PepsiCo is Pushing Back its Climate Goals. The Company Wants to Talk About It

As companies are facing backlash for quietly undoing their environmental pledges, PepsiCo is trying a fresh approach.
The beverage and snack giant, which makes everything from Mountain Dew sodas to Lays chips, this week cited myriad reasons why it won't be meeting certain of its sustainability goals. It pointed to some external factors such as a lack of progress on recycling and electric vehicle charging infrastructure, as well as electric grid modernization. PepsiCo also cited internal factors like the growth of the business.
PepsiCo said Thursday it pushed back by a decade its goal to achieve net-zero emissions from 2040 to 2050, as well as a handful of delays on plastic packaging goals, to name a few of the shifts. The company made some new pledges too, for example it increased its goal for regenerative agriculture, farming practices intended to increase biodiversity and more, and is now aiming to adopt such practices across 10 million acres by 2030, rather than its previous goal of 7 million acres.
Jim Andrew, chief sustainability officer, said PepsiCo's ability to make progress at the rate it would like to "is very very dependent on the systems around us changing." He added the "world was a very different place" when it was working on these goals in 2020 amid a completely different political and regulatory landscape.
"We had anticipated stronger policy support, increased investments, more regulatory action to drive change," he said. "And honestly many of those expected shifts didn't materialize."
PepsiCo's move follows criticism of Coca-Cola in December when it walked back some of its environmental goals. Some rebuked Coca-Cola for quietly unwinding a commitment to make 25% of its products with reusable packaging by 2030. Another of Coca-Cola's commitments from several years ago, to use at least 50% recycled material in its packaging by 2030, was unwound to 35% to 40% of recycled material by 2035.
The beverage industry currently faces a multitude of economic and regulatory pressures on plastic use across the globe. Coca-Cola recently said it may be more reliant on plastic following President Trump's tariffs on aluminum. PepsiCo didn't address tariffs in its update, but the company said it is "exploring opportunities to increase recycled content in non-plastic materials such as aluminum, glass and paper to further advance circularity." PepsiCo also has a tariff concern because it makes the concentrate for nearly all of its U.S. sodas in Ireland, which would be subject to duties when imported into the U.S.
"When you're a successful company and you grow a lot, that causes goals to be more challenging than if you're flat or shrinking," Andrew said, adding that the company is aiming to reduce the amount of virgin plastic it uses while simultaneously growing the business. PepsiCo just completed the acquisition of Poppi prebiotic sodas, adding a drink favored among Gen Z to its portfolio. But its earnings outlook isn't expected to rise compared with last year because of tariff-related supply chain costs and consumer confidence amid the trade war.
PepsiCo is now aiming to reduce Scope 1 and 2 greenhouse gas emissions—those emissions it has direct control over or come from its energy use—by 50% by 2030, while it was previously seeking to do so by 75%. Its Scope 3 goals—relating to emissions that come from its supply chain and are outside its control—are more complex: it's now aiming for a 42% reduction in energy and industrial emissions and a 30% reduction in value-chain forest, land and agriculture emissions. The company previously said it aimed to reduce Scope 3 emissions 40% by 2030.
PepsiCo emphasized that its Scope 3 target is in line with the Paris Agreement, backed by the Science Based Targets initiative, and is in line with the intent to limit global warming to 1.5°C above pre-industrial levels.
There are several shifts on plastic: PepsiCo's goal to use 50% recycled content in its plastic packaging by 2030 was lowered to 40% by 2035 for its primary plastic packaging. The company wanted to design 100% of its packaging to be recyclable, compostable, biodegradable or reusable by 2025, but that target has been reduced to 97% by 2030 "in our key packaging markets."
It's also putting an end to its goal to cut virgin plastic from non-renewable sources, as well as dropping a goal to deliver 20% of all beverages through reusable packaging such as glass or plastic by 2030. PepsiCo now wants to reduce absolute virgin plastic by 2% each year. The company cited some restrictions, for example that China doesn't allow recycled PET—a type of plastic used for bottles and food containers—in food-grade packaging.
The United Nations is still wrestling over a plastics treaty—of which PepsiCo is advising on as part of a business coalition—with an upcoming session in August in Geneva.
On water usage, PepsiCo said it met its goal two years early to improve water-use efficiency by 25% by 2025 in certain areas. But it also ended a target to "reach world-class water-use efficiency" at PepsiCo and third-party manufacturing facilities.

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