In October 2019, PepsiCo issued its first Green Bond, a 30-year, $1 billion senior notes offering, the proceeds of which are being used to build a more sustainable food system. The net proceeds from this offering have been and will continue to be allocated to investments in Eligible Green Projects, supporting our efforts in three categories, while also advancing several of the UN’s Sustainable Development Goals:
- Sustainable plastics and packaging
- Decarbonization of our operations and supply chain
- Water sustainability
We have integrated our sustainability capital expenditure and Green Bond allocation processes. PepsiCo’s Sustainability team assesses and determines Eligible Green Projects. Following final approval, PepsiCo’s Sustainability team recommends allocation of proceeds, and provides description of Eligible Green Projects to PepsiCo’s Finance department. PepsiCo’s Finance department tracks the allocation of net proceeds to approved projects. Pending allocation, net proceeds are temporarily invested in cash, cash equivalents, short-term investments, or used to repay other borrowings.
Until the net proceeds are fully allocated, we plan to publish an annual update of the allocation of the net proceeds, including, subject to any confidentiality considerations, descriptions of select projects funded, and, where possible, their environmental impacts. These allocation reports will be accompanied by an assertion by PepsiCo management stating that amounts equivalent to the net proceeds of the Green Bond offering (or, pending full allocation, a portion thereof) were allocated to Eligible Green Projects. Our management assertion is independently assured. For more detail, see our Green Bond Prospectus.
In October 2020, we published our first Green Bond Report, describing our use of proceeds. As of December 31, 2019, PepsiCo had allocated $447 million in proceeds from the issuance of its first Green Bond to Eligible Green Projects. This represents more than 40 percent of the net proceeds and includes investments in all three eligible categories of packaging, decarbonization, and water. Individual investments have ranged from approximately $350,000 to $200 million, and spanned five continents. While projects within the three categories focused on a wide breadth of solutions, they all shared the common effect of supporting PepsiCo’s vision for a sustainable food system.