Indra Nooyi: making progress and profits at Pepsi

Indra Nooyi put the principles of stakeholder capitalism into practice at the soft-drink giant before it was fashionable and grew returns for shareholders too.

Indra Nooyi, Pepsico chair
(Image credit: © Hindustan Times via Getty Images)

“I’ve occasionally wondered whether there’s something about Indians that makes them particularly suited to American corporate life,” says Sathnam Sanghera in The Times. The roll-call of Indian-born CEOs who have run prominent US companies is impressive. Yet most are men. The first woman to break the mold is former PepsiCo boss Indra Nooyi.

Indian-born Nooyi has just published a memoir, My Life in Full, which she hopes will inspire more women to reach the top echelons, says the Financial Times. When she became PepsiCo’s CEO in 2006, Nooyi was one of only 11 women running a Fortune 500 company. Things have improved since, but not by much. More than 90% of America’s biggest listed businesses are still run by men. Few women who join companies like PepsiCo reach even the second or third tier of management. They face unconscious bias and unequal pay, she says. Then “the biological clock and career clock are in conflict with each other”. Many have no choice but to “opt out of this incredible rat race”.

A grim scramble to the top

Although Nooyi could rely on her husband and extended family when raising her own children, her “scramble to the top” sounds grim. At Boston Consulting Group, Motorola, ABB and then PepsiCo, “there were nights when she barely slept… and years when she was rarely home for dinner”. The big driver, she writes, was pride. “I was determined that I wasn’t going to let my family down.”

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Born in 1955, Nooyi grew up in Madras (now Chennai), the middle of three siblings “in a family where education was paramount”, says The Daily Telegraph. In 1978, she won a scholarship to take an MBA at Yale. Nooyi found solidarity in a group of other international students and met her future husband, industrial engineer Raj Nooyi.

Yale had only just opened its business school and the “basic belief”, then radical, “was that companies are members of society, and what you do has to be viewed as through a stakeholder lens, not just a shareholder lens.” It was an ethos Nooyi would put to work during her 12 years leading Pepsi – mostly successfully, says The New York Times. As well as pushing into healthier foods, she instigated change on environmental practices. PepsiCo nonetheless grew net revenue by more than 80% during her tenure, delivering a total shareholder return of 162%. Nooyi is a strong believer that business, not government, should lead the response to environmental and social challenges. “Companies like ours are little republics. We have market capitalisations bigger than many countries in the world. We are engines of efficiency.”

Life after Pepsi

On leaving Pepsi in 2018, there were rumours she was being considered by the Trump administration for the position of World Bank president, says The Times – her name was apparently “floated” by Ivanka Trump, who considers her a mentor. It was not to be. Nooyi these days divides her time between the boards of Philips and Amazon, and teaching at the West Point military academy. Despite loving Pepsi, she claims “not to miss the company”, says the Financial Times. It’s probably a relief she no longer needs to be seen “sipping Pepsi or nibbling Doritos in public”. In line with her general outlook, “dietary indiscipline is not Nooyi’s style”.

Jane writes profiles for MoneyWeek and is city editor of The Week. A former British Society of Magazine Editors editor of the year, she cut her teeth in journalism editing The Daily Telegraph’s Letters page and writing gossip for the London Evening Standard – while contributing to a kaleidoscopic range of business magazines including Personnel Today, Edge, Microscope, Computing, PC Business World, and Business & Finance.

She has edited corporate publications for accountants BDO, business psychologists YSC Consulting, and the law firm Stephenson Harwood – also enjoying a stint as a researcher for the due diligence department of a global risk advisory firm.

Her sole book to date, Stay or Go? (2016), rehearsed the arguments on both sides of the EU referendum.

She lives in north London, has a degree in modern history from Trinity College, Oxford, and is currently learning to play the drums.