The PepsiCo Foundation recently announced that it will provide $10 million in funding to jumpstart the “All In On Recycling” challenge, making it easier for 25 million families across the country to recycle bottles and cans.

But nonprofit corporate watchdog As You Sow believes that’s not enough.Though the move is welcomed, Pepsico’s announcement actually represents a retreat from its 2010 recycling goal in terms of commitment and impact, says senior vice president of As You Sow, Conrad MacKerron. And they should be doing better.

We sat down with MacKerron to find out more about his position, why he’s disappointed with The Pepsico Foundation, the state of recycling in the U.S. today and what he thinks needs to happen for real impact to occur.

 

What is your organization’s mission and how has it been holding companies to account?

 

As You Sow engages companies as shareholder owners to improve their social and environmental policies using shareholder advocacy. For example, earlier this year, McDonald’s Corporation agreed to phase out harmful polystyrene foam cups and packaging globally as a result of our work.

For more than a decade we engaged Coca-Cola, PepsiCo and Nestle Waters to make stronger commitments to recycle more bottles and cans and to use higher levels of recycled content, especially plastic.  These companies typically oppose proven solutions like container deposit laws, but have not proposed alternatives that will work at scale.

 

What is the current recycling rate in the U.S.?

 

The recycling rate for bottles and cans in the U.S. is just 36%, an embarrassment for such a technologically advanced nation, and has moved very little in the past decade. Only about 30% of plastic bottles are recycled. Many European countries recycle twice this many bottles and cans. This represents an enormous waste of embedded energy and material value when you consider the extracted resources that go into making these materials, most of which are recyclable. A few years ago we calculated the value of recyclable materials that are wasted and landfilled at about $11 billion a year.

What commitment was made by PepsiCo and others?

 

In 2010, As You Sow agreed to withdraw a shareholder proposal to the company after it promised to work with peers to increase the beverage container recycling rate to 50% by 2018. (Coca-Cola and Nestle Waters also made separate recycling commitments. You can find more details here).  (The commitment was made by PepsiCo corporate, not its foundation.) We monitored the company’s progress as best we could although they were not too transparent about what actions they were taking. They tried some promising initiatives involving reverse vending machines but it was not done at a scale sufficient to have impact and ultimately was not successful.

We were disappointed at the apparent lack of collaboration with peers that is vital in making progress on a national level. Over the last seven years, the recycling rate has barely budged, currently at around 36%, which is actually 2% lower than it was in 2010! Over the past year we have engaged the company to discuss what went wrong and to urge the company to develop a reinvigorated approach to meeting the 50% goal based on lessons learned, especially in light of increasing concern about the huge amounts of plastic waste ending up in oceans.

 

Tell us about PepsiCo’s recent announcement and what it means

 

The recent announcement was a response to the company’s failure to meet the commitment made to As You Sow, but we are disappointed that the company did not mention this in any of its messaging, which is why we issued a press release to clarify the context.

It is certainly positive to make a $10 million donation to a group like The Recycling Partnership doing great work to increase recycling rates locally on a city-by-city basis. It is also positive that the company says it intends to follow up and press peers it should have pressed years ago to also contribute to this group in an effort to raise a total of $100 million.

 

Why is it not enough and what do you hope they would do instead?

 

Though a $100 million commitment seems like a lot, it is far less than what’s needed to substantially move the needle. As the company noted in its release, it has spent $55 million in recycling efforts in the U.S. in the last nine years alone. An estimated two billion additional containers must be collected annually to increase the recycling rate by 1% nationally.

If the full $100 million is raised and seven billion more bottles and cans are collected over five years as hoped, the resulting progress would be perhaps 4%, still far short of the original goal of 50%. We are disappointed because the action, while positive, is just one component of a complex puzzle and does not represent the kind of comprehensive blueprint needed to deal with a variety of factors that must be supported to substantially raise the recycling rate. The main concern is that $100 million is far too little; $1.5 billion is a more realistic estimate of the funds needed.

 

What is your hope moving forward for all companies who’ve made commitments? How will you continue to encourage these efforts?

 

Our hope is that Pepsi makes this action just the first of many needed integrated actions to create a robust and workable plan to substantially increase the recycling rate. It will need to work hard to motivate other parts of the beverage industry like dairy, juice, wine, and beer that appear to be doing little to increase recycling.  It needs to greatly increase the scale of activity from incremental voluntary efforts like the $10 million donation to a national system of mandated payments to support underfunded recycling collection and processing efforts.

Pepsi and the rest of the beverage industry needs to send a financial signal to the recycling markets that it will be a long-term steward providing steady financial support so that recyclers can make much-needed investments in better processing equipment.  This in turn allows more materials to be collected, and more recycled content added to new containers, reducing reliance on continued extractive methods for virgin materials and paving the way for a truly circular economic system.

Mandates like deposit or producer responsibility laws would remove the current uneven playing field where a few companies take some financial responsibility, while many other corporate free riders do little or nothing.

We will continue to raise these issues as shareholders in dialogue with publicly traded beverage companies to act as a catalyst for a more efficient and well-financed recycling system in the U.S.


As You Sow is the nation’s non-profit leader in shareholder advocacy. Founded in 1992, the organization harness shareholder power to create lasting change that benefits people, planet, and profit.

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