With many company sustainability commitments coming due in 2025, a rising refrain of corporations is revisiting and altering targets. Some quietly make the adjustments with out detailed rationalization. However PepsiCo is publicly discussing what prompted it to lately revamp a few of its sustainability targets in packaging, emissions and different areas, together with the choice to sundown sure targets.
The adjustments don’t imply the patron packaged items firm is lessening its sustainability focus; somewhat, it’s evolving its technique to sustain with altering instances, in response to Chief Sustainability Officer Jim Andrew.
Since asserting the PepsiCo Optimistic (pep+) sustainability program in 2021, “We have discovered quite a bit, and the world has modified quite a bit, and so we wished to include these learnings and people exterior realities into any adjustments that we have made,” mentioned Andrew, who has served as CSO since 2020.
Jim Andrew, chief sustainability officer at PepsiCo
Permission granted by PepsiCo
He notes that three most important ideas underlie Pepsi’s sustainability targets revamp: transparency, pragmatism and specializing in the place the corporate may have most affect. As well as, “we need to keep grounded within the science,” Andrew mentioned. “Once more, the world is a special place, so we have tried to include that, in addition to enterprise progress.”
The shift has additionally triggered some blowback. Environmental and advocacy teams together with Oceana and As You Sow expressed disappointment with what they are saying is Pepsi’s pullback on environmental commitments, akin to by retiring a earlier goal for reusable packaging and weakening the aim to scale back virgin plastic use by 20%. AYS says Pepsi made the earlier commitments after the advocacy group filed shareholder proposals for these measures, which it subsequently withdrew.
“I haven’t got a particular response to any particular person group. We do interact with them. We take all suggestions severely,” Andrew mentioned. “We stay dedicated to transparency and to engagement. However on the identical time, there’s plenty of challenges.”
In a dialog with Meals Dive’s sister publication Packaging Dive, Andrew detailed these challenges and what else factored into the CPG’s goal-setting course of, in addition to classes discovered alongside the best way.
This interview has been edited for size and readability.
PACKAGING DIVE: PepsiCo isn’t the one firm that has reset sustainability targets lately, however not all others are detailing the why and the how. Discuss extra about what went into this choice.
JIM ANDREW: Our local weather targets are actually absolutely aligned with the 1.5 levels Celsius trajectory, which they weren’t earlier than. The scope 1 and a pair of was, however the scope 3 was “properly under” — that’s the SBTi classification — properly under 2 levels.
We, as a meals firm, needed to break scope 3 into FLAG — forest, land and agriculture emissions — and E&I — power and business emissions. And we mentioned, you recognize, as we do it, let’s make all of them aligned with 1.5 levels Celsius. I used to be speaking with plenty of stakeholders forward of time, and took them via the targets and the adjustments we have been going to make, and plenty of them mentioned that is the only most vital factor out of every part. As a result of finally, that’s nonetheless a part of the Paris Settlement: web zero by 2050.
Scope 1 and a pair of we’ve really made fairly good progress on from our baseline 12 months [2015] to 2024, however scope 3 we’ve made a lot much less progress on. The reason being that requires system adjustments actually the world over. We take part in enterprise in 200 international locations and territories, us and our franchise bottlers, and we’d like the programs we’re elements of to alter. These are very massive, very advanced issues.
If you are going to have elevated quantities of recycled plastics, you want assortment, you want processing, you want enabling coverage to have the ability to have that occur at scale, at tempo. The world is just about aligned round 2050. And the speed at which these programs are altering, candidly, is lower than we had hoped or anticipated once we have been setting the primary targets. These have been the issues that went into it.
Pepsi famous exterior challenges to reaching its earlier targets, together with guidelines in international locations akin to India or China that held again using recycled PET in food-grade packaging. How do these exterior forces reshape your technique?
Just about every part we do, definitely in our major packaging, is meals contact, which is a really totally different stage of problem than non-food contact. It imposes a really stringent set of necessities.
India solely handed legal guidelines permitting rPET for beverage packaging in 2023, and meals packaging was added in 2024. And China nonetheless doesn’t permit rPET inclusion in food-grade packaging in any respect. So these are two extraordinarily massive markets that both have simply or nonetheless don’t permit the incorporation of recycled materials.
