3. ETHICAL PRACTICES OF
PEPSICO INDIA LTD.
EP JOHN
11397044
A’ SEC

4. INTRODUCTION

5. INTRODUCTION
 PepsiCo is one of the largest food and beverage
companies in the world.
 It manufactures and sells 18 brands of beverages
and snack foods and generates over $98 billion in
retail sales.
 PepsiCo encompasses the Pepsi Cola, Frito-Lay,
Tropicana, Quaker, and Gatorade brands and
offers products in over 200 countries.
 It currently holds 36 percent of the total snack food
market share in the U.S. and 25 percent of the
market share of the refreshment beverage industry.

6. INTRODUCTION
 The company’s headquarters are in New
York and employs over 2,00,000 people.
 PepsiCo has received many awards and
recognitions over the years, including
being ranked in the top 25 of the best
global brands, ranking number four overall
by Diversity Inc, and earning the Green
Award by the Environmental Protection
Agency.

10. OUR VISION
PEPSICO’S RESPONSIBILITY IS TO
CONTINUALLY IMPROVE ALL ASPECTS OPF
THE WORLD IN WHICH WE OPERATE –
ENVIRONMENT, SOCIAL, ECONOMIC –
CREATING A BETTER TOMMOROW THAN
TODAY.
OUR VISION IS PUT INTO ACTION THROUGH
PROGRAMMES AND A FOCUS ON ENVIRONMENTAL
STEWARDSHIP, ACTIVITIES TO BENEFIT SOCIETY AND A
COMMITMENT TO BUILD SHAREHOLDER VALUE BY
MAKING PEPSICO A TRULY SUSTAINABLE COMPANY.

11. OUR MISSION
PEPSICO’S MISSION IS TO BE THE WORLD’S
PREMIER CONSUMER PRODUCTS COMPANY
FOCUSED ON CONVENIENT FOODS AND
BEVERAGES, WE SEEK TO PRODUCE
FINANCIAL REWARDS TO INVESTORS AS WE
PROVIDE OPPURTUNITIES FOR GROWTH AND
ENRICHMENT TO OUR EMPLOYEES, OUR
BUSINESS PARTNERS AND THE COMMUNITIES
IN WHICH WE OPERATE IN EVERYTHING WE
DO, WE STRIVE FOR HONESTY, FAIRNESS AND
INTEGRITY.

12. ISSUE

13. ISSUE
 PepsiCo first entered the Indian market in 1989, and since
then the company has become one of the largest food and
beverage companies in the country.
 Unfortunately for the company, some of the largest and
longest running allegations of PepsiCo’s wrongdoing are
also based in India.
 The company and other competitors in the industry have
been heavily criticized about the quality and the quantity
of the water used in their beverages.
 In 2003, the Centre for Science and Environment (CSE)
claimed that the water which PepsiCo and other beverage
companies in India were using contained toxins.

14. ISSUE
 These toxins included pesticides that can contribute to
cancer and the overall breakdown of the immune
system.
 According to the CSE, Pepsi soft drinks had 36 times the
level of pesticide residues permitted under European
Union Regulations.
 However, no such law bans the presence of pesticides in
India. The issue is still under investigation and the Indian
government is trying to find a way to validly detect the
pesticide levels and ultimately ban any trace in a soft
drink.
 This allegation of unsafe levels of pesticide has been
denied by both PepsiCo and the Coca-Cola Company.

15. ISSUE
 Although there is not yet a law in place, PepsiCo
found that it could still face considerable
repercussions for what its stakeholders perceive to
be unethical activities.
 When pesticides were once again reported in the
soft drinks a few years later, the Indian state of
Kerala temporarily banned the sale of Pepsi and
Coca-Cola.
 Five other Indian states also instituted partial
bans. These extreme actions on the part of the
local governments reveal the care multinational
organizations must take to go above and beyond
the national law in social responsibility.

16. ISSUE
 Another major concern in India cited by
farmers is that the Pepsi manufacturing plants
are polluting the lands, making them less
fertile for growing crops.
 A study conducted in 1992 found that PepsiCo
India and similar companies created 10,000
metric tons of plastic through their
manufacturing and importation processes.
 Similar allegations of waste and pollution
arose again in 2006, concerning both farmers
and government officials alike.

