PepsiCo

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This article is about the company. For the soft drink, see Pepsi.

PepsiCo

Type Public (NYSE: PEP)

S&P 500 Component

Industry Food

Beverages

Founded Delaware - June 8, 1965

reincorporated in North Carolina - 1986

Founder(s) Donald M. Kendall

Herman W. Lay

Headquarters Purchase, New York,

United States

Area served Worldwide

Key people Indra Nooyi

(Chairperson and CEO)[1]

Products Pepsi

Diet Pepsi

Mountain Dew

Aquafina

Sierra Mist

Lipton Teas
 7up (outside the U.S.)

Mirinda

Tropicana Products

Naked Juice

Gatorade

Quaker Oats Company

Lay's

Doritos

Cheetos

Walkers snack foods

Fritos

Tostitos

Revenue US$43.23 billion (FY 2009)[2]

Operating US$8.04 billion (FY 2009)[2]

income

Net income US$5.95 billion (FY 2009)[2]

Total assets US$39.85 billion (FY 2009)[3]

Total equity US$16.80 billion (FY 2009)[3]

Employees 285,000 (2010)[4]

Divisions PepsiCo Americas Foods; PepsiCo Americas

Beverages; PepsiCo Europe; PepsiCo Asia, Middle East

& Africa

Website PepsiCo.com

PepsiCo, Incorporated (NYSE: PEP) is a Fortune 500, American global corporationheadquartered

in Purchase, New York, with interests in the manufacturing, marketing and distribution of grain-based
snack foods, beverages, and other products. PepsiCo was formed in 1965 with the merger of
the Pepsi-Cola Company and Frito-Lay, Inc. PepsiCo has since expanded from its namesake
product Pepsi to a broader range of food and beverage brands, the largest of which include an
acquisition of Tropicana in 1998 and a merger with Quaker Oats in 2001 - which added
the Gatorade brand to its portfolio as well.[5]

As of 2009, 19 of PepsiCo’s product lines generated retail sales of more than $1 billion each,[6] and the
company’s products were distributed across more than 200 countries, resulting in annual net
revenues of $43.3 billion. Based on net revenue, PepsiCo is the second largest food & beverage
business in the world,[7] Within North America, PepsiCo is ranked (by net revenue) as the largest food
and beverage business.[7]

Indra Krishnamurthy Nooyi has been the chief executive of PepsiCo since 2006, and the company
employed approximately 285,000 people worldwide as of 2010.[4] The company’s beverage distribution
and bottling is conducted by PepsiCo as well as by licensed bottlers in certain regions.[8] PepsiCo is
a SIC 2080 (beverage) company.

Contents
[hide]

• 1 History

o 1.1 Origins

o 1.2 Acquisitions and divestments

o 1.3 Competition

• 2 Products and brands

• 3 Areas of business

o 3.1 PepsiCo Americas Foods

o 3.2 PepsiCo Americas Beverages

o 3.3 PepsiCo Europe

o 3.4 PepsiCo Asia, Middle East & Africa

• 4 Corporate governance

o 4.1 Charitable activities

• 5 Sustainability practices

o 5.1 Environmental record

 5.1.1 Water usage (India, U.S., U.K.)

 5.1.2 Pesticide regulation (India)

 5.1.3 Packaging and recycling

 5.1.4 Energy usage and carbon footprint

o 5.2 Product nutrition

  5.2.1 Product diversity

 5.2.2 Ingredient changes

 5.2.3 Distribution to children

• 6 References

• 7 See also

• 8 External links

[edit]History

[edit]Origins

The recipe for Pepsi, the soft drink, was first developed in the 1890s by a North Carolinapharmacist
and industrialist, Caleb Bradham, who named it "Pepsi-Cola" in 1898. As the cola developed in
popularity, he created thePepsi-Cola Company in 1902 and registered a patent for his recipe in 1903.
[9]
The Pepsi-Cola Company was first incorporated in the state of Delaware in 1919.[10] Ownership of
this company traded hands several times throughout the 1920s and 1930s, and in the early 1960s its
product line expanded with the creation of Diet Pepsi and Mountain Dew.[11]