However it’s even bigger than that. If you concentrate on it state by state — or in some circumstances, municipality by municipality, or exterior of the U.S., province by province or nation by nation — the legal guidelines, the infrastructure, the enabling mechanisms round recycling will be extraordinarily totally different. They are often virtually evening and day.
You understand, does a state have a deposit return scheme or an EPR system? Or does a rustic? Even when they’ve an EPR system, they’re continuously totally different. Is there assortment? Is it organized assortment or is it casual assortment? Is there washing and processing functionality for that recycled materials as soon as it is accessible?
In 2020, when you suppose again to that point, there was a variety of dialogue in all corners of society, not simply corporations, however NGOs, governments, civil society broadly, banks and financiers about how all these organizations and insurance policies have been going to more and more get aligned to have the ability to help these transitions. These issues both have not occurred or have occurred far more slowly than we, and I believe anyone, would have thought.
Describe in additional depth the choice to sundown sure targets, akin to reuse, versus simply extending their timeline.
We sundown our reuse aim, however then I will let you know within the subsequent sentence that we didn’t sundown our reuse aim. What we did was we modified it.
We had a quantitative reuse aim, which, sure, we sundown. We’re nonetheless very centered on reusables. Once more, that is an space the place we have discovered quite a bit since we set the aim. Important, measurable progress is extraordinarily troublesome. There’s plenty of causes for that, not the least of which is there are a number of regulatory reporting frameworks that exist.
We would like a aim that may be tracked, will be reported on. If I’ve a aim with a quantity and a date, I may do this. The place that’s not doable, we selected to sundown.
Reuse is an efficient instance as a result of there isn’t a frequent definition. There are, in actual fact, a number of competing regulatory frameworks round it. And scaling reuse requires fascinated with how do you make it the popular, handy and reasonably priced selection for shoppers?
That requires a system in a given geography that works, and that system actually must be finish to finish. That requires not solely the producers, however logistics suppliers, retailers, meals service or away-from-home retailers, coverage and shoppers all to be working in the direction of a standard aim — which usually would require a constant regulatory framework to be put in place that is acceptable for the particular merchandise which are being talked about.
You want shared infrastructure coverage that allows it, and then you definitely want a variety of non-competitive collaboration. And in lots of circumstances you want standardization. These issues both have not occurred or are occurring very slowly.
We’re working, in plenty of circumstances, on reusable cups. For instance, in Petaluma, California, we had an enormous challenge. We even have returnable bottles in 75-plus worldwide markets. However to have a single, reportable, quantifiable quantity was simply extraordinarily troublesome.
We are going to report qualitatively, as a result of we expect that truly will extra precisely describe the complexity, until and till a few of these issues occur and standardize the reporting. Second, we have now a aim that’s RCR — reusable, compostable or recyclable. That is a quantitative aim, as a result of we all know how one can measure it. Reuse stays part of what we’re doing round our broader sustainable packaging technique.
Concerning the regenerative agriculture aspect, the place do you imagine you may make essentially the most affect? And what limitations have you ever encountered alongside the best way that influenced your sustainable agriculture technique?
Form of the important thing three ideas as we checked out it, be clear, be pragmatic, align with the sustainability targets, the PepsiCo optimistic targets, with the enterprise priorities, after which focus for max affect and keep grounded in science.
We checked out every of the targets, you recognize, we mentioned, look, we do these targets as a result of they are going to assist us construct a stronger, extra resilient enterprise and assist us drive scalable optimistic affect. We’re an enormous firm. We’re in 200 international locations and territories, and what we need to do is issues which are good for the enterprise, and drive a huge impact. And in order that was form of behind all of it.
We mentioned our targets are anchored in our enterprise and what we’d like for long-term success. And we have made a variety of progress in plenty of areas — important progress particularly in regenerative agriculture and water stewardship, broadly, which is each effectivity and replenishment. And we have made optimistic strides on sustainable packaging and local weather change. And once more, the world’s a special place. So we have tried to include that, in addition to enterprise progress.
