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2011/2012 Sustainability Report

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2011/2012 Sustainability Report performance with Purpose Sustainability Report 2011/2012 Open Me! Contents Performance with Purpose 1 Talent Sustainability 26 CEO Letter 4 Global Citizenship 32 About PepsiCo 6 Awards & Recognition 38 Our Performance with Purpose Goals 8 GRI Index 40 Human Sustainability 10 Corporate Information Back Cover Environmental Sustainability 18 1 PepsiCo Sustainability Report 2011/2012 performance with purpose Performance with Purpose is our goal to deliver sustained value by providing a wide range of foods and beverages, from treats to healthy eats; finding innovative ways to minimize our impact on the environment and lower our costs through energy and water conservation as well as reduce use of packaging material; providing a safe and inclusive workplace for our employees globally; and respecting, supporting and investing in the local communities in which we operate. As we look out across the world, we see megatrends that make These megatrends also affirm that the work of modern Performance with Purpose more important now than ever. business must encompass partnerships with the public, These megatrends include the increasing focus of consumers private and nonprofit sectors, which is a central tenet of and governments on health and wellness, growing concern Performance with Purpose. PepsiCo was one of the first over food safety and traceability, scarcity of critical global contemporary corporations to recognize the important resources, and the growing importance of talent development interdependence between corporations and society when within our business and communities. Each of these mega- we articulated Performance with Purpose back in 2007. trends presents an opportunity for PepsiCo to add value by We recognize that partnerships with stakeholders across the delivering innovative solutions to societal challenges and, in globe in the public, private and nonprofit sectors are vital to doing so, create value for our stakeholders. our business and long-term success. 2 Our Sustainability Reporting PepsiCo is pleased to share this report on the Sustainability Governance Stakeholder Engagement PepsiCo Sustainability Report 2011/2012 progress we are making on our Performance PepsiCo has formed a Sustainability Task Force We are committed to continued engagement with with Purpose journey. The report presents our that is chaired by the President of PepsiCo. The our stakeholders, whose insights have helped sustainability goals and provides data as well as Sustainability Task Force guides PepsiCo’s shape our thinking and actions. In particular, we examples of our efforts to achieve those goals. sustainability efforts in partnership with leader- would like to thank Ceres for its input regarding ship teams overseeing the three focus areas of our sustainability goals and reporting. We also Our companion Global Reporting Initiative Performance with Purpose: Human, Environmental have benefited from stakeholder feedback in (GRI) report offers greater detail on PepsiCo and Talent Sustainability, and with the opera- various markets provided to us through surveys activities during 2011/2012. An index providing a tional leads of our businesses. These leadership conducted by GlobeScan and others on PepsiCo’s comprehensive list of topics covered by the GRI teams include PepsiCo senior executives within behalf. Of course, we are deeply appreciative of report can be found at the end of this report on our global and governance functions, including our many stakeholder partners, across sectors pages 40–41. Global Operations, Human Resources, Legal, and around the world, who are helping PepsiCo to Public Policy and Government Affairs, Research advance our sustainability goals. Additionally, we regularly update the Performance and Development, Finance, Procurement with Purpose section of PepsiCo.com with news and Communications. and data regarding our sustainability efforts. Comments To submit comments about this report to PepsiCo, please email [email protected] Our Sustainability Reporting 3 PepsiCo Sustainability Report 2011/2012 CEO LETTER 4 PepsiCo Sustainability Report 2011/2012 CEO letter Dear Fellow Stakeholders, The test of a great company is whether it has the ability to constantly manage for both the level of returns and the duration over which those returns will be realized. It’s a challenge that we at PepsiCo embrace, because we recognize that there’s always a bigger picture, a longer time horizon and a broader world in which we operate. Our heritage as a food and beverage powerhouse runs deep. What began with Pepsi-Cola more than a century ago and became PepsiCo with the addition of the Frito-Lay snack business nearly 50 years ago, has transformed into a global, diversified company with more than $65 billion in annual revenue. We are the largest food and beverage business in the United States and one of the largest in the world. If our history and trajectory have taught us one thing, it’s that we have to think in terms of both quarters and generations. Business does not operate in a vacuum — ​it operates under a license from society. We recognized early that when we transform our business to deliver for our consumers, protect our environment, and invest in our employees — ​we achieve sustained value. In fact, these actions fuel our financial returns. CEO LETTER ________________________________ __________________________________ In 2007, we articulated this powerful idea through We’re proud to be a leader in water stewardship In all of these areas, Performance with Purpose 5 Performance with Purpose, our goal to deliver and continuously work to minimize our environ- fuels our growth and allows us to stay ahead of sustained, top-tier financial results through: mental impact. We have reduced our water usage trends shaping our industry and the world in which by more than 20 percent per unit of production we operate. It galvanizes our global associates, PepsiCo Sustainability Report 2011/2012 • Transforming our portfolio to provide a wide since 2006. And by teaming up with partners positions our business to deliver today and well range of foods and beverages, from treats to around the globe, we have provided access to into the future, and protects resources for the healthy eats, to sustain topline growth; safe, clean drinking water for 3 million people. next generation. Our achievements were recognized with the • Finding innovative ways to reduce our impact on Stockholm Industry Water Award and the U.S. We’re proud of what we have achieved so far but the environment, which enables us to lower our Water Prize in 2012. We have also reduced the recognize that there is much work to do to meet costs at the same time; and packaging weight of our products (primarily in the aggressive goals we’ve set for ourselves. our beverage bottles) by more than 350 million PepsiCo has the capacity, and the will, to lead. We In 2012, • Providing a safe and inclusive workplace for pounds over the last five years, exceeding will continue to work with governments, NGOs, our employees around the globe to attract our goal by more than 20 percent. We remain local community partners and other industry and retain the best talent, and investing in the committed to environmental stewardship at every leaders toward common goals and fight for those communities in which we do business to retain level of our company. things that make the world a better place. our license to operate. PepsiCo’s talented people are vital to our At the heart of PepsiCo and our Performance with From our operations on farms and the plant floor, continued success, and we continuously invest Purpose vision is the powerful idea that every to delivery of our products to store shelves, to in our associates, giving them the tools and footstep matters, but so too does the horizon to strategic decision making — ​we are guided by training to succeed. I recently saw firsthand the which you’re headed. We’re proud of the indi- 49% Performance with Purpose. It’s more than a vision expertise and passion of PepsiCo’s diverse team vidual steps we’re taking, and the larger journey of our U.S. beverage volume statement. It’s the soul of PepsiCo. Over the past in the Asia, Middle East and Africa Sector, where on which we’ve embarked. was in juices, low- seven years, we have woven Performance with we’re employing more women in Saudi Arabia or zero-calorie Purpose into every aspect of our business — ​and in than ever before. And our Asia Pacific team has We remain steadfastly dedicated to building a doing so, changed the very fabric of our company. increased the female executive promotion rate to profitable and sustainable 21st century corpo- drinks, and nearly 50 percent. In the United States, women, ration — ​one that is a good investment for our active hydration We have achieved some impressive results. people of color and people from diverse back- shareholders, a good environment for our beverages. grounds comprised more than 60 percent of the employees, a good citizen in our communities and We are transforming our portfolio to offer new hires from our college campus recruiting in a good steward of our planet’s resources. That’s consumers more choice, successfully launching 2012. We have also established a Human Rights Performance with Purpose. It is important now nutritious products like Quaker Real Medleys, Operating Council to better coordinate, implement more than ever. Trop50, Gatorade Energy Chews, Muller Quaker and monitor our human rights strategy across our Dairy yogurt, baked snacks, and
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