LEZMAN - PepsiCo Sustainability_Recycle Florida Today_6!5!2012
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Performance with Purpose The Promise of PepsiCo
SUSTAINABLE PRACTICES AT
PEPSICO AND TROPICANA
At $65 billion in revenues,
PepsiCo is the largest food and
beverage company in North America
and the second largest in the world
PepsiCo is one of the largest
agricultural enterprises in the world
Grows or sources 4 million tons of
potatoes for Frito Lay
Sources 3 million tons of oranges
and other fruits and vegetables for
Tropicana, Naked and SoBe
Uses 600,000 tons of oats
for Quaker
Conducts agricultural operations in
more than 30 countries
Highly integrated system
Note: 2009 pro forma revenue reflecting bottler merger
% of system revenue
~15%
Total operating control
~85%
Franchised
Strong Global Brands
$250MM - $1B brands (examples)
18
19 $1B+ brands
Delivering Performance with Purpose
Attract, retain and develop world-class
talent
Be responsible stewards of our
planet’s resources
Nourish
consumers with a range of products
Our Environmental Sustainability Vision
“Sustainability is one of PepsiCo’s most important business imperatives.”
Indra K. Nooyi
Chairman and CEO
PepsiCo
PepsiCo’s responsibility is to protect our natural resources and operate in a
way that minimizes our environmental footprint, with the goal of reaching a
net-neutral impact.
Environmental Sustainability Journey
Tropicana Pure Premium
orange juice became the
first consumer brand in
North America to certify
its carbon footprint
1999 2002
2004 2006 2001
2005
PepsiCo
formalizes
sustainability
initiative
Environmental Task
Force formed to
share best practices
Established a goal of
10% PET recycled
content in plastic
bottles in the US
Sustainability
Vision
defined
Awarded LEED Gold
Level Certification
for Frito-Lay
distribution center
Admitted to Dow
Jones Sustainability
World Index
2007
Walkers was the first
major food brand in
the world to display
a carbon footprint
reduction logo on
its packaging
2009
PepsiCo, an Energy
Star partner since
2007, was awarded the
Energy Star Sustained
Excellence Award
2009
2008
PepsiCo India
achieves positive
water balance
2009
Dream Machine recycling
initiative launched to
help increase US
recycling rate
2010
2011
PepsiCo develops
world’s first
100% plant-based,
renewably sourced
PET bottle
Market-tested our
first-ever 100%
compostable snack
bag for SunChips
Global Awards and Recognition
• Ranked 1st in the 2011 Dow Jones
Sustainability World Index Food and
Beverage Sector
• Listed for the 4th time to the Dow Jones
Sustainability World Index
• Listed for the 5th time to the Dow Jones
Sustainability North America Index
• Placed 3rd in Newsweek’s
Green Rankings
• Ranked 3rd in CR magazine’s 100 Best
Corporate Citizens
• Recognized by 2010 Global Water Awards with
“Environmental Contribution of the Year” Award
• Ranked 28th by Fast Company as one of the
World’s Most Innovative Companies
Deloitte survey confirmed that consumers are influenced by the profile of sustainability
And remain on a learning curve….
Water Consumption: 20%
Electricity Consumption: 20%
Fuels Consumption: 25%
Greenhouse Gases: 25%
2015 Targets
PepsiCo’s Commitment to Environmental Sustainability
Frito-Lay Near Net Zero Plant Casa Grande, Arizona
• RECYCLES 75% OF PROCESS WATER SAVING 110MM
GALLONS OF WATER PER YEAR
• 5 MEGAWATT PHOTOVOLTAIC SOLAR SYSTEM PRODUCES
ALL OF THE DAYTIME ENERGY USE
• LESS THAN 1% OF OVERALL WASTE TO LANDFILL
• LEED EXISTING BUILDING GOLD CERTIFICATION
Climate Change
Reduce the Carbon Footprint of our operations
– Improve our electricity use efficiency by 20 percent per unit of production by 2015.
– Reduce our fuel use intensity by 25 percent per unit of production by 2015.
– Commit to a goal of reducing greenhouse gas (GHG) intensity for U.S. operations by 25 percent through our partnership with the U .S. Environmental Protection Agency Climate Leaders program.
– Commit to an absolute reduction in GHG emissions across global operations.
