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Comparing two sustainability reports


Coke and Pepsi companies have been perennial competitors since their inception, each

having the quest of controlling huge market share within the United States and other parts of the

world (Hillman, 2009). Each of the companies has implemented strategic frameworks to retain a

competitive edge. However, some of the strategies are similar. For instance, since the year 2000,

the consumption of carbonated soft drinks slumped, leading to development of substitutes to

enhance sustainability of the companies. Consequently, both companies ventured into bottled

water, juices, and a number of tea variants. Some of the brands that Pepsi developed included

Aquafina for water while Coke introduced Dasani. Secondly, the companies ventured heavily in

advertising campaigns. Overtime, Coke has been advertising using lifestyle promotion while Pepsi

has been using sports celebrity as the advertising strategy. Finally, both companies considered the

possibility of having concentrate suppliers from other parts of the world, especially in Asia. This

was aimed at ensuring that the market for carbonated soft drinks remained outside the United States

while considering new markets for no-carbonated soft drinks.

Insofar as the sustainability reporting of Coca-Cola and Pepsi is concerned, the two

companies have begun communicating sustainability through reports. However, in non-developed

nations, most of the companies share inadequate information in their reports. Also, the content and

extent of sustainability reporting varies in the tow companies, meaning that the sustainability

efforts of the two companies vary. Therefore, the aim of this paper is to compare the sustainability

reports Coca-Cola and Pepsi. The paper focuses on soft drinks companies that report their

determinations by adhering to the rules established through Global Reporting Initiative.


Overview of sustainability reporting

In reference to World Business Council for Sustainable Development, sustainability

reporting refers to the open reports provided by firms giving external and internal stakeholders the

clear overview of corporate situation on operations regarding environmental, social, and economic

scopes (Pérez-López, Moreno-Romero and Barkemeyer, 2013). Researchers have studied

sustainability reporting mainly in connection with sustainability revelations at local, regional,

industry, company, sector, national, and international levels. There is variation in disclosures for

diverse segments and environmental reporting. Developing countries are still behind when it

comes to research concerning sustainability reporting since majority of the researches are done in

developed nations. Therefore, there is need to carry out more studies in the perspective of non-

developed nations (Singer, 2012).

Sustainability strategy, objectives or principles

Pepsi and Coca-Cola are the main rivals within the beverage and food business. The two

companies produce the sustainable report with almost comparable standard and content.

Nevertheless, Coca-Cola delivers a comprehensive and more complete report as compared to Pepsi

(Mokhov and Ryabukhin, 2018). Coca-Cola’s objective in sustainability is simply to invest

environment and social for creating a sustainable future, business growth, and transforming the

society through changes peoples’ lives. The company believes that changing peoples’ live styles

and making them to live positively is the greatest means of establishing a sustainable globe that

comprise seven key aspects in sustainable matters. While, Pepsi’s objective is to put in place

positive environmental influences to attain the sustainable development. Sustainable development


is based on the environmental, and human ability. The area concern and objective the investors are

more wide-ranging as compared to Coca-Cola. For the target environment, Coca-cola states the

attained objectives from the past years in the report. Though the company only shows the attained

objectives and hides unattained goals. Coca-Cola provides the information for stakeholders to get

the clear of what it has successfully achieved in regards to sustainability (Gertner and Rifkin,


To survive the volatility of the current market situation, there is a dire need to invest in

intensive market research. This will be instrumental in ensuring that the market trends and

consumer preferences are captured and addressed appropriately by the cola companies.

Additionally, it will be imperative for the companies to consider innovations that tailor various

blends of concentrates to fit the taste of the consumers especially in the wake of globalization. This

could include venturing into manufacture of energy drinks, using alternative sweeteners, and

introducing diet sodas while maintaining corporate branding strategies. However, this should be

done dependent on the preferences of the local market rather than implementing it as one global

package. On the same breadth, the companies could consider rebranding in order to rejuvenate

their images and enhance global brand recognition (Roy and Sarkar, 2015). For this to take effect

there must be rigorous corresponding advertisement campaigns to sensitive the existing and

prospective consumers about the new product developments.

