PepsiCo Foundation is donating $8 million to support access to clean water in India, the food and beverage company announced Thursday.
Water is a critical environmental and social issue as billions of people worldwide currently lack access to safe water for drinking and sanitation needs. A growing population, climate change and other demands on the world's water supply are expected to make water scarcity and quality into much larger challenges in the future.
PepsiCo is providing the grant to support Water.org, a nonprofit organization co-founded by celebrity Matt Damon. Through this organization, the money will be used to provide micro-loans to families throughout India to get access to clean water by supporting funding for anything from water taps in their home to a working toilet.
It is the latest of several efforts by U.S. beverage companies to offset some of the massive amounts of water they use for their businesses. Drink makers use water for everything from the crops for ingredients to packaging in its plants.
Beverage companies like Coca-Cola Co. and PepsiCo have paid much more attention to water issues since the early 2000s when both faced sharp criticism in India over claims that the company was depleting and polluting local water supplies. The companies denied the claims but it changed their corporate response to water issues.
Since 2005, PepsiCo has pledged nearly $34 million to safe water and sanitation initiatives in developing countries. It has launched a variety of programs to cut its own water use, from using air instead of water to clean bottles in its plants or helping rice farmers that grow its crops switch from flood irrigation to direct seeding, which uses less water and makes crops more resilient to drought.
Coca-Cola, SABMiller PLC and other beverage makers have also made major pushes to address water issues. Coca-Cola has donating millions to various water support programs and aiming to improve its own water efficiency by 20 percent by 2012, versus its 2004 baseline. And SABMiller has built new treatment plants at breweries in Uganda and Tanzania to maintain water quality there among other efforts
"It's so critical when you look at our business," said Dan Bena, head of sustainable development for PepsiCo.
PepsiCo needs water for its beverages, packaging and the crops used as ingredients for its foods and drinks. Agriculture represents the bulk of water consumption around the world. Add to this the fact that India is one of the fastest-growing regions for the company and it's a clear-cut business and social decision for the company.
"We believe that if you can help people out at or near the bottom of the pyramid, if we can help them develop their access to resources, they will lift out of poverty," Bena said. "They will lift out of poverty and they will have discretionary income. They will be the consumer of Pepsi products five or 10 years from now."
Water may be on the radar for these companies, but advocates say it doesn't get the public attention it deserves.
"This issue of clean water for us is something we never think about," Damon said. "There is clean water everywhere. We just turn on the tap in the morning."
Water.org hopes that attaching the big names like Damon's or PepsiCo might help draw attention to the challenges people around the world are facing.
Water.org cofounders Gary White and Damon say access to safe water can mean the difference to people in some of the poorest areas of making it through the day.
The organizations estimate it will enable roughly 800,000 people access to safe water by 2016 with this contribution. It is the largest single donation ever by the foundation, which is the philanthropic arm of PepsiCo Inc.