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Company: PepsiCo
Subject: Pesticides and Pollinators
Year: 2016
Sector: Food Retail/Processing
Lead Filer: Trillium Asset Management; The Sustainability Group of Loring, Wolcott and Coolidge
Cofiler(s): Green Century Capital Management; Benedictine Sisters of Virginia; Benedictine Sisters of Mount St. Scholastica
Outcome: Vote: 8.9%

 Policy on Pesticide Pollution to Curtail Pollinator Decline

Use of neonicotinoids (‘neonics'), a class of insecticide linked to dangerous declines in pollinators and other beneficial organisms, is growing rapidly.

More than 90 percent of corn and 30-40 percent of soybeans planted in the United States are pre-treated with neonics. Neonics are a widely used insecticide, accounting for roughly 25 percent of the global agrochemical market. Their prevalence in agriculture, compounded by their ability to persist in soils and become mobile in waterways, further magnifies the risks. 

Multi-year double digit declines in pollinators in the United States and Europe pose risks to our food system.  According to the United States Department of Agriculture, "bee-pollinated commodities account for $20 billion in annual United States agricultural production and $217 billion worldwide." 

The use of neonics and similar insecticides is a growing public concern. In December 2013, the European Union enacted a two-year ban on three neonics. In July 2014, the United States Fish and Wildlife Service announced plans to restrict neonic use across the National Wildlife Refuge System.  In November 2015, the Environmental Protection Agency said it would cancel the registration of sulfoxaflor, a systemic insecticide known to be harmful to bees.   

Questions about neonic efficacy are increasing. In October 2014, the Environmental Protection Agency reported that pre-treating soy seeds with neonics provided little or no benefit to production.

Pepsi is a major purchaser of corn, oats and potatoes -- crops routinely pre-treated with neonics.

Pepsi states that it recognizes the impact that pesticides can have on beneficial insects. The Company reports it is implementing procedures and policies to measure and address the use of pesticides, yet provides inadequate disclosure which would allow investors to assess the effectiveness of these polices.

In light of these conditions, other companies are taking action:

  • Whole Foods' Responsibly Grown Rating System reserves its "best" rating for those suppliers that prohibit the use of four neonics.
  • Home Depot is working with suppliers to phase out neonics on live goods.
  • Lowe's set a time bound target to phase out products containing neonics and will work with growers to eliminate their use.
  • General Mills is working with The Xerces Society for Invertebrate Conservation to minimize the impact of neonicotinoids to pollinators in its almond, tomato, corn and soy supply chains.
  • Conagra's Potato Sustainability Initiative includes criteria to protect bee habitat and reduce exposure to pesticides harmful to bees.

RESOLVE: Shareholders request that within six months of the 2016 annual meeting, the Board publish a report, at reasonable expense and omitting proprietary information on the Company's options to minimize impacts on pollinators of neonics in its supply chain.

Supporting statement:  Proponents believe the report should include:

  • Practices and measures, including technical assistance and incentives, provided to growers to reduce the harms of neonics to pollinators; and
  • Metrics tracking key crops grown from seeds pre-treated with neonics.

 

 


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