PepsiCo moves toward creating a more sustainable future

The future of business relies on a sustainable, resilient supply chain and food system. At NRF 2024: Retail’s Big Show, PepsiCo Foods North America CEO Steven Williams discussed the ways his company is investing in a sustainable future — and “doing the right things for the people and the planet.” He was joined on stage by Michael Jeschke, who leads Deloitte Consulting’s Retail and Consumer Products practice.

Jeschke began by talking about a recent Deloitte initiative called the Future of the Consumer, a two-year research journey encompassing 1,000 industry leaders and analysis of more than 250 trends, issues and policies. The goal is to understand the forces shaping the future and the choices we’ll make.

These forces, Jeschke said, are catalysts. Collectively, they will “work together to dismantle old paradigms, demand a reevaluation of how businesses engage and how we create a sustainable planet going forward.

“At Deloitte, we believe companies that seize this opportunity will be the ones that are successful,” he said. “Those that integrate it into their organizational mindset, together with their value chain partners, will be the ones that succeed into the future.”

Driving positive change

PepsiCo Foods North America — which includes Frito-Lay and Quaker — has a substantial footprint, Williams noted: Its products are in 94% of U.S. households, it employs more than 70,000 associates and it has one of the largest private fleets in North America, driving in excess of 150 million miles annually. The company’s 40 manufacturing sites make 6 billion pounds of food annually, and it serves “many of you in this room,” he said, “315,000 stores a week with our direct-to-store delivery system.”

As such, it has the capacity to make a large impact with its actions. While PepsiCo has made good progress over the past decade or more, Williams said, several years ago it unveiled PepsiCo Positive, which charted a “more accelerated course” to drive sustainability and positive action across the organization. An important goal by 2040 is to reach net-zero emissions across the entire value chain; not just the primary business, but through Scope 1, 2 and 3 emissions.

Frito-Lay and Quaker have made great strides already. All the company’s offices and plants in the United States and Canada are powered by 100% renewable energy. Frito-Lay’s Modesto, Calif., location — which Williams called the “true north site” of the company, with sustainable initiatives including solar fields and electric trucks — saw a 90% reduction in emissions. At another California site, the company is using biomass technology to save “hundreds of millions of gallons of water annually,” Williams said.

Collaboration is key

“It’s on the other side of hard,” he said. “Sustainability is the ultimate team sport. You’ve got to have everybody moving in the same direction. We’ve been very lucky, when we started dialing up the intensity, to have retail partners that share the same commitment, including how we support farmers.”

PepsiCo doesn’t own farms, which is a “tricky part,” he noted. “Bringing farming partners with us is super important.” Many have been farming — and working with the company — for generations. “We work hand in hand with the men and women who dedicate their lives to growing the food we eat. They will bear the brunt of climate change.”

“Their ability to grow crops successfully relies on us doing things,” he said. “And our retail partners have the same commitment to farmers that we do.”

Last year PepsiCo and Walmart announced a $120 million joint commitment and investment to drive adoption of regenerative agriculture, covering more than 2 million acres. It’s expected to reduce or remove some 4 million metric tons of greenhouse gas emissions by 2030.