Pepsi: The Choice of a New Generation

Pepsi was founded in 1898, but after merging with Frito Lay in 1965 it became known as PepsiCo. Though most people associate Pepsi with cola, the company has a very diverse product line including Frito-Lay, Gatorade, Tropicana, and Quaker Foods(PepsiCo.com). After loosing the Cola Wars of the 1990's, Pepsi has begun to focus on a more varied array of products. Pepsi was the first incorporate bottled water and sports drinks into their product line according to Katrina Brooker and Doris Burke of Fortune Magazine (Brooker & Burke, 2006). Since Steve Reinemund took over the position of CEO, Pepsi has adjusted to consumer market changes almost as quickly as they happen (Brooker & Burke, 2006).

According to an article in Treasury & Risk Management by G. Palmisano (Palmisano, 2005), PepsiCo was recognized by them in 2005 for excellence in corporate governance. He commended Pepsi on their succession planning policy, should a member of the board be replaced quickly, as well as their high ethic standards. Palmisano views Pepsi's greatest asset as being an independent board with the power to keep management in line. He considers twelve of fourteen members to be independent. He also points out how Pepsi addressed many ethical and conduct issues before they become problems. Pepsi is introducing a web-based program that will test employees around the world on their understanding of ethical issues involving harassment, financial ethics, and cultural sensitivity. This program is an addition to the yearly certification test to make sure employees are complying with Pepsi's Code of Conduct (Palmisano, 2005).