PepsiCo has a “Human Rights Workplace Policy” in which the company explains the “meaning” of human rights. According to Pepsi, “Freedom of association means associates shall have the right to assemble, communicate and join associations of their choice”. There’s not a word about the internationally-recognized right of workers to form and join trade unions, or about the management responsibility to recognize those unions and enter into good faith negotiations.
PepsiCo promises more information on their “Human Rights Management Approach” in a 2012 report based on Global Reporting Initiative (GRI) indicators. Companies can and do play fast and loose with these reporting exercises, because the procedures allow the company to cherry pick the “indicators” selected. Omissions can reveal more about the company’s social impact than the responses. In keeping with their unilateral declaration of the “meaning” of freedom of association, PepsiCo has not responded to the labour and employment Indicators LA 4 – 5 specifying “Percentage of employees covered by collective bargaining agreements, and Minimum notice period(s) regarding significant operational changes, including whether it is specified in collective agreements.” PepsiCo either doesn’t have this information, or doesn’t think it important, or chooses not to report it. In any case, they can claim to meet reporting requirements but their “endorsement” of the Universal Declaration of Human Rights (which doesn’t require corporate “endorsement” because it forms part of international human rights law) and their workplace human rights statement are empty without union recognition and collective bargaining.
PepsiCo in 2012 formed a “Human Rights Operating Council” to, according to the company, “ensure PepsiCo meets the international standards set out in the United Nations Guiding Principles on Business and Human Rights.” These Principles are based on international human rights instruments, including Conventions of the United Nations’ International ILO which guarantee workers the right to form unions and to bargain their employment terms and conditions. The Principles, and the OECD Guidelines for Multinational Enterprises which incorporate their human rights provisions, establish a clear corporate responsibility for respect for human rights throughout a company’s entire web of business operations, including joint ventures, franchises, licensing and supply chains. The Pepsico report which promises information on their “Human Rights Management Approach” specifically excludes “operations that produce PepsiCo products and, in many instances, carry the ‘Pepsi’ name, as these are not owned or operationally controlled by PepsiCo.” And “If PepsiCo leases a building but does not have management control and does not directly employ anyone working at the facility, we do not include that data for health and safety.”
Does the “Human Rights Management Approach” extend to bottlers like G&J Pepsi-Cola Bottlers Inc., with over 1,600 employees at 11 US sites? The US Labor Department’s Occupational Safety and Health Administration in February 2014 cited the company for seven alleged serious workplace health and safety violations at an Ohio site. According to the OSHA area director, “this company consistently failed to protect its workers and implement basic safety requirements. Repeat violations demonstrate a lack of commitment to employee safety and health and that s unacceptable when employee safety is on the line.”
Supply chain operations like the warehouses that stock their products also full outside the scope of PepsiCo’s “sustainability” reporting.
PepsiCo produces glossy reports, runs “online training” on human rights for their “associates” and carries out human rights “audits” but has failed to take corrective action when confronted with blatant violations of basic human rights in warehouses which are an integral part of the business.
PepsiCo knows what’s happening in these warehouses: the abuses have been brought to the attention of both Indian and corporate management. PepsiCo refuses to act to ensure that workers’ rights are respected.
PepsiCo may believe what’s on their site – we believe it must be measured against the company’s real, not virtual, impact.