Food and beverage company PepsiCo has launched the Kgodiso Development Fund – a five-year, R600-million investment to help transform the food system in South Africa.

The fund will seek to create shared value solutions that help build a sustainable food system by creating local employment opportunities and increasing local procurement and supplier diversity.

“The Kgodiso Development Fund will prioritise activities that support the growth and scaling up of black-owned emerging farming enterprises and small, medium-sized and microenterprise (SMME) businesses, promote regenerative agriculture practices and encourage the adoption of innovation to revitalise local production within South Africa's agriculture sector,” says Kgodiso Development Fund executive director Diale Tilo.

“PepsiCo aims to play a bigger role in supporting activities that contribute to the long-term sustainability and resilience of South Africa’s food system. The Kgodiso Development Fund will act as a catalyst to create local jobs, increase local procurement, build small businesses, support education and holistically contribute to black economic empowerment in South Africa,” says PepsiCo sub-Saharan Africa CEO Tertius Carstens.

The fund hopes to deliver a meaningful impact through its commitment to creating shared value solutions and transformation of supply and value chains. Although founded by PepsiCo, it will be run as an independent fund, with an executive director and a board of trustees.

The fund will allocate R300-million to agricultural development to assist black-owned emerging farming enterprises to upscale their businesses and ensure that they are provided with opportunities to integrate into the value chain.

“This will help transform the country’s agricultural landscape by developing a new generation of sustainable farming enterprises,” says Tilo.

Additionally, R200-million will support education to enable initiatives that provide appropriate training and upskilling, thereby enhancing the skills pipeline in the country.

“This will assist in unlocking the immense potential of South Africa’s human capital by addressing key skills and knowledge gaps in the food system. PepsiCo launched a Graduate and Future Leaders programme in 2021,” says Carstens.

Further, the fund will allocate R100-million to SMMEs to provide incubation and technological support to those small businesses which can provide their goods or services to PepsiCo or its partners.

“This investment looks to encourage unique innovation, increase competitiveness and drive economic inclusion by building a pipeline of suppliers and entrepreneur networks, and by providing them a route to market,  business development support, funding and mentoring.”

Meanwhile, the fund is one of PepsiCo’s public interest commitments, made to government at the time of the acquisition of Pioneer Foods. In addition it forms part of the newly launched approach to strategic end-to-end transformation called PepsiCo Positive. Sustainability is the driving force in the company creating growth and value by inspiring positive change for the planet and people.

PepsiCo procures more than 1.5-million tonnes of local maize, wheat, potatoes, oats and raisins a year, and employs about 13 000 people in 70 warehouses and 45 production facilities on the continent.

“The establishment of this fund, although independent, allows us to collaborate with like-minded partners, and develop solutions that address critical issues surrounding the region’s food security and combatting hunger.

"We look forward to seeing the impact that these commitments have on helping us reach the shared goal of a thriving, resilient and sustainable food system in South Africa,” concludes Carstens.