That was actually form of the case with regenerative agriculture. We really elevated our targets there. We set extra bold targets in our local weather aim. So we went from 7 million acres of regenerative practices by 2030, to 10 million acres. And we additionally added a nature element round shield and restore. We do these issues with farmers all over the world. So how will we help them as they undertake these practices?
That is an enormous improve. The rationale behind it was we have discovered quite a bit. We predict we all know what works properly, what would not. We have constructed groups, relationships, once more, belief. In order we checked out it, we mentioned, Okay, that is one the place we really feel each we will improve the aim, however then additionally broaden it to be extra express round nature. As a result of we all know that agricultural land each impacts and is impacted by biodiversity, water and nature.
You’ve talked about a number of forces that affect your technique, together with policymakers and shoppers. Does PepsiCo additionally keep in mind what opponents are doing on sustainability?
We attempt to pay attention to all the assorted influences. And we take enter from anyone.
Our methods are those which are proper for our enterprise and for our targets and goals. Normally, we need to be one of many leaders in most targets. However once more, it is very troublesome to get too far forward of how briskly the system goes to alter.
We’ve talked about meals packaging, contemplating Pepsi owns manufacturers akin to Lay’s, in addition to beverage bottles and cans, which is what a lot of Pepsi’s packaging sustainability technique facilities on. How do you steadiness consideration to the totally different enterprise traces’ sustainability?
They’re each vital. They’re each central to our targets and what we’re doing.
Beverage packaging is inflexible for essentially the most half. It is continuously a PET bottle or an aluminum can. These supplies and people recycling programs, in the event that they exist — and once more, in lots of locations there’s little or no enabling coverage and infrastructure — we have doubled the quantity of recycled content material that we have utilized in our North American enterprise since 2020.
Most of our meals is in versatile movie, and that’s one thing the business, NGOs, materials suppliers, everybody is aware of is a way more sophisticated end-to-end system that should change all the best way from assortment to processing the supplies and to the supplies that work for our programs to offer meals security, to offer freshness, to offer high quality. That complete ecosystem is far much less developed than the one for our bottles and cans. However we’re spending a variety of effort and time on each of them.
With many company sustainability commitments coming due in 2025, a rising refrain of corporations is revisiting and altering targets. Some quietly make the adjustments with out detailed rationalization. However PepsiCo is publicly discussing what prompted it to lately revamp a few of its sustainability targets in packaging, emissions and different areas, together with the choice to sundown sure targets.
The adjustments don’t imply the patron packaged items firm is lessening its sustainability focus; somewhat, it’s evolving its technique to sustain with altering instances, in response to Chief Sustainability Officer Jim Andrew.
Since asserting the PepsiCo Optimistic (pep+) sustainability program in 2021, “We have discovered quite a bit, and the world has modified quite a bit, and so we wished to include these learnings and people exterior realities into any adjustments that we have made,” mentioned Andrew, who has served as CSO since 2020.
Jim Andrew, chief sustainability officer at PepsiCo
Permission granted by PepsiCo
He notes that three most important ideas underlie Pepsi’s sustainability targets revamp: transparency, pragmatism and specializing in the place the corporate may have most affect. As well as, “we need to keep grounded within the science,” Andrew mentioned. “Once more, the world is a special place, so we have tried to include that, in addition to enterprise progress.”
The shift has additionally triggered some blowback. Environmental and advocacy teams together with Oceana and As You Sow expressed disappointment with what they are saying is Pepsi’s pullback on environmental commitments, akin to by retiring a earlier goal for reusable packaging and weakening the aim to scale back virgin plastic use by 20%. AYS says Pepsi made the earlier commitments after the advocacy group filed shareholder proposals for these measures, which it subsequently withdrew.
“I haven’t got a particular response to any particular person group. We do interact with them. We take all suggestions severely,” Andrew mentioned. “We stay dedicated to transparency and to engagement. However on the identical time, there’s plenty of challenges.”
In a dialog with Meals Dive’s sister publication Packaging Dive, Andrew detailed these challenges and what else factored into the CPG’s goal-setting course of, in addition to classes discovered alongside the best way.
This interview has been edited for size and readability.
