PepsiCo

We need to fix the food system. But how?

July 24, 2011

“Today’s food system is unfair, ineffective and operates beyond ecological limits,” Mark Lee says, via email.

“Unfair in that some 925 million are malnourished…

“Ineffective in that there are enough calories out there to feed everyone, but we fail to do so (and if we fail to do so for 7 billion, how will we cope with 9-10 by mid-century?)…

“Beyond ecological limits in too many ways too count – freshwater use, soil degradation, climate impacts, you name it.”

Mark is not an environmental activist. He’s the executive director of SustainAbility, a think tank and strategy consultancy that has worked with such food industry clients as Chiquita, Coca-Cola Kellogg’s, Mars and McDonald’s, Nestle, Starbucks and Unilever. He approached me because Sustainability recently released a report called Appetite for Change, about the food industry and how to fix it.

I’ve been writing a lot about food lately because it interests me, because food and agriculture matter a great deal if you care about climate or global poverty or health, and because there’s so much debate about what the path forward should be. Organics? Farmers markets? Genetically engineered crops? Vegetarianism? Local? [click to continue…]

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PepsiCo and Naked Juice: Confused about GMOs

March 22, 2011

I’m a fan of Naked Juice. The Protein Zone and Protein Zone Mango smoothies are great ways to refresh and rebuild tired muscles after a long run..

I’m not a fan of sanctimonious b.s., though, and Naked Juice is peddling that along with its juices and smoothies.

Here’s what I’m talking about. The other day, I noticed this message on a Naked Juice bottle:

We use only the freshest, purest stuff in the world and leave out everything else. * no added sugar * no preservatives *non-GMO**   *gluten free

The double asterisk next to non-GMO led me to this:

While many ingredients do not exist in bioengineering varieties, Naked Juice does not use ingredients that were produced using biotechnology as a matter of principle.

It was the last five words that caught my attention. “As a matter of principle.” The phrase also is used on Naked’s website.

Not as a matter of marketing. Not because the consumers of Naked Juice just might happen to be the kinds of people  who would feel good about avoiding GMOs. But as a matter of principle.

Hmm. There’s an implicit moral judgment there, no?

What, I wondered, might the principle be? [click to continue…]

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Will Rosenzweig: Venturing in sustainability

December 14, 2010

Most venture capital investors don’t have a focus. Kleiner Perkins says it is “in search of the next big idea.” Draper Fisher Jurvetson “backs extraordinary entrepreneurs everywhere who set out to change the world.” Mohr Davidow values “entrepreneurs who identify impressive market opportunities and are not afraid to go after them.”

Physic Ventures is different. Its mission is “investing in keeping people healthy.” Specifically, the San Francisco-based venture firm, which has backing from corporate giants Unilever, PepsiCo and Humana, invests in “technology-enabled, consumer-facing companies that help people and the environment stay healthy,” according to Will Rosenzweig, its managing director.

Physic is betting that it can discover and invest in startups that can make “personal and planetary health” a big business, just as richer and better-established Silicon Valley VCs made fortunes by backing information technology startups like Apple, Google and Amazon.

Will Rosenzweig

I had lunch recently with Will Rosenzweig in Washington to talk about Physic and some of its portfolio companies. Will is an engaging and interesting guy, best known for starting a company called The Republic of Tea in the early 1990s. (He and his co-founders, Mel and Patricia Ziegler, who also co-founded Banana Republic, wrote an acclaimed book about the experience that’s also called The Republic of Tea.) Will, who is 51, was also an early organizer of the TED conferences, the head of marketing for Odwalla and a teacher at the Haas business school at Berkeley.

Will and Dion Madsen, who had run a venture fund inside Unilever, the $57 billion consumer products giant, co-founded Physic Ventures about five years ago. It’s an independent fund whose corporate backers who offer strategic advice and research insights. Its financial investors include CalPERS and CalSTRS, the California state and teachers’ pension funds.

Will has written about the fund-raising efforts and strategy in an article called 7 Reasons Why Great LPs Invested in Our First-Time Venture Fund . [PDF, download] He and his partners raised about $159 million by 2008–an impressive amount for a fund in a new sector, with no track record of successful exits.

