PepsiCo’s investment in SA goes beyond the financial

THE acquisition of Pioneer Foods in March 2020 by PepsiCo Inc was a strong financial commitment to unlocking socio-economic and local value chain benefits for South Africa.

Since being appointed CEO of PepsiCo South Africa in May this year, I have become even more acutely aware of the significance of this commitment in tackling the key opportunities and hurdles we face as a business operating in our amazing yet often challenged country.

But this commitment is not merely financial; it also speaks to the vital role of corporate citizenship and driving sustainable development, both of which form fundamental pillars of our corporate strategy. This can only be impactful through a deep understanding of the environment we operate in and some of the unique challenges we face in South Africa.

Our corporate citizenship initiatives, therefore, focus on issues such as food security, nutrition, access to water and agricultural development, which not only impact the livelihoods and well-being of the communities we operate in but also the sustainability of our business. Through partnerships with government, industry bodies, non-governmental organisations, and communities, we are making progress on several fronts to support the growth and scale of emerging farming enterprises, small businesses, and communities across South Africa.

Improving agricultural productivity

As a large procurer of agricultural products, we acknowledge our direct responsibility to improve agricultural productivity in the country. We are promoting regenerative agriculture practices and encouraging the adoption of innovation to revitalise local production within the agriculture sector and beyond.

Through the Kgodiso Development Fund, which we founded following approval of the acquisition of Pioneer Foods, we are delivering on our commitment to support the broad socio-economic imperatives of education and enterprise development across our value chain. A portion of this work is to assist, fund and provide a route to market for emerging farming enterprises to upscale their businesses and ensure they have opportunities to integrate into our value chain.

Since its launch, the fund has invested R144 million (of a total of R300 million earmarked for agricultural projects) across 43 black-owned entities. Of this amount, 20% is supporting women, and 10% has gone to supporting youth.

Our commitment extends to enabling initiatives that provide appropriate training to address key skills and knowledge gaps in the food system. An additional R200 million of funding from the Kgodiso Fund is allocated to education programmes that target scarce skills in the consumer goods and agronomy sectors. Our graduate programme is dedicated to developing leadership capability. The first cohort of candidates from these programmes graduated earlier this year, with 97% of them being absorbed into the business.

Addressing water insecurity

Water is a vital and scarce resource within the food system, and our understanding of this drives our focus to protect and replenish this valuable resource through various programmes, with the aim to replenish more than 100% of the water we use.

Our approach to this is threefold: we have partnered with The Nature Conservancy and the World Wide Fund for Nature (WWF) to remove alien invasive trees and restore the landscape in the Western Cape, Eastern Cape, Northern and Southern Drakensberg; we are assisting municipalities with loss reduction using pressure management devices; and we are repairing leaks and upgrading ablutions in schools to improve access to sanitation and reduce water losses.

We also fully implement the Alliance for Water Stewardship (AWS) standard at all high-risk water facilities. This requires increased collaboration, advocacy, idea-sharing, and investment to address water insecurity. We will use AWS to elevate efforts to address water risk and mitigate water insecurity.

Zeroing in on emissions

As we strive to reach net-zero emissions and create a positive value chain, we aim to achieve 100% renewable electricity in our operations by 2030. Significant progress has been made in South Africa – the current installed capacity at 13 production sites and three distribution centres is 10.7 megawatt peak (MWp), with several others underway.

Solar installations at the Atlantis Cereals and South African Dried Fruit Plant in Upington were completed in July 2022, the Weet-Bix Plant in December 2022, and the Parow Central Distribution Centre and Isando Phase 2 installations in April and August 2023, respectively. The Ceres Beverages installation will be completed in early 2024.

The expected total annual electricity produced by Weet-Bix, the South African Dried Fruit Upington Plant, the Parow Central Distribution Centre, and Atlantis Cereals will be around 4.2 gigawatt hours (GWh).

We are also advancing our sustainability agenda by further reducing carbon emissions in our operations and supporting our business partners on their journey by sharing best practices, building capabilities, and collaborating on solutions.

All of this is only possible because of the diverse group of 12 000 people that form part of our PepsiCo South Africa team. We recognise the impact they have in shaping and driving our future. That is why I am so honoured and humbled to be at the helm of this pathfinding company. We are committed to creating a positive impact through our people, products, and purpose.

Creating more smiles with every sip and every bite!

Riaan Heyl is the CEO of PepsiCo South Africa.

Brought to you by PepsiCo South Africa.

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