION BILLION 100 CASH RETURNED TO ANNUAL PRODUCTIVITY SHAREHOLDERS SAVINGS IN U.S. DOLLARS 12/06 12/07 12/08 12/09 12/10 12/11 12/12 12/13 12/14 12/15 12/16 * For additional information regarding our 2016 financial performance, PEPSICO $100.00 $123.89 $91.72 $105.14 $116.32 $121.85 $129.64 $161.60 $189.49 $206.06 $222.13 please refer to our 2016 Annual Report on Form 10-K. S&P 500 $100.00 $105.49 $66.46 $84.05 $96.71 $98.75 $114.56 $151.66 $172.42 $174.81 $195.72 *$100 invested on 12/31/06 in stock or index, including reinvestment of dividends.