It’s much too early to judge the success of the fund or its investment thesis, but there’s no doubt that Physic has invested in some intriguing startups. [click to continue…]

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Sugary sodas: The new tobacco?

October 7, 2010

New York’s Mayor Bloomberg has a controversial idea: Prohibit food stamp recipients from using them to buy sugary sodas.

While, as a rule, I would prefer that the government stay out of people’s choices about what to eat, drink, or smoke, and who to invite into their beds, and while I admire the Coca-Cola Co. and PepsiCo for much of the corporate-responsibility work they do, particularly around the environment, I say: Bravo!

Why? Tax dollars ought not to be used to subsidize people’s purchases of sugared drinks that make them fat and sick, and lead them to then require more government support when they enter the subsidized health-care system.

This isn’t a simple or clear-cut issue. It wouldn’t, I think, be smart or practical to try to exclude other fatty foods from the food stamp program. In fact, if we are going to try to guide people’s choices, I’d rather see incentives given to those who use food stamps to buy fresh fruits and vegetables, ideally locally grown. (See Chef to the rich, advocate for the poor.)

But the government is drawing lines already. Food stamps cannot be use to buy cigarettes, beer, wine or prepared foods from restaurants. The question is, on which side of that line should sodas belong?

In an op-ed today in The Times, Thomas Farley, New York City’s health commissioner, and Richard Daines, New York state’s health commissioner, make the argument well:

Over the past 30 years, consumption of sugary beverages in the United States has more than doubled, in parallel with the rise in obesity, to the point where nearly one-sixth of an average teenager’s calories now come from these drinks. Some 57 percent of adults in New York City and 40 percent of children in New York City public schools are overweight or obese.

…And substantial health care costs arise from this trend: obesity-related illnesses cost New York State residents nearly $8 billion a year in medical costs, or $770 per household. All of us pay the price through higher taxes.

Poor people will still be able buy sodas, of course–just not with taxpayer money.

For companies like Coca-Cola and PepsiCo, which will fight this idea through the American Beverage Association, the message here should be clear: your future does not like in selling sugary sodas that are bad for people’s health, at least not if you want to be seen as companies that do good. Increasingly, these products will be stigmatized, as tobacco has been over the years. To its credit, the beverage industry has begun to recognize this by diversifying its product mix and removing full-calorie sodas from schools.

The mayor’s proposal now goes to the Obama administration’s agriculture department. Should be interesting to see how the feds respond.

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A food revolution?

May 21, 2010

OgAAAOMz3dH0-HafZx1TctR2lFMwnVnyn6UpdLUHNQ_8SAcyDMFhCebvsjC51YuU8w8gRAXu46wPNy5WHetI_9W0XewA15jOjFRxqljFWwNaFDgYenGcIpUAl50UHave you noticed? A food revolution has begun—with the goal of making our food and agriculture systems better for us, better for the environment, maybe even better for workers and democracy.

So, at least, says Marion Nestle, the author, activist, NYU professor and corporate critic, who gave a rousing closing speech at Cooking for Solutions, a mind-stretching, belly-expanding conference and foodfest organized by the Monterey Bay Aquarium.

The revolution will be inspired, in part, from the top—symbolized by the White House organic garden, First Lady Michelle Obama’s anti-obesity campaign and some encouraging legislation, including a requirement in the health-care law that fast food restaurants put calorie labeling on menus.

“I can’t remember every having a First Family that was interested in the issues that I’m interested in,” said Nestle, a veteran of the food wars and author of six books, including a new volume about pet food.

More important, the energy for a food revolution is being generated by diverse, decentralized grass roots (pun intended). Signs include the robust growth of organic food, albeit from a small base; the slow food movement; the rapidly increasing number of farmers markets across America; strong interest in local agriculture; Jamie Oliver’s broadcast TV prime time anti-obesity crusade; other celebrity chefs who tout “green” practices; the battle to reform school lunch programs; the campaign against bottled water; the animal welfare movement; and the obsession with food issues in so much of the media, ranging from Michael Pollan’s bestsellers to indie movies like Food Inc. to the  legions of food bloggers, many of whom came to Monterey.

When you look at it that way, there’s a lot going on. [click to continue…]

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Sanjeev Chadha: Why is PepsiCo building dams?

