Accounting essay on:Balancing stakeholder and special interest groups- Pepsico

PepsiCo is in an industry in which it is quite hard to deliver healthiest food and beverage options to consumers. However, the company tries to create a balance with the demands of stakeholders, such as consumers and shareholders who have interest in good tasting products and financial performance of the company respectively, with the regulators and special interest groups who have more concerns about the nutrition of the products offered by the company in the market (PepsiCo’s Journey Towards an Ethical and Socially Responsible Culture 2011).            The company continues to emphasize on its commitment towards the community and sustainable growth by emphasizing on generation of healthier financial results, while maintain the high quality standards of the products with production of attainable outcomes (PepsiCo’s Journey Towards an Ethical and Socially Responsible Culture 2011). PepsiCo has made many changes in its product line to make it healthier and suitable for special interest groups that focus on nutritional value. It has reduced sugars, fats and other unhealthier ingredients. But, at the same time, it does recognize the desire of the consumer to get easy as well as accessible beverages and other snack food items. These food offerings may not prove to be the healthiest food options for consumption, but it does satisfy the consumer’s need of easy access and convenience snack foods, such as baked lays, Cheetos, SunChips, etc. (Brands 2012)

            Even in the products with the high calories due to presence of salts, sugar, soda, etc., the company has reduced the calorie content by creating sodas that are low in calories and sugar content. This has helped in reduction of the risk of putting on weight by the consumers. The nature of the industry is such that the health issues continue to bother the company but it is addressing the challenges by reducing unhealthier ingredients as well as maintaining the aspect of good taste (Brown 2008).            The interest of shareholders towards the financial performance is also balanced. Out of the total revenues of the company, $10 billion comes from the healthy food section, which the company has plans to expand further, so as to extend the revenue to $30 million. In order to create the balance between demands of stakeholders and special interest groups, the company is hiring health officials so that they can research to put in health ingredients for the snacks offered by the company (PepsiCo’s Journey towards an Ethical and Socially Responsible Culture 2011). As the heath conscious market place is increasing and expanding, the inclusion of healthier products that have good nutritional value is beneficial for the financial performance of the company as well. The evidence of this benefit can be found in the success of introduction of a natural sweetener that has zero calories, named stevia in new products developed by the company, such as Sobe Lifewater in US. Gatorade, one of the brands of PepsiCo containing stevia, has become a $100 million brand in less than a year in 2010, which is a good signal for financial performance of the company (Coke, Pepsi introduce drinks with Stevia-based artificial sweetener 2009).            Thus, PepsiCo Inc. is trying hard to maintain the balance between its various stakeholder groups and special interest groups so that it can offer healthier and tastier food products and beverages that have the potential of grabbing good profits for the company.

Nutrition and sustainability

            PepsiCo has received many criticisms for the unhealthy ingredients in their products. Taking these criticisms regarding the nutrition portion in their products, the company has launched a range of healthy food products; however, the signature popular product of the company remains Pepsi cola only. Regarding the sustainability criteria, companies dealing in bottled water are facing criticisms all over the world as the plastic bottles contribute to the landfill (Hitt et al 2008). Considering this, PepsiCo can be said to be effective in dealing with the issue as it is in the process of developing such bottles that use comparatively less amount of plastic per bottle so that the waste can be reduced. The example of this is observable in the Aquafina bottle of Pepsi, which today weighs 10.9 grams in comparison to the 18.5 grams in the year 2001 and it has goal to decrease the packaging of the bottled water by 350 million pounds by the end of the year 2012 (PepsiCo’s Journey Towards an Ethical and Socially Responsible Culture 2011). The company gives back to the stakeholders in terms of sustainability and nutrition by achieving outcomes. The company is effective in its programs related to sustainability by decreasing the environmental impact in the best interest of the stakeholders of the company.

            For the concern for nutrition, the company is balancing the need for easy and convenient food with the nutritional and healthier food options. It is developing healthier products and is reducing unnecessary additions to the product line. The company provides more food and choices of beverages that are made from wholesome ingredients contributing to healthier eating and drinking. In the global product portfolio of the company, there is an increasing amount of fruit, grains, vegetables, seeds, and low fat dairy ingredients. The effectiveness can be seen in the commitment of the company to reduce the average amount of sodium per serving by almost 25% by the year 2015 with 2006 as the base line. Both saturated fat and added sugar are also committed to be reduced by 15% and 25% respectively by 2020 in key countries at the global level (Human Sustainability 2012).            The company also emphasizes on the going green and reducing the carbon footprint by conservation of water and reductions of waste. The PepsiCo foundation, which is the philanthropic anchor of PepsiCo, has commitment for developing programs and partnerships in various regions so that there are opportunities for sustained and improved health (PepsiCo Foundation 2012). The cause related marketing of the company also attaches people from various parts of the world which is beneficial for the shareholders as well. As the success of the company depends on its stakeholders, the company strives to understand the wants and needs of the consumers, and for meeting the expectations of the stakeholders, the company has clear goals and focuses on attainable solutions so that it can analyze both the short as well as long run consequences of its actions (PepsiCo’s Journey Towards an Ethical and Socially Responsible Culture 2011).             In this context, it can be said to be effective. It has high standards for quality and through proper governance. Although, the company has become a major leader in the area of sustainability, there is a long way for the company to be recognized as a company offering healthy snacks, as it has to take into consideration the convenience and taste aspects of consumer as well (PepsiCo’s Journey Towards an Ethical and Socially Responsible Culture 2011). But, with the effective sustainable programs and focus on health aspects, it can be said to be effective in answering the concerns of the stakeholders.

AMP Up Before You Score mobile app

            PepsiCo was trying to become an ethical and a socially responsible company, but the mobile app named AMP Up Before You Score, proved to be offensive and damaged the reputation of the company as the marketing campaign was not well thought and designed. The launch of mobile app was a creative idea in regards to the marketing of the energy drink AMP. The company was just trying to remain current and funny in terms of reaching to its target market, which were males aged between 18 and 24 (The Ethics Environment 2012). The nature and content of the mobile app was overlooked by the factor of new innovative technology and marketing campaign in the form of mobile app so as to reach the target market in a creative manner by having inclusions of the social media such as Facebook and Twitter, for the young generation. The app got distributed without the oversight of those who are concerned with the reputation of the company because it was targeted for males in the age between 18 to 24 and it actually liked by the target people (The Ethics Environment 2012). However, the company pulled the app from the market due to the socially responsible and ethical behavior as many groups criticized the app as degrading and objectifying women.

            It was due to the nature of the target market that such mobile app was launched by the company as it wanted to show the humorous lengths that males go to pick a woman. Although, all the feedback was not negative, as the target people found the app to be quite funny and acceptable, but it was offensive for various other groups concerning the dignity of women. Therefore, the company has to take into consideration all the social aspects before deciding to launch marketing or any other campaign in the target market. Identification and management of conflicts of interest is necessary for the company so that all the stakeholder groups are satisfied and their respective interests are taken into consideration (The Ethics Environment 2012).

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