PACKAGING DIVE: PepsiCo isn’t the one firm that has reset sustainability targets lately, however not all others are detailing the why and the how. Discuss extra about what went into this choice.
JIM ANDREW: Our local weather targets are actually absolutely aligned with the 1.5 levels Celsius trajectory, which they weren’t earlier than. The scope 1 and a pair of was, however the scope 3 was “properly under” — that’s the SBTi classification — properly under 2 levels.
We, as a meals firm, needed to break scope 3 into FLAG — forest, land and agriculture emissions — and E&I — power and business emissions. And we mentioned, you recognize, as we do it, let’s make all of them aligned with 1.5 levels Celsius. I used to be speaking with plenty of stakeholders forward of time, and took them via the targets and the adjustments we have been going to make, and plenty of them mentioned that is the only most vital factor out of every part. As a result of finally, that’s nonetheless a part of the Paris Settlement: web zero by 2050.
Scope 1 and a pair of we’ve really made fairly good progress on from our baseline 12 months [2015] to 2024, however scope 3 we’ve made a lot much less progress on. The reason being that requires system adjustments actually the world over. We take part in enterprise in 200 international locations and territories, us and our franchise bottlers, and we’d like the programs we’re elements of to alter. These are very massive, very advanced issues.
If you are going to have elevated quantities of recycled plastics, you want assortment, you want processing, you want enabling coverage to have the ability to have that occur at scale, at tempo. The world is just about aligned round 2050. And the speed at which these programs are altering, candidly, is lower than we had hoped or anticipated once we have been setting the primary targets. These have been the issues that went into it.
Pepsi famous exterior challenges to reaching its earlier targets, together with guidelines in international locations akin to India or China that held again using recycled PET in food-grade packaging. How do these exterior forces reshape your technique?
Just about every part we do, definitely in our major packaging, is meals contact, which is a really totally different stage of problem than non-food contact. It imposes a really stringent set of necessities.
India solely handed legal guidelines permitting rPET for beverage packaging in 2023, and meals packaging was added in 2024. And China nonetheless doesn’t permit rPET inclusion in food-grade packaging in any respect. So these are two extraordinarily massive markets that both have simply or nonetheless don’t permit the incorporation of recycled materials.
However it’s even bigger than that. If you concentrate on it state by state — or in some circumstances, municipality by municipality, or exterior of the U.S., province by province or nation by nation — the legal guidelines, the infrastructure, the enabling mechanisms round recycling will be extraordinarily totally different. They are often virtually evening and day.
You understand, does a state have a deposit return scheme or an EPR system? Or does a rustic? Even when they’ve an EPR system, they’re continuously totally different. Is there assortment? Is it organized assortment or is it casual assortment? Is there washing and processing functionality for that recycled materials as soon as it is accessible?
In 2020, when you suppose again to that point, there was a variety of dialogue in all corners of society, not simply corporations, however NGOs, governments, civil society broadly, banks and financiers about how all these organizations and insurance policies have been going to more and more get aligned to have the ability to help these transitions. These issues both have not occurred or have occurred far more slowly than we, and I believe anyone, would have thought.
Describe in additional depth the choice to sundown sure targets, akin to reuse, versus simply extending their timeline.
We sundown our reuse aim, however then I will let you know within the subsequent sentence that we didn’t sundown our reuse aim. What we did was we modified it.
We had a quantitative reuse aim, which, sure, we sundown. We’re nonetheless very centered on reusables. Once more, that is an space the place we have discovered quite a bit since we set the aim. Important, measurable progress is extraordinarily troublesome. There’s plenty of causes for that, not the least of which is there are a number of regulatory reporting frameworks that exist.
We would like a aim that may be tracked, will be reported on. If I’ve a aim with a quantity and a date, I may do this. The place that’s not doable, we selected to sundown.
Reuse is an efficient instance as a result of there isn’t a frequent definition. There are, in actual fact, a number of competing regulatory frameworks round it. And scaling reuse requires fascinated with how do you make it the popular, handy and reasonably priced selection for shoppers?
That requires a system in a given geography that works, and that system actually must be finish to finish. That requires not solely the producers, however logistics suppliers, retailers, meals service or away-from-home retailers, coverage and shoppers all to be working in the direction of a standard aim — which usually would require a constant regulatory framework to be put in place that is acceptable for the particular merchandise which are being talked about.