April 24, 2010

Sanjeev2Today’s guest post comes from Sanjeev  Chadha, the chairman and CEO of PepsiCo India. Sanjeev, who is 50, joined the company in 1989, as part of the team that brought Pepsi products to India and while the brands are doing well, they have been controversial because of their impact on water in a country where water shortages are an issue. Here he writes about how PepsiCo has responded to the expectations of Indian citizens–by both reducing its own water use and helping communities do a better job of gathering and storing water, to the point where PepsiCo now says it has a “positive water balance” in India, a global first for the company.

Images from space illustrate an Earth plentiful with vast blue oceans, seemingly providing our world with an endless supply of this necessary resource. What the pictures don’t show are the millions of people with no access to a clean water supply. Water shortage is a global crisis.

In my home country of India, a lack of fresh water supply has long been an issue among all classes of society. Our consumers range from urban businesspeople to farmers in the countryside. All Indians are acutely aware of the fallout of long-standing issues – from heavy farming and pesticide use to poor sewage treatment and industrial pollution – that impact the nation’s lack of fresh water. As a nation steeped in agriculture, water is of particular concern to farmers, who understand that we need to immediately find better ways to conserve water.

The company I work for, PepsiCo, takes these issues very seriously and is actively making a difference. Not so long ago, environmental activists in India targeted PepsiCo and other beverage companies operating in India  for consuming excessive groundwater in local communities. As you can imagine, our executives were surprised by these accusations, as we work to employ safe water and bottling practices in PepsiCo facilities around the world. In response, we continued to improve efforts to reduce water use in our plants and took additional action to provide local communities with the clean water they need.

In 2003, we took this a step further.  We launched a country-wide effort to achieve a Positive Water Balance in India by 2009. Essentially, this means that for all water used in our manufacturing process, we would give the same amount of water back to local communities, through in-plant processes to reduce our water use, as well as programs and interventions to create greater freshwater access in local areas. You can learn more about Positive Water Balance from the World Business Council for Sustainable Development.

Check Dam Sept 2009We also recognized the need for on-the-ground action in these communities. Replenishing water supplies only partially solves the problem; villagers also need tools to better manage these expanded water resources. It’s an important part of our role to invest in and aid our neighbors. And at PepsiCo’s facilities in India, we saw an opportunity to better manage water resources in these areas by working directly with community members.

After assessing several areas near our beverage manufacturing locations,  we determined that the creation of check-dams would be the best way to manage and rejuvenate the water supply. [click to continue…]

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PepsiCo, sexism and “diversity”

February 16, 2010

This is PepsiCo’s SoBe brand, showcasing the actress Ashley Greene and her “zero inhibitions” in a painted-on swimsuit, as part of the Sports Illustrated swimsuit extravaganza. What better way, after all, to promote Sobe’s  “zero calorie” flavors than with a babe wearing zero clothes on your corporate website and on You Tube videos, which have attracted more than 500,000 views?

sobe_ashley_green

And then there is the photo below, from the page about Our Commitment to Diversity on the PepsiCo website, which goes on at some length about the company’s efforts to foster a workplace of caring and candor and where everyone is treated with respect. As best as I can tell, all the PepsiCo employees in this photo appear to fully clothed, although it’s possible that some wise guy in the back isn’t wearing pants.

diversityinclusion_commitment_contentThe company says:

Diversity isn’t just the right thing to do. It’s the right thing to do for our business. We’ve made it our commitment to make diversity and inclusion a way of life at PepsiCo….In fact, we view diversity as a key to our future.

And:

PepsiCo has been nationally recognized as one of the top places for women and minorities to work. We were one of the first companies to begin hiring minorities in professional positions, as far back as the 1940s. We were the first Fortune 500 company to have an African-American vice president.

The company also says that its

Multi-year strategic plans for diversity are developed with the  same vigor and goal-setting process as other business issues.

Interestingly, PepsiCo apologized for its sexist advertising just last fall, according to Mashable, a website about social media. The company had launched an iPhone application for its AMP energy drink called “before you score,” with “score” meaning (to put it in the most subtle of terms) having a successful night with a woman. The company subsequently removed the application from the iPhone store.

