seeks to keep resolution off ballot
PLASTICS NEWS STAFF
N.Y. (Jan. 15, 2001 - 1:30 p.m. EST) -- PepsiCo
Inc. is fighting several investment funds that want the company to use
25 percent recycled content in PET bottles and work to boost container
recycling to 80 percent.
Pepsi sent a letter to the Securities and Exchange Commission in late
December asking that the investors´ resolution be tossed out and
not submitted to a vote at Pepsi´s annual meeting. The group invests
in companies and then promotes policies it considers socially responsible.
The Purchase-based soft drink bottler said the resolution contains misleading
statements, including that a majority of Pepsi´s bottles are not
recycled and that recycled PET is less costly than virgin. The latest
estimates put container recycling at 55.6 percent, and the cost of recycled
content depends on both supply and the manufacturing process, Pepsi said.
Ken Scott, research analyst for one of the shareholders, Walden Asset
Management in Boston, said the 55.6 percent figure is based on inflated
numbers that include imported aluminum scrap. When that is factored out,
the rate is 49.6 percent, he said.
Scott also said the company presents no evidence to back up its claims
Pepsi also said shareholder statements that other consumer products, like
Gatorade and Veryfine, use at least 25 percent recycled content is "speculative"
because none of those companies have publicly stated a commitment to 25
Scott said Procter & Gamble Co. and Miller Brewing Co. have committed
publicly to 25 percent, and that Coke uses 25 percent recycled content
in other countries and in a fraction of its PET bottles in the United
A Pepsi spokesman had no comment.
The Securities and Exchange Commission will determine if Pepsi can prevent
the resolution from getting to a shareholder vote, Scott said.
Scott said Pepsi´s approach "stands in contrast to Coca-Cola´s
more shareholder-friendly discussion" about letting shareholders
vote. The investors have meetings with both Coke and Pepsi in the near
future to discuss recycling policies, he said.