17. ISSUE
 About 60-70 percent of this plastic was recyclable, creating
a large amount of unnecessary plastic waste.
 Furthermore, the farmers complained that the PepsiCo
plant takes the groundwater to run its operations, making
it, once again, harder to effectively grow crops.
 In solving these ethical dilemmas, PepsiCo must take the
different levels of government into account, as well as the
concerns of NGOs and individual Indians.
 A thorough stakeholder orientation is needed to discover
ethical courses of action and avoid negative repercussions.

18. ISSUE
 The nature of the products manufactured and sold
by PepsiCo has caused many problems for the
company in the issue of health. Although PepsiCo
now has numerous products geared toward
health, its most popular product is still its signature
Pepsi-Cola.
 Also, India, is becoming more health-conscious
and desires low calorie, low fat, natural items
instead of processed sugary and salty foods.
Some of the health concerns of drinking soda
include the increased caloric intake as well as the
possibility of tooth decay due to soda’s acidity,
caffeine dependence, and weaker bones

19. SOLUTION
 Pepsi has fought back by creating sodas that
have low calorie and sugar content.
Unfortunately, this only helps with the weight
risk. The acidic nature of the product can still
damage the teeth, and the artificial
sweeteners used also have their own set of
health risks.
 PepsiCo’s traditional snack items have met
with similar criticism. Most of the products are
processed and contain a high amount of
sodium and sugar as well as being highly
caloric and fatty.

20. SOLUTION
 Frito-Lay Company has tried to combat the
issue by offering Baked Lays, Baked Cheetos,
Sun Chips, and other healthier alternatives.
 These alternatives are claimed to be healthier
all-around. The health issue is going to be an
ongoing battle for the company due to the
nature of the industry it is in.
 Continual research and product development
to offer healthier products is essential for
PepsiCo’s future profitability.

21. SOLUTION
 Although the battle may be a long one,
PepsiCo is making strides to address these
concerns.
 For example, the Frito-Lay website has a
special area devoted to health that
describes the ingredients of Frito-Lay
snacks and encourages consumers to
practice moderation in snack food
consumption. Already the company claims
that $10 billion comes from healthy snacks
the company offers.

22. SOLUTION
 PepsiCo is hiring people that are potential enemies
of the organization: health officials.
 Formerly employed at institutions like the World
Health Organization and the Mayo Clinic, these
Pepsi employees are now researching healthier
ingredients to put in PepsiCo snacks.
 One success thus far has been the introduction of a
zero-calorie natural sweetener called Stevia into
new brands, one of which has become a $100
million brand in less than a year.
 It is clear that not only is healthier snack foods
socially responsible, but it is also good business in
an increasingly health-conscious marketplace.

23. SOLUTION
 The public’s attention was on Aquafina
bottled water in 2007 when the watchdog
group Corporate Accountability International
claimed that the company was using tap
water to fill the water bottles being sold.
 The water was not regular tap water but
came from a public water supply before
processing. Aquafina was accused of not
being transparent in its business practices.

24. SOLUTION
Itwas not publically known that the
company’s procedures included a rigorous
seven-step process which removes
unwanted substances and is then branded
as purified drinking water.
Additionally, the label on the Aquafina
bottle had snow capped mountains on it,
which seems to suggest that the water is
purified spring water. PepsiCo is now
required to put the words “Public Water
Source” on the label..

25. SOLUTION
This scenario brings up an ethical
situation common in today’s
marketplace. Many corporations utilize
idyllic scenes on their packages that
do not reflect reality.
A giant agribusiness, for example,
might have a picture of a traditional
farm on its package. Some consumers
find this to be misleading.

26. SOLUTION
 However, the increasing popularity of bottled
water does not appear to be diminishing
anytime soon. PepsiCo is in the process of
developing bottles that use less amounts of
plastic per bottle to help the waste issue.
 Today, the Aquafina bottle weighs 10.9 grams,
compared with the 18.5 grams in 2001, and
PepsiCo has set a goal to decrease its
packaging by 350 million pounds by 2012.

28. CSR PARTNERS

TERI – The Energy and Resources Institute, was
established in 1974 with the purpose of Tackling and
dealing with the immense and acute problems that
mankind is likely to be faced with in the years ahead on
account of the gradual depletion of the earth's finite energy
resources which are largely non-renewable and on account
of the existing methods of their use which are polluting.
 Achievements
 The Institute has grown substantially over the years,
particularly, since it launched its own research activities
and established a base in New Delhi, its registered
headquarters.