So….here’s my question. Why would PepsiCo–a company with a female CEO, Indra Nooyi–now run a high-profile advertising campaign using a naked young woman to sell flavored water? Does that reflect its commitment to diversity? Or is it old-fashioned sexism?

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Lay’s local potato chips

May 13, 2009

So what are we to make of the fact that Lay’s potato chips now promote themselves as a locally-grown food? Do we thank Michael Pollan for this?frito-lay-logo

In case you missed the news, Frito-Lay, the world’s biggest snack food maker and a unit of PepsiCo., this week said it will market Lay’s potato chips (“America’s favorite potato chip”) by putting the spotlight on the 80 farmers in 27 states who grow  potatoes for Lays. By typing product codes from a bag of chips into a website using what the company calls a Chip Tracker – you can check it out here – consumers can learn where their chips were grown and made. Just the other day, I wrote that traceability is a big deal, but I never expected to be able to track the supply chain of a potato chip.

USA Today quotes a Frito-Lay exec:

“Knowing where food is made and grown is important to consumers,” says Dave Skena, vice president of potato chip marketing at Frito-Lay. “Sharing with consumers how regional we are is relevant and compelling.”

TV ads will feature the local farmers, the New York Times reports:

One is Steve Singleton, who tends 800 acres in Hastings, Fla.

“We grow potatoes in Florida, and Lays makes potato chips in Florida,” he says in the ad. “It’s a pretty good fit.”

And you thought eating local was about shopping at your neighborhood farmer’s market. How naïve.

It’s no surprise, really, to see Big Ag is jumping aboard the “local” movement. My Giant supermarket touts “Delmarva” chickens, meaning they come from the vast chicken farms on the eastern shores of Delaware, Maryland and Virginia. They may be local, but, alas, their chicken poop is also responsible for much of the pollution in the Chesapeake Bay.

Wal-Mart, too, says it is buy more local food, for practical as well as environmental reasons. It’s fresher, cheaper to ship and helps counter the notion that Wal-Mart is a giant chain store that doesn’t care about local communities.

As Frito-Lay’s Skena put it: “This is celebrating the notion of community.”

Oh, please.

Of course, American growers have a compelling reasons to argue that local is superior to long distance food. Again, from The Times:

For some big agricultural interests, promoting local food has a protectionist bent. Sales of Virginia apples were hurt a few years ago when Chinese apples flooded the market, said Martha Moore, director of governmental relations for the 38,000-member Virginia Farm Bureau.

Those kinds of threats from imported food is one reason her agency started a local food marketing program last year.

“If promoting local agriculture will help America to become food independent, that’s what we want,” she said.

Well, sure. But if we close our doors to Chinese apples, Chilean grapes or Brazilian sugar (which we do, at least in the case of sugar), what, then, are we going to say with other countries decide to shut out American wheat—or movies or software.

And as long as we’re on the subject of grapes, next time you pack a lunchbox for little Joey or Judy, ask yourself what you’ve accomplished by throwing in a “local” bag of chips instead of a “foreign” bunch of grapes. Junk food is junk food, even if it’s made right around the corner.

Now I’ve got no beef with Frito-Lay. The company takes environmental issues seriously. A Frito-Lay plant in Casa Grande, Arizona, aims to cut its electricity and water usage by 90%, and within a couple of years, the plan will “run almost entirely on renewable energy and recycled water while reducing waste going to the landfill to less than 1%,” the company says. Frito-Lay has set big audacious goals to reduce its environmental footprint. I interviewed a Frito-Lay sustainability exec named Dave Haft at the Milken conference a year ago, and he was a really impressive guy. If I were a fan of potato chips instead of a pretzels guy, I’d buy Lay’s.

The trouble is, local is a slippery idea. Indeed, there’s no one quality or attribute when it comes to food (or anything else) that equals “good.” Not organic, or Fair Trade, or local or, for that matter, low-fat. We need to find ways to think more holistically about the impact of the things we buy or consume. Over time, I suspect, companies will move to create broader eco-labels that take into account the entire life cycle impacts of the things they sell.

Are “local “Lay’s a step in that direction? Not really. But if all they do is get people thinking about the environmental impact of the food choices, that can’t be a bad thing.
lays_classic

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