Considering the financial muscle of these companies, it is also possible introduce new

manufacturing technologies that could improve on the current production capacity as well as

enhance making of new blends. Additionally, the top management of these corporations need to

remain abreast of the major changes within the external environment to make the necessary

strategic adjustments. The aspects of external environment to consider may include political,

environmental concerns, social adjustments, technological changes, as well as the prevailing

economic conditions. This will not only be beneficial to the concentrate producers but also to the

associated bottlers. Finally, companies ought to relook into the internationalization strategies,

especially Pepsi since it is heavily dependent on the U.S. market (Azuayi, 2016).

Social accounting in Coca-Cola is superior to that in Pepsi. Coca-Cola’s report is more

comprehensive, transparency, and complete in comparison to Pepsi (Kayabas, Boyraz and

Derdiyok, 2018). Coca-Cola has developed seven key aspects in sustainability that are more

specific as compared to those of Pepsi. The objectives and timeframe are evidently stated in the

report. The GRI has the mandate to work as an international standard. The BECO Verification

Statement and Board of Directors give the report in noble principles of global standards and social

account. Pepsi Company concerning social accounting is more comprehensive as compared Coca-

Cola. The objective of Pepsi is simply to attain the sustainable development. Pepsi is inferior o

environmental talent, and human sustainability. Similarly, the past objects and GRI report are not

revealed in the report. Sustainability actions and objectives are put in place as a long-term plan

minus an existing timeframe (Odeku, 2014).

Reasons for adopting sustainability approach

The marketing mix of both Coca-Cola and Pepsi are very similar in nature as they are two of the

world’s leading soda beverage providers. Both brands have different strategies in the way that they

attract the customers that they wish to attract and retain by a number of means. Being aware of

consumer views regarding product differentiation have for sustainability decisions such as product

positioning, pricing policies, and consumer segmentation. The products offered by these firms are

alike but different in appearance, price, and taste. These aspects are cantered the demand for the

products and goods being sold. Coca-Cola is more global than Pepsi, and the brand has indeed

taken advantage of that. Their marketing has been consistent, and therefore it is at a different

“height” than Pepsi (Kayabas, Boyraz and Derdiyok, 2018).

Coca-Cola and Pepsi have created numerous measures that aim at attaining a sustainable

setting. For example, Coca-Cola has taken an exceptional attention to protect the water sources

which sustain the society. The company also has a vested business that aims at preserving and

improving the sources of the local water. On the other hand, Pepsi has taken the approach of

participating in the global sustainability initiatives and also connecting the social responsibility

issues with the businesses. Lastly, Coca-Cola has been involved in sustainable management

through engagement in the community activities, environmental footprint and also the running of

the leadership programs which aims at conserving the environment.

Effectiveness of reporting on key stakeholders, interests and engagement approaches

Coca-Cola, in its report shows the care offered to the stakeholders and the general public.

Coca-Cola has invested a lot of funds to help create and preserve vibrant and sustainable

stakeholder base. The report gives the stakeholders an overview to perceive the company’s

concerns and effort regarding their interests and the general public. It employs its sustainability

report to function as a guideline for each business activity. Subsequent to evaluating stakeholders’

main concerns including human rights, lively healthy living, product, ingredient safety, water

stewardship and packaging, the company places these concerns into the value chains. Regarding

about human rights, the offers inclusive and safe workplaces for its employees. As a result, the

employees’ satisfaction rise, creating more value for the firm. Coca-Cola has invested much in the

society worldwide, since the company believes that when the society is sustainable and healthy,

the firm attains sustainability (Taylor et al., 2010).

