Approach

PepsiCo understands the concerns around pesticides and takes them seriously. In recognition of these concerns, evolving regulations and the importance of responsible pesticide use to our business and stakeholders, we established a cross-functional Global Pesticide Council (GPC) comprised of senior leaders across key functions to evaluate pesticide issues and direct the Company’s policies and programs. The work is structured around five key areas: 

1. Pesticide usage in sourced crops
2. Risk assessment
3. Compliance with global regulations
4. External engagement
5. Internal governance & communication

The GPC's mission is to ensure global compliance, anticipate changes in the marketplace and take proactive steps to minimize pesticide-related risks. These include environmental and human health risks associated with the application of pesticides in agricultural production as well as food safety risks associated with our raw materials. We take into account the fact that pesticides are highly regulated and routinely evaluated by expert government agencies in markets around the world, to address both environmental and human health risks.

Sustainable agriculture and integrated pest management (IPM)

Our Global Sustainable Agriculture Policy sets standards of performance and expectations for growers across our diverse, global supply chains, including compliance with governmental laws, regulations and industry standards, including appropriate use of pesticides. Our aim is to support sustainable practices that substitute and promote 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.

To implement our policy, we set specific performance goals on regenerative agriculture and sustainable sourcing of major agricultural raw materials, backed by our global Sustainable Farming Program (SFP) or an equivalent program. The SFP is a comprehensive framework to gauge environmental, social and economic impacts associated with our agricultural supply chain. The SFP Fundamental Principles and Scheme Rules are available on our website and provide information on the overall framework as well as specific practices that PepsiCo expects our farmers to adopt, including measures to support safe, legal and responsible use of pesticides and minimize agrochemical application through IPM. 

PepsiCo has a strong heritage of partnering with experienced farmers who are responsible stewards of natural resources. The SFP has been fully implemented and independently verified across 35 countries and with more than 4,800 verified farmers, from large agribusinesses to smallholder farms. Crops addressed through the program include key ingredients we source directly such as corn, oats and potatoes, among others. The assessments completed on our direct supply chain alone represent 92% of our total agricultural supply chain by volume. For more on our sourcing progress with the SFP, see Agriculture.

The 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 topics, providing a means through which PepsiCo gathers information on implementation of our principles of pesticide management. The SFP includes seven principles, split between required, fundamental principles and encouraged, progressive principles.

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:

We encourage our farmer suppliers to use a variety of tools to reduce risks from pests. Using a combination of biological, physical and chemical tools to identify, manage and reduce pest risks can help minimize overall economic, health and environmental impacts. Under IPM, actions are taken to control pests only when their numbers are likely to exceed acceptable levels. Any action taken is designed to target the troublesome pest and limit the impact on other organisms and the environment. Although applications of pesticides are always the last resort in an IPM program, they may be needed to help control the spread of disease, ensure farmer safety and/or prevent direct plant loss.

Protecting food safety and quality

PepsiCo has detailed internal programs and procedures for food safety. A summary of our policies, programs and actions may be found on Product safety and quality.

With respect to pesticides and other agrochemicals, PepsiCo’s growers and suppliers are required to follow our Global Supplier Code of Conduct and have pesticide management programs. As part of our supplier contracts, we require compliance with our Global Raw Material Quality and Food Safety Policy, which covers suppliers’ adherence with all applicable rules and regulations. We have various programs that involve pesticide audits and/or pesticide surveillance, including focused testing of raw materials for residues and implementing corrective actions where appropriate. We have a long-term program to work towards third-party Good Agricultural Practice (GAP) certification for farmers globally, which includes details of pesticides used and their application. This program has started with North American and European potatoes and includes an annual independent third-party audit at harvest time to a recognized scheme, which includes a detailed inspection of pesticide use on farms. Pilots are underway in other geographies, including Thailand, China, New Zealand and South Africa.

The legal limits for pesticide residues in commodities are governed by local laws and regulations, which cover products produced both conventionally as well as organically. These limits specify the allowable pesticide residue levels and reflect good agricultural practices and assure safety. Studies published by the U.S. Department of Agriculture (USDA) and by the European Food Safety Authority concluded that the vast majority of food consumed within the U.S. and the EU, respectively, is largely free of pesticide residues or contains residues that fall within legal limits.¹ For example, over 99% of food produced in the U.S. was compliant with federal pesticide residue limits, according to the USDA study.²

Protecting agricultural workers

PepsiCo is compliant with laws and regulations in countries where ingredients are grown and where products are sold. We are aware of concerns around occupational exposure to glyphosate, an herbicide used by farmers, including its use as a drying agent prior to crop harvesting. Glyphosate has been used by farmers around the world for more than 40 years because of its ability to control weeds and its safety profile, which has been vigorously tested and affirmed by numerous risk assessment authorities and independent expert panels. Though we do not own any farms, we expect and encourage growers, especially those with whom we have direct relationships, to comply with local agricultural practices and label restrictions to ensure that the pesticides are applied safely and responsibly. 

Protecting bees and pollinators

We recognize the potential impact of pesticides, among other environmental stressors, on beneficial pollinators as an important issue within PepsiCo’s supply chains. We are actively monitoring scientific understanding and publications in this area as well as regulatory activity, including with respect to pesticides called neonicotinoids (“neonics”).