Sunflower growing
Potato growing
Seasoning
Packaging
17%
17%
2%
17%
53% of Carbon Footprint upstream, outside our
own operations
34% of Footprint from Agriculture
Transport Disposal Processing Cooking
34% 10% 3%
Carbon footprint of a 30g bag of Walkers crisps
Raw materials 53%
Significant natural resources are engaged in producing our crops Carbon footprint for potato chips: Walkers Snack Foods
87% of CF
from raw
materials and
processing
Tropicana completed a Carbon Footprint
• First consumer brand in North America to certify its carbon footprint through the Carbon Trust in 2008
• Results were published on Tropicana’s website and in the NY Times
• We understand our full impact on the environment and how we can reduce our ecological footprint
• Working to reduce our carbon footprint
Carbon
Footprint
The carbon footprint of a product is the total amount of
carbon dioxide (CO2) and other greenhouse gases emitted
during a product’s life, including production, use and
disposal
Tropicana has received the first Carbon Trust product footprint certification outside of the UK
Tropicana is a leader in better understanding the impacts associated with our products
–1st to benchmark packaging footprint
–1st product life cycle assessment
–1st to receive Carbon Trust certification
The certified carbon footprint is 1.7 kg of CO2E/64 oz. carton of NFC OJ
– Includes total product life cycle impacts from grove to end of life disposal. Covers the US, Canada and Mexico
Tropicana NFC Orange Juice Carbon Trust CO2E Calculations
Footprint per 64 oz. Gable-top Carton
Footprint per 8 oz. serving
1662 g CO2E 219.4 g CO2E
Where does 1.7 kg of CO2E come from?
60%
NFC OJ
15%
Packaging
3%
Use and
Disposal 22%
Distribution
34% orange growing
and 26% processing
Greenhouse Gas Reduction Initiatives
Tropicana-owned
refrigerated railcars
Railcars are 3 times more fuel efficient than other road alternatives
Tropicana is exploring opportunities to
make their railcars even more efficient
• Tropicana has preserved more than 405
million square feet (9,200 acres) of
rainforest with the Rescue the
Rainforest Program since 2009
• More than 10 times this amount has
been “saved behind” this acreage
• Benefit of nearly 2 million tons of
carbon dioxide, equivalent to 1.8 million
flights from New York to London or the
carbon footprint of 80 million Americans
• Every carton or package of Tropicana
redeemed saves 100 ft2 of endangered
rainforest in Peru
Tropicana’s Rescue the Rainforest promotion engages
consumers
Sustainable Agriculture
Environmental Sustainability
Pillar
Social Sustainability
Pillar
Economic Sustainability
Pillar
Sustainable Agriculture is built around 3 core pillars.
1. Rainforest Alliance 2. Food Alliance 3. SAI Platform 4. Stewardship Index 5. SureHarvest (Protected Harvest) 6. Keystone Initiative (Field to Market) 7. Assured Food Standard (Red Tractor Farm Assurance) 8. GLOBALG.A.P (and related schemes like SimbaGAP) 9. McDonald’s 10. Leonardo Academy’s Ag Sustainability Efforts (formerly SCS-001) 11. Natural Resources Conservation Service (USDA-NRCS) Environmental Quality Criteria
Certification program:
Built from the consolidation of
leading survey programs and
principles that sit behind our
Agriculture Sustainability
policy
Sustainable Agriculture at PepsiCo
Protecting our local resources engaged in farming today…
Water availability and management
Soil conservation and preservation
Management of Agrochemicals
Energy management
Farm economics and Land management
Social and community dynamics
ENSURE CONTINUED ACCESS TO KEY AGRICULTURAL RAW MATERIALS NECESSARY FOR GROWING CONSUMER NEEDS
WHILE RESPECTING THE ENVIRONMENT AND COMMUNITIES PRODUCING THOSE RAW MATERIALS
Energy/Carbon Footprint Benefit
Closed Loop System
An Orange Peel Based Fertilizer
Natural, Renewable
Potential to reduce use of petrochemical fertilizers
and petroleum sprays
i
i
i
i
Great, comprehensive agricultural sustainability potential
Improved Tree Health Potential to
improve tree health, reduces disease which
can lead to improved yield
and taste
Energy and Carbon Footprint Reduction potentials
Runoff Barrier
Reduce nitrogen leaching and formulate a runoff
barrier
Where does Recycling link in?
Promoting Recycling
Several million pounds reduction
in PET
Zero waste to landfill in the U.K.
