PepsiCo Statement on Pesticides and Other Agrochemicals

For PepsiCo, sourcing our agricultural ingredients responsibly and sustainably is important to the continued growth of our business, helping to ensure food safety and supporting crop resilience for ongoing, localized supply. With respect to pesticides and other agrochemicals used by farmers in our supply chain, PepsiCo seeks continuous improvement in agricultural practices to minimize chemical use and its potential impacts while protecting the crops that are vital to food production.

Pesticides are substances designed to control pests such as weeds and insects. They have many commercial and residential uses but most are applied as crop protection products to control agricultural pests. Responsible use of pesticides is an important aspect of sustainable agriculture. By improving crop yield from farms and plantations, pesticides help ensure a reliable and productive food chain and reduce pressure to convert more land to agriculture, which helps to prevent deforestation. By protecting crops, pesticides also help to keep food affordable for consumers while supporting farmer incomes.

According to the UN Food and Agriculture Organization, global pesticide use has increased over the past decade, driven by factors such as population growth, climate change, increased demand for food and scarcity of good agricultural land. Much of the growth has occurred in emerging economies. In the United States, data provided by the US Department of Agriculture shows that pesticide use has actually remained flat for the past decade even while agricultural production has grown significantly.

Pesticide use has led to concerns around the potential for unintended environmental and health impacts. These may include the potential for pesticide residues on the raw materials used in food manufacturing, contribution to stress on bee populations, and, if not handled and applied properly, potential health impacts on farm workers and communities. PepsiCo understands these concerns and takes pesticide issues seriously. However, we also believe that appropriate pesticide use is important for protecting crop yields and promoting agricultural sustainability more broadly.

Our Actions on Responsible Use of Pesticides and Other Agrochemicals

PepsiCo’s approach begins with our Global Sustainable Agriculture Policy, which sets standards of performance and expectations for growers across our diverse, global supply chain, including compliance with governmental laws, regulations and industry standards, as well as a broad-based objective specifically addressing optimization of pesticide and nutrient management. Our aim is to support sustainable practices that substitute natural controls for some agrochemicals, foster ecosystem balance, reduce greenhouse gas emissions and mitigate crop losses. Our policy also recognizes the risk of water pollution from pesticides and the need to responsibly manage water runoff from farms.

Our policy is supported by specific goals on sustainable agricultural sourcing as part of our sustainability agenda. Our goals are to sustainably source our direct agricultural raw materials by 2020 and our non-direct major agricultural raw material ingredients by 2025. To achieve these goals, we are, among other things, extending our Sustainable Farming Program (SFP) across additional key crops and investing to help growers meet the minimum SFP standards.

PepsiCo developed SFP to be a comprehensive framework to gauge environmental, social and economic impacts associated with our agricultural supply chain. The SFP Scheme Rules are available on our web site and provide information on the overall SFP framework. In 2018 PepsiCo plans to publish a summary of its SFP code as well, which will provide more detailed information of the specific types of practices that PepsiCo encourages farmers to adopt.

PepsiCo has worked closely with our growers for years, and we have a strong heritage of partnering with experienced farmers who are responsible stewards of natural resources. The SFP has been successfully implemented across a wide variety of operations—from large agribusinesses to smallholder farms—including both direct and non-direct agricultural materials. From 2013 to 2016, SFP implementation took place in 33 countries with active programs representing more than 35,000 growers. The crops addressed included major direct materials such as corn, oats, potato and orange as well as non-direct materials, including canola, cassava, coconut, plantain and sunflower. The assessments completed on our direct supply chain alone represent nearly 50% of our total agricultural supply chain by volume. Additionally, PepsiCo has major initiatives on sustainable palm oil and sugarcane that utilize industry-leading sustainability certification standards, specifically the Roundtable on Sustainable Palm Oil (RSPO) and Bonsucro, respectively.

SFP’s framework contains nine environmental, four social and three economic sustainability topics, with detailed criteria and global standards for each. Under the environmental pillar, agrochemicals are one of the nine indicators, providing a platform through which PepsiCo gathers additional information on pesticide management and application, including measures to support safe, legal and responsible use while minimizing agrochemical application through practices such as Integrated Pest Management (IPM). The agrochemical indicator includes seven principles, which we categorize in the following way:

Fundamental Principles (required):

  • Ensure all agrochemicals applied are registered in the geography of use, in the country of production and as required by any national and international treaties.
  • Ensure the management, selection, purchase, storage, security, handling, application and transport of agrochemicals meets all relevant legal requirements including national and international treaties, and occurs in a way that minimizes any negative effects on the environment.
  • Develop and maintain an IPM Plan.
  • Maintain agrochemical inventory and application records.

Progressive Principles (encouraged):

  • Keep crop scouting records.
  • Maintain, clean and calibrate agrochemical application machinery to ensure accurate application.
  • Keep agrochemical application equipment calibration records.

