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Group Name:-

Group Members:S.No
1
2
3
4
Submitted To:-

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Name
Shujaat Ali Nadeem
Syed Ezaz ul Hassan
Haider Iftikhar
Asad Mehmood

Roll No
W1F14MCOM0030
W1F14MCOM0021
W1F14MCOM0035
W1F14MCOM0040

PROJECT COMPLECTION CERTIFICATE

Certified that the work contained in this project titled A Project on Pepsi Co.
has been carried out and completed by Mr Shujaat Ali, Mr Ezaz ul Hassan, Mr
Haider Iftikhar and Mr Asad Mehmood, Registration Number
W1F14MCOM0030, W1F14MCOM0021, W1F14MCOM0035 and
W1F14MCOM0040, under my supervision during their Master of Commerce.

Signature _____________
Principal
University of Central Punjab Wah Campus.

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Contents
DEDICATED..............................................................................................................................................7
MISSION STATEMENT.............................................................................................................................8
Stakeholder Engagement...........................................................................................................................24
Introduction:-.........................................................................................................................................24

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ACKNOWLEDGEMENT

A task undertaken without offering prayers to almighty ALLAH and talking

blessings from the elders is not a good beginning. Likewise the work completed
without acknowledging the assistance to those who were always by our sides to
make our efforts fruitful in the task left incomplete.

Firstly, we would like to thank ALLAH for his cordial and merciful blessings
which have enabled us to complete this project.

We wish to extend our deepest regards and obligation to Sir Asif Mahmood Attari
who has guided us in this project and helped us in all possible ways to collect and
analyze all the data.

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DEDICATED
To our Dearest and most respected
Parents, whose efforts and prayers are
great source of strength to us. Their love
inspired us to the higher idea of life

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MISSION STATEMENT
To be the world's premier

Consumer Products Company focused on

Convenient foods and beverages. We seek to produce healthy
Financial rewards to investors as we provide opportunities for
Growth and enrichment to our employees, our business
Partners and the communities in which we operate.
And in everything we do, we strive for honesty,
Fairness & integrity.

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VISION STATEMENT

To be the world's best beverage

Company. Being the best means providing outstanding
Quality, service, cleanliness and value, so that their every
Customer is contented and happy with their products. To increase
The value of their shareholders Investment through
Sales growth, cost control and wise investment
Of resources

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Introduction
Pepsi International is a world renowned brand. It is a very well organized multinational
company, which operates almost all over the world. They produce, one of best carbonated drinks
in the world. Pepsi is a symbol of hygiene, quality and service, all over the world. Pepsi
is producing Cola for more than 100 years and it has dominated the world market for a long time.
Its head office is in New York.

History of Pepsi Cola:It was first introduced as "Brad's

Drink" in New Bern,
North Carolina in 1898 by Caleb
Bradham, who made it
at his pharmacy where the drink was
sold. It was later named
Pepsi Cola, possibly due to the
digestive
enzyme
pepsin and kola nuts used in
the recipe.
Bradham
sought to create a fountain drink that
was
delicious
and
would aid in digestion and boost
energy.
In
1903,
Bradham moved the bottling of PepsiCola from his drugstore
to a rented warehouse. That year,
Bradham sold 7,968
gallons of syrup. The next year, Pepsi
was sold in sixounce bottles, and sales increased to
19,848 gallons.
In 1909,
automobile race
pioneer Barney
Oldfield was the first celebrity to
endorse
Pepsi-Cola,
describing it as "A bully drink...refreshing, invigorating, a fine bracer before a race". The
advertising theme "Delicious and Healthful" was then used over the next two decades. In 1926,
Pepsi received its first logo redesign since the original design of 1905. In the year 1929, the logo
was changed again.
In 1931, at the depth of the Great Depression, the Pepsi-Cola Company entered bankruptcy in
large part due to financial losses incurred by speculating on wildly fluctuating sugar prices as a
result of World War I. Assets were sold and Roy C. Megargel bought the Pepsi trademark. Eight
years later, the company went bankrupt again. Pepsi's assets were then purchased by Charles
Guth, the President of Loft Inc. Loft was a candy manufacturer with retail stores that contained
soda fountains. He sought to replace Coca-Cola at his stores' fountains after Coke refused to give
him a discount on syrup. Guth then had Loft's chemists reformulate the Pepsi-Cola syrup
formula.
During the Great Depression, Pepsi gained popularity following the introduction in 1936 of a 12ounce bottle. Initially priced at 10 cents, sales were slow, but when the price was slashed to five
cents, sales increased substantially. With a radio advertising campaign featuring the jingle"PepsiCola hits the spot / Twelve full ounces, that's a lot / Twice as much for a nickel, too /Pepsi-Cola
is the drink for you," arranged in such a way that the jingle never ends. Pepsi encouraged price10 | P a g e