Designing packaging for
recycling
Reduce Packaging Weight
Solid Waste Reduction
Continue to lead the industry
with 10% recycled PET
Increase Recycled Content
Minimizing Our Packaging Footprint
• Eliminated millions pounds of
packaging since 2008 and on track to
meet our goal of reducing 350 million
pounds of packaging by 2012
• 100% post-consumer recycled
containers: Naked Juice and 7-Up
Canada were first-to-market
• 10% post-consumer recycled content:
Best-in-market for all US soft drink
containers
PepsiCo has best-in-class sustainable packaging
performance
38% Less
Plastic
38% Less
Plastic
200922.5g
200910.9g
50% Less
Plastic
50% Less
Plastic
20% Less
Plastic
20% Less
Plastic
200818.5g
200931g
20% Less
Plastic
20% Less
Plastic
200921.5g
10% Less
Plastic
10% Less
Plastic
Light-weighting Initiatives
• New Tropicana container is 100%
recyclable
• Developing 100% bio-based bottles out
of plants that can be recycled with regular
plastic
• Dow Jones Sustainability Index ranked
PepsiCo’s packaging performance as
number one
Sustainable Packaging Performance, cont’d
The Dream Machine Recycling Initiative
The Opportunity
• Only 12 percent of public spaces
are equipped with recycling
receptacles
• There is an opportunity to increase
on-the-go recycling and incent and
reward for recycling
• If every U.S. household recycled
just three more plastic bottles, we
could divert more than 23 million
pounds of plastic from our landfills
The Solution
With each bottle recycled in a Dream Machine, PepsiCo will also make a donation to
Entrepreneurship Bootcamp for Veterans with Disabilities (EBV)
When a bottle or can is deposited, the Dream Machine is
activated in three ways:
1. The environment gets greener
2. Consumers earn points redeemable for
rewards
3. U.S. veterans with disabilities receive training
& education on how to start their own business
Create partnerships to increase the U.S. beverage container
recycling rate to 50% by 2018 Mission
www.DreamMachineRecycleRally.com
www.Facebook.com/DreamMachine
Kiosks
Bins
K-12 Schools
• Currently, less than 1/3
of plastic beverage
containers are being
recycled each year
STEP 1
Shoppers register
& deposit empty
beverage
containers into
the kiosk
STEP 2
Kiosk calculates
“reward value”
of the deposit Posts point value to
rewards account and prints
in-store coupons
STEP 3
Consumers
redeem rewards through Greenopolis
rewards platform and
coupons at the store
STEP 4
Shoppers feel good
about their role in
supporting the
environment and EBV
The Dream Machine is easy to use & rewarding
Dream Machine Recycle Rally Program
• Education: Program provides resources and
opportunity for interactive learning.
• Interaction: Students encouraged to collect as
many non-alcoholic beverage containers (plastic
bottles and aluminum cans) as possible.
• Incentives: Scanned cans & bottles provide schools
a chance to earn points redeemable for rewards
such as Amazon gift cards, laptops, iPads, rewards
with local businesses.
• Contests: Monthly drawings and annual school-
year awards encourage recycling. 2011-2012
winning school receives $50,000 Green School
Makeover.
The more a school recycles, the more they can help the environment &
earn rewards!
How Recycle Rally Works
1 2 3 4
1. K-12 schools apply through www.DreamMachineRecycleRally.com
2. Interactive Recycle Rally system set up in school
3. Teachers/school volunteers scan empty non-alcoholic beverage
containers using hand-held scanner; deposit containers into a
recycling receptacle
4. Schools redeem rewards through Greenopolis rewards platform
For bottles and cans recycled through Recycle Rally, PepsiCo will make a
donation to help post 9/11 disabled veterans start their own businesses
We Have Had Great Success !
• Collected and recycled over 110 million bottles and
cans
• Placed more than 6,000 recycling bins and kiosks in
40 states
• Partnered with hundreds of customers, colleges,
municipalities and non-profits
• Driving awareness with billions of program
impressions
• Rewarding thousands of consumers and helping
veterans with disabilities receive training
Financial impact
PepsiCo Florida Operations are Significant
PepsiCo Florida : 1. Employs 7250 employees 2. Payroll over $325 million. 3. Purchases $500 million from local
farmers. 4. Owns/ Leases over 8.3 Million
square ft.
8 Manufacturing Plants: 2 Tropicana – Bradenton / Ft. Pierce 1 Gatorade – Kissimmee 4 Pepsi – Orlando / Tampa /Jacksonville/ Rivera Beach 1 Frito-Lay – Orlando 32 Warehouses / Distribution 24 Bins
Facilities
Bradenton Manufacturing and Distribution
Ft. Pierce Manufacturing and Distribution
Orange Groves
Oranges received at the
plant
Final Grading
Orange Receiving and Grading
Orange Processing
Extraction
• The oranges are washed and graded
• Juice is extracted and passed through finishers to strain out seeds and pulp
• Each extractor can squeeze 700 oranges a minute
• Tropicana can process over 50 million oranges in a single day, making well over a million gallons of orange juice
Citrus Juice Extraction
Orange By-Products
Citrus pulp pellets are made
into cattle feed
Oils used in
perfumes
By products used
in orange
cleaners are
used to clean the
space shuttle
Useful Products from
Every Part of the Orange
Peel Oil
Juice Pulp
Pulp Wash D’Limonene
Oil
Cattle Feed
150,000Tons
Community Relations and Recycling Efforts
• Founding sponsor and active
member of Keep Manatee Beautiful
• Participate in coastal and beach
clean-ups and street beautification
efforts
• Recycled about 46 million pounds of
material this past year at our plants,
including corrugate, scrap metal,
electronics, etc.