You want shared infrastructure coverage that allows it, and then you definitely want a variety of non-competitive collaboration. And in lots of circumstances you want standardization. These issues both have not occurred or are occurring very slowly.
We’re working, in plenty of circumstances, on reusable cups. For instance, in Petaluma, California, we had an enormous challenge. We even have returnable bottles in 75-plus worldwide markets. However to have a single, reportable, quantifiable quantity was simply extraordinarily troublesome.
We are going to report qualitatively, as a result of we expect that truly will extra precisely describe the complexity, until and till a few of these issues occur and standardize the reporting. Second, we have now a aim that’s RCR — reusable, compostable or recyclable. That is a quantitative aim, as a result of we all know how one can measure it. Reuse stays part of what we’re doing round our broader sustainable packaging technique.
Concerning the regenerative agriculture aspect, the place do you imagine you may make essentially the most affect? And what limitations have you ever encountered alongside the best way that influenced your sustainable agriculture technique?
Form of the important thing three ideas as we checked out it, be clear, be pragmatic, align with the sustainability targets, the PepsiCo optimistic targets, with the enterprise priorities, after which focus for max affect and keep grounded in science.
We checked out every of the targets, you recognize, we mentioned, look, we do these targets as a result of they are going to assist us construct a stronger, extra resilient enterprise and assist us drive scalable optimistic affect. We’re an enormous firm. We’re in 200 international locations and territories, and what we need to do is issues which are good for the enterprise, and drive a huge impact. And in order that was form of behind all of it.
We mentioned our targets are anchored in our enterprise and what we’d like for long-term success. And we have made a variety of progress in plenty of areas — important progress particularly in regenerative agriculture and water stewardship, broadly, which is each effectivity and replenishment. And we have made optimistic strides on sustainable packaging and local weather change. And once more, the world’s a special place. So we have tried to include that, in addition to enterprise progress.
That was actually form of the case with regenerative agriculture. We really elevated our targets there. We set extra bold targets in our local weather aim. So we went from 7 million acres of regenerative practices by 2030, to 10 million acres. And we additionally added a nature element round shield and restore. We do these issues with farmers all over the world. So how will we help them as they undertake these practices?
That is an enormous improve. The rationale behind it was we have discovered quite a bit. We predict we all know what works properly, what would not. We have constructed groups, relationships, once more, belief. In order we checked out it, we mentioned, Okay, that is one the place we really feel each we will improve the aim, however then additionally broaden it to be extra express round nature. As a result of we all know that agricultural land each impacts and is impacted by biodiversity, water and nature.
You’ve talked about a number of forces that affect your technique, together with policymakers and shoppers. Does PepsiCo additionally keep in mind what opponents are doing on sustainability?
We attempt to pay attention to all the assorted influences. And we take enter from anyone.
Our methods are those which are proper for our enterprise and for our targets and goals. Normally, we need to be one of many leaders in most targets. However once more, it is very troublesome to get too far forward of how briskly the system goes to alter.
We’ve talked about meals packaging, contemplating Pepsi owns manufacturers akin to Lay’s, in addition to beverage bottles and cans, which is what a lot of Pepsi’s packaging sustainability technique facilities on. How do you steadiness consideration to the totally different enterprise traces’ sustainability?
They’re each vital. They’re each central to our targets and what we’re doing.
Beverage packaging is inflexible for essentially the most half. It is continuously a PET bottle or an aluminum can. These supplies and people recycling programs, in the event that they exist — and once more, in lots of locations there’s little or no enabling coverage and infrastructure — we have doubled the quantity of recycled content material that we have utilized in our North American enterprise since 2020.
Most of our meals is in versatile movie, and that’s one thing the business, NGOs, materials suppliers, everybody is aware of is a way more sophisticated end-to-end system that should change all the best way from assortment to processing the supplies and to the supplies that work for our programs to offer meals security, to offer freshness, to offer high quality. That complete ecosystem is far much less developed than the one for our bottles and cans. However we’re spending a variety of effort and time on each of them.