watching consumers to switch, obliquely referring to the Coca-Cola standard of six ounces per
bottle for the price of five cents (a nickel), instead of the 12 ounces Pepsi sold at the same price.
Coming at a time of economic crisis, the campaign succeeded in boosting Pepsi's status. In 1937
500,000,000 bottles of Pepsi were consumed. From 1936 to 1938, Pepsi-Cola's profits doubled.

Pepsi Cola in Pakistan

In 1959 Pepsi Cola was introduced in Pakistan but due to lack of awareness it was unsuccessful
therefore the headquarters decided to windup their business in Pakistan. In 1963 it came again
with much revised Strategy, facing a lot of difficulties in promoting their product and competing
against COCA COLA which was a well established brand here.
In 1971, first plant of Pepsi was constructed in Multan, and from there after Pepsi is going higher
and higher. Pepsi had secretly promoted its diversified products and carter to all demographic
groups of Pakistan there for within 5 years they emerged as a market leader, having 72% of
market share while COCO COLA had only 28% share.
Pepsi is the choice soft drink of every one. It is consumed by all age groups because of its
distinctive taste. Compared with other Cola in the market, it is a bit sweeter and it contributes
greatly to its liking by all. Consumers survey results explain the same outcome and Pepsi has
been declared as the most wanted soft drink of Pakistan.
Pepsi Cola International has given franchises all over Pakistan. These companies have installed
their plants in different parts of Pakistan with these specified areas and names e.g

City

Name of Franchise

Karachi

Pakistan Bottlers

Lahore

Riaz Bottlers

Faisalabad
Multan

Punjab Beverages
Shamim & Company

Founders Of Company
The company was initially owned by late Nawab Saddiq Hussain Qureshi & family till 1989.
The Pepsi International franchise declared the management incompetent, thus, the company was
handed over to a new set of personnel. The factory set up was reorganized & reestablished with
expansion in various sectors. The Pepsi International did this by offering it to Mr. Jehangir
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Tareen, who formed up his new team. Mr. Jehangir Tareen is Nephew of General (late) Akhtar
Abdur Rehman.

Incorporation and listing

The parent company of Pepsi cola international is PepsiCo Inc. Basically the PepsiCo operate in
three markets
1. Soft Drinks: Pepsi Cola Company and Pepsi Cola International.
2. Snake Foods: Pepsi Food International.
3. Restaurants: Pizza Hut & KFC.

Pepsi Cola International:Pepsi Cola International represents the soft drinks business of PepsiCo outside the USA. It is
registered at 09 September, 1992 under the security exchange commission of Pakistan. The
company registration office is in Lahore.
The following table shows the record of Pepsi Cola International under Security Exchange
Commission of Pakistan.
Name

PEPSI-COLA INTERNATIONAL (PVT) LTD

Status

Incorporated

CUIN

0028338

Old CUIN

L-05485/19920902

Registration Date

Wednesday, September 09, 1992

CRO

Lahore

Form A/B Made upto date Monday, March 31, 2008

Mandatory Filing

Yes

Pepsi Cola Pakistan Inc:The Pepsi Cola Pakistan is a part of Pepsi Cola International (West Asia Division). There are
three countries in West Asia Division.
1. Pakistan.
2. Bangladesh.
3. Sri Lanka.

