PepsiCo Case of Study Building Gender Balanced Leadership Teams 2012 CONFIDENTIAL

PepsiCo

Within PepsiCo, our commitment to diversity

and inclusion encompasses the goal of

achieving parity between women and men in our

management and leadership ranks

Gender Balanced Leadership Teams

Build a leadership pipeline that reflects the Consumer and Talent demographics 1

Creating a competitive advantage through Gender

Balanced teams in PepsiCo 2

PepsiCo South East Europe and Turkey Journey, key insights and cultural implications 3

4

! Studies show that companies with significant number of women in Senior Roles perform better than others

! Women worldwide control about $20 trillion in consumer spending each year

! Women are the driving force behind more than 70% of purchasing decisions

! Sixty percent of university graduates in Europe and North America are women

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In Europe, only 7% of the total number of Executive Committee

members of the top 101 European companies are women Source: 2010 WOMENOMICS101, 20-first

Build a leadership pipeline that reflects the Consumer and Talent demographics

A few women at Senior levels...

Source: 2010 WOMENOMICS101, 20-first

In Europe, 44% of companies have at

least one woman on their Executive

Committees.

The US leads the way, well ahead with

87% of American companies having at least one woman on their Executive

Committee.

The problem is not only at the top: women are increasingly outnumbered as they rise through the ranks

...the most important issues

: !"#$%&'()*#$)(+&#,-$./,&+'0#$ ; Combination of work and domestic responsibilities

: The linear career path

; No space for career breaks or the rejection of a geographical mobility option

: Dual career couples

; Couples need to find better ways of balancing life and work during their careers

: Lack of role models

; Few women in senior roles, to build role models

: Need for promotions and development

; Women perceive that males are getting most of the promotions and development opportunities

: Lack of flexibility

; Work life balance

: The talent gap

; The female representations drops at almost every management layer

Creating a competitive advantage through Gender Balanced teams in PepsiCo

Enablers Development Commitment

PepsiCo Europe holistic approach to increase female representation management

and leadership ranks

Commitment

: Diversity and inclusion are a key part of who we are and firmly anchored in our core values

: Behaviours that support diversity and inclusion are embedded in our Leadership Model

: All people managers have a diversity and inclusion objective as part of our Performance

Management Process and Senior Leaders

have targets for women representation

: In 2012, Europe Regional Leads developed an action plan to ensure gender balanced

management and leadership teams as part of our Talent Review process

Our Commitment started with the top of the organization and today:

Key initiatives to increase female development in PepsiCo:

Development

: Talent Review: Detailed plans to drive female representation at executive levels with strong focus on Select, Develop and Retain

: Career Conversations: Conversations to explore factors influencing mobility, life stage and any issues impacting Work Life Balance as part of the Talent Review Process

: Mentoring: Formal and informal mentoring programs

: D&I Scorecard: 2 year aspirational goal to ensure gender balanced management and leadership teams

: Communities'(<-9"1-9(0="-0"$061=(">(7",&-?0(

International Networking, Global Summit of Women, Empowering Women and other high profile conferences

: Communities: Support to Trestle foundation to help female entrepreneurs in emerging markets, while providing development opportunities to our internal talent

Video

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always offer really challenging tasks for people, and at the same

time is growing people, developing people, and

understanding their motivators

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Kristina Rossova, R&D Manager

Europe

Retaining focus on evolving our culture & environment

Enablers

: PepsiCo have various practices around work life balance:

: FlexiCo Program ! Flex Place - Work from another location one day a week ! Flex Time - Adjust on-going schedule around core work hours ! Flex Day - Summer hours - Compress 5 days of work into 4 ! day

: As part of the annual objective setting process, &,=@"A&&0(B10%#00(+186(86&1$(,.-.9&$0(+6.8(Cone simple

thing?(+"#@B(6&@=(86&,(.%61&5&(.(/&88&$(+"$D-home balance

: Being more effective at work - Less is More and Simplicity

: Encouraging our employees to lead a healthier lifestyle - Fit for Life, Vive Saludable and Vielife

: Maternity Management an innovative, holistic approach which meets the needs of our women through all stages of their pregnancy

Video

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Helen Hofstede, Project Manager

Quaker Oats

Building Gender Balanced Leadership Teams

Key success factors

: Leadership commitment and

accountability

: Focus on our Culture and Environment

: Career Conversations to understand aspirations and explore factors influencing mobility and life stage

: Career development tracked by Talent Management

: Transparency by implementing gender

diversity scorecard and goals

: Measures to facilitate the work-life balance

South East Europe and Turkey Journey

Umran Beba, formerly President of South East Europe and now President of Asia Pacific, achieve nearly 40% female representation in her leadership team in Turkey

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Women with poor levels of education, especially in urban areas:

: Have access to jobs that offer low wages and harsh working conditions : The cost of hiring someone else to help working

women with childcare and domestic work is too high

Source: WorldBank

Many women in Turkey would like to work but they face a number of difficulties that prevent them from doing so

Some factors affecting women to join the labour force...

Source: WorldBank

Social and Cultural Constrains

: Family would not allow : Safety : Mistrust : What would others say : Care giving

Economic Constrains

: Low wages (high informality) : Long working hours : Economic crisis : Insufficient education : Lack of affordable childcare

Women are disadvantaged

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Reasons of not being in labour force 2011

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Employment status 2011

Schooling ratio, 2010-2011 Mean age at first marriage by sex

Women are disadvantaged

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Distribution of Employment by agriculture and non-agriculture, 2004-2011

PepsiCo has done a good progress in Gender Balance over the years in Turkey

26% 27%

33% 32%

Female Representation

Global Europe SEE Turkey

PepsiCo Executive Female Representation

19% 20%

26%

32%

Female Representation

Turkey Emp Mgrs Exe

Turkey Female Population in Business

...So, how our journey begun?

The Journey started with our Leadership Team..

: A Task force was established and led by Umran Beba (Region President)

: Our target group: Female executives and managers

: Quantitative survey and focus groups to understand:

:WLB

:Culture

:Communication

:Development

: Opportunities, challenges and issues identified

: Actions defined in workshops

To Region President

To Functional VPs

To Business Unit GMs

To Market Unit GMs

To HRDs

Actions defined: Targets given for Female executive representation

Flexibility to facilitate the work-life balance...

Adjust on-going schedule around core work hours of 10:00-3:00

Work from another location one day a week

Summer hours - Compress 5 days of work into 4 1/2 days

... And ONE Simple Thing as part of our A,,(4*$F)G#:57H#.IJ

Because Work Life

Balance is different

for everyone

...followed by cultural change.....

:Leadership meetings

Regular updates about D&I in quarterly Leadership Meetings

:Mentoring Programs

Diverse and High Potential Executives has been matched with VPs and GMs

:D&I Local councils in Business Units

"

!

...and strong communication campaigns

We organized

internal networks....

I$&#H#*'60#,5al meetings

... And distributed

developmental books

...then we decided to invest more

Being a role model with consistent communication...

....and promoting gender equality in management

PepsiCo was among 30 local and international companies that signed Turkish Society for Quality's gender-equality declaration

"Women have the Right to Govern - Gender Equality in Management" declaration, showing their support for equality, diversity and inclusion

in the workplace.

In 2012 our journey requires a new focus...

We have a much more diverse workforce : 14 countries

: Different religions and cultures

: Bottler acquisition and culture integration

: We have much larger population (7,000)

: Leadership Team from 6 different nationalities

: 33% Female executives in South East Europe

...Our journey

will continue...