Pitchbook - A4

PepsiCo & Stakeholder Engagement Enhancing Enterprise ValueOctober 24, 2012

1FTI Consulting is a global business advisory firm that provides multidisciplinary solutions that help clients address complex business opportunities and challenges.Critical Thinking At The Critical TimeWe are 3,800 trusted advisors with diverse expertise and exceptional credentials serving clients globally

We combine unparalleled expertise and industry knowledge to address challenges to enterprise value

Our breadth and depth extends across every social, political, and economic hub across the globe

2 Broad global reach encompassing approximately 700 strategic communications experts and a total of 3,800 business consultants in 23 countries around the worldProven ability to manage global issues with local expertiseOur Global NetworkParisBrusselsLondonBostonChicagoLos AngelesSan FranciscoSao PauloBeijingWashington DCPhiladelphiaNew YorkTorontoDublinFrankfurtBerlinMoscowBogotaPanama CityCape TownJohannesburgManamahAbu DhabiDohaDubaiNew DelhiShanghaiHong KongSingaporePerthMelbourneSydneyPittsburgh 3 The PepsiCo Team 4 The FTI PepsiCo team will be staffed with an integrated team of experienced professionals who focus on the food and beverage industry.Beth SaundersStrategic CounselBob KnottProgram DirectorJeannine DowlingMgr., Stakeholder EngagementLinda MayerAnshula Ahluwalia

John WattsMgr., Stakeholder Identification & MappingJocelyn LandauJeremy Ruch

Mitzi EmrichOnline Engagement

Sacha Mohabeer Adam Sopko

4Helping Brand And Market Leaders Advance Their Businesses 5

Created an engagement strategy to help deepen stakeholders commitment and belief to its new CEOs Vision 2020.Reinforced the companys market leadership and reputation, despite the commoditization sweeping the insurance industry, while raising its profile as a leading advocate for the economic wellbeing of Americas middle class.

Communicated transformation and long-term strategy to position the company as a leader in science and innovation.

Managed the communications surrounding the explosion of its Deepwater Horizon rig, widely characterized as the BP Oil Spill, including the engagement of various internal and external stakeholders regarding the companys ongoing operations.

Created a grassroots strategy that engaged consumers to combat pending state and federal legislation that would adversely affect the companys corporate strategy.

Worked with executive management to raise visibility in the US and create a new positioning theme. Facilitated introductions between Tata executives to develop US-based relationships.

5Our Unique Approach: Enhancing Enterprise Value 6

FTI is uniquely capable of developing and implementing communication campaigns that enhance and protect a companys enterprise value.

Our approach emphasizes the effective engagement of employees, customers, governmental publics and third parties, in addition to investors, analysts and other members of the financial community a diversity of essential stakeholders we are uniformly adept at reaching and influencing.

Through the use of unified messages that resonate with each of these stakeholders, as well as a coordinated approach to communications, FTI not only enables companies to achieve committed workforces, reputational leadership and an increased license to operate, but also an optimal valuation of their stock. 6.Articulate the economic importance of PepsiCo and the industryAcknowledge PepsiCos contributions / leadershipListen to and incorporate PepsiCo viewsRefrain from or amend restrictive laws / regulations BehaviorsBehaviors:.Thoughtfully consider and internalize managements plansAnalysts echo PepsiCo viewsAttract / retain desired investor baseProvide time when needed, based on belief in management BehaviorsBehaviorsOur Approach: How It WorksEngaged Leadership, Committed WorkforceReputational Leadership with Opinion Leaders and PartnersOptimal Valuation in Capital MarketsLicense to Operate with Public and RegulatorsEnterpriseValueBehaviorsConstructively engage with PepsiCo in public forumsCite or refer to PepsiCo and PepsiCo experts views positivelyUnderstand and internalize all of PepsiCos strategic directionsCommitment to companyProductivityCompany ambassadorship / active articulation of PepsiCos perspective 7 7 8 Increase the credibility and resonance of PepsiCos near- and long-term business strategyEducate and increase understanding of PepsiCos position around key issuesEnsure the perception of PepsiCos past and present trajectory is validated and amplifiedBrand BuildingInnovationProductivityExecutionReturn to ShareholdersDevelop a comprehensive influencer engagement strategy and program that will:This program will operationalize PepsiCos strategic goals:Understanding PepsiCos Objectives8

Attitudes and opinions in the U.S. of the food and beverage industry9Questions Consumers Are Asking 10 Packaged food used to be a convenience that was simply enjoyed. Now its a loaded gun. Questions and concerns have created a series of global trends that impact the reputations and bottom lines of food companies operating in an increasingly complex environment.

