PepsiCo’s Food for Good program drives company innovation
How the purpose-driven business initiative has helped achieve company goals.
As the recent public outrage over an internal Google memo pooh-poohing diversity programs has shown, consumers are increasingly expecting transparency in how companies treat their employees and their surrounding communities. One way to do this is to install a corporate social responsibility (CSR) program.
Eight years ago PepsiCo piloted a different approach to social good with a purpose-driven business initiative called Food for Good (FFG). FFG generates no profit for the company, but uniquely takes advantage of the logistical expertise and technological knowledge of PepsiCo.
“FFG is more than a CSR program and more than a philanthropic initiative,” says Jonathan George, the innovation manager at FFG. “In its use of a purpose-driven business model, FFG was designed to be self-sustaining and scalable, leveraging the combined capabilities of a major food and beverage corporate and local non-profit partners to address a specific social need by making healthy meals accessible to children throughout the year.”
The FFG has delivered, in total, over 12 million healthy meals to low-income families who weren’t being reached by other services. George says this total includes more than 50 million healthy servings of fresh fruits and vegetables, grains and dairy, much of it going to kids, particularly in the summer months when school lunches are not available.
Even though the objective of the FFG program is to make healthy food more physically and financially accessible for low-income families, the initiative supports wider goals at PepsiCo. The company launched its Performance with Purpose 2025 Agenda, which is designed to foster continued business growth by responding to changing consumer and societal needs. George says at the heart of this, PepsiCo is transforming its portfolio of foods and beverages to develop a wider variety of choices and reach more underserved communities.
“FFG has a key role to play in this,” he says. “It is a driver of innovation for PepsiCo products that meet strict nutritional standards, whilst also being accessible to lower income consumers.”
To meet consumers’ changing consumer tastes and needs, PepsiCo is reformulating its products and growing the company’s nutritional offerings. For example, its Everyday Nutrition portfolio now accounts for 25 percent of the company’s revenue, which dwarfs the 12 percent revenue gained by Pepsi-Cola.
“By 2025, the majority of our products will meet science-based criteria for reduced levels of added sugars, saturated fat and salt in order to help consumers to follow dietary advice set by the WHO and the FDA,” George says. “FFG works with the research and development teams at PepsiCo to explore and create new products that are suitable to being offered as part of FFG initiatives. This means that they must meet the dietary requirements of federal nutrition programs and be available at an affordable price point.”
FFG was instrumental in creating the new Maple Brown Sugar Quaker Chewy Bar, which meets USDA school breakfast requirements. Additionally, the Life Cereal “Bowl pack” and three flavors of Tropicana juice boxes were also developed through FFG.
“The value of FFG as a center of innovation also goes beyond the products it serves,” George adds. “New technologies developed through FFG are now used across PepsiCo’s business.”
For instance, FFG developed a transportable cold box, featuring phase change material, to help keep fresh food stay at food-safe temperatures while being delivered in extreme heat.
“For FFG, cold boxes help the program control costs by eliminating the need for costly refrigerated trucks and enabling drivers to transport refrigerated and ambient products on the same truck,” says George. “In 2015, PepsiCo’s Gatorade brand began using FFG’s cold box technology to chill protein bars. Without this solution, 75 percent of these bars were at risk of melting during the distribution process. Last year alone, $14 million worth of at-risk product was saved due to the implementation of this technology.”
The program also helps to create employment opportunities in the communities it serves. The program has created more than 150 jobs, including in warehouse management and food delivery. Since FFG works with over 40 nonprofit and governmental partners to ensure the program is effective, some of its local partners also create another 100 jobs each summer.
“In addition to the professional opportunities available through the program, FFG also works with PepsiCo field operations to give our staff the opportunity to be promoted into warehouse and sales positions throughout the company,” George says.