We strive for the "5 Rs"-to reduce, recycle, use renewable sources, remove environmentally sensitive materials and promote the reuse of packaging in the entire process of packaging selection, design and procurement.

Over the last five years, we have reduced the packaging weight of our products by more than 350 million pounds in all manufacturing for which we procure packaging, including acquisitions, exceeding our target by 20 percent. The packaging weight reductions we have achieved are equivalent to removing more than 95 tons of packaging material each day during that five year period.

In the U.S., initiatives by our Aquafina team have enabled PepsiCo to avoid using more than 135 million pounds of plastic. The current 16.9 ounce Aquafina bottle uses half the amount of plastic as the 2002 bottle of the same size. For Gatorade, the amount of resin used in 32-ounce bottles has been reduced from 45 grams to 39 grams, resulting in approximately 595,000 pounds of PET reduction in the U.S. and nearly 9 million pounds of bottle waste reduction in Europe.

Efforts to reduce food packaging paying off

In 2012, our partner 3M awarded PepsiCo Mexico Foods a Sustainable Packaging Award for Sabritas' environmental sustainability efforts in the daily packaging process. Sabritas invested in a sustainable stretch wrap system that significantly reduces waste material. 3M provided Sabritas with an innovative, customized and effective solution to guarantee the correct transfer and delivery of product while reducing waste by 70 percent. The new solution also cuts costs by five percent and reduces warehouse space needs.

In 2012, 91.2 percent of solid waste generated by more than 260 company-owned manufacturing facilities was put to beneficial use, such as recycling; only 8.8 percent was disposed of through more traditional methods, such as landfills. Moreover, around the world, we have 61 plants that send less than 1 percent of their waste to landfills.

We are committed to increasing the recyclability of our packaging, increasing recycling of post-industrial packaging related to our products and making sure our containers utilize materials that are compatible with accessible recycling systems.

We are facilitating recycling by our consumers and retail customers. For example, in the U.S., we have created and deployed a convenient recycling solution to capture plastic that is recycled for use in manufacturing our bottles.

Since 2010, we have added more than 5,000 recycling systems across North America through recycling programs in more than 42 states. These systems have diverted more than 196 million beverage containers to recycling since 2010.

Our success in increasing recycling rates and the amount of recycled polyethylene terephthalate (rPET) available for use has enabled us to increase the amount of rPET in our bottles. We now incorporate, on average, up to 10 percent of post-consumer rPET in our U.S. primary soft drink bottles. Moreover, we lead the industry in expanding the use of rPET across key international markets.

Our TerraCycle bag brigades, which are sponsored by Frito-Lay, have diverted more than 23 million of our post-consumer snack bags from landfill.

Since their U.S. launch in September 2009, our Frito-Lay sponsored TerraCycle bag brigades have diverted over 23 million of our post-consumer snack bags from landfill. The program expanded into Brazil, Mexico and Israel in 2012, collecting more than 6 million bags in just one year. The program now operates 70 brigades in 22 countries. Funded by Sabritas, Gamesa and Quaker, PepsiCo Mexico and TerraCycle's chip-bag collection program has diverted more that 1 million chip bags from going into landfills. Printed directions on the product's packaging encourage consumers to visit TerraCycle's website, sign up and recruit others to collect chip bags for recycling.

We also have some unique brand activities. For example, over the last two years, Mountain Dew and Burton have worked together on a collaboration which introduced a line of sustainable apparel. The partnership creates fabrics out of recycled plastic bottles that can be used in Burton products. The first product, a collection of t-shirts made from 50 percent recycled plastic bottles and 50 percent organic cotton, was launched in 2011. In 2012, the line was expanded to include Men's and Women's pants and jackets made from recycled bottles. The new collection for 2013 continues to change the way outerwear and apparel are made by creating sustainable fabrics out of recycled plastic bottles and using this material in key products within the Burton line.

Waste to Wealth

Our Latin America business has been working with waste pickers, who salvage reusable or recyclable materials to sell or for personal consumption. We also work with area associations to develop sustainable "waste to wealth" programs that help improve the environment, enhance the quality of life of recyclers and contribute to a local recycling market.

For example, in Brazil, in partnership with the business association CEMPRE (Compromisso Empresarial para Reciclagem), we support an initiative that includes waste picker training, professional development, waste management and recycling training, and business management practices training to help waste pickers increase their income.

Waste to Wealth Programs in South America

Brazil: Increasing Recycling Rates
In November 2012 PepsiCo, together with Ciudad Saludable and GAIA Social, launched a project to increase recycling rates of Biaxially-Oriented Polypropylene (BOPP) films and PET in Brazil. This project involves eight cooperatives in São Paulo. It assesses each one's situation, creates action plans and provides training for commercialization to establish an advantageous partnership for the recycler.

Argentina: Urban Recyclers Program
PepsiCo Argentina celebrated its successful first year of the Urban Recyclers program, which we founded in alliance with the IDB and Avina Foundation. The project's goal is to strengthen the cooperatives of recyclable materials collectors and their production processes. In addition to being a donating partner for the program, PepsiCo started the Pepsi Music 5x1 promotion. 5x1 invites consumers to redeem five yellow plastic caps from Pepsi or 7UP bottles at different points of sale in exchange for a free Pepsi or 7UP 2.25 liter product. Across the country, 35 tons of plastic bottle caps were collected for recycling. In return for the recycled material, PepsiCo supplier and partner Scrap Control will make a donation to El Alamo, a local cooperative, to fund new recycling machines and improve the cooperative's production processes.

The Urban Recyclers project is a Power of One initiative and part of the regional Wealth from Waste program currently implemented in Brazil, Bolivia, Colombia, Peru, Guatemala, the Dominican Republic and now, Argentina.

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