Where was this manufactured? How was it produced? What are the ingredients? Does this soda contain high fructose corn syrup? Should I be focused on getting more protein into my breakfast?What does your environmental footprint look like? How do you treat your farmers, suppliers and employees? 10Understanding The Industry and External Pressures

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11Obesity Influences the Dialogue

Theres a growing global health paradox: while people in developing nations are increasingly overweight, many of these consumers are undernourished. Fast food, processed foods, sweets and snacks may be part of the problem, but they fit seamlessly into a broader story that few stakeholders fully understand. As a result of this landscape, regulators, health professionals and industry leaders have become more focused on calories from beverages and processed foods, while also increasing their scrutiny of food labels and health claims and industry-supported research. 12 12Social Media is Mainstream Media

What makes the current food environment so daunting is the connectivity of the digital age. Social media often drives or amplifies what happens in traditional channels such as top-tier daily publications or online news and commentary channels. Conversations and content about nutrition, health and food products are amplified through the food community, creating an echo chamber that often starts with experts and is carried by enthusiasts and average consumers. 13 13The Rise of the Corp-sumer

When it comes to issues and advocacy, consumers and activists have more than an opinion they have a voice. Consumers are passionate about their food choices and about the companies they buy from; theyll take action for or against you based on how you engage with them on the issues and initiatives they care about. 14 A New Issue Import/Export Dynamic

As multi-nationals enter new markets, the old paradigm of food issues being limited to developed markets and by geographic boundaries has changed. As markets develop, issues develop with them and new influencers join others in driving conversations. Navigating the complexity now and engaging in meaningful ways is critical to success. 15 Glocal Thinking and Doing is a Must

What we eat has personal, political, social, environmental and economic implications across the globe. From obesity to food ingredients, sustainability to food safety, food security to commodities pricing, food issues dominate our global and local food dialogues, and shape the way companies and industries enter new markets and do business in those markets. Understanding the issues that are being discussed at the local and regional levels, the influencers who are driving those conversations, and the nuances of local and regional market engagement is critical to your success. 16

Influencers Use Peer-to-Peer Networks to Create Social Currency

Deeply engaging financial thought leaders, health professionals, influencers and other stakeholders means reaching them in the online communities they know and regularly use. Creating a unique presence on the niche social networks that are important to key audiences helps build credibility and trust relationships that start online can become the foundation for finding vocal supporters who can take action offline. 17 How Others In the Industry Are Reacting to the Landscape 18 From Candy to Innovation: With the worlds cocoa supply at risk, concentrated primarily in West Africa and susceptible to disease, and stakeholders calling for support of impoverished cocoa farmers, Mars decided to take action. In mapping the cocoa genome, Mars was seen as a leader, bringing solutions to a delicate agricultural and economic problem. More than Just Coffee: While suffering declining financial returns and an increasingly competitive market, Starbucks heralded the return of CEO Howard Schultz and highlighted its deep bench of talented executives by partnering its thought leaders with select stakeholders in a series of global conversations, securing the companys corporate reputation as a leader in not just coffee, but in responsible capitalism, corporate citizenship and sustainability.Thinking Local: In the wake of a series of crises over the sourcing and ingredients of products sold in its restaurants, Yum! launched a global program that tracked and anticipated food and nutrition-related issues and influencers, leading to many of its brands announcing reformulated products based on unique market demands around the world. Healthy Food Initiative: After successfully demonstrating that sustainable products should not and do not need to cost more for its customers, Walmart brought those same principles to healthy foods. Declaring that no family should ever have to make a choice between foods they can afford and foods that are good for them, Walmart announced a program with Michelle Obamas Lets Move! that includes working with manufacturers to reformulate packaged goods, creating its own healthy foods seal, and lowering prices on fruits and vegetables.