In Pepsi, a number of concerns have been raised by the stakeholders regarding

sustainability. The quality of products can be expressively affected by using chemicals and

additives. Therefore, the solutions to those concerns raised by the stakeholders have been offered

in the sustainability report. In the report, minimization, recycling of residuals, and safe handling

have been clarified. Similarly Risk Management Plan has been instigated by the company to

protect some of the company stakeholders against some threats. Also, the stakeholder are able to

get the information required from company’s sustainability report (Kayabas, Boyraz and Derdiyok,


A commentary on areas of strong sustainability performance of the company

Coca-Cola has superior intangible and tangible resources. Its commodities involve

flexibility, responsiveness, and quality. Also, the Coca-Cola’s brand equity and human capital

create loyalty, performance, and long-term value (Taylor et al., 2010). These are actually the

company’s key assets, where the firm has placed its sustainable competitive edge. Its assets enable

it to outdo its rivals constantly due to being internationally recognized, innovative, and coherent.

Coca-Cola’s competitive advantage and strategy are highly sustainable.

PepsiCo is committed to increasing its water use efficiency. It also promised to use more

recycled material in its packaging operations to reduce environmental damage. The company is

committed to counter climate change by improving electricity use efficiency, reducing the fuel

used, reducing the greenhouse gas emissions from its operations, and applying on its farmed lands

agricultural practices that proved to be sustainable. These activities increase buyer patronage,

reduce the risk of reputation-damaging incidents, lower costs and enhance employee recruiting

and retention, increase revenue, and impress stakeholders. PepsiCo has redone its commitments

many times over the years in a way to help benefit sustainability while still satisfying consumer

concerns. Every time the firm’s sustainability report is released it has a stronger structure that is

more favorable to company and environmental sustainability.

A commentary on areas of weak sustainability performance of the company

Coca-Cola’s sustainability report has a number of commodities that have not received

approval in the market. The company’s marketing practices of promoting sustainability have not

been successful in some areas. The company has not been able to place the right people at an

appropriate in order to get the advertising and right marketing developments for those commodities

is core to attaining success in the sustainability sector. The setbacks to Coca-Cola include water


PepsiCo is operating on a global basis. The competition between the two is heavy and just

like Coca-Cola, Pepsi drinks are available in almost every nation, in almost every food and drink

store. Although fulfilling a similar position as Coca-Cola in their market, PepsiCo has a rough

opponent with Coca-Cola. The past several years, PepsiCo is not as profitable as before and has

more and more trouble with competing with Coca-Cola, also because of the high investments of

Coca-Cola in marketing. Therefore, their brand equity is developing negatively.

Utilization of established reporting frameworks

GRI report refers to a voluntary form of sustainability report that is prepared by firms which

conforming to Global Reporting Initiative Framework. Sustainability reporting is important to bot

Coca-Cola and Pepsi and their stakeholders since it offers a prospect to carefully examine

performance on daily basis in the social, economic, and environmental areas. Both Coca-Cola

and Pepsi conform to GRI reporting frameworks through the application of the fourth generation

of GRI guidelines. These guidelines are examined and matched in their reports for purposes of

addressing the way they employ GRI report to issue their sustainability approach and where they

report benefits to stakeholders.

External assurance, awards, sustainability ratings and other forms of recognition

In 2011, both Coca-Cola and Pepsi laid strong drive toward their 2020 objective of

expanding their business in the course the decade. In the last two years, the companies have

exceeded or met their longstanding development objectives. Coca-Cola earned $46.5 billion in

2011 as revenues and raised working income by $1.7 billion to $10.2 billion (Kayabas, Boyraz

and Derdiyok, 2018).

Layout, appearance, readability and length of the report

The layout of the two companies’ sustainability reports varies, however, what is significant

is the information contained in the reports. Sustainability reports are documents that offers a

summary of the sustainability status of the companies for a year (Truant, Corazza and Scagnelli,

2017). These reports give both external and internal customers information required to make

sustainability decisions regarding the firms. The reports contain the environmental activities,

stakeholder, company strategies, and resources. Both of the reports are made available for

shareholders and investors to view the company’s sustainability position.



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