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Pepsi Cola (Pakistan) Inc is registered at September 27,1982 under the Security Exchange
Commission Of Pakistan. The company registration office is in Karachi.
The following table shows the record of Pepsi Cola International under Security Exchange
Commission of Pakistan.
Name

PEPSI COLA (PAK) INC

Status

Incorporated

CUIN

0009783

Old CUIN

146/19820907

Registration Date

Monday, September 27, 1982

CRO

Karachi

Form A/B Made upto date none

Mandatory Filing

N/A

Procedure with legal documents:Incorporation of company means the registration and formation of a company. First step is to
select the name of company. After getting the availability of name, documents are prepared by
the promoters to be submitted to the registrar of company for registration of company. Following
are the main documents which are necessary to be submitted for registration.
S.No
1
2
3
4
5
6
7

Documents
Memorandum of Association (4 Copies)
Articles of Association.
Declaration on Form-1
Original Paid Challan of Registration fee
Notice of situation of Registraed office of Company
Form 29
Authorization of Sponsors

The memorandum of Association & Article of Association of Pepsi Cola International are
attached below

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Question by question Analysis

Q: Do the concepts of limited liability?
Yes, in our company the liability of shareholders is limited. This means that if a company is put
into liquidation, the people who own the company will only be required to pay what they have
already paid or agreed to pay towards settling its debts. Limited liability gives the owners of the
company (its members) protection if the company fails.
Q: Why does the Company Registration Office need the information?
In exchange for the benefits of trading , companies must deliver certain information about
themselves to the Registrar, who makes this information available for inspection by the public so
that they can make informed decisions about companies that they may wish to invest in or do
business with.
Q: How do you begin the process of incorporation?
Incorporation process starts with an idea of company. After this there is necessary to make
important documents which are
Memorandum of association
Article of association
Fees
Certificate of incorporation
Q: Are there any benefits of incorporation?
Yes, there are many benefits of incorporation. Some of these benefits are
Limited liability
Tax advantage
Perpetual existence
Rising Capital.
Q: Are there any benefits of registration at the federal level?
Yes, there are many benefits of registration at federal level forexample
Trade mark protection
Companys name protection
We can do business anywhere in country.
Q: Is it necessary for subscriber of memorandum to take shares?
This rule is defined in Companies ordinance 1984. According to this rule no subscriber of
memorandum shall take less than one share of company.
Q: Can your company pepsi cola alter its memorandum?
Yes, company can alter the memorandum of association by special resolution for the purpose of
carry business for economically and for more efficiently. Also alter to change the local area of its
operations.

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Q: What is the legal procedure for alteration in memorandum of association?

First of all the certified copy of order confirming along with printed copy is filled by company
with registrar. The registrar registers this and issues the certificate. After this company send all
these documents to registrar when the registrar satisfy the documents provided by company than
memorandum will be alter.
Q: Is a lawyer is necessary for incorporation of company?
No. a lawyer is not necessary for incorporation of company; lawyers only provide valuable
advice to the company. When the incorporators are less experiences then they need lawyers for
advisory purpose.
Q: If a company incorporates at federal level, do they need to register at provinces level?
Yes, if a company incorporate at federal level, they will be registered their business in one or
more provinces where they carry on business.
Q: Can a company convert from public to private?
Yes, a public company converts in to private company with the written permission of
commissioner, and subject to such conditions which may imposed by commissioner.
Q: What happens if your documents do not meet the guidelines?
Section 468 of the Ordinance allows the Registrar to reject document that is insufficiently legible
or is written upon paper, which is not durable, giving a notice to file a revised document.

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Director
Persons appointed or elected according to law, authorized to manage and direct the affairs of a
corporation or company. The whole of the directors collectively form the board of directors
A Director of Pepsi Cola Company does not have to be a stockholder or an employee of the firm,
and may only hold the office of director. Directors act on the basis of resolutions made at
directors' meetings, and derive their powers from the corporate legislation and from the
companys articles of association.