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Stakeholder Identification & Mapping19Health and Nutritional GroupsFinancial CommunityGovernmental PublicsHealth ProfessionalsKey Opinion MakersBloggers, Citizen JournalistsNews Media Online Community

20 PepsiCos Essential Stakeholders20ONLINE MAPPINGImmediatelyPhase 1Identify hot spots 21 RESEARCH-LEAD MAPPINGPhase 2Manage brush firesIdentify the most vocal, credible and trusted sourcesManage and drive the conversationMap stakeholders by current vs. desired attitudes and behaviors, influence, and impact on achievement of our business objectivesDevelop plans for most vocal, influenceable, influential and valuableTrack success via measures of opinion, engagement and behaviorReach out and engage the most vocal, credible and trusted sourcesParallel paths address near-term opportunity and long-term, documentable results.Stakeholder Mapping on Parallel PathsThe Research-led Mapping ProcessTo facilitate effective engagement over the long-term, we take a structured approach to mapping stakeholders and design communications that drive engagement and behavior. 22 22The Research-led Mapping ProcessWhile PepsiCo has clear strategic vision and initially-identified stakeholders, a research-driven approach will ensure we know precisely who needs to hear what and how.

The objectives developed in this stage will operationalize PepsiCos strategic goals:

Brand BuildingInnovationProductivityExecutionReturn to Shareholders

23 23The Research-led Mapping ProcessAbility to InfluenceLevel of EngagementThe resulting stakeholder map provides a holistic view of your messaging landscape, along with strategic and tactical insights.

Certain loud voices may be unmovable, and require development of credible surrogates more likely to support PepsiCo while we identify the key advocates we need to continue to engage. 24 24The Research-led Mapping ProcessAt the top of the pyramid, special strategies are often required.

Focusing on the issue of most interest to the individual is both possible and critical.

Whether due to beliefs, position or role, some can be intractable and immovable, requiring development of other equally credible individuals to articulate your view.Engagement & Influence 25 25Digital Stakeholder Identification and Mapping 26 By mapping digital stakeholders, PepsiCo can identify online personalities who have the potential to become vocal online ambassadors for the companys initiatives and designate an approach for activating them. FTIs Process for Digital Stakeholder MappingEngagementInfluencePopularityTrustKey Food Policy Health and Nutrition Consumers Sourcing and Supply Chain

TreeHuggerFooducateMomRNSuperHealthyKidsJollyTomato26Amplifying Messages Throughout the Food Community 27 Online conversation shapes media coverage, government action and consumer opinion ultimately impacting a companys bottom line. Conversations about the business and social impacts of food are shared and reverberate amongst a tight-knit group of stakeholders who are deeply connected to PepsiCo and its competitors, providing the opportunity to reach broad audiences by targeting a few key digital influencers. Food Advocates & Enthusiasts

Food & Nutrition ExpertsConsumers

Market27A multi-stakeholder world means opinions are formed across diverse channels, a debate can start anywhere and new influencers can rise to prominence each day. Navigating the complexity and engaging stakeholders in meaningful ways is critical to success, but PepsiCo must first start with the potential allies and influencers who are the most vocal, credible and trusted sources of information. FTI will immediately leverage its global heat-mapping tool to identify and chart a course for engaging prime stakeholders early, securing initial wins that will help PepsiCo establish broader relationships in key communities.

Identifying Short-term Hotspots 28 28

Stakeholder Engagement29Our Principles to Advance Engagement 30 Authentic engagement underlies all strategic alliance development effortsSteps to Cultivating Stakeholders 31

12345Frame messages for individualEngage stakeholdersMeasure results in real time Respond accordinglyIdentify individuals attributes and commitment31Build Relationships with Potential Advocates 32

Incentivize with insights and unique experiencesBuild proactive and offline relationships by giving stakeholders exclusive and advanced access to products, internal experts, tools and programs before they are launched.

Leverage partnerships with reputable offline groups to promote the progress of PepsiCos initiatives and help stakeholders understand the companys relationships with credible groups.

Provide regular comments on news and issues core to PepsiCos business, offering a unique and reliable perspective on prominent issues.

Take the lead in making the issues accessible Educate diverse audiences with engaging information in the form of videos, interactive infographics and other multimedia to share perspectives and messages unique to PepsiCo.

