Approach

Food safety is a top priority for PepsiCo. Our products are sold in many countries around the world and we have the responsibility to ensure their safety and quality. Fundamental to our mission is a promise to manufacture products that are both safe and delicious for our consumers to enjoy every day. The PepsiCo Global Food Safety Policy outlines our commitments to deliver on this promise.

Product safety and quality compliance is at the heart of the PepsiCo growth strategy. PepsiCo has deployed actionable global programs and quality management systems that monitor performance against compliance targets set in each sector. These programs include internal and third-party audits and verification systems, providing checks and balances across the end-to-end operations of the company.

Compliance programs and quality management systems are housed within the Research and Development (R&D) function. Specifically, the compliance team includes Food Safety, Quality Assurance, Scientific Affairs, and Regulatory Affairs, supported with input from many other functions within PepsiCo. Food safety and quality performance, including recalls and regulatory inspections, are reviewed in sector and global PepsiCo Executive Product Integrity Council (EPIC) meetings on a quarterly and annual basis, respectively. In addition, PepsiCo tracks and reviews food safety information with its Board of Directors at least annually.

PepsiCo has strong global quality and food safety standards. We use qualified ingredients, approved suppliers and follow all applicable regulations issued by regulatory authorities. Our products are traceable, which enables us to quickly investigate and address any potential concerns in the marketplace. Our facilities conduct mock recalls on at least an annual basis to ensure readiness to respond to any incident. On the rare occasions when incidents occur, we take quick action, conduct robust investigations, implement corrective actions and share learnings across the system.

Product development follows our technical stage-gate process to ensure that the design is rigorously vetted, and products are made and sold in compliance to our standards.

Our PepsiCo Quality & Food Safety College delivers capability building solutions in support of our organization’s strategies and objectives. These tailored training sessions are available to all workers whose roles impact the safety and quality of our products, including the R&D function, plant managers, quality and food safety managers, lab personnel, and frontline associates. They are delivered through both virtual and in-person platforms and are available to employees of company-owned, franchise-owned, joint venture and independent manufacturing facilities.

Our compliance team is leading efforts to address an increasingly challenging and dynamic external environment, with increased consumer and regulatory expectations. Our Smart Compliance framework enables us to navigate this environment while ensuring compliance across our large, diverse, and ever-changing portfolio.

PepsiCo's Smart Compliance Framework

Progress

In 2020, we continued to deliver strongly against our Smart Compliance framework as follows:

• Scan the horizon: PepsiCo has established a diverse cross functional team that provides formal governance to assess and escalate new science and potential regulations that should be acted upon.
• Promote science-supported regulations: Engagement with external organizations has helped define new and enhanced food safety regulations and standards. PepsiCo is committed to learning from the US Food Safety Modernization Act (FSMA) and EU Official Control Requirements (EU OCR) and we have incorporated these best practices into our global standards, where appropriate.
• Implement digital technologies: We continue to invest in new IT systems to connect ingredient and product specifications across our system, enhancing product traceability. We have implemented a centralized system that details past results in recalls, regulatory violations, Global Food Safety Initiative (GFSI) performance and other programs. This enables the organization to deliver proactive insights and target capability-building to minimize risk across our entire organization. Our enterprise-wide systems investments must meet future requirements by our regulators and customers for accuracy and speed.
• Risk-based decision making: We have applied new tools to assess product and process risk on an increased range of food safety and quality dimensions and implemented tailored mitigation strategies. This has improved speed to market while enhancing diligence. We have also aligned our product incident program and Global Food Safety Policy and updated critical food safety standards to assure the safety of incoming ingredients and manufacturing of our products.
• Make every data point count: We continue to assess new opportunities to enhance testing capability and efficiency.
• Align the supply chain: Through external industry partnerships such as GFSI and AIB International certification, we have aligned food safety content, enhanced audit outputs, and reduced the need for re-auditing.

It is our policy for PepsiCo-owned facilities globally to be GFSI certified. The vast majority have completed such certification, with the remainder planned for completion by the end of 2021. In addition, it is our policy for high-risk ingredient suppliers to be GFSI certified, or to demonstrate equivalence through a PepsiCo pre-approval audit scheme.

In 2020, PepsiCo’s Quality & Food Safety College was unable to hold classroom training for a significant portion of the year as a result of the COVID-19 pandemic. As a result, we redesigned in-person programs to fit a virtual classroom model.

COVID-19 related constraints have impacted the ability to conduct on-site audits at manufacturing facilities and this will continue in some markets. Effective mitigation steps have been implemented globally, including risk-based prioritization of on-site audits, information and communications technology (ICT) enabled remote audits and hybrid audits. This approach will continue in 2021.

Strategic Partnerships

In line with our Smart Compliance framework, we will continue to leverage external partnerships. For example:

Auditing Bodies. PepsiCo is an active participant in GFSI and AIB International. We have also partnered with GFSI certification program owners, namely FSSC, BRC-GS, IFS and SQF to enable us to track and trace data more efficiently.

Trade Associations. PepsiCo is an active member of many associations working on quality and food safety issues, including GS1, Consumer Brands Association, International Society of Beverage Technologists, American Beverage Association and Food Drink Europe.

What's Next?

We plan to complete implementation of GFSI certifications across our full network of company-owned manufacturing facilities globally by the end of 2021.

In addition, we will continue to refine and improve our Smart Compliance framework, making further investments in ICT, strategic external partnerships, and active engagement with regulators, NGOs and other bodies to enable science and risk-based regulation.