30. 
CSR PARTNERS
ADI – Alternative Development Initiative, is devoted to
support, promote and nurture sustainable growth, social
development and good governance for the empowerment of
communities through collaborative action.
 ADI facilitates an alternative paradigm of development that
values appreciating people's basic potential to lead the
process of socio-economic change.
 The organization envisages to bring about people centred
development by fostering institutional linkages, technology
transfer, technological innovation and experiments,
demonstrate new ideas, promote new approaches, mobilize
resources, demystify concepts and technologies, mediate to
bring about collaboration, and impart skills and foster
conditions for reflection and learning.
 ADI promotes institutions, systems, processes and
mechanisms that would bring socio-economic growth.

32. 
CSR PARTNERS
Exnora Green Pammal, an award-winning model of public
private partnership, improves residents' quality of life by
bringing municipal solid waste management services into
compliance with the government's regulations.
 Exnora Green Pammal and its members, under the able
guidance of Mrs. Mangalam Balasubramanian, founder and
managing trustee, demonstrate that civil society organizations
have tremendous potential to improve local environments.
 In Pammal and several other localities, civic engagement,
corporate responsibility and people's participation have
improved public health by introducing source segregation of
solid waste, vermicomposting of biodegradable waste,
recovery of recyclables and the restoration of local
environmental resources.

34. 
CSR PARTNERS
Akshay Patra (registered Trust) started as a pilot feeding
program for 1,500 children in 2000 and today reaches out over
a million children every day in 7,500 government schools, in 17
locations, across seven states in India. This makes Akshaya
Patra the world’s largest NGO-run school meal program. Its
vision is: “No child in India shall be deprived of education
because of hunger”.
 PepsiCo India has completed discussions with Akshay Patra
(Mr. Sridhar Venkat lead the Corporate partnership discussions)
to enter into a public/ private/NGO partnership with Akshay
Patra to set up a kitchen in Gurgaon (PepsiCo India HQ), to
feed approx 50,000 needy children across government schools
in the neighborhood. The initiative is being launched by PepsiCo
India, in Gurgaon as a pilot to enable structured employee
volunteerism and giving.


36. CSR PARTNERS
 CAF India
 A registered public charitable trust set up in 1998
Committed to increase the flow of resources to the
non profit sector
 Has been commissioned by the Planning
Commission and validated 1500 charities for support
 Supports not-for-profit development and increases
the fundraising capacity of the Indian not-for-profit
sector
 Provides solutions to companies, individuals and
employees to donate to charitable cause of their
choice in a professional and tax-effective manner

38. CSR PARTNERS
 CAP Foundation is an independent, registered organization
demonstrating Public Private Partnership initiatives between
civil societies, corporate and government agencies in linking
learning and livelihood for communities of children, youth and
women 'at risk'.
 The mission of the CAP Foundation is to reach out to the
children, adolescents and youth at risk by providing a holistic
education and livelihood promotion module, which combines
formal education with vocational training, skill development
training, life skill modules, job placement and career exploration
opportunities through an experiential mode, aimed at developing
confident individuals capable of self directed growth.

40. CSR PARTNERS
 "Swashrit" is an NGO that works in the area of uplifting
underprivileged children by providing them with basic education
and empowering them with better futures and has also been
actively involved in conducting training workshops for primary,
middle and senior school children as well as teachers.
 These workshops have addressed important health related
issues such as
 Stress management, Holistic child development
 Substance abuse prevention.
 The organization has also undertaken prestigious annual
projects with schools in Delhi and the NCR, such as
 Save the Young Heart, Obesity management
 Get Active

42. CSR PARTNERS
 Project Healing Touch was launched by Mukesh Anand in
the aftermath of the Kargil war in 1999. The project
strives to help servicemen in the Indian Army earn a
sustainable livelihood after they have retired from the
armed forces.
 Under the auspices of Project Healing Touch, Mission
Vijay – II provides former Indian soldiers an important
opportunity to live independently and be financially self-
reliant. The partnership has provided employees of the
armed forces with a stable source of income in their new
roles as distributors, sub-distributors, salesmen or as
trolley vending distributors for PepsiCo.
 In addition to PepsiCo, Project Healing Touch also
partners with Apollo Tyres, ICICI, MICO, Castrol, IOC,
Hero Honda and Tata Motors.

