National Legal and Policy Center today presented a proposal that calls for an independent chair of the Board of Directors at PepsiCo, Inc.‘s annual meeting of shareholders. The proposal would require the positions of board chair and CEO to be held by two different individuals — currently those roles are occupied by Ramon Laguarta (pictured above).
Pepsi’s board of directors opposed our proposal, as explained on Page 88 of the company’s proxy statement. NLPC responded to the board’s opposition statement in an exempt solicitation report circulated to the company’s shareholders.
Presenting the proposal was Paul Chesser, director of NLPC’s Corporate Integrity Project. His three-minute remarks can be heard here, and a transcript follows:
Good morning.
I’m Paul Chesser of the National Legal and Policy Center, presenting Proxy Item Number 4, which requests that PepsiCo adopt a policy requiring an independent Chair of the Board of Directors.
Pepsi’s recently reported first-quarter 2026 results showed meaningful improvement.
We are genuinely pleased to see that.
But here is the important question shareholders should ask: why did it take a $4-billion-dollar outside activist campaign to make this happen?
In September 2025, Elliott Investment Management disclosed a $4 billion-dollar stake in this company and delivered a pointed critique of Pepsi’s strategic drift — the kind of critique that a truly independent, structurally empowered board should have delivered to management long ago.
Only after Elliott’s intervention did Pepsi commit to cut its U.S. product lineup by nearly 20 percent, closing plants, reducing its workforce, and pursuing the margin improvements that shareholders have long been owed.
That is not a governance success story.
That is a governance failure that required a $4-billion-dollar outside correction.
The reason this board failed to provide that accountability on its own is a structural governance deficiency.
When the same person holds both the Chairman and the CEO title, the board is asked to evaluate the very individual who presides over it.
That is not independence — it is a conflict of interest built directly into the governance architecture.
An independent Chair does not need to be an activist investor with billions of dollars at stake.
An independent Chair simply needs to be structurally free to ask the hard questions — about strategy, about capital allocation, about whether management’s priorities are aligned with shareholder interests — without the conflict of being the same person wearing both hats.
Pepsi’s board has cited “flexibility” to resist this proposal at three prior annual meetings.
What that flexibility produced was a Pepsi cola brand that fell out of America’s top three sodas for the first time in recorded industry history.
That alleged flexibility also gave us a stock with near-zero three-year returns, and a restructuring that outside activists had to force.
These belated signs of a turnaround are welcome. But shareholders deserve a governance structure that produces accountability BEFORE a crisis.
Not one that requires a $4 billion-dollar outside intervention to generate urgency that an independent board chair should have provided all along.
Therefore we urge shareholders to vote FOR Proxy Item Number 4.
Thank you.
All assertions made by Chesser in his above remarks are footnoted and can be found in NLPC’s exempt solicitation report, here. An executive summary of the report can be viewed here.
Read NLPC’s shareholder proposal for the PepsiCo annual meeting here.
Listen to Chesser’s presentation of the proposal at the meeting here.
