* Says new sugar target more ambitious than previous goal
* Also sets water, emissions and other targets
* Soft drinks companies pressured to address health issues
By Martinne Geller
LONDON, Oct 17 PepsiCo Inc has set a
target for reducing the amount of sugar in its soft drinks
around the world as part of a suite of goals aimed at tackling
problems ranging from obesity to climate change.
The New York-based company will announce on Monday that by
2025 at least two thirds of its drinks will have 100 calories or
fewer from added sugar per 12 oz serving, up from about 40
The move, which it plans to achieve by introducing more zero
and low-calorie drinks and reformulating existing drinks, comes
as PepsiCo and rival Coca-Cola come under increasing
pressure from health experts and governments who blame them for
fuelling epidemics of obesity and diabetes.
PepsiCo says the new global target is more ambitious than
its previous goal of reducing sugar by 25 percent in certain
drinks in certain markets by 2020.
"The science has evolved," Mehmood Khan, PepsiCo's chief
scientific officer of research and development, told Reuters.
He gave an example of new flavour ingredients that require
less sweetening, saying: "It's not just about sweeteners, it's
about understanding the flavour ingredients and having
proprietary knowledge and access to them."
The World Health Organization this month recommended taxes
on sugary drinks, as France and Mexico have done, to curb
consumption and improve health. The soft drinks industry opposes
Despite its name, PepsiCo generates only 12 percent of its
$63 billion in annual revenue from its famous cola brand. It
makes 25 percent from carbonated soft drinks such as Mountain
Dew, with the rest coming from waters and juices including the
Tropicana brand, plus snacks and dips such as hummus and
Its 2025 goals also include targets for lowering sodium and
"These are good steps. But when we have an obesity crisis, I
think there is more that we can be doing," said Mindy Lubber,
president of non-profit organisation Ceres, which pushes
companies and investors to take action on sustainability.
"If a food and beverage company is not looking at nutrition,
they are not looking at the direction the world is going in."
Coke has said that by 2020 it would offer low-calorie or
no-calorie options in every market as part of its sustainability
PepsiCo is building on goals set out 10 years ago, which
targeted nutritional, environmental and social improvements.
Khan said there has also been financial progress.
He said the company has saved $600 million over the past
five years from reduced water, packaging and energy use, as well
as a reduction in waste. He added that, over the past decade,
average returns on investments in this area have been better
than the cost of capital.
Khan expects similar returns in future, which might be good
news for investors, who generally don't base investment
decisions on sustainability.
"It might not be the driving factor, but it might a filter,"
said Morningstar analyst Philip Gorham.
Other targets include a 15 percent improvement in the water
efficiency of PepsiCo's direct agricultural supply chain in
water-stressed areas by 2025 and a 20 percent drop in greenhouse
gas emissions across its supply chain by 2030.
(Reporting by Martinne Geller in London; Editing by David