In the news: The latest on PepsiCo, Nestlé, Kellogg, Campbell Soup, Mondelēz and Grupo Bimbo
PepsiCo, Kellogg’s and Nestlé are among 250 major brands to pledge to cut down on unnecessary plastic at its source, in an effort to reduce the inundation of plastic packaging choking our oceans.
The snack giants have committed to cut all plastic waste from their operations; eliminate all single-use plastics; and invest in new technology that ensures all packaging will be recyclable by 2025.
The initiative – formed by the United Nations Environment Program (UNEP) in partnership with The Ellen MacArthur Foundation – has been described as the most ambitious yet. However, without it, we could soon reach the point of no return.
According to UNEP, if the current rate of pollution continues, there will be more plastic in the sea than fish by 2050.
World’s worse plastic polluters
The commitment is especially timeous for PepsiCo and Nestlé, which were listed among the companies recently named the world’s worst plastic polluters, according to Break Free From Plastic.
The two – along with Coca-Cola – accounted for 64% of all plastic pollution in the US, identified through clean-up operations and brand audits conducted by the movement.
The audits also found Mondelēz, Unilever, Perfetti van Melle and Mars were also among the most frequent multinational brands collected in clean-ups around the world. Polystyrene was the most common type of plastic found, followed closely by PET.
The fight continues
Meanwhile, Campbell’s woes are far from over.
The New Jersey-based company – which has been hit by falling soup sales and a higher debt because of its Snyder’s-Lance snacks acquisition – is locking horns with Third Point.
Daniel Loeb’s activist hedge fund is in a proxy battle to potentially divide Campbell into two units, one focused on snacks, the other on meals and beverages.
Third Point also wants the company to consider divesting noncore assets such as Pepperidge Farm frozen cakes, and buy smaller, healthier snack brands.
Finally, it is pushing to replace Campbell’s entire 12-person board, which Third Point maintained, would be a better option than a full sale.
However, in a statement earlier this week, Campbell said Third Point does not understand the food industry and a split would be more costly and riskier.
Campbell heir George Strawbridge Jr. has thrown in his hat with Loeb and together, they own around 10% of Campbell’s stock. However, they are pitted against other Campbell heirs – three of whom are current directors – who own around 41% of the company.
A shareholder vote is scheduled for November 29, 2018. If Loeb wins the proxy fight, the board will have to decide on a split within 100 days.
Hiking US prices
Mondelēz has joined a growing list of global companies to up product prices to counter the rising cost of raw materials.
The Oreo-maker’s CFO Luca Zaramella announced the multinational was planning to raise the price of only certain biscuits, gum and candy products in the US early next year.
The company added, ’it is not an across-the-board pricing action for our company or for the North America region.’
However, it did not disclose which specific products would be affected, nor the scale of the increases.
Our snacking future
The belVita breakfast biscuit and Oreo maker also announced it is launching a new innovation hub this month, aimed to develop ‘the future of snacking.’
The move is aligned to capitalize on the dazzling growth of the global snack business – one of the fast growing food categories – which pulled in £3.4bn in revenue last year, according to Nielsen.
SnackFutures – which Mondelēz forecasts will contribute $100m to the $26bn company’s bottom line by 2022 – will focus on three areas the company feels are ripe for growth: well-being snacks, digital platforms and premium snacks.
The innovation team – made up of both internal talent and entrepreneurial-minded partners – will work like a small company, cutting out much of the large-organization red tape to test and scale up products quickly.
Inspiration for all
Further south, Latin American bakery giant Grupo Bimbo has also been in the news.
Daniel Servitje, CEO of the Mexican conglomerate, has been awarded the Leadership for the Americas Award for Corporate Social Responsibility by the Inter-American Dialogue.
Servitje was recognized for his innovative efforts toward sustainable growth and the reduction of the environmental footprint of Grupo Bimbo. Earlier this year, the company announced its commitment to use 100% renewable electric power by 2025.
Servitjie said four areas of social responsibility have become essential for companies:
- To take more care of the people who work in the company and also the communities
- Leaders must be committed to innovation in order to face new challenges
- Caring for the environment must be at the essence of corporate social responsibility
- Integrity must not only be aligned to compliance with the law – “it must go further and be part of the culture of any organization,” he said.