THE BRAND OWNER’S PERSPECTIVE: PEPSICO

THE BRAND OWNER’S PERSPECTIVE: PEPSICO

Elisabeth Skoda catches up with Archana Jagannathan, senior director for sustainable packaging at PepsiCo, and explores how a collaborative approach helps the company to develop sustainable packaging solutions.

ES: Could you tell us a bit more about your role at PepsiCo, and what responsibilities it entails?

AJ: My role at PepsiCo focuses on driving a much more sustainable future for packaging, focusing on Europe. I see this as an opportunity to make a difference to PepsiCo and what PepsiCo does, but also use the reach and scale that we have to influence and drive change in the industry more broadly, so I’m hoping we can make a small difference to the health of our planet for the future generations.

ES: Earlier this year, PepsiCo published its 2019 Sustainability Report. Could you give our readers a quick overview on the report highlights in the area of packaging?

AJ: PepsiCo’s sustainability strategy overall, and what we have laid out in the report, focuses on three key things. First of all is Reduce. We think it’s really important to genuinely reduce the amount of packaging and plastics that we use overall, and a great example that we’ve highlighted in our Sustainability Report is the use of technology, the use of charged compaction technology for our snack films, which we’ve used to successfully reduce their size. It means that we use technology to make sure that the chips settle down in the bag a bit better, and therefore you can have a smaller size bag. But equally, we have used technology in Europe to reduce the size of our outer bags for our snack multipacks by 30%. That might seem small, but given the amount of snacks that PepsiCo produces, that is a huge amount of virgin plastics savings. We are continuing to lightweight our bottles, reduce our films, and there are some great examples that we have laid out in the Sustainability Report.

The second key area is Recycling, firstly making sure that all our packaging is recyclable, compostable and biodegradable, and we’ve committed to 100% by 2025. We are at 88% now. But equally important is making sure that we close the loop, making sure that we support systems that collect, sort and recycle materials. After the report was published, we announced that we joined the leadership team of Holy Grail, which is a really innovative digital watermarking technology that will hopefully help to sort waste much more efficiently and give waste a better second life. We have included 100% recycled PET in Tropicana, Naked and Lipton, and we are looking to go much further in the coming years as well.

The third line of what we talk about in the report is Reinvent, i.e. radically rethinking materials and business models. SodaStream is a great example of that. We acquired the business in 2018 and are expanding it in Europe as we speak. We estimate that we will probably save about 67 billion bottles from the expansion of SodaStream. But equally, use of alternate materials is a really important part of our Reinvent strategy. We have recently announced a consortium with Diageo and Unilever on a project called Pulpex, which will be a first of its kind paper bottle, and we are really looking forward to bringing it to market and testing it on one of our brands in 2021. On the snacks side, we are working with Danimer Scientific on compostable materials. I think technology is evolving so fast in this space, so making sure that we are continuing to explore alternative materials is a key part of our strategy.

ES: You mentioned that PepsiCo is 88% on the way towards its goal of using 100% recyclable, compostable or biodegradable by 2025. What would you say are the biggest challenges of the remaining 12%, and how is the company planning on getting there?

AJ: The single biggest challenge for us to get there globally is recycling of our snack films, so the bags we use for Walkers, Lays, Doritos etc. There are two elements in that. One is making sure that the packaging is designed for recycling, and we’ve worked with CEFLEX and co-developed with them a set of design guidelines for what we think actually makes the package recyclable. But equally important, and this is where the challenge lies, is the development of infrastructure to collect and recycle crisp packets. Crisp packets are actually recycled in some parts of Europe at very small scale, for example in Germany. We are working with government, policy makers and packaging recovery organizations to make sure that that is widespread across Europe in the coming years.

I mentioned Holy Grail, which will hopefully help flexible packaging be sorted and recycled, but we are also in constant conversation with recyclers and packaging recovery organizations. The reasons this is so challenging is because it requires a system-wide value chain approach to drive the infrastructure that is required for recycling the product.

ES: I wanted to delve a bit deeper into your work with the CEFLEX consortium. You mentioned design for recycling criteria; are there any other projects you have been working on with them?

AJ: CEFLEX has about 160 companies across the value chain, so it’s a great opportunity to collaborate and drive the change that’s required for this system. In addition to the design for recycling guidelines, we are working with CEFLEX on a whole host of other workstreams, including shaping extended producer responsibility and what that should look like in all of the markets, also working with them on assessing what the end market use for flexible packaging would look like. Generating that demand from the end market for flexible packaging will be really important to drive the whole process of recycling, so again, working with them across the value chain, designing the right system, ensuring the right collection system, the right sorting systems, figuring out what the end markets are, feasibility in those end markets etc.

