How PepsiCo is scaling its multicultural and equity efforts

PepsiCo was among many companies that pledged to focus more on racial equity in the wake of George Floyd's murder in 2020. The food and beverage giant launched initiatives including several programs meant to lift up Black communities and increase Black representation at PepsiCo, as described by CEO Ramon Lagurata. Now PepsiCo is seeking to scale these efforts under the leadership of Derek Lewis, a 34-year veteran of PepsiCo, in February was named president of the company’s newly established Multicultural Business and Equity Development Organization, which is charged with scaling PepsiCo North America’s ongoing efforts to create economic opportunity for underserved businesses and communities, and address inequalities for historically excluded people. Lewis most recently served as president of PepsiCo Beverages North America’s South Division. In a recent interview, he detailed his new job and gave his perspective on how companies big and small can make a difference. The following was excerpted from his conversation with Ad Age. What was your first order of business for this new group? Outside of jumping up and down with excitement, I wanted to create early energy, early excitement and early engagement regarding this new organization. This is a significant move for PepsiCo, as we take the next step in our racial equality journey, which is all part of the 'PepsiCo+' transformation, which creates growth and shared value. So we’re beginning the stages of bringing people on internally and externally, and driving excitement around what we’re about to go do, so we can kick this off in a really big way. We already had the ball in motion. Through the South division we had a platform of events, activities and success that laid a foundation over the prior couple of years. We had a lot of momentum in the space and so a lot of that will be extended out into the organization. I’m in the process of building a new team, and we’re going to build upon the strategies already in place. We want to create massive alignment, cooperation, collaboration and connectivity. The programs that we’ve run, like She Got Now [an internship program focused on Black women], Juntos Crecemos [supporting Hispanic-owned businesses] and Pepsi Stronger Together [an engagement platform with origins in the company’s pandemic response] will all scale up. They were all strong programs that will have more legs now. More from Ad Age April 5: Retail and e-commerce leaders explore latest marketing trends How in-store music can play a role in retail media networks What's next for media retail networks amid explosive growth How equitable—or inequitable—have you found Pepsi’s business and practices as you took on the role? Diversity is a core value of Pepsi. If you go back to the 1940s, we were the first company in corporate America to hire African American interns. We subsequently built the first Black sales force, and in the 1960s hired the first Black vice president. We understood early on the importance of diversity, and we have a great history. It’s one of the reasons that I joined the company. Having said that, this new organization will continue to address business inequalities to maximize our overall results. We want to increase engagement impact internally with associates, and with the consumer externally. We’ve got three pillars in place today—people, business and community—and to that we are adding the consumer pillar as part of our multicultural growth. So we have a strong foundation but there’s more to go do. We have to find that next level. Ad Age A-List 2022 Best agencies of the year, ranked Top production companies to know about Definitive rankings of advertisers and agencies Why is diversity important for Pepsi—and for business—today? I like to start by saying diversity is the one thing that we all have in common. Not just people of color, not just gender diversity, everyone. Everyone brings something unique to the table. As we recognize this, it will create unparalleled levels of unity and teamwork and results across the business, inside and outside of the company. Our starting point is, [diversity] is great for everybody. It creates wins for everybody, and as we embrace it and work together better we drive better results, we drive more impact in the communities we operate in. So holistically, diversity drives wins. That's the narrative. PepsiCo doesn’t just win, the marketplace wins and our partners win. We all win. Not every company has the resources of a Pepsi to put against diversity. What would be your message to them? Size doesn’t really matter. Anyone can build a framework for success. It starts with conviction from the organization and ownership and having an action orientation. It requires commitment, and it requires some hustle. A lot of organizations are behind in this space, so in my mind, take those attributes you want as an organization, and no matter how big or small you may be, you can figure it out. The most important part is empowering people inside the organization to share the mission and the vision. Resources can be added as time goes on: You don’t have to hit a home run. Building the foundation is the important thing and making sure you utilize your strongest assets—your associates—is an incredibly powerful formula that I think anyone can take on. You’ve served many roles at PepsiCo. How did you develop what's become your expertise in overseeing diversity? I grew up in Washington, D.C., which primarily was an African-American city when I grew up. I went to Hampton University, so I attended an HBCU [historically Black colleges and universities]. Fundamentally I was grounded in this space, and so for me a lot of things were natural. When I thought about recruitment, I saw that Pepsi's values were already aligned with mine as a student. I wanted to be a part of a company in which I could dream big and continue to be who I am, and PepsiCo has delivered on that. I've been here 34 years, had a lot of different jobs, but I’ve always been committed to the diversity space in an organic way. It was never forced with me. As I assumed more and more responsibility, I’ve subsequently been able to help scale the effort. So you go from a junior role with a small team in a small territory, to a business unit with 10,000 employees, to a national organization where there’s 50,000 associates, or 100,000 if you include all of PepsiCo North America. Now, you can have a tremendous impact and that’s been a blessing. This couldn’t have been done if the leadership weren’t behind my effort. This is not something you just go do; you need that support, and I’ve had tremendous support. Hopefully others are following and feeding off that energy because you want it to transcend associates across the company. How will you know when this is a success? We put commitments out there across the racial equality journey. Fundamentally our ability to exceed those commitments even as we continue to adapt and modify them is No. 1. No. 2 is driving results in our business. This should help drive a boost in business. This is good for our communities, so it should drive a boost in our communities. And this is great for our business and for our culture: Our associates want to be involved in companies that care about the communities we live in, work in, play in and our kids go to school in. That’s important to them. You work with bottlers, distributors, suppliers, retailers and other businesses. How do you encourage them to adhere to the same kinds of visions that you might have? They see the wins. And I go back to diversity being the one thing we have in common. So you go back to embracing that, and do great work against that drives a boost in your business and in the communities you operate in and improve your employee culture. And [partners] are starting to recognize the difference that makes in the business, versus it just being an expense item, or something they have go do that’s separate. They realize it is inclusive, it’s what you do day in and day out, and once they realize that they want to join forces. And when we join forces, we can make more impact. We are begging for partners in this endeavor because it helps our reach.

How PepsiCo is scaling its multicultural and equity efforts

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