PepsiCo Vietnam Keen On Corporate Responsibility
Reported by Quang Tuan
Mr. Saad Abdul-Latif, CEO of PepsiCo Asia, Middle East and Africa Sector (AMEA), the largest geographic and most diverse business sector in the PepsiCo system, made a trip to Vietnam early this week. On this occasion, he shared further development plans as well as corporate social responsibility initiatives with the Weekly.
Q: Why do you come to Vietnam this time?
A: This is my third trip to Vietnam. With responsibility for such a large region, my travel takes me to many different countries, but I am very happy to be back in Vietnam this week to celebrate our achievements of the past almost 20 years with the team here.
As I look at the 90 countries that I oversee in Asia, the Middle East and Africa, I see Vietnam as one of our most important growth markets. There are three key reasons why I am confident, and why PepsiCo is betting, that Vietnam will play a key role in the Asian century. First, Vietnam enjoys a stable government with consistent policies. This stability has served the country well over the past 20 years and will continue to do so into the future. Second, Vietnam has the right demographics to succeed. It is a nation of young, educated and hardworking people, with a population eager to learn and to advance in their lives. Third, and the most important for any business to be successful, is the potential of the local talent in Vietnam.
One more reason I am here is for a special announcement.
What is that?
I am pleased to announce that over the next three years we expect to invest US$250 million in our food and beverage business in Vietnam. Vietnam represents one of PepsiCo’s most exciting growth opportunities, and this investment is a reflection of our confidence in this dynamic country and the talented people who live and work here.
This US$250 million will include a large investment in the northern, central as well as southern regions. The investment will be targeted at increasing manufacturing capacity, including new plants, adding marketplace equipment like coolers, further strengthening our existing brands and broadening our portfolio via product innovation.
This investment is a reflection of my confidence in this dynamic country, our local management team and strong support from the authorities. I would like to emphasize that this investment is over and above the two new beverage and food plants we have opened in Vietnam since 2008. I expect our overall investment from 2008 through 2013 to exceed US$400 million.
What are the biggest challenges for PepsiCo business in Vietnam?
Our business has grown fast over the last four years. The challenge is to make sure that we grow the team match the business. I believe that the greatest asset a company has is its people. Our approach is to get good people and then train them. We have a management training program in Vietnam for Vietnamese employees from different universities. I met with many of the program participants today and was very impressed with the quality of the young talent. This type of program not only occurs in Vietnam but also in all of our markets.
You have just mentioned the local management team. What is the policy of PepsiCo Vietnam?
PepsiCo is investing in the dynamic talent base in Vietnam. PepsiCo’s vision, Performance with Purpose, places a special emphasis on three aspects of social responsibility, and Talent Sustainability is one of them.
There is a particular aspect of our talent sustainability here in Vietnam that is truly impressive to me. About 35% of our management team is female, and I believe that such diversity is critical to drive business success in today’s environment.
I call this a great example of enlightened self-interest. It’s a win-win for the company, for our employees and for society at large.
Do you have any idea of localizing the team in Vietnam?
One core pillar of PepsiCo’s vision of Performance with Purpose is Talent Sustainability, so the development of strong local talent is an important priority for us. We are always searching for and recruiting young local talents, and there is no reason to believe that these young people won’t someday join PepsiCo Vietnam’s management team. The power of PepsiCo is built upon our people. And Vietnamese team members are very well positioned to understand and satisfy the tastes and preferences of Vietnamese consumers.
While we are focused on developing our business and our people, we are equally committed to being a model corporate citizen of Vietnam. I am most proud of the corporate social responsibility initiatives undertaken by our team here. As I mentioned earlier about our vision of Performance with Purpose, this means achieving financial success while making a positive imprint on society.
Talent Sustainability is one of the three aspects of the social responsibility of PepsiCo Vietnam. How about the two others?
We are doing this everyday in Vietnam, through the emphasis on Talent Sustainability, and also on our other focus areas of Human and Environmental Sustainability.
For Human Sustainability, we are providing a healthier eating and drinking options for Vietnamese consumers. In addition to carbonated soft drinks, we offer Tropicana Twister juice drinks, Aquafina water, Lipton ready-to-drink tea, and two new isotonic drinks, 7-Up Revive and Sting Pro. And the company’s Poca brand snacks line includes a range of nut-based snacks such as Poca Nutz.
For Environmental Sustainability, we have reduced our water usage by a full 50 percent over the past three years. That is a savings of 879 million liters, enough to fill almost 900 Olympic-sized swimming pools. Over the last five years, we have saved 16 million kilowatt-hours of energy in our operation, enough to power a small city for a full year.
Could you please tell us something about PepsiCo AMEA. How do you put Vietnam market in your business map?
AMEA covers almost three-quarters of the world’s population. And Asia, especially emerging markets like Vietnam, is the key point of our developing business.
Vietnam itself is a great case study for PepsiCo. Our team here has won PepsiCo’s biggest award for international businesses named after PepsiCo co-founder Donald M. Kendall four times, and the business is still growing very fast.
Vietnam has also won an AMEA Tiger Award, which goes to the best sales teams in the region.
The world has experienced the economic turmoil since late 2008. How have PepsiCo worldwide and PepsiCo Vietnam dealt with the turmoil?
In general, there have been some economic difficulties, especially in the West. However, Asia and Southeast Asia have grown despite the turmoil. In particular, we still have had good food and beverage consumption in the region, including in Vietnam, where I believe we will have more growth.
What is the trend of PepsiCo products now?
We are developing products which are good for health, including hydrating isotonics such as 7-Up Revive and Sting Pro. We are also developing products that are more environmentally friendly and more convenient for consumers.
What’s your plan for Vietnam market in the next five years?
The next five years will be exciting for PepsiCo Vietnam. As I mentioned, we just announced a US$250-million investment that will increase our manufacturing capacity, strengthen our existing brands and allow us to innovate new products that appeal to local consumers in Vietnam. We will also extend our work with local agricultural suppliers for our food business, and of course we will continue to be a good corporate citizen.