Have a presence where your advocates spend their time

Leverage channel-specific conversations and engage potential allies and partners through unique online events like Twitter chats and communities like LinkedIn.

Using Mapping to Guide Strategy and Tactics

Once the identification process is complete, stakeholders will be mapped against influence and level of engagement to guide decisions on strategic communications tactics. 33 Contact ManagementContact detail: store typical contact information (address, phone, email, etc.).Custom fields: create limitless data points to categorize contacts; store additional relevant info; page view can be collapsed for accessibility.Tracking & ownership: assign contact owner, monitor when record created or last updated. 34

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Performance Metrics35Measuring Performance Against Objectives36Our programs center around measurement. We will work in partnership with your team to create a shared vision of success at the outset of the program based on:FocusToolsExamples OUTPUTSFTI work productsProject management / tracking tools, including contact tracking (e.g. via Salesforce or similar)Activity tracking, by period and by key stakeholder group.

Examples:

# briefings / meetings# contacts made # site visits driven in # articles placed citing key messages# blog mentions citing key messages

OUTCOMESChanged behaviorCommunications / contact tracking tools (e.g. Salesforce or similar)Media audits / tracking including traditional and social channels, by influence Regulatory filings / state and local codesExamples:

# requests for information# attending conferences / eventsVolume and % actively articulating preferred viewsVolume and % favorable media coverageVolume and % favorable social media discussion# 3rd party endorsements# (foreseen) unfavorable laws / regulations avoided or modifiedIMPACTSChanged opinions, attitudes, beliefs / knowledge, leading indicatorsPeriodic pulse checks via in-depth interviews among KOLs and other specialist groups,Delphi panel responses,Survey larger groups (public influentials, investors),Media auditsExamples:

Volume and % favorable media coverageVolume and % favorable social media discussion% of message penetration, with or without PepsiCo attribution% who know PepsiCos position% hearing/believing messages % with aligned views 36 36Institutionalizing Relationships 37 Institutionalizing relationships between PepsiCo and its key influencers through a contact management system will help knowledge-sharing across the FTI and PepsiCo team as well as create a database of information to be used long-term, ultimately driving these relationships across the PepsiCo enterprise.

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Biographies38Bob Knott, Senior Managing DirectorBob Knott is a Senior Managing Director, FTI Consulting Strategic Communications practice, and leads the firms corporate communications practice throughout the Americas. An expert in organizational positioning, reputation and issues management, thought leadership and stakeholder identification, mapping and engagement, Mr. Knott has developed and executed integrated communications campaigns on behalf of Fortune 500 companies and trade associations in a diversity of sectors. Prior to joining FTI Consulting, Mr. Knott was a global practice chairman and global client relationship manager at Edelman, where he managed many of the firms largest and most high profile client engagements. Mr. Knott managed the global launch of GEs ecomagination, while overseeing Edelmans worldwide work for the conglomerate. At Edelman, Bob established the Field to Fork Survey Seriesthe firms annual study comparing and contrasting the attitudes of adult primary grocery shoppers nationwide and Washington DC-based opinion elites about the food they eat, its impact on society and the extent to which government should regulate it. Team Biographies

39 Beth Saunders, Senior Managing DirectorElizabeth Saunders is a Senior Managing Director and Americas chairman of the FTI Strategic Communications practice and is based in Chicago. Ms. Saunders specializes in building best practices investor relations programs across a wide spectrum of clients. She also serves as senior counsel for business transformation assignments and has actively worked on post merger communications, CEO transitions, and restructurings for Fortune 500 Companies including The Coca-Cola Company and Dow Chemical. She has also worked extensively in the technology space with companies including Dell, Symantec and Juniper.Prior to her role at FTI Consulting, Ms. Saunders co-founded Ashton Partners in 1997, a strategic advisory firm focused on financial communications. Ashton Partners was one of the country's top 15 independent investor relations firms. Prior to founding Ashton Partners, Ms. Saunders was the President and Chief Operating Officer of the investor relations consulting arm of Thomson Financial Services. Before this, she created and managed the Shareholder Services division of the Financial Relations Board. Earlier in her career, Ms. Saunders served as an analyst for Inland Steels Pension Fund and a senior analyst for Monticello Investments, a Chicago area merchant banking firm.

