Deception with Purpose: Pepsico's Water Claims in India
By India Resource Center and Community Resource Centre November 30, 2011
Pepsico, one of the largest food and beverage companies in the world, has begun claiming that it has achieved "positive water balance" in India, that it is "Giving Back MORE WATER Than We Take". Wonderful as it may sound, Pepsico's claims of achieving "positive water balance" simply do not add up. The India Resource Center approached Pepsico in 2010 to question them on how it accounted for its claim of "positive water balance." We were provided with an audit conducted by Deloitte Touche Tohmatsu India Private Limited, a firm that provides "audit, consulting, financial advisory, risk management, and tax services to selected clients." The audit was based on 2009 figures provided primarily by Pepsico, and the audit was released in 2010. This was followed by two rounds of questions from our end and Pepsico's responses. Our request in 2011 to obtain the latest audit went unanswered. Pepsico's claims of having achieved "positive water balance" in India, and Deloitte Touche Tohmatsu's assurances, are misleading and do not stand up to scrutiny.
Pepsico's Claim on Aquafina Bottled Water Label in India
Giving Back MORE WATER Than We Take We call it "Positive Water Balance". To help save a precious resource that is fast depleting in India. Through rain-water harvesting, community water-sheds, and water conservation in agriculture, we at PepsiCo India saved 836 million litres* more water than we consumed in 2009. To know more, log on to www.tomorrowbetterthantoday.com *
As confirmed by an independent audit
Pepsico's claims on water in India are designed primarily to manage the business and reputational risks that the company faces with regard to its water usage in India and globally. Pepsico is on a fast track to manufacture an image of itself as a global leader in water conservation, and Pepsico's claims of returning more water than they use is a public relations exercise by the company to blunt the growing and real criticism of its water management practices in India and elsewhere. It is also astonishing that Pepsico has chosen one of the relatively more water stressed areas of the world – India – to claim to have achieved "positive water balance" and yet it has failed to do so anywhere else, including relatively more water "healthy" countries such as Canada, Norway and even the US, its home country. Communities across India have powerfully challenged the operations of beverage companies such as Pepsico and Coca-Cola. One of Coca-Cola's largest bottling plants, in Plachimada, has been shut down since 2004 and other Coca-Cola bottling plants in Kala Dera and Mehdiganj are facing considerable pressure for unsustainable water practices. To deflect attention from the growing campaigns, Coca-Cola has also claimed, from time to time, that they too have become "water neutral" in India, even though they are well aware that it is practically impossible to do so. It is in this context – the growing scrutiny and pressure being placed on beverage companies' unsustainable water usage in India and globally – that Pepsico's claims of having achieved "positive water balance" needs to be viewed. Claims of "positive water balance" as in the case of Pepsico and "water neutral" in the case of Coca-Cola are business and reputational risk management maneuvers, assisted by risk management companies such as Deloitte Touche Tohmatsu, and implemented through sophisticated public relations efforts to "bluewash" the company's image. Pepsico's claims of "positive water balance" fail for a number of reasons, some of which are detailed below. 1. Pepsico Severely Understates the Amount of Water it Uses in India The audit assuring that Pepsico had achieved "positive water balance" stated that Pepsico used or counted as "debit" 5168 mml of water (or 5.168 billion liters) in India in 2009. And Pepsico claims to have saved or...
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