A Keep America Beautiful affiliate in our
Bradenton, FL community
Environmental Sustainability
The ZERO Landfill Challenge:
“Cash for Trash”
Bradenton Florida
Key Elements of Initiative
1. Why Is Recycling Important?
Good for the Environment and Good for the Business
2. What are our Recycling Opportunities?
“Expand the EXISTING” and “Capture the NEW”
3. Recyclable Definitions The Devil is in the Detail!
4. Your Department Focus Chase the Fat Rabbit first!
5. Site Recycling Plan
6. Team Member Responsibilities
Your role in Tropicana Recycling
7. Safety and Environmental Reminders
8. Key Learning The “Bad Apple” Analogy
3 Primary Package Formats for Tropicana
Gable Top Cartons
– Cost advantageous
– Materials
» LDPE
» Paperboard
» Nylon
» EVOH
Injection Stretch Blow Molding -
PET Bottles
– Clear bottle
– Material
» PET
» UV Barrier
Extrusion Blow Molding
HDPE Bottles
– Enables pass through
handle
– Material
» HDPE
» Nylon
Packaging Materials needed for TPP Carafe
What are our Recycling Opportunities?
Expand the EXISTING
Cardboard
Mixed Paper
Scrap Steel
Copper
HDPE Bottles
Cartons
Capture the NEW
PET Bottles
Wood
Soft Plastics
Hard Plastics
Stainless Steel
Construction Rubble
Cardboard Recycling: Target 15% increase
Cardboard often called “corrugated”
or OCC (Old Corrugated Containers)
Scrap Steel Recycling: Segregate Stainless Steel
Recycle Special Discards: Call Grounds Maintenance.
Segregate and recycle Copper wiring
– Contact Point Team or EIA
Mixed Paper Recycling: Target: On-site Office Areas
Tropicana’s Janitorial team will collect
mixed paper from 45 gal receptacles
centrally located in each office area.
Each team member should empty their
individual mixed paper can into the
conveniently located 45 gal receptacles.
Plastic Bottle Recycling: Major Focus on PET/ Maintain HDPE
Wood Recycling: Target Pallet Repair & Fruit Rec.
WOODWASTE Recycling: Local Reprocessing
Landscape & Fruit Operations
organic discards converted into compost
.
Scrap pallets, wooden crates and
bad lumber made into “red” mulch
Plastic Recycling: Soft or Flexible Materials
Stop No Plastic
Bands
Plastic Recycling: Hard or Rigid Components
Plastic pallets & drums are typically reused. When hard plastic
components or parts become damaged,
most can be recycled! Check with
Grounds Maint..
Remove
all Labels
What’s your department’s Fat Rabbit?
UFO – PET, Cardboard & Soft Plastic (Stretch Wrap)
Carton Filling – Cartons, Cardboard & Soft Plastic
Diversified – HDPE, Cardboard & Soft Plastic
All Maintenance Teams – Stainless Steel, Scrap Steel, Copper, Wood and Hard Plastic
Fruit Ops. – Wood wastes
JDS – Soft Plastic & Cardboard
Palletizing and DC’s - Soft Plastic (Stretch Wrap) and Cardboard
Material Logistics – Wood, Hard Plastic, Scrap Steel and Special Discards
Quality – PET and HDPE
MRO – Cardboard, Wood, all metals and Soft plastic
Contractor Area – Wood, Cardboard, Stainless Steel and Scrap Steel
Team Member Responsibilities
THINK – Can this material be recycled?
Place the material in the right recycle container!
Use “I have an Idea” form to improve the recycling process.
The “Bad Apple” Analogy
Positive Results
INCREASED EMPLOYEE ENGAGEMENT
69% INCREASE IN RECYCLED MATERIAL REVENUE
– Biggest contributors were corrugated/cardboard and stainless steel
REDUCTION IN LANDFILL FEES
Performance with Purpose The Promise of PepsiCo
THANK YOU!
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