Separately, the Frito Company and H.W. Lay & Company - two American potato and corn chip snack
manufacturers - began working together in 1945 with a licensing agreement allowing H.W. Lay to
distribute Fritos in the Southeastern United States. The companies merged to becomeFrito-Lay, Inc. in
1961.[12]

In 1965, the Pepsi-Cola Company merged with Frito-Lay, Inc. to become PepsiCo, Inc., the company it
is known as at present. At the time of its foundation, PepsiCo was incorporated in the state
of Delaware and headquartered in Manhattan, New York. The company's headquarters were relocated
to their present location of Purchase, New York in 1970,[13] and in 1986 PepsiCo was reincorporated in
the state of North Carolina.[10]

[edit]Acquisitions and divestments

Between the late-1970s and the mid-1990s, PepsiCo expanded via acquisition of businesses outside
of its core focus of packaged food and beverage brands; however it exited these non-core business
lines largely in 1997, selling some, and spinning off others into a new company named Tricon Global
Restaurants, which later became known as Yum! Brands, Inc..[14] PepsiCo also previously owned
several other brands that it later sold, in order to allow it to return focus to its primary snack food and
beverage lines, according to investment analysts reporting on the divestments in 1997.[15] Brands
formerly (no longer) owned by PepsiCo include: Pizza Hut,[16]Taco Bell,[16] KFC,[16] Hot 'n Now,[17] East
Side Mario's,[18] D'Angelo Sandwich Shops,[19] Chevys Fresh Mex, California Pizza Kitchen,
[20]
Stolichnaya[21] (via licensed agreement), Wilson Sporting Goods[22]and North American Van Lines.[23]

The divestments concluding in 1997 were followed by multiple large-scale acquisitions, as PepsiCo
began to extend its operations beyond soft drinks and snack foods into other lines of foods and
beverages. PepsiCo purchased the orange juice company Tropicana Products in 1998,[24] and merged
with Quaker Oats Company in 2001,[25] adding with it the Gatorade sports drink line and other Quaker
Oats brands such as Chewy Granola Bars and Aunt Jemima, among others.[26]

In August 2009, PepsiCo made a $7 billion offer to acquire the two largest bottlers of its products in
North America: Pepsi Bottling Group and PepsiAmericas. In 2010 this acquisition was completed,
resulting in the formation of a new wholly-owned subsidiary of PepsiCo, Pepsi Beverages Company.
[8]
Also in late 2010, the company made its largest international acquisition when it purchased a
majority stake in Wimm-Bill-Dann Foods - a Russian food company which produces milk, yogurt, fruit
juices and dairy products.[27]

[edit]Competition

The Coca-Cola Company has historically been considered PepsiCo’s primary competitor in the
beverage market,[28] and in December 2005, PepsiCo surpassed The Coca-Cola Company in market
value for the first time in 112 years since both companies began to compete. In 2009, the Coca-Cola
Company held a higher market share in carbonated soft drink sales within the U.S.[5] In the same year,
PepsiCo maintained a higher share of the U.S. refreshment beverage market, however, reflecting the
differences in product lines between the two companies.[5] As a result of mergers, acquisitions and
partnerships pursued by PepsiCo in the 1990s and 2000s, its business has shifted to include a
broader product base, including foods, snacks and beverages. The majority of PepsiCo's revenues no
longer come from the production and sale of carbonated soft drinks.[29] Beverages accounted for less
than 50 percent of its total revenue in 2009. In the same year, slightly more than 60 percent of
PepsiCo's beverage sales came from its primary non-carbonated brands,
namely Gatorade and Tropicana.[5]

PepsiCo's Frito-Lay and Quaker Oats brands hold a significant share of the U.S. snack food market,
accounting for approximately 39 percent of U.S. snack food sales in 2009.[5] One of PepsiCo's primary
competitors in the snack food market overall is Kraft Foods, which in the same year held 11 percent of
the U.S. snack market share.[5]

