PepsiCo Champions Farmer Economic Security, Sustainability

CornThe word “sustainability” doesn’t give too many farmers the warm fuzzies, admits Margaret Henry, PepsiCo director of sustainable agriculture. She gets it. Henry grew up on a Kentucky dairy farm.

But here’s why she thinks the concept is important: In her view, it allows the food system to speak with a common language that resonates with consumers. If used properly, it instills confidence that farmers and their food-system partners are conserving natural resources.

“We actually want to minimize farmer burden,” says Henry during an interview at the 2018 Sustainable Brands conference in Vancouver. “Less farmer bothering is better.”

With full support from CEO Indra Nooyi as part of the company’s Performance with Purpose sustainability initiative, PepsiCo participates in ongoing efforts to engage farmers. The company’s global reach means Henry works with an array of farmers, such as smallholder farmers in India operating on half a hectare and oat-growers in Saskatchewan managing 15,000 acres. In the U.S., brands such as Frito-Lay source grain from hundreds of Corn Belt farmers.

“We have tried to be both all-encompassing as well as specific enough to be very meaningful to farmers,” Henry explains. In the Midwest, PepsiCo helped found the Midwest Row Crop Collaborative (MRCC) with other food companies, food retailers and NGOs. This summer, the group will evaluate how conservation-agriculture messages resonate with Walmart shoppers in key states. It’s also funding test plots for farmers to study conservation practices such as cover crops and reduced tillage through the Soil Health Partnership, a project of the National Corn Growers Association.

PepsiCo customers and shareholders care about conservation issues such as hypoxia in the Gulf of Mexico, Henry says. The company has a responsibility to demonstrate it is making progress across its supply chain by connecting farmers with the right incentives. Many farmers are great stewards, and they want to improve water quality, but it’s hard to do with when certain practices might not have a return on investment for years.

“We see ourselves as partners with farmers,” she says. Henry acknowledges farmers invest their lives in their businesses—as well as blood, sweat and debt. PepsiCo seeks out groups such as Precision Conservation Management, which works with farmers in one of its prominent sourcing regions of Champaign-Urbana in Illinois, to collaborate on nutrient optimization, reduced tillage and cover crops. It provides cost-share dollars to farmers to help bridge the three-year gap research shows can occur between the time farmers implement cover crops and the time row-crop yields return to normal or even improve, Henry says.

The company champions farmer-to-farmer learning as an important way to teach and scale conservation practices across its sourcing regions. To facilitate these efforts, it supports Practical Farmers of Iowa, which works with Iowa farmers on cover-crop adoption. Henry follows the Everything Cover Crops group on Facebook to stay glued into key conservation opportunities and challenges farmers face.

Water stewardship remains key to PepsiCo as a food and beverage manufacturer with decades of water-conservation experience. Reducing agriculture’s water footprint globally is a “win-win-win” for farmers because without it, they can face government regulations and higher production costs, among other issues, Henry says. Timing water applications precisely and planting crop varieties that maximize water are among the tools she thinks will be catalytic to continued success.

The work won’t stop there, though. Non-operator landowners and ag retailers are other types of stakeholders PepsiCo must reach to be successful in partnership with the food industry, Henry says. To tackle these challenges and others, PepsiCo has incorporated sustainability into the job descriptions of thousands of its employees. The company not only works with farmers in the field but also with policymakers in Washington, D.C., in support of farm bill programs that incentivize conservation.

If these efforts push consumer trust in the food system higher, everyone wins. PepsiCo thinks it can achieve that objective by working closely with farmers on issues that will impact communities rural and urban for generations to come.

“We want to do it hand in hand,” Henry says.