PepsiCo accelerates sustainability mission with new US$1.25B Green Bond

GLOBAL – PepsiCo, an American multinational food, snack, and beverage corporation, has closed a new US$1.25 billion 10-year Green Bond to accelerate the focus on its pep+ (PepsiCo Positive) agenda.

The company will use an amount equivalent to the net proceeds from the offering to fund green projects that focus on two pillars of its pep+ agenda: ‘positive agriculture’ and ‘positive value chain’.

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PepsiCo added that the 10-year Green bond will help deliver on its aim to operate within planetary boundaries and inspire positive change for the planet and people.

The new green bond is PepsiCo’s second since 2019, with US$858 million from the US$1 billion first Green Bond already allocated to Eligible Green Projects.

The Eligible Green Projects cuts across six continents in categories of sustainable plastics and packaging, decarbonization of its operations and supply chain, and water sustainability.

Jim Andrew, Chief Sustainability Officer, PepsiCo stated: “We were one of the first food and beverage corporations to issue a Green Bond and that initial funding has played a critical role in our sustainable transformation so far.”

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While tackling the climate crisis requires a collaborative effort, it is clear that the private sector must play a leadership role. “

He noted that the new Green Bond will be pivotal in channeling investment into the critical areas of the company that requires building a more sustainable and resilient food system.

The new Green Bond framework targets to cover regenerative agriculture, decarbonization, and climate resilience within operations and value chain.

It will also extend to the circular economy and virgin plastic waste reduction, and pursue net positive water impact.

Under regenerative agriculture, PepsiCo’s business will start to source key ingredient crops such as potatoes, whole corn, and oats in a way that accelerates regenerative agriculture.

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The company added that investments from the new Green Bond will be used to adopt regenerative agriculture practices such as farmer training, practices to reduce fertilizer, and watershed enhancement and improvement projects.

Meanwhile, decarbonization and climate resilience within its operations and value chain framework aim to reduce the absolute greenhouse gas (GHG) emissions by more than 40% against a 2015 baseline, by 2030.

Equivalent net proceeds from the Green Bond may also be used for initiatives to further these goals including on-site sustainable energy generation, according to PepsiCo.

The on-site sustainable energy generation encompasses solar installations, investments in greener buildings, energy efficiency, and/or reducing GHG emissions at facilities, and upgrading of vending and cooling equipment.

The funding may also be used towards the expansion of cleaner transportation, such as electric vehicles.

The multinational company detailed the circular economy and virgin plastic waste reduction will help it strive to use 50 percent recycled plastic content and even extend to other more sustainable product packaging by 2030.

In addition, PepsiCo revealed that the new Green Bond framework will enable it to direct funding to projects that strengthen recycling infrastructure and increase recycling rates in key markets.

In pursuing net positive water impact in owned operations and throughout the value chain, PepsiCo intends to allocate new Green Bond equivalent proceeds to water recycling and reuse projects.

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