[edit]Products and brands

Largest PepsiCo Brands (based on 2009 retail sales)
Brand
Pepsi  
Mountain Dew  
 Lay's potato chips  
Gatorade  
Diet Pepsi  
Tropicana beverages  
7UP (outside U.S.)  
Doritos tortilla chips  
Lipton teas (PepsiCo/Unileverpartnership)  
Quaker foods and snacks  
Cheetos  
Mirinda  
Ruffles potato chips  
Aquafina bottled water  
Pepsi Max  
Tostitos tortilla chips  
Sierra Mist  
Fritatos corn chips  
Walkers potato crisps  
Source: 2009 Annual Report[30] $0 $5b $10b $15b $20b

PepsiCo’s product mix as of 2009 (based on worldwide net revenue) consists of 63 percent foods, and
37 percent beverages.[5] On a worldwide basis, the company’s current products lines include several
hundred brandsthat in 2009 were estimated to have generated approximately $108 billion in
cumulative annual retail sales.[30]

The primary identifier of companies' main brands within the food and beverage industry are those
which generate annual sales exceeding $1 billion, and 19 of PepsiCo's brands met this description as
of 2009: Pepsi-Cola, Mountain Dew, Lay's, Gatorade, Tropicana, 7Up, Doritos, Lipton Teas, Quaker
Foods, Cheetos, Mirinda, Ruffles, Aquafina, Pepsi Max, Tostitos, Sierra Mist, Fritos, and Walker's.[6][30]

[edit]Areas of business
The structure of PepsiCo's global operations has shifted multiple times in its history as a result of
international expansion, and as of 2010 it is separated into four main divisions:[31] PepsiCo Americas
Foods, PepsiCo Americas Beverages, PepsiCo Europe, andPepsiCo Asia, Middle East and Africa. As
of 2009, 71 percent of the company’s net revenues came from North and South America, 16 percent
fromEurope and 13 percent from Asia, the Middle East and Africa.[32]

[edit]PepsiCo Americas Foods

PepsiCo Americas Foods consists of the company’s food and snack operations in North and South
America. This operating division is further segmented into Frito-Lay North America, Quaker Foods &
Snacks, Sabritas, Gamesa and Latin America Foods. Food and snack sales in North and South
America combined contributed 48 percent of PepsiCo’s net revenue as of 2009.[30][7][33]

Frito-Lay North America, the result of a merger in 1961 between the Frito Company and the H.W. Lay
Company, produces the top selling line of snack foods in the U.S. Its main brands in the U.S., Canada
and Mexico and include Lay's and Ruffles potato chips,Doritos tortilla chips,Tostitos tortilla chips and
dips, Cheetos cheese flavored snacks, Fritos corn chips,Rold Gold pretzels, Sun Chipsand Cracker
Jack popcorn. Products made by this division are sold to independent distributors and retailers, and
are transported from Frito-Lay's manufacturing plants to distribution centers, principally in vehicles
owned and operated by the company.[34]

Quaker Foods North America, created following PepsiCo’s acquisition of the Quaker Oats Company in
2001, manufactures, markets and sells Quaker Oatmeal, Rice-A-Roni, Cap'n Crunch and Life cereals,
as well as Near East side dishes within North America. This division also owns and produces the Aunt
Jemima brand, which as of 2009 was the top selling line of syrups and pancake mixes within this
region.[35][5]

Sabritas and Gamesa are two of PepsiCo’s food and snack business lines headquartered in Mexico,
and they were acquired by PepsiCo in 1966 and 1990, respectively. Sabritas markets Frito-Lay
products in Mexico, including local brands such as Poffets, Rancheritos, Crujitos and
Sabritones. Gamesa is the largest manufacturer of cookies in Mexico, distributing brands such as
Emperador, Arcoiris and Marías Gamesa.[36]

PepsiCo’s Latin Americas Foods operations market and sell primarily Quaker- and Frito-Lay-branded
snack foods within Central andSouth America, including Argentina, Brazil and other countries in this
region.[37]