Team BiographiesJeannine Dowling, Managing DirectorJeannine Dowling is a senior member of FTI's Corporate Communications Practice and is based in New York. Jeannine has spent the last twenty years working with high profile global consumer products companies operating in highly regulated industries or highly publicized environments. She is a communications executive with tested experience in all communications environments from business to lifestyle. She specializes in reputation management, corporate positioning and stakeholder engagement. She effectively leverages multiple communications channels on a global platform to enhance corporate reputation and brand heritage and promote both top and bottom line growth. Prior to joining FTI, Jeannine was Senior Vice President of Corporate Affairs for Diageo NA., the largest beer, wine and spirits company in the world. At Diageo Jeannine led a multidisciplinary team responsible for the organization's brand and corporate communications. Jeannine has a wealth of front-line experience in managing the daunting regulatory, legislative and social policy challenges inherent in the beverage alcohol industry in the US. Before joining Diageo, Jeannine was a Vice President in Government Affairs for New York Life Insurance Company, and served as Director of Public Affairs at Philip Morris (now Altria).

40 Mitzi Emrich, Managing DirectorWith more than 12 years in strategic communications and an expertise in social media, Mitzi Emrich has helped Fortune 100 clients from the health and retail sectors develop and integrate social media strategies into corporate communications and marketing initiatives aimed at consumers, influencers, and decision-makers. At FTI Consulting, Mitzi leads a team of digital strategists dedicated to helping clients protect and bolster their reputations in the digital space and build online experiences for social communities. During her career, Mitzi has focused on several food and nutrition clients. Having led the digital communications effort for Walmart and Sams Club, she helped the companies connect with stakeholders online through multi-channel tactics including social business strategy, blogger relations, social network engagement, website development and conversation analysis; as part of her work for Walmart, Mitzi supported the company during the development and launch of its groundbreaking Healthy Food Initiative with First Lady Michelle Obama. Prior to joining FTI Consulting, Mitzi served as a Senior Vice PresidentGroup Head at Edelman Public Relations and she previously worked as a lobbyist and grassroots organizer for the Sierra Club in Washington, DC.

John Watts, Managing DirectorJohn Stuart Watts is a Managing Director in FTIs Strategic Communications Practice, where he leads Research and Strategy work focused on Corporate Communications. The group offers full-service research services, including the design, management and analysis of research using a full suite of data gathering and advanced analytical and modeling tools. Johns personal focus is on the application of these tools to business strategy, corporate communications, reputation and brand, and customer experience. John joined FTI with 20+ years experience in market research, strategic consulting and teaching/research in the worlds top business schools. His previous experience includes serving as a Managing Director at Vivaldi Partners. Earlier, he was a Senior Vice President and Global Managing Director at the Opinion Research Corporation, a leading primary research house, reporting to the CEO and overseeing the firms Value Based Marketing and Decision Science practices. As ORCs Global Managing Director for Decision Sciences, John oversaw the design, analysis, supervision and delivery of numerous studies including brand, customer experience and decision processes, market segmentation, market size, product features and pricing. John has also served as a Senior Manager in the Strategy, Telecommunications and High Technology practices at Ernst & Young Consulting, Accenture and PRTM, and as an independent consultant.Team Biographies

41 Jocelyn Landau, Senior DirectorJocelyn Landau is a Senior Director in the Strategic Communications Practice of FTI Consulting, based in New York City. Jocelyn has over nine years of experience in communications and research, specializing in public affairs, healthcare/life sciences and energy. Jocelyn has extensive experience in survey research, message testing, marketing, communications strategy and campaigns, as well as rigorous training in quantitative and qualitative research methods. She has conducted numerous telephone and online polls covering a range of issues in politics, policy and healthcare. Jocelyn is currently engaged in a variety of strategic consulting projects, including reputation management, market segmentation, industry thought leadership, stakeholder perception audits, brand and customer experience improvement, coalition building and growth strategy.

