Sustainable Development at PepsiCo

            
 
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Case Details:

Price:

Case Code : BECG122 For delivery in electronic format: Rs. 500;
For delivery through courier (within India): Rs. 500 + Rs. 25 for Shipping & Handling Charges

Themes

Sustainability / Corporate Social Responsibility / Stakeholder Tension
Case Length : 17 Pages
Period : 2006-2011
Organization : PepsiCo
Pub Date : 2012
Teaching Note : Available
Countries : Global
Industry : Food and Beverages

* This case was a Runner-up in the 2012 oikos Global Case Writing Competition (Corporate Sustainability track), organized by oikos International, Switzerland.

Abstract:

This case was a Runner-up in the 2012 oikos Global Case Writing Competition (Corporate Sustainability track). It is about the sustainable development initiatives of one of the world's leading food and beverage companies, PepsiCo.

Faced with various criticisms on the social and environmental fronts, PepsiCo adopted the ‘Performance with Purpose’ strategy in 2009 under the leadership of its CEO Indra Nooyi (Nooyi). This strategy was based upon the philosophy that the company’s financial performance should go hand in hand with its responsibilities toward society and the environment.

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The new sustainable development program contained 47 commitments that PepsiCo made toward society and these were divided into four broad areas: Performance, Human Sustainability, Environmental Sustainability, and Talent Sustainability. Despite some progress made by the company in these fronts, since mid-2011, Nooyi had come under fire from key stakeholders such as shareholders and bottlers who contended that her focus on 'Performance with Purpose' had come at the cost of positioning of the company's products and had hurt sales. They felt that its archrival, the Coca Cola Company had gained the upper hand during Nooyi's tenure. This case is meant for MBA/MS-level students as part of the Business Ethics/Corporate Social Responsibility curriculum. It can also be used in a core strategy curriculum.

Issues:

Understand the main issues and challenges related to corporate social responsibility for a global company.
Study the sustainable development strategy adopted by PepsiCo.
Understand the various challenges faced by organizations regarding the impact of their operations on the society and environment.
Appreciate the importance of a company's top management in guiding the company to implement key strategies like sustainable development.
Understand the reasons for the criticism of Nooyi and her 'Performance with Purpose' strategy.
Explore the strategies which can be adopted by PepsiCo to improve its sustainability record.

Contents:

  Page No.
Introduction 1
Company Background 2
Controversies Surrounding Pepsico 3
Sustainable Development Practices of Pepsico 4
Looking Ahead 9
Exhibits 11

Keywords:

Sustainable Development; 'Performance with Purpose' strategy; Business Ethics; Corporate Social Responsibility; Operating performance; Human Sustainability

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