[edit]PepsiCo Americas Beverages

This division contributed 23 percent of PepsiCo’s net revenue as of 2009,[30] and involves the
manufacture (and in some caseslicensing), marketing and sales of both carbonated and non-
carbonated beverages in North, Central and South America.[38] The main brands distributed under this
division include Pepsi, Mountain Dew, Gatorade, 7UP (outside the U.S.), Tropicana Pure Premium
orange juice, Sierra Mist, SoBe Lifewater, Tropicana juice drinks, AMP Energy, Naked
Juice and Izze. Aquafina, the company’s bottled water brand, is also marketed and licensed through
PepsiCo Americas Beverages.[1]

PepsiCo also has formed partnerships with several beverage brands it does not own, in order to
distribute these or market them with its own brands.[1] As of 2010, its partnerships
include: Starbucks (Frappuccino, DoubleShot and Iced Coffee), Unilever’s Lipton brand (Lipton Brisk
and Lipton Iced Tea), and Dole (licensed juices and drinks).

[edit]PepsiCo Europe
PepsiCo began to expand its distribution in Europe in the 1980s, and in 2009 it made up 16 percent of
the company’s global net revenue.[30] Unlike PepsiCo’s Americas business segments, both foods and
beverages are manufactured and marketed under one umbrella division in this region, known
as PepsiCo Europe. The primary brands sold by PepsiCo in Europe include Pepsi-Cola beverages,
Frito-Lay snacks, Tropicana juices and Quaker food products, as well as regional brands unique to
Europe such as Walkers crisps, Copella, Paw Ridge, Snack-a-Jack, Duyvis and others. PepsiCo also
distributes the soft drink 7UP in Europe via license agreement.[1] PepsiCo's European presence
expanded with its acquisition of Russian juice and dairy product brand Wimm-Bill-Dann Foods in
December, 2010.[39]

[edit]PepsiCo Asia, Middle East & Africa

The most recently created operating division of PepsiCo covers Asia, the Middle East and Africa.[29] In
addition to the production and sales of several worldwide Pepsi-Cola, Quaker Foods and Frito-Lay
beverage and food product lines (including Pepsi and Doritos), this segment of PepsiCo’s business
markets regional brands such as Mirinda, Kurkure and Red Rock Deli, among others.[1] While PepsiCo
owns its own manufacturing and distribution facilities in certain parts of these regions, more of this
production is conducted via alternate means such as licensing (which it does with Aquafina), contract
manufacturing, joint ventures and affiliate operations. PepsiCo’s businesses in these regions, as of
2009, contributed 13 percent to the company’s net revenue worldwide.[30]

[edit]Corporate governance

Pepsi-Cola Venezuela

Headquartered in Purchase, New York, with research and development headquarters inValhalla, New
York, PepsiCo’s Chairman and CEO is Indra Nooyi.[40] The board of directors is composed of eleven
outside directors as of 2010, including Ray Lee Hunt, Shona L. Brown, Victor Dzau, Arthur C.
Martinez, Sharon Percy Rockefeller, Daniel Vasella, Dina Dublon, Ian M. Cook, Alberto Ibargüen,
James J. Schiro and Lloyd G. Trotter. Former top executives at PepsiCo include Steven
Reinemund, Roger Enrico, D. Wayne Calloway, John Sculley, Michael H. Jordan, Donald M.
Kendall, Christopher A. Sinclair and Alfred Steele.

On October 1, 2006, former Chief Financial Officer and President Indra Nooyi replacedSteve
Reinemund as Chief Executive Officer. Nooyi remains the corporation's president, and
became Chairman of the Board in May 2007, later (in 2010) being named #1 onFortune's list of the "50
Most Powerful Women"[41] and #6 on Forbes' list of the "World's 100 Most Powerful Women".
[42]
PepsiCo received a 100 percent rating on the Corporate Equality Indexreleased by the LGBT-
advocate group Human Rights Campaign starting in 2004, the third year of the report.[43]

[edit]Charitable activities
PepsiCo has maintained a philanthropic program since 1962 called the PepsiCo Foundation,[44] in
which it primarily funds “nutrition and activity, safe water and water usage efficiencies,[45] and
education,” according to the foundation’s website.[46] In 2009, $27.9 million was contributed through
this foundation, including grants to the United Way[47] and YMCA,[48] among others.