Team BiographiesLinda Mayer, Senior DirectorLinda Mayer is a Senior Director in the FTI Consulting Corporate Communications practice and is based in New York. She leverages her expertise in communications, public affairs and reputation management on behalf of Health Care & Life Sciences clients. For more than two decades, Linda has provided counsel and successfully executed internal and external communications on behalf of Fortune 500 companies with brands that are household names.Linda has held senior communications positions at some of the worlds leading global health care and consumer packaged goods companies such as Merck, Pfizer/Wyeth, Cadbury and Johnson & Johnson. Her experience includes corporate branding, employee engagement, media relations, product communications, reputation management, crisis/issues management, executive positioning, corporate social responsibility and advocacy. Linda joined from Merck, where she was a senior consultant to the Global Human Health team supporting corporate, executive, employee and product communications.

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Anshula Ahluwalia, DirectorAnshula Ahluwalia is a Director in the Chicago office of FTI Consulting. She is responsible for strategic planning and timely execution of communications programs, including corporate reputation management , thought leadership, media relations and training, executive visibility and crisis communications for clients such as American Society of Anesthesiologists, OfficeMax, Career Education Corporation and Insurance Auto Auctions, and serves as a point of contact for client communications. Prior to this, she has held several positions with Ogilvy Public Relations in Chicago where she managed corporate reputation (internal and external) and thought leadership campaigns for CDW Corporation, a leading provider of technology products and services, COUNTRY Financial, a provider of insurance and financial services, McDonalds Corporation, Grant Thornton and Hudson Highland Group.Anshula supported McDonalds in a change management and employee communications campaign for a cost management initiative, designed to help the company save $20 million over a period of three years. She developed strategic positioning communications, including business case and messaging, that helped sell-in the value and benefits of the program to executive leadership, as well as supported development and execution of franchisee and employee communications strategy to inform and align the groups in support of the initiative Team Biographies 43 Jeremy Ruch, DirectorJeremy Ruch is a Director with the Strategic Communications practice of FTI Consulting in the Washington, D.C. office. With more than 11 years of experience conducting public opinion research, Jeremy currently lends his research expertise to the companys Strategy Consulting and Research sector, helping clients navigate public affairs, customer insight, employee engagement, corporate reputation, and communications challenges. Jeremy manages several high profile, publicly released opinion research efforts, including the Allstate/National Journal Heartland Monitor series.Jeremy joined FTI Consulting from Public Opinion Strategies, where he was Senior Project Director in charge of public opinion research projects for Fortune 500 companies, trade associations, major media outlets and many of the most high-profile political campaigns of the past decade. At Public Opinion Strategies, he played a key role on the polling team that was named Pollster of the Year by the American Association of Political Consultants in 2002 and 2009.

Adam Sopko, Senior ConsultantAdam is a Senior Consultant, based in Washington, D.C. in the FTI Strategic Communications Digital and Social Media Practice. He currently assists clients with a broad range of issues in shaping their social media presence, reputation management, corporate positioning and executive thought leadership. Adam has helped clients in the consumer product sector navigate the daunting regulatory and legislative environment in the US. Current and previous clients include Lorillard, The Coca-Cola Company, Reebok, Iridium Communications, HSBC and the Futures Industry Association.Prior to joining FTI, Adam was an intern in New York City for global communications consultancy, Financial Dynamics (FD). At FD, Adam provided research and writing support for the Strategic Consulting practices portfolio of clients, including Ply Gem, the Coca-Cola Company, Burger King, the Center for American Progress and Lorillard.

Team Biographies 44 Sacha Mohabeer, Senior ConsultantSacha joined FTI Consulting Strategic Communications in 2008 and has had roles in Social Media engagement and implementation, as well as Online Engagement and Planning, and Client Services, working with clients such as Forex.com,Wyndham Worldwide, and Duane Reade.She was a part of a team that managedDiageo's successful public affairs campaign, AxeTaxesNotJobs.com, a campaign to stop tax hikes on alcohol. Sacha has also worked with The Coca Cola Company in developing their internal social media guidelines and certification program for employees.Her expertise is in developing, managing and implementing online creative strategy and social media initiatives across each of the sectors. Sacha is also well-versed in social media strategy and platforms in regions across the world, having spent time working with clients and alsoproviding Social Media training for consultants in our FTI SC Brussels, London and Bogot offices.

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