44. CSR PARTNERS
 Youth Reach India, Founded in 1997, is a not for profit
organisation based in New Delhi
 Youthreach India engages in creating awareness on critical
issues to sensitise people and institutions and provide
opportunities for significant participation in response to
community and ecological needs.
 Youthreach creates spaces that engender a deeper inquiry into
the nature of social and ecological injustices and work towards
building a culture that is rooted in the humane and equitable.
 Youthreach seeks to bridge two parallel worlds of the haves and
have-nots, by sensitising people who have access to resources
and opportunities and opening up spaces for them to make a
difference to the less advantaged people, and communities.
 Youthreach partners with 80 grassroots NGOs, identifying needs,
and creates opportunities for individuals, institutions, businesses
to volunteer, donate materials and support projects through
grants.

46. CSR PARTNERS
 PepsiCo India partnered with the International Labor
Organization (ILO) to develop and implement a
sustainable HIV/AIDS workplace prevention care and
support programme for its employees, their families and
community members.
 The International Labour Organisation is the UN agency
responsible for work related issues. In 2000 it created
the Programme on HIV/AIDS and the World of Work
(ILO/AIDS). The key objectives of this programme
consist of raising awareness on the social, economic
and developmental impact of AIDS on labour and
employment while helping Governments, employers and
workers support national efforts to control HIV/AIDS.
This crucial programme also serves to fight
discrimination and stigma related to HIV.

48. PEPSICO FOUNDATION
Activities in India
PepsiCo's philanthropic anchor, PepsiCo
Foundation is committed to developing
sustainable partnerships and programmes
that provide opportunities for improved health
and inclusion and a better environment.
The total funding for India has been $11mn
(2008–10)
The programmes have benefited more than
300,000 people in nine States of India

49. PEPSICO FOUNDATION
 Health: Food security; Improved and optimum nutrition; Energy
balance
 Health Alliance
 Project: This research project focuses on reducing chronic
diseases by promoting healthy diets and physical activity and
controlling tobacco use. The project is being implemented
through integrated interventions to drive policy and
environmental changes.
 Impact: Lower rates of obesity and chronic diseases
(cardiovascular problems and diabetes).
 Reach: 12,000 people in Kerala.
 India grant: $1.13mn during 2007–10.

50. PEPSICO FOUNDATION
 Save the Children
 Project: The project catalyzes community-based interventions
to deliver integrated health and nutrition solutions to children
under 5, young mothers and pregnant and lactating women.
Save the Children works with community health educators to
provide families important information about health, nutrition,
water, sanitation and hygiene.
 Reach: 100,000 people in Rajasthan. (The project reaches
50,000 beneficiaries including children under 5, young mothers
and pregnant and lactating women through health and nutrition
interventions. It reaches another 50,000 people through water
and sanitation initiatives.
 India grant: $4.4mn during 2009–11.

51. PEPSICO FOUNDATION
 Environment: Water security; Sustainable agriculture; Adaptive
approaches to our changing climate
 Project: The project tests methods that deliver 'more crop per
drop'. This approach focuses on water security through water
harvesting, recharging, watershed management and innovative
irrigation practices. It is envisaged that the project will empower
private and public communities with practical new methods to
use water more efficiently both now and in the future. The
project is developing research, tools, and strategies to improve
agricultural income and water use through policy reform and
private sector contributions to the agricultural value chain in
terms of market development, technology transfer and risk
management.
 Reach: 500 farmers across Punjab and Gujarat.
 India grant: $1.15mn during 2008–10.

52. PEPSICO FOUNDATION
 Safe Water Network
 Project: This project focuses on providing affordable potable water
at the community level by harvesting rainwater, installing small
water village kiosk purification systems and building cisterns and
community tanks.
 Reach: 55,000 people across Rajasthan and Andhra Pradesh.
 India grant: $1.1mn during 2008
 Water.org
 Project: The project acts as a catalyst to introduce microfinance to
the water and sanitation sector and provides household water
connections and toilets.
 Reach: 150,000 people in Tamil Nadu, Karnataka, Andhra
Pradesh, Orissa and Maharashtra. Water.org is one of the
Foundation's largest partnerships in terms of reach.
 India grant: $3.64mm during 2008–10.

53. THANK YOU