15 May 2010, Posted by Zubaria Lone in Food, Leadership, 0 Comments
Convenience foods are getting healthy
Sometimes, its ok to say nice things about companies even if they are empires of profit.
Fan or not, Pepsi’s effort to make sustainability live and breath in practice is note worthy.
Strategy
Pepsi’s big business strategy is all about moving from convenience foods and beveredges towards healthy foods. They want to do this by 2015.
Corporate social responsibility
Pepsi loves talking about human sustainability and their performance with a purpose ethos. The company has over 185, 000 employees.
As a commitment to its values and manager quality, Pepsi bases individual performance equally, 50% on people and 50% on business.
To further nurture internal talent, Pepsi launched ‘Pepsi University’ in 2008 and is rolling this out to its operating countries.
To top it all, Pepsi has nurtured the rise of one of the most powerful business women in the US today, Indra Nooyi, typifying the American dream.
Environmental stewardship
There is not much not to like here.
Pepsi was one of the first to carry the carbon trust label in the UK – on the walkers crisps brand.
What a carbon label actually communicates is another story. At a base level, such information helps consumers make choices on more than just price and quantity.
Pepsi wants to achieve what they call a ‘positive water balance’ across their businesses – this means for every litre of water they use they want to return a litre of water to the planet. In 2009, they managed to do this for their beverage operations in India.
Pepsi are even helping the World Business Council for Sustainable Development test new frameworks that will help other companies use water more efficiently.
Economic prosperity
Pepsi generates over $39 billion in revenues. Financially the company has done well in recent times. In the period between 2004-2008, Pepsi grew by over 9% each year.
In the last few years Pepsi has been working hard to improve its profitability by reducing costs. Optimising energy and water use plays well to their operational efficiency objectives. Especially, in their slower growth regions.
Transparency
Pepsi backs up their belief that performance (the financial bit) has to go hand in hand with their purpose – their social and environmental responsibilities.
Information about sustainability practices features prominently and is pretty much all over Pepsi’s web-site.
Sustainability information is not simply confined to their sustainability report.
The stories they tell feel more like a genuine effort to wrestle with the big sustainability challenges than playing tick box tokenism.
The secret
Pinpointing how Pepsi helps sustainability make sense across their organisation is probably down to a formulae. One attributed to doing a combination of things well than the star quality of any single ingredient.
If we interviewed people from Pepsi for a business sustainability case study, we envisage;
- the strategy guys would put success down to their business strategy;
- the financial guys would quite rightly put success down to the company’s financial health;
- the human resources folks would be well founded in saying success was due to the way Pepsi trains its leaders from the inside;
- the corporate responsibility folks could put success down to nudging environment and social priorities into Pepsi’s operational activities
In fact, maybe this is what business sustainability looks like in practice – everyone believes their contribution makes a positive difference, so everyone gets to be right.
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