In response to these developments, PepsiCo monitors scientific and regulatory issues related to neonics under our GPC. We have engaged with a wide range of external stakeholders and enlisted external experts to conduct studies and broaden our understanding, including the potential for viable alternative approaches. We continue to implement our policies and programs, such as the SFP, to address the use of all pesticides in our supply chains and with the aim to minimize unintended impacts to pollinators.

Progress

Since launching the SFP in 2015, the program has enabled PepsiCo to obtain data and improved visibility into our agricultural supply chains, including the use of IPM. PepsiCo is engaging with our agriculture teams and growers to support the development and implementation of IPM improvement programs, including making the business case for IPM and training on appropriate IPM based on the size and capability of the grower. While the impact of IPM on pesticide application will vary according to a complex set of factors, including crop type, region and climate, IPM aims to help reduce the amounts of pesticides used.

Working with farmers

Good Agricultural Practices

In 2023, we continued to work with farmers to implement Good Agricultural Practices, including GAP certification in key geographies and on key crops. At the end of the year, 100% of our potato suppliers in the U.S. and Canada were GAP certified and 98% of our European potato suppliers were GAP certified. Recently, we’ve expanded GAP certification for potatoes to other geographies, including Australia and New Zealand (100%), Saudi Arabia (100%), South Africa (90%) and China, Thailand and Egypt. Pilots are underway in other geographies and crops. 

Implementing IPM

Comparing year-end 2023 performance with the baseline established from 2015-2018, compliance with our IPM program requirement has improved from less than 50% to over 96% globally. The remaining IPM non-conformance is primarily attributed to smallholder farmers with whom we are continuing to support implementation of IPM practice.

As part of our efforts to promote IPM, we engage directly with farmers in our Demonstration Farm Program. The program showcases practices that are leading to the commercialization of innovative ag-tech and the scaling of proven practices that lead to regenerative outcomes. By the end of 2023, we had 83 farms in the program globally. It enables the farmers we work with to share their firsthand experiences, which encourages broader adoption. In 2023, we worked with our partners to support different areas of regenerative agriculture practices such as agrochemical and water-use efficiency, advancements in IPM and many aspects of precision farming. Our demonstration farms showcase practices that can yield measurable outcomes and value for farmers, the environment and the business. For example:

• In Europe, we are using a special “Late Blight” warning app which is developed by Wageningen University (Netherlands). This in-season decision support tool helps potato farmers to reduce their pesticide usage and increases plant health. 
• We have also teamed up with agro-tech companies such as AgroScout to pilot precision agriculture programs for more efficient and targeted use of pesticides. For example, we are using drone technology and an integrated machine learning platform in Latin America. The technology improves scouting coverage and accuracy, reduces the amounts of pesticides needed for spraying and improves plant health.

We have made progress in promoting responsible use of pesticides and implementing our food safety programs, yet we also face challenges:

Governance

The GPC's following strategic plan includes the following aspirations:

• Advancing foundational horizon scanning initiatives;
• Improving internal awareness and understanding through consumer message testing and global pesticide media updates;
• Implementing new audit and selective surveillance programs for potatoes, oats, corn and citrus; and
• Monitoring global regulatory change and following change management protocol. 

Strategic partnerships

PepsiCo actively engages with multi-stakeholder groups, peer companies and NGOs that seek to develop, promote and adopt best practices related to responsible use of pesticides. We participate in a range of collaborative programs that focus on regenerative and sustainable agriculture generally and pesticide use specifically. These include Field to Market, The Keystone Policy Center and the Sustainable Agriculture Initiative Platform, among others. These platforms allow collaboration and dialogue with peer companies, growers and other critical stakeholders to better understand established and emerging best practices related to pesticide use and disclosure thereof and help drive industry-wide progress and solutions.

What's next?

The collaborative efforts of the PepsiCo GPC are continuing to address our key challenges and to prioritize and govern PepsiCo pesticide programs in order to ensure global compliance and minimize pesticide-related risks. To achieve our ambitions, PepsiCo’s GPC has developed a five-year strategic plan with clear deliverables, including industry benchmarking, and we are expanding our centralized global scientific and regulatory tracking. Among our priority actions, we continue to engage externally and continue to promote learning opportunities for our staff and management. In addition, we are continuing our program to investigate potential biologic or other alternatives. We have significantly expanded our supplier management programs and continue to review expansion thereof as appropriate to our business. In addition, the GPC is overseeing targeted ingredient surveillance programs.

¹European Food Safety Authority (EFSA), The 2020 European Union report on pesticide residues in food, March 30, 2022; https://doi.org/10.2903/j.efsa.2022.7215

US Department of Agriculture, Pesticide Data Program, Annual Summary Calendar Year 2021, December 2022; https://www.ams.usda.gov/sites/default/files/media/2021PDPAnnualSummary.pdf

European Food Safety Authority, Pesticide residues in food: risk to consumers remains low, April 11, 2017; https://www.efsa.europa.eu/en/press/news/170411

²US Department of Agriculture, Pesticide Data Program, Annual Summary Calendar Year 2022, December 2023; https://www.ams.usda.gov/sites/default/files/media/2022PDPAnnualSummary.pdf