Sustainable protection of crops against pests includes prevention and monitoring of pest problems, using pesticide control methods only when necessary, and targeting only the pests that can harm crops. IPM is an important tool for advancing these practices. The UN's Food and Agriculture Organization defines IPM as "the careful consideration of all available pest control techniques and subsequent integration of appropriate measures that discourage the development of pest populations and keep pesticides and other interventions to levels that are economically justified and reduce or minimize risks to human health and the environment. IPM emphasizes the growth of a healthy crop with the least possible disruption to agro-ecosystems and encourages natural pest control mechanisms."

Since launching the SFP Code in 2015, the program has enabled PepsiCo to obtain data and improved visibility into our agricultural supply chains, including the use of IPM. Comparing year-end 2018 performance with the prior period (2015-17), farmers' compliance with our IPM requirement has improved from 55% to 66% globally, including nearly 100% compliance in the U.S. In the developing world, non-conformance is primarily attributed to smallholder farmers that require IPM training. PepsiCo is in the process of engaging with our agro teams and growers to support the growers in developing and implementing IPM improvement programs, including training on what constitutes an acceptable IPM that is appropriate for the size/capability of the grower and also to build the business case to adopt IPM. Our goal is 100 percent compliance with our SFP Code globally, and we are using third-party verification to ensure that growers are employing the right practices, including IPM. While the impact of IPM on pesticide application will vary according to a complex set of factors, including crop type, region and climate, IPM helps reduce the amount of pesticides used.

Lastly, PepsiCo is also a founding member of the Midwest Row Crop Collaborative (MRCC) in the United States. MRCC is a diverse coalition of industry and non-profit groups working to expand agricultural solutions that protect air and water quality and enhance soil health. Among its goals, the MRCC seeks to have 75 percent of row crop acres in Illinois, Iowa and Nebraska engaged in sustainability measures by 2025, for example, by using cover crops. We believe such measures will promote appropriate and optimized use of pesticides consistent with our Global Sustainable Agriculture Policy and the SFP Code.

Protecting Food Safety and Quality

PepsiCo is dedicated to producing the safest, highest-quality and best-tasting beverages and foods in every part of the world. Developing and maintaining robust food safety programs is how we work to assure safety for every package, every day, in every market. PepsiCo has detailed internal programs and procedures for food safety. A summary of our policies, programs and actions may be found here.

With respect to pesticides and other agrochemicals, PepsiCo’s growers and suppliers are required to follow all applicable rules and regulations. Pesticide management programs by growers and suppliers are assessed as part of the supplier selection process. PepsiCo also has a Global Raw Material Quality and Food Safety Policy that is included in the contracts with our suppliers. We require our ingredient suppliers and growers to manage pesticide residues through their programs and make pesticide testing and use data available to us upon request. We also audit our suppliers on a regular basis to ensure quality and food safety practices are in place at the supplier site.

The legal limits for pesticide residues in commodities and finished products are governed by local regulations, which cover products produced both conventionally as well as organically. These limits specify the allowable pesticide residue levels and involve significant margins of safety for consumer protection. In 2017, studies by the U.S. Food and Drug Administration (FDA) and the European Food Safety Authority concluded that the vast majority of food consumed within the US and the EU, respectively, is largely free of pesticide residues or contains residues that fall within legal limits. For example, 98 percent of food produced in the US was compliant with federal pesticide residue limits, according to the FDA study.

PepsiCo is compliant with regulations in countries where ingredients are grown and where products are sold. We are aware that concerns exist around growers’ use of glyphosate, a herbicide, including its use as a drying agent prior to crop harvesting. Glyphosate has been extensively studied, and its safety has been reviewed and affirmed by numerous risk assessment authorities and independent expert panels, including a broad review in 2016 that supported the safety of glyphosate use. As safety remains a paramount concern, PepsiCo will continue to monitor the evolving science in this area and engage with stakeholders to understand any potential issues.

Protecting Bees and Pollinators

We are aware of the potential impact of pesticides, among other environmental stressors, on beneficial pollinators as an important issue within PepsiCo’s supply chain. With respect to the group of pesticides called neonicotinoids (neonics), we understand that a significant amount of study is underway to evaluate their impact on pollinators, though significant gaps in scientific knowledge remain.

PepsiCo’s growers and suppliers are required to follow all applicable rules and regulations. Additionally, we implement policies and procedures, including the SFP discussed above, to address and optimize the use of pesticides in our supply chain and minimize any unintended impacts.

PepsiCo commits to broaden our engagement with external stakeholders on the issue of pollinator health specifically. Through this engagement and our ongoing review of available science, we will continue learning about the issues as they evolve while evaluating the feasibility of actions we can take to protect pollinators.