In 2009, PepsiCo launched an initiative which the company calls the Pepsi Refresh Project,[49] in which
individuals submit and vote on charitable and nonprofit collaborations.[50] The main recipients of grants
as part of the refresh project are community organizations with a local focus and nonprofit
organizations, such as a high school in Michigan which - as a result of being selected - received
$250,000 in 2010 towards construction of a fitness room for high school students.[51] Following the Gulf
of Mexico oil spill which occurred in the spring of 2010, PepsiCo donated $1.3 million to grant winners
in determined by popular vote.[52] As of October, 2010, the company had provided a cumulative total of
$11.7 million in funding, spread across 287 ideas of participant projects from 203 cities in North
America.[53] In late 2010, the refresh project was reported to be expanding to include countries outside
of North America in 2011.[54]

[edit]Sustainability practices
According to its 2009 annual report, PepsiCo states that it is “committed to delivering sustainable
growth by investing in a healthier future for people and our planet”,[55][30] which it has defined in its
mission statement since 2006 as “Performance with Purpose”.[56][57]According to news and magazine
coverage on the subject in 2010, the objective of this initiative is to increase the number and variety of
healthier food and beverage products made available to its customers,[58] employ a reduction in the
company’s environmental impact,[59]and to facilitate diversity and healthy lifestyles within its employee
base.[56] Its activities in regards to the pursuit of its goals - namely environmental impacts of production
and the nutritional composition of its products - have been the subject of recognition from health and
environmental advocates and organizations, and at times have raised concerns among its critics. As
the result of a more recent focus on such efforts, “critics consider (PepsiCo) to be perhaps the most
proactive and progressive of the food companies", according to former New York Times food industry
writer Melanie Warner in 2010.[60]

[edit]Environmental record
[edit]Water usage (India, U.S., U.K.)

PepsiCo’s usage of water was the subject of controversy in India in the early and mid 2000s in part
because of the company’s alleged impact on water usage in a country where water shortages are a
perennial issue. In this setting, PepsiCo was perceived by India-based environmental organizations as
a company that diverted water to manufacture a discretionary product, making it a target for critics at
the time.[61]

As a result, in 2003 PepsiCo launched a country-wide program to achieve a “positive water balance” in
India by 2009.[62] In 2007, PepsiCo’s CEO Indra Nooyi made a trip to India to address water usage
practices in the country, prompting prior critic Sunita Narain, director of the Centre for Science &
Environment (CSE), to note that PepsiCo "seem(s) to be doing something serious about water
now."[61] According to the company’s 2009 corporate citizenship report,[55] as well as media reports at
the time,[60] the company (in 2009) replenished nearly six billion liters of water within India, exceeding
the aggregate water intake of approximately five billion liters by PepsiCo’s India manufacturing
facilities.[55]

Water usage concerns have arisen at times in other countries in which PepsiCo operates. In the
U.S., water shortages in certain regions resulted in increased scrutiny on the company’s production
facilities, which were cited in media reports as being among the largest water users in cities facing
drought - such as Atlanta, Georgia.[63][64] In response, the company formed partnerships with non-profit
organizations such as the Earth Institute and Water.org, and in 2009 began cleaning new Gatorade
bottles with purified air instead of rinsing with water, among other water conservation practices.[65] In
the United Kingdom, also in response to regional droughtconditions, PepsiCo snacks brand Walkers'
reduced water usage at its largest potato chip facility by 45 percent between the years 2001 and 2008.
In doing so, the factory employed machinery which captured the water naturally contained in potatoes,
and used that water to largely offset the need to bring in outside water to the factory.[66][67]