ES: You mentioned testing 100% industrially compostable thin film plantbased snack bags. Could you tell us a bit more about this? AJ: This is something that we are actually working on with a company called Danimer Scientific, and we are trialling this in the US and in Chile. We are looking at understanding and learning what the consumer reaction is to compostable film, but equally, how they dispose of it, how they behave in the systems that are prevalent in a country. We are not trialling these in Europe, because Europe for a long time has been pursuing the recycling route, and we want to make sure, whatever system we adopt, is looking at the wider environmental outcomes, but also what’s right given the ease for the consumer and the infrastructure that exists in that market. So, in Europe, all of the work we are doing with CEFLEX focuses on continuing to develop a recycling stream and the right recycling infrastructure for crisp packets.

Globally, we are learning from both solutions: from the compostable films in the US and some of the other markets, and from the recycling infrastructure development in Europe, so we want to be able to take the best learnings from everywhere and develop a system that works.

ES: In 2019, PepsiCo launched within the framework of the Loop initiative, and in cooperation with Terracycle, reusable packaging for orange juice and muesli. Could you update us on this trial?

AJ: We worked with Terracycle very closely to launch Loop in France last year. That trial has gone well, and we’re now expanding it to launch with Carrefour as a key strategic retail partner in France, so I’m really looking forward to the learnings from that trial, and understanding how it goes, so we are gearing up to launch the Loop platform with Carrefour.

ES: Also on the subject of project updates, I’d be interested in finding out more about the progress on the work with the Natural Bottle Alliance, which has set out to develop and recycle 100% plant-based PET bottles from biomass. How is work coming along with this?

AJ: It’s great. It is a California-based start-up that we partner with on this, with other PR companies, and our R&D teams are working really closely with the teams at Origin as part of the Natural Bottle Alliance to develop PET from biomass-based materials, used cardboard, used sawdust etc., so something

that could really be revolutionary. But more broadly, investing, like I said, staying on top of technology, staying on top of innovations in this space is really important for us. We recently launched this collaboration with Pulpex, and I’m looking forward to getting the first fully recyclable paper bottle into the market very soon.

ES: On a more general note, what role do packaging suppliers play in PepsiCo’s sustainability efforts? What innovations have you seen that particularly stood out for you, and what more would you like to see in the future?

AJ: A very, very important role! I have alluded to this a couple of times already, but collaborative innovation is going to play a huge role in this industry. We regularly hold innovation days with all our suppliers, because we want to understand what is in the pipeline and what is applicable to our products. Suppliers understand the packaging material, they understand the technology, and we think it is very critical for us to be partnering with them to bring some of these technologies to life for our products in the marketplace.

ES: Constructing a circular packaging value chain comes with big challenges. Have you seen any improvements in the harmonization of recyclability standards across different markets, or clear guidelines on food grade recycled plastics? What more could be done to achieve that?

AJ: We have been speaking to policy bodies at the EU level and at national level about harmonizing the collection systems across all of the markets. Even within a market, for example in the UK or France, different parts of the country have different systems, and ultimately, as a consumer product company, we want to make it as easy as possible for our consumers to dispose of the packaging. It’s so important to have that harmonized framework of extended producer responsibility in place, that collects materials in predefined streams, that gives very clear labelling and instructions to consumers on where to dispose of the packet etc, so that at the end of the day, the system is designed as efficiently as it possibly can be.

ES: On a subject that is likely to stay with us for some time, what have the effects of the COVID-19 pandemic been on sustainability efforts? AJ: My view is that COVID-19 has actually shown how important it is to build resilient food systems overall, and how important food security is. That’s something I think everybody took for granted. In our view, sustainability is going to become an even more important topic. Coming out of the pandemic we have recently signed the EU Parliament’s Green Recovery Alliance as well, and we also recently signed the UN Global Business Ambition for the one and a half degrees pledge, so we are still very committed to this agenda. Within Europe, policy makers seem to be really committed to this agenda, and to the green recovery overall, which is very heartening to see.

ES: In conclusion, what is next on PepsiCo’s sustainability journey? What challenges do you particularly look forward to tackling in the coming months?

AJ: I’m looking forward to continuing a lot of the great work that we’ve been doing, to use more recycled materials, continuing to work with policy bodies on collection, recycling infrastructure, but also continuing to keep an eye on interesting technology and innovations that we can bring to market. The pace of innovation in this industry is immense, so every day is a new day, and I’m always looking to how we can shape the future to be a lot better and a lot more sustainable going forward. n