Board of Directors of Pepsi Cola Pakistan:-

Mr. Akbar Akhtar Khan

(Chairman)
Mr. Haroon Akhtar Khan
(Chief Executive Officer)
Mr. Amjad Jahanzaib Khan
(Company Secretary)
Mr. Ghazi Akhtar Khan
Mr. Saifullah Khan Paracha

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Directors Duties
Following are the main duties of directors
1. Represent the interests of the Companys shareholders in maintaining and enhancing the
success of the Companys business, including optimizing long-term returns to increase
shareholder value.
2. Select a Chief Executive Officer (CEO) in a way that it considers in the best interests
of the Company. Formally evaluate the performance of the CEO, the executive officers1
and other key executives each year.
3. Oversee and interact with senior management with respect to key aspects of the
Companys business including strategic planning, compliance, risk assessment and
mitigation, senior management development and succession, operating performance, and
shareholder returns.
4. Provide general advice and counsel to the Companys CEO and senior management team.
5. Adopt and oversee compliance with the Corporations Global Code of Conduct.
6. Hold regularly scheduled executive sessions of independent Directors.
7. Attend all Board and applicable Committee meetings. Any extraordinary circumstance
that would cause a Director to be unable to attend a Board or Committee meeting should
be discussed with the Chairman of the Board and the Chair of the Nominating and
Corporate Governance Committee as far in advance as possible.
8. Review meeting materials in advance of Board and Committee meetings. Suggest
additional topics to be included on meeting agendas by contacting the Chairman of the
Board, the Presiding Director or the relevant Committee Chair.
9. Discharge duties as a Director and Committee member under applicable law requires that
a Director shall act: (1) in good faith; (2) with care an ordinary prudent person in a like
position would exercise under similar circumstances; and (3) in a manner he or she
believes to be in the best interests of the Company.
10. Duty to act in accordance with any constitutional or contractual agreements.
11. Duty to independent judgment rather than to allow others to influence their decisions or
male decisions for them.
12. Duty not to accept benefits from third parties for being a director.
13. Duty to manage the company with care. All the decisions should be for the benefit of
company.
14. Duty to promote the success of the company.
15. Duty to interest in proposed transaction or arrangement.

Question by Question Analysis

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Q: To whom directors duties general owned?

A board is the top management of any organization who make policies of the organization, after
that chief executive officer (CEO) performs their duties. Then Directors and company sectary
exists. And they are assigned their duties by CEO as well as board. Directors are responsible to
report about their duties to the board or CEO.
Q: How directors terminate employees in your company?
On the bases of disciplinary proceeding or violation of rules and regulation directors can
terminate their employees.
Q: What happens if accounts are filed late?
As a director of a company, you normally have a maximum of 5 months from the close of
accounting year for filing your company's audited accounts. If accounts are received late, the
company will not only pay additional filing fee but the company and its officers can also be
punished with fine and imprisonment in case of non-preparation, non-circulation and no
presentation of accounts before the general meeting. The additional filing fee is deposited in
addition to any fine imposed by the registrar, the Commission or the Court
Q: Retired director is eligible for reelection or not? How to remove the director?
Yes, A retired director shall be eligible for reelection. A director may b removed by a resolution
passed in the manner as section 181 of ordinance.
Q: What is the primary duty of Director of Pepsi Cola?
Represent the interests of the Companys shareholders in maintaining and enhancing the success
of the Companys business, including optimizing long-term returns to increase shareholder value.
Q: In the case of misrepresentation and fraud commence by the employees then what is
your reaction according to the company law also court an example?
In such cases of misrepresentation and fraud commence by the employees disciplinary
proceedings are applicable.
Two types of plentys are there
1. Minor plenty:
In this salary can stop for 2 or 3 months, suspensions, fines, plenties in the form of overtime.
2. Major plenty:
In this major decisions are taken against employee act. Like fire him or down grading e.g step
back from this 16 scale to 14.promtion can b stopped.
Q: Is there any duty of director related to selection of CEO of company?
Select a Chief Executive Officer (CEO) is the duty of director, in a way that it considers in the
best interests of the Company. Formally evaluate the performance of the CEO, the executive
officers1 and other key executives each year.
Q: If there is any problem a situation arises where law become silent than how directors
take decision and on which bases?

