Recently, food and beverage giant PepsiCo announced further improvements to its "pep+" (PepsiCo Positive) sustainable development strategy, which aims to align key goals such as climate, packaging, agriculture and water resources with core business priorities and ensure that these goals are feasible and achievable.

(Image source: "PepsiCo Climate Transition Plan 2025")

"As circumstances evolve, PepsiCo continually adapts how we source ingredients; make, move, and sell our products; and inspire people through our brands," said PepsiCo Chairman and Chief Executive Officer Ramon Laguarta. "This journey is underpinned by pep+, which is an investment in building a stronger and more resilient business – today and in the future – and guides our actions to help create a more resilient, more sustainable food system. Our goals must evolve with us to keep our ambition and to deliver on our long-term vision."

PepsiCo's strategic adjustment this time revolves around "strengthening operability" and "balancing growth needs". The main motivations include:

1. External environmental constraints: insufficient recycling infrastructure, regional policy differences (such as China's ban on the use of food-grade rPET), delayed construction of electric vehicle charging networks and other systemic obstacles, making it difficult to achieve some goals as scheduled.

2. Business expansion pressure: Against the background of 8% revenue growth in 2024, companies need to balance sustainable goals with supply chain expansion needs, such as the difficulty of recycled material supply to match the speed of capacity expansion.

3. Scientific standard iteration: Based on the latest industry guidelines of the Science-Based Targets Initiative (SBTi), update the forest, land and agriculture (FLAG) emission accounting method, requiring stricter carbon sink management.

PepsiCo believes that its long-term success is closely linked to a healthy planet, a resilient food system and the well-being of communities. To this end, the company has proposed the following overall climate goals:

● Achieve net zero emissions across the entire value chain by 2050

● By 2030, achieve:

- 50% reduction in Scope 1 and 2 (owned operations) emissions

- 30% reduction in Scope 3 "Forest, Land and Agriculture" (FLAG) emissions

- 42% reduction in Scope 3 "Energy and Industry" (E\&I) emissions

These goals are consistent with the Paris Agreement and verified by the Science Based Targets Initiative (SBTi).

A. Direct Operations (Scope 1 & 2)

According to the PepsiCo Climate Transition Plan 2025, carbon emissions from PepsiCo's direct operations (Scope 1 and Scope 2) account for 8% of its total carbon footprint (based on 2022), mainly concentrated in manufacturing facility energy consumption and fleet fuel use. To achieve its emission reduction goals, PepsiCo plans to take the following key actions:

- Improve energy efficiency: Optimize energy consumption in manufacturing and warehousing through the Resource Conservation Program (ReCon).

- Transition to renewable energy: Achieve 100% renewable electricity in 40 countries by 2023, with a goal of global coverage by 2030.

- Decarbonize manufacturing heat: Use alternative fuels such as biomass and biogas, and pilot hydrogenated vegetable oil technology.

- Deploy low-carbon fleet solutions: Promote electric vehicles (such as Tesla Semi, Ford E-Transit) and renewable diesel.

B. Value Chain (Scope 3)

The majority of PepsiCo's GHG footprint (92%) was generated by the value chain (Scope 3), most of which comes from agriculture (40%), packaging (26%) and third-party transportation and distribution (13%).

1. Agriculture and land use (FLAG emissions)

In the long run, healthier soil has the potential to increase farmers' yields and grow better crops. Regenerative agriculture can be a powerful tool to promote healthier soils, reduce agricultural emissions, enhance biodiversity and watershed health, and help improve the lives of farmers and agricultural communities.

PepsiCo has now increased its regenerative agriculture goal to promote the adoption of regenerative, restorative or conservation practices on 10 million acres of land by 2030. This is an expansion of the original 7 million acres of regenerative agriculture goal and further expands the goal in both scale and depth because it includes specific targets for nature in the goal. As of 2024, PepsiCo has achieved approximately 3.5 million acres of regenerative agriculture in line with the newly released goals.

2. Packaging Life Cycle (Energy and Industrial Emissions)

After agriculture, packaging is the second largest contributor to PepsiCo's Scope 3 greenhouse gas emissions. Packaging emissions cover emissions from upstream and downstream processes. Upstream emissions include links such as raw material extraction and production, while downstream emissions include emissions related to end-of-life management.

2030 goals:

• Reduce emissions by 40% (based on 2022), focusing on reducing plastic use and promoting a circular economy.
• Increase the proportion of recycled plastic in beverage packaging from 13% (2022) to 50%.

In order to reduce the impact of packaging, PepsiCo has proposed three major strategies: Reduce, Recycle, and Reinvent, with the goal of adding more recycled content and working to make the company's packaging recyclable, reusable or compostable in the company's major packaging markets. The company is also reducing the weight of packaging materials, introducing alternative materials, and exploring alternative business models that can eliminate or significantly reduce packaging. In addition, PepsiCo is working with major packaging suppliers to accelerate the adoption of clean energy solutions to reduce greenhouse gas emissions from packaging materials.

3. Third-party logistics and transportation

In the field of third-party transportation and distribution, PepsiCo is committed to improving the efficiency and carbon intensity of non-PepsiCo fleets that transport the company's products. By mapping and quantifying the baseline emissions of third-party carriers and working with the company's carriers, the U.S. Environmental Protection Agency's "Smart Lanes" program, and industry alliances such as the "Smart Freight Buyers Alliance", PepsiCo is looking for opportunities for improvement within the carriers. These improvements include working with carriers on efficiency measures, using sustainable biofuels, and transitioning to zero-emission vehicles such as electric vans and trucks.

Like many large global organizations, reducing Scope 3 emissions is PepsiCo’s biggest challenge as it advances its 2050 net-zero emissions goal.

The system solutions needed to scale transportation decarbonization include cost-competitive Class 8 electric trucks, charging infrastructure, and market development for sustainable biofuels. While progress has been made, these system developments must accelerate.

PepsiCo’s value chain is large and complex. Achieving climate goals means PepsiCo needs to pursue multiple initiatives across different areas of the value chain while maintaining internal stakeholder alignment and expanding collaboration with suppliers, peers, and other industry partners.

"We know it's important that we continue to be transparent about our progress – both our successes and the challenges – and the dynamic realities that our company and the broader industry face today," said Jim Andrew, PepsiCo Executive Vice President and Chief Sustainability Officer. "Our sustainability journey will not always be linear, but we are focused on doing the work that can both strengthen our business resilience and support a positive impact for the planet. All while remaining agile in our approach, applying learnings across our operations, and sharing them with others to help create a more sustainable food system. We will continue to embed sustainability into our company in ways that aim to enhance the strength, adaptability, and future growth of our business."

Author：Qinger