As a result of water reduction practices and efficiency improvements, PepsiCo in 2009 saved more
than more than 12 billion liters of water worldwide,[68] compared to its 2006 water usage. Environmental
advocacy organizations including the Natural Resources Defense Council and individual critics such
as Rocky Anderson (mayor of Salt Lake City, Utahvoiced concerns in 2009, noting that the company
could conserve additional water by refraining from the production of discretionary products such as
Aquafina.[69] The company maintained its positioning of bottled water as “healthy and convenient”,
while also beginning to partially offset environmental impacts of such products through alternate
means, including packaging weight reduction.[69]

[edit]Pesticide regulation (India)

PepsiCo’s India operations were met with substantial resistance in 2003 and again in 2006, when an
environmental organization in New Delhi made the claim that, based on its research, it believed that
the levels of pesticides in PepsiCo (along with those from rival Coca-Cola Company), exceeded a set
of proposed safety standards on soft drink ingredients that had been developed by the Bureau of
Indian Standards.[70] PepsiCo denied the allegations, and India's health ministry has also dismissed the
allegations - both questioning the accuracy of the data compiled by the CSE, as it was tested by its
own internal laboratories without being verified by outside peer review.[71][72] The ensuing dispute
prompted a short-lived ban on the sale of PepsiCo and Coca-Cola Company soft drinks within India's
southwestern state of Kerala in 2006;[73] however this ban was reversed by the Kerala High Court one
month later.[74]

In November, 2010, the Supreme Court in India invalidated a criminal complaint filed against PepsiCo
India by the Kerala government, on the basis that the beverages did meet local standards at the time
of the allegations. The court ruling stated that the “percentage of pesticides” found in the tested
beverages was “within the tolerance limits subsequently prescribed in respect of such product,” since
at the time of testing “there was no provision governing pesticide adulteration in cold drinks.”[75][76] In
2010, PepsiCo was among the 12 multinational companies that displayed “the most impressive
corporate social responsibility credentials in emerging markets”, as determined by the U.S.
Department of State.[77] PepsiCo's India unit received recognition on the basis of its water conservation
and safety practices and corresponding results.[78]

[edit]Packaging and recycling

Environmental advocates have raised concern over the environmental impacts surrounding the
disposal of PepsiCo’s bottled beverage products in particular, as bottle recycling rates for the
company’s products in 2009 averaged 34 percent within the U.S.[79] The company has employed
efforts to minimize these environmental impacts via packaging developments combined with recycling
initiatives. In 2010, PepsiCo announced a goal to create partnerships that prompt an increase the
beverage container recycling rate in the U.S. to 50 percent by 2018.[80]

One strategy enacted to reach this goal has been the placement of interactive recycling kiosks called
“Dream Machines” insupermarkets, convenience stores and gas stations, with the intent of increasing
access to recycling receptacles.[81][82] The use ofresin to manufacture its plastic bottles has resulted in
reduced packaging weight, which in turn reduces the volume of fossil fuelsrequired to transport certain
PepsiCo products. The weight of Aquafina bottles was reduced nearly 40 percent, to 15 grams, with a
packaging redesign in 2009. Also in that year, PepsiCo brand Naked Juice began production and
distribution of the first 100 percentpost-consumer recycled plastic bottle.[83]

[edit]Energy usage and carbon footprint

PepsiCo, along with other manufacturers in its industry, has drawn criticism from environmental
advocacy groups for the production and distribution of plastic product packaging, which consumed an
additional 1.5 billion gallons of petrochemicals in 2008. These critics have also expressed
apprehension over the production volume of plastic packaging, which results in the emission of carbon
dioxide.[84]Beginning largely in 2006, PepsiCo began development of more efficient means of
producing and distributing its products using less energy,[85] while also placing a focus on emissions
reduction.[84] In a comparison of 2009 energy usage with recorded usage in 2006, the company’s per-
unit use of energy was reduced by 16 percent in its beverage plants and 7 percent in snack plants.[55]