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In this sort of situation where law become silent then director analysis the past record of
organization that rather same case exists in past if yes then how it had been treated. So that
problem will be treated on the bases of past record. And if there is no case in past similar to this
then director has right to handle it by his experience and power and authority.
Q: Does law provide guidance about the role of senior management?
Yes, law provides guidance about the role of senior management in the form of policies. Law is
like an umbrella which provides equal rights and responsibilities to the management.
Q: What responsibilities does a director have towards Commission and the registrar?
Every company director has a personal responsibility to ensure that statutory documents are
filed with the Registrar and the Commission as and when required under the Ordinance. In
particular:
1. Audited accounts (only for public limited companies);
2. Annual returns (Form A/B);
3. Particulars of directors or other officers (Form 29); and
4. Notice of change of registered office (Form 21).
Q: What happens if accounts or annual returns are not filed?
All the directors of the company could be prosecuted. Failure to deliver documents on time is an
offence under the Ordinance. On conviction, a director could be penalized with a fine or in some
case be imprisoned.
Q: What are the rights of director related to interim Dividends?
The directors of Pepsi Cola have right to pay to members such interim dividend as in their
judgment the financial position of the company justifies.

Reporting

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Question by Question Analysis

Q:

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Stakeholder Engagement
Introduction:Stakeholder is an individual or group with an interest in an organization. Pepsi Cola divide its
stakeholder in to three categories.

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Internal

Connected

External

Directors

Shareholders

Government

Manager

Suppliers

Local

Employees

Advisers

Media

Directors:Director refers to a rank in management. In Pepsi directors play a role of bridge between
shareholders and management. Director only looks for salary, share option, status & Bonuses.

Managers:Manager is a person who drives the work of others to run business efficiently and effectively. In
pepsi cola there are many managers. Managers of a company only look for bonuses and his own
reward.

Employees:Employees are the individuals who work in pepsi Cola Company. Employee of a company only
looks for high pay, fair treatment, health and safety, fair treatments.

Shareholders:Shareholders of Pepsi cola are the persons who purchase the shares of company. Shareholders of
pepsi only look for high profit, high dividend, long term growth & positive corporate image.

Suppliers:Suppliers of Pepsi cola provide raw material which enable production process.

Advisers:Advisers are normally a person with more and deeper knowledge in a specific area. i.e. a
specialist. Is only looks for profit maximization, return on money invested, repayment of loans.
Government Of Pakistan:-

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Government is system by which a state or community is governed. Government normally

consists of legislators, administrators & arbitrators. Government look for compliance with laws
and regulation, employments, payments of taxes etc.
Local:A Local Community is a group of interacting people sharing an environment. In human
communities, intent, belief, resources, preferences, needs, risks, and a number of other
conditions may be present and common, affecting the identity of the participants and their degree
of cohesiveness.
Media:MEDIA Communication channels through which news, entertainment, education, data, or
promotional messages are disseminated. Pepsi cola of Pakistan expend huge amount of money
for advertisements. Media only looks for monitor the company, support freedom of expression.

Question By Question Analysis:

How government of Pakistan is stakeholder of Pepsi cola?
Government is system by which a state or community is governed. Government normally
consists of legislators, administrators & arbitrators. Our company Pepsi cola gives taxes to
government of Pakistan. Government looks for compliance with laws and regulation,
employments, payments of taxes etc. We are following the rules and regulations imposed by the
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government and company ordinance 1984.So due to payment of taxes to government and follow
the policies of government, he is our stakeholder.
Q3 Can non-shareholders
meetings?

address

companies'

annual

general

The non-shareholders attend the annual general meeting but he cannot

participate in the meeting. The shareholder of company can only participate
in meeting of company. The non shareholder person has no right to address
on any issue in meeting of company.
Media plays a important role in advertisement. How many you spend
on advertisement?
Yes, you are right media play a important role in advertising of our
company and others companies also. Our top level management
decides that how many we should spend on advertising of our
company this year. We spend millions of rupees every month in
advertisement. Meanwhile we sponsor different events in Pakistan.
We are sponsoring the Pakistan Cricket team and different events in
Pakistan and rest of the world also.

