Frito-Lay demonstrates successful macro-CSR

Some of the most delightful CSR news comes from enormous companies. Earlier I reported on WalMart's CSR triumphs; now PepsiCo can concretely assert positive gains, especially for its subsidiary Frito-Lay. PepsiCo has adopted a rigorous triple bottom line CSR regime, frequently touted by CEO Indra Nooyi, and is so far living up to it. Frito's message to manufacturing: "If we can do it, you can do it".

Much of Frito and Pepsi's environmental gains have been made through adopting cleaner technology, which they estimate has saved them $50 million as of 2006. Frito has met their energy targets by sourcing their energy more carefully and incorporating every energy trick in the book- cogen, solar, biomass, efficiency, waste heat, etc. Charmingly, now sun chips are made using approximately 80% solar power :) (capitalizing on the preexisting brand…). Sun Chips have also gotten some awesome new sustainability-focused marketing that is worth a google: compostable bags, cute advertisements, neato contest, etc.

Frito has cut its water use significantly as well. Water use is a too often ignored aspect of sustainability, especially in manufacturing. But manufacturing plants are water hogs. Most manufacturing requires high volumes of water to cool hot machinery which is run "once through" and dumped. What a waste, especially since the quality of the water has nothing to do with its ability to cool machines down. As a result manufacturers can make relatively modest changes to eliminate once-through cooling and use recycled water and gray water instead, and see huge sustainability gains. This is much of what Frito has done, but it's important. Wise water use is not yet common in American manufacturing, but there is not reason for it not be.

Waste is another CSR front Frito has done well in. They have reduced their landfill input by 37% in 2009 alone. That's tremendous considering the scale of Frito's business. It was all done through tech and design improvements, streamlined processes, and choices for efficiency all of which led to cash savings. That's not just CSR, it's sound business judgment. Frito is a great CSR case because it makes it hard for other companies to supply reasoning as to why they aren't taking comparable measures.

As a result of all their awesomeness, Frito won a 2009 Wisconsin Manufacturer of the Year Award. Their manufacturing choices should be adopted by all domestic manufacturers. In most cases, product has nothing to do with the type of efficiency decisions Frito has made. Frito also made money off their investments, not to mention the accounting benefit of writing off all the depreciation attached to new equipment. If Obama's plan to eliminate gains on business investment goes through, maybe we'll see more manufacturers taking the Frito-Lay leap into sustainability.