Forced labor

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Forced labor

To PepsiCo:

As one of the world’s leading convenient food and beverage companies, we are committed to doing our part to help prevent and eradicate forced labor. Forced labor can materialize in global value chains, including our own. As outlined in our Global Human Rights Policy and our Global Supplier Code of Conduct, we prohibit all forms of forced labor, coercion to work and limitations on freedom of movement for our own employees, our suppliers, and business partners. Recognizing the scale of our value chain and the inherent complexities involved in global agricultural supply chains, we continually act to mitigate potential human rights impacts on workers across our value chain.

To the World:

Modern slavery remains one of the most severe global human rights challenges facing our society. The International Labor Organization currently estimates that 50 million people are victims of modern slavery worldwide, including 28 million people trapped in forced labor. Of the 28 million victims of forced labor, over 17.6 million are being exploited through forced labor in the private sector. Modern slavery occurs across every region of the world and can materialize in global value chains.

Approach

PepsiCo prohibits the use of all forms of forced labor, including involuntary prison labor, indentured labor, bonded labor, military labor, slave labor, and any form of human trafficking. No employee may be coerced to work or subjected to physical punishment or threats of violence or other forms of physical, sexual, psychological, or verbal abuse as a method of discipline or control. All workers must have freedom of movement, and the conditions of employment must not restrict their movement through the retention of identity papers, holding of deposits, accommodation requirements, or any other action aimed at restricting worker mobility. Furthermore, in line with the Employer Pays Principle, no worker should be required to pay recruitment or other similar fees to secure or retain their employment. These standards are embedded in our Global Human Rights Policy and Global Supplier Code of Conduct, which outline the expectations for our employees, suppliers, and business partners. We conduct regular due diligence through mechanisms such as the Sustainable Sourcing Program that are designed to ensure compliance with these standards and to gather insights to inform our broader human rights governance process.

Progress

In 2022, we continued to refine our efforts in high-risk geographies in our supply chain, expanding our traceability efforts and due diligence programs to additional segments of our supply chain, and leveraging our unique size and scale to advocate for and drive responsible recruitment practices throughout our value chain.

Challenges

Modern slavery occurs across every region of the world and can materialize in global value chains. Different segments of supply chains, types of raw materials, and geographies require unique solutions and navigating complex systems.

We have continued to deepen our understanding of the value chain segments, like contract labor providers, logistics, raw material suppliers, and geographical areas, including Southeast Asia and Latin America, where we should focus our efforts, prioritizing action on forced labor impacts across our value chain. Insights from country and commodity risk assessments and our due diligence programs have been used to identify our target supply chain segments, raw materials, and priority geographies. In recent years, we have continued to expand our due diligence programs to cover these areas of our supply chain; to strengthen our ongoing sustainable sourcing initiatives for palm oil and cane sugar; and to deepen our engagement in regional and local collaborative initiative to address systemic forced labor challenges at a country level.

Additional detail on our progress on our journey to eliminate forced labor in our value chain can be found in our annual Modern Slavery and Human Trafficking Statement.

What's next?

We will continue to strengthen our policies and commitments and evolve our programs to ensure forced labor is not used in our value chain. To this end, we will:

Reassess the high-risk operating and sourcing markets for our value chain, prioritizing efforts to address risks in these geographies
Enhance our due diligence assessments to ensure they effectively address forced labor, incorporating new methods and strengthening our focus in high-risk supply chains
Continue ongoing stakeholder engagement and industry collaboration efforts through Consumer Goods Forum and AIM-Progress to develop industry guidance on key issues such as responsible recruitment and fee payment
Continue to strengthen our grievance process and more effectively use our leverage to enable remedy