Coca cola is your tough competitor in market? What are your views?
Competition is very necessary for the company. We are focusing on
the weakness of our competitor every time. Coca cola has a loyal
customer in market but we are attacking on weak points of
company. This would able us to gain a competitive advantage of
coca cola. Now our market share is 65% while coca colas share is
only 30%.it is only due to our efforts and work.
Q: What are the challenges your company is facing now?
We are facing many challenges in Pakistan. Especially we are facing
energy crisis, costly availability of raw material. Due to energy crisis
the cost of production is very high. The economic conditions of
Pakistan are not good. The infrastructure of Pakistan is now better
than before. The government rules and regulation, taxation system
is also a big challenge for us.
Is the stakeholders take any actions on the decisions of the
company?
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Yes the stakeholders of Pepsi cola take the actions on the decisions of the
company. Today many business units consider partner to the stakeholders of
company. The decisions of company can effects the stakeholder so it is very
difficult for the Pepsi cola to make such policies which is favorable for all the
stakeholder of a company in long run.

Q4: How the suppliers affect the company?

A: the person who supplies goods, raw materials or their services to the
company are known as Suppliers. Suppliers greatly affect the business in
many ways like quality, timeliness, price etc. In quality, suppliers affect in
this way that if the quality of the product is high, then the chances of return
decreases whereas if the quality of the product does not provide satisfaction
to the customer it creates problems. Similarly, price is also a factor that
affect the business. If suppliers supply products to our company and at that
time the competitor of our company buy that product from that supplier at
high price, so the supplier supplies the product to that competitor company
instead of our company, so it will also affect our company.

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Question by question analysis

Director duties
Q1) To whom are directors duties owed (i.e. to the company, nonshareholders etc)?
Q2) Are there duties to avoid legal risk and damage to the
company's reputation? If so, are they duties in their own right or
are they incorporated into other duties?

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Q3) If directors are required or permitted to consider the impacts

on non-shareholders, to what extent do they have discretion in
determining how to do so?
Q4) what are the legal consequences of failing to fulfill any duties;
and who may take action to initiate them? What defenses are
available?
Q5) Are there any other director's duties which might encourage a
corporate culture respectful of human rights?
Q6) For all the above, does the law provide guidance about the
role of supervisory boards in cases of two tier board structures, as
well as that of senior management?
Reporting
Q1:- Are Companies required or permitted to disclose the impacts
of their operations (including human rights impacts) on nonshareholders, as well as any action taken or intended to address
those impacts or actions of subsidiaries, suppliers and other
business partners, whether as part of financial reporting
obligations or a separate reporting regime?
Q2:- Do reporting obligations extend to such impacts or actions
outside the jurisdiction; to the impacts or actions of subsidiaries,
suppliers and other business partners, whether occurring inside or
outside the jurisdiction?
Q3:- Who must verify these reports; who can access reports; and
what are the legal consequences of failing to report or
misrepresentation?

STAKEHOLDER ENGAGEMENT
Q1 Are there any restrictions on circulating shareholder proposals
which deal with impacts on non shareholders including human
rights impacts?

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Q2 Are institutional investors including pensions funds required

or permitted to consider such impacts in their investment
decisions?
Q3 Can non-shareholders address companies' annual general
meetings?

OTHER ISSUES OF CORPORATE GOVERNANCE

Are there any other laws, policies, codes or guidelines related to corporate
governance that might
encourage companies to develop a corporate culture respectful of human rights,
including
through a human rights due diligence process?
Are there laws requiring representation of particular constituencies (i.e. employees,
representatives of affected communities) on company boards?
Are there any laws requiring gender, racial/ethnic representation; or nondiscrimination generally,
on company boards?

INCORPORATION AND LISTING

Do the concepts of "limited Liability" and "separate legal personality exist?"
Did incorporation or listing historically, or does it today, require any recognition of a
duty to
society, including respect for human rights?
Do any stock exchanges have a responsible investment index, and is participation
voluntary?

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