In 2009, Tropicana (owned by PepsiCo) was the first brand in the U.S. to determine the carbon
footprint of its orange juice product, as certified by the Carbon Trust, an outside auditor of carbon
emmisions.[86] Also in 2009, PepsiCo began the test deployment of so-called “green vending
machines,” which reduce energy usage by 15 percent in comparison to average models in use. It
developed these machines in coordination with Greenpeace, which described the initiative as
“transforming the industry in a way that is going to be moreclimate-friendly to a great degree.”[86]

[edit]Product nutrition
[edit]Product diversity

From its founding in 1965 until the early 1990s, the majority of PepsiCo’s product line consisted of
carbonated soft drinks and convenience snacks. PepsiCo broadened its product line substantially
throughout the 1990s and 2000s with the acquisition and development of what its CEO deemed as
“good-for-you” products, including Quaker Oats, Naked Juice and Tropicana orange juice.[87]Sales of
such healthier-oriented PepsiCo brands totaled $10 billion in 2009, representing 18 percent of the
company’s total revenue in that year. This movement into a broader, healthier product range has been
moderately well received by nutrition advocates; though commentators in this field have also
suggested that PepsiCo market its healthier items as aggressively as less-healthy core products.[88]

In response to shifting consumer preferences and in part due to increasing governmental regulation,
PepsiCo in 2010 indicated its intention to grow this segment of its business, forecasting that sales
of fruit, vegetable, whole grain and fiber-based products will amount to $30 billion by 2020.[89][90] To
meet this intended target, the company has said that it plans to acquire additional health-oriented
brands while also making changes to the composition of existing products that it sells.[90]

[edit]Ingredient changes

Public health advocates have suggested that there may be a link between the ingredient makeup of
PepsiCo’s core snack and carbonated soft drink products and rising rates of health conditions such
as obesity and diabetes. The company aligns with personal responsibility advocates, who assert that
food and beverages with higher proportions of sugar or salt content are fit for consumption in
moderation by individuals who also exercise on a regular basis.[91]

Changes to the composition of its products with nutrition in mind have involved reducing fat content,
moving away from trans-fats, and producing products in calorie-specific serving sizes to discourage
overconsumption, among other changes.[58] One of the earlier ingredient changes involved sugar and
caloric reduction, with the introduction of Diet Pepsi in 1964 and Pepsi Max in 1993 - both of which are
variants of their full-calorie counterpart, Pepsi. More recent changes have consisted of saturated
fat reduction, which Frito-Layreduced by 50% in Lay's and Ruffles potato chips in the U.S. between
2006 and 2009.[91] Also in 2009, PepsiCo’s Tropicana brand introduced a new variation of orange juice
(Trop50) sweetened in part by the plant Stevia, which reduced calories by half.[91] Since 2007, the
company also made available lower-calorie variants of Gatorade, which it calls “G2”.[92]

[edit]Distribution to children

As public perception placed additional scrutiny on the marketing and distribution of carbonated soft
drinks to children, PepsiCo announced in 2010 that by 2012, it will remove beverages with higher
sugar content from primary and secondary schools worldwide.[93] It also, under voluntary guidelines
adopted in 2006, replaced “full-calorie” beverages in U.S. schools with “lower-calorie” alternatives,
leading to a 95 percent reduction in the 2009 sales of full-calorie variants in these schools in
comparison to the sales recorded in 2004.[94] In 2008, in accordance with guidelines adopted by the
International Council of Beverages Associations, PepsiCo eliminated theadvertising and marketing of
products that do not meet its nutrition standards, to children under the age of 12.[95][96]

In 2010, First Lady Michelle Obama initiated a campaign to end childhood obesity (entitled
"Let's_Move!"), in which she sought to encourage healthier food options in public schools, improved
food nutrition labeling and increased physical activity for children. In response to this initiative,
PepsiCo, along with food manufacturers Campbell Soup, Coca-Cola, General Mills and others in an
alliance referred to as the "Healthy Weight Commitment Foundation", announced in 2010 that the
companies will collectively cut one trillion calories from their products sold by the end of 2012 and 1.5
trillion calories by the end of 2015.[97]