Cramer: This Company Making Green from Going Green

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If you're skeptical that a green company can generate big returns, Jim Cramer would like a word.

Shares of this company have surged 20% year to date and it's at the very forefront of environmental sustainability

The company Cramer is talking about is PepsiCo.

Nicolas Belton | E+ | Getty Images

Many investors may not realize it, but PepsiCo has made substantial commitments to all kinds of green endeavors and is considered an innovator in its initiatives.

"Frito Lay trucks (which are owned by PepsiCo) are either electric or hybrid trucks," explained CEO Indra K. Nooyi during an interview on Mad Money. The company has also leveraged solar power. "Many plants built by PepsiCo, such as the plant in Modesto, California are net zero."

In the case of the Modesto operation, Nooyi added the company gives back to the community. That is, not only does the PepsiCo plant not draw energy, it generates excess energy which is returned to the California energy grid.

In the US, Nooyi added that PepsiCo's commitment to environmental sustainability helps the company attract top tier employees. "It makes our employees feel great," she said.

However, in other nations, PepsiCo's green initiatives are almost a requirement as PepsiCo evolves into a global powerhouse.

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Nooyi reminded that in many countries around the world reducing the carbon footprint isn't only desirable, it's mandatory.

"In some nations you can't get a license to operate unless you demonstrate that you're focused on recycling, or using water carefully, or something similar," Nooyi said.

All told, it appears that whatever PepsiCo may spend on green initiatives, the returns are far greater.

"Going green has given us a license to operate in other societies, it's makes employees feel great, and it saves costs," said Nooyi. "And it most definitely creates value for shareholders," Nooyi added.

* Jim Cramer finds the initiatives impressive. On April 18th he said both the company and the stock were positioned for strength. "I see more upside ahead," he said.

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