*PepsiCo has come under scrutiny after scaling back its diversity, equity, and inclusion (DEI) efforts, a move that reflects a broader trend among major U.S. companies.
Earlier this year, the company announced it would eliminate DEI workforce representation goals and phase out its five-year DEI plan, replacing it with a new “Inclusion for Growth” strategy, The Street reports. PepsiCo said it would broaden its supplier base to support all small businesses, stop conducting surveys focused on single demographic categories, and evaluate sponsorships based on their impact on overall business growth. This change follows President Donald Trump’s executive order banning federal DEI programs, calling them “illegal and immoral discrimination.”
Civil rights leader Rev. Al Sharpton opposed PepsiCo’s decision. In an April 4 letter to CEO Ramon Laguarta, Sharpton accused the company of prioritizing “political pressure” over “principle” and “walking away from equity.” He also criticized PepsiCo for breaking off community partnerships with minority-focused organizations and threatened a boycott led by his group, the National Action Network.
Following the backlash, PepsiCo agreed to meet with Sharpton and NAN representatives. “It was a constructive conversation,” Sharpton said in a statement on X after the meeting, which included Laguarta and PepsiCo North America CEO Steven Williams. He noted that further talks are planned and that NAN will decide soon whether to proceed with the boycott.
“This morning, I and several members of NAN met with PepsiCo Chairman Ramon Laguarta and CEO of PepsiCo North America Steven Williams for more than an hour to discuss our grievances over reports they were rolling back nearly $500 million in DEI commitments,” said Sharpton in the statement. “It was a constructive conversation, which PepsiCo agreed to hold within the 21 days we gave them to meet. We agreed to follow-up meetings within the next few days.”
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The controversy comes as PepsiCo faces declining U.S. sales. According to The Street, in Q4 2024, the company reported a 0.2% drop in net revenue. Frito-Lay volumes were down 3%, Quaker Foods dropped 6%, and beverage volumes also fell by 3%. CEO Laguarta and CFO Jamie Caulfield attributed the downturn to inflation, higher borrowing costs, and increased dining out.
The company’s DEI rollback and consumer challenges signal a complex moment for the brand as it navigates public perception and shifting market dynamics.
READ MORE FROM EURWEB.COM: Coca-Cola Says Altering DEI Policies Could Harm Business Growth
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