The Corporate social responsibilities adopted by Mc Donald’s

Corporate social responsibility (CSR) or corporate citizenship entails companies behaving in a

socially responsible manner, and dealing with other business parties who do the same. With
growing public awareness and demand for socially responsible businesses, it is little wonder that
companies of today take corporate social responsibility into account when planning future
socially responsible business operations. This case study on McDonald’s social responsibility
examines one such example of corporate social responsibility exemplified by McDonald’s.

McDonald’s is the world's largest chain of hamburger fast food restaurants. According to
the McDonald’s Corporate Social Responsibility website, McDonald’s take on corporate social
responsibility or CSR of McDonalds is about taking action, achieving results and always
maintaining open lines of communication with its customers and other key stakeholders.

Sustainable Supply Chain Strategy

McDonald’s works with its suppliers to promote socially responsible practices in its supply chain
as part of its supply chain strategy. This is part of its wider Framework for Corporate Social
Responsibility. As described on its corporate social responsibility website, it has its own Code of
Conduct for Suppliers which describes how McDonald’s expects its suppliers to treat their
employees. It has also sought to extend social accountability throughout its supply chain as part
of its supply chain strategy. McDonald’s has succeeded in supporting suppliers who are phasing
out sow gestation crates in their supply chain. According to its website, currently, more than 50%
of all Cargill's contracted hog farms are in new-generation systems that do not use gestation
stalls.

For example, McDonald’s embarked on a sustainability project to improve conditions for farm
workers in the Florida tomato industry in 2007, which in turn promotes good environmental
practices in its land-based agricultural supply chain and makes the farm a sustainable business.
Although McDonald’s purchases only 1.5% of Florida's tomatoes annually, McDonald’s and its
suppliers instituted industry-leading grower standards that improved working conditions in these
farms and made the farm a sustainable business.

Engaging the Community through Community-based Projects

One approach to engaging in corporate social responsibility is through community-based

development projects. Community-based and community-driven development projects have
become an important form of development assistance among global socially responsible
companies. An economic relationship implies a strategy of engaging the wider community into
the core business activity of the company so that communities become embedded in corporate
supply chain strategy to create a sustainable business.
An example of this approach of McDonald’s and its contribution to the communities is seen in
launch of its Flagship Farms Initiative (FAI) in Europe. The program showcases seven
“progressive farms” employing innovative farming practices across Europe and carries out
research into how ethical farming practices can be incorporated into commercial farming
systems. Another example is seen in the Sustainable Fisheries program which is in collaboration
with the Sustainable Fisheries Partnership. This program defines sustainability standards that
guide all of McDonalds’s purchases worldwide for wild-caught fish that goes into making those
Fillet-o-Fish and make the relevant fishery a more sustainable business.

Corporate Philanthropy

McDonald’s also donates a portion of its pre-tax profits to corporate philanthropy as part of its
efforts to be more socially responsible. McDonald’s makes charitable contributions through the
Ronald McDonald House Charities (RMHC) which aims to create, find and support programs
that directly improve the health and well being of children.

According to Clara Carrier of Ronald McDonald House Charities, in particular, the Ronald
McDonald Care Mobile attempts to ensure that children in vulnerable communities can receive
state-of-the-art medical and dental treatment to improve their health and strengthen the whole
family. This health care on wheels program attempts to change children’s lives and improve
communities along the way.

McDonald's joins World Wildlife Fund and beef industry leaders in

engaging stakeholders

McDonald's recently joined the World Wildlife Fund (WWF), along with global leaders from
throughout the beef industry for a 3-day conference on sustainability entitled the Global
Conference on Sustainable Beef. The event marked an important step towards understanding,
clarity, and alignment within the industry and McDonald's was proud to be a part of the historic
meeting.

Hosted by Cargill, Intervet/Schering-Plough Animal Health, JBS, McDonald’s, Walmart and

WWF, the Global Conference on Sustainable Beef convened all elements of the global beef
supply chain and a diverse array of other key stakeholders, including academics, scientists and
NGO thought leaders for a constructive dialogue about the current state of sustainability in the
beef industry. Participants engaged in a series of panel discussions and breakout sessions around
eight key issues related to the environment, economy and society – food and nutrition,
community, water, labor and business, land management, energy, biodiversity and greenhouse
gas emissions.

The conference produced robust feedback centered on the “triple bottom line” – to be
environmentally, socially and economically sustainable. At the conclusion, the conference hosts
challenged the participants to incorporate this feedback to develop on-the-ground programs that
enhance sustainable beef, driven by new relationships developed in Denver.

“This is a powerful first step in bringing all the key stakeholders of the beef sector together for a
transparent dialogue and to identify the real potential of the beef industry to be more sustainable,”
said Gary Johnson, Senior Director, McDonald’s Worldwide Supply Chain.

"By incorporating sustainability into Wal-Mart’s own operations, we have seen firsthand the
opportunities it creates to increase efficiency and reduce costs," said Pete Eckes, Wal-Mart’s
senior director of business development for meat. "By making the sustainability practices of
producers and suppliers a factor in deciding which beef we buy for our 8500 global locations,
Wal-Mart and Sam's Club can provide the access to customers that is needed to make this effort a
success."

Conference leadership agreed to a series of next steps in the multi-stakeholder process on

sustainable beef. They will ensure continued and frequent engagement at a regional and global
scale, document and communicate collective experiences through science-based networks, and
serve as conveners to expand partnerships that drive toward increased industry sustainability.

Toys, Happy Meals and Making a Difference with Kids

As you may have heard, city officials in San Francisco, CA recently approved a measure that
would ban the sale of a toy with a meal unless the meal meets certain nutritional criteria.
I have been reflecting on this a lot, not only because it's an important issue for our company, but
also because nutrition and the well-being of children are topics about which I am very passionate.
Without doubt, childhood obesity is a serious issue. However, the answers to what we, as a
society, should do about it, remain very unclear. What is clear, however, is that government, the
private sector, and civil society need to be engaged together in order to reverse the trend.
I am often asked about how nutrition and children's well-being issues should be viewed from a
CSR lens. From a corporate responsibility standpoint, here's my perspective:
First, we need to be engaged as part of the solution. We're in. McDonald's cares about the well-
being of children and their families. We are committed to using our size and scope to make a
difference in the world, and we know we have a tangible role to play in addressing this issue.
Second, we need to take action. And we are.
Our menu options have expanded significantly over the past decade, providing customers
a variety of chicken, fruit, vegetable and dairy options in addition to our core menu
offerings. Our menu continues to evolve today, with the introduction of offerings like fruit
smoothies and oatmeal.
We provide nutrition information in a variety of formats - inside and outside of
our restaurants.
 We operate under a set of Global Guidelines for Marketing to Children and have
implemented voluntary advertising pledges in several of our markets to ensure our
communications are responsible and appropriate.
McDonald's sponsors and encourages athletic activities for youth at the grassroots level.
We have put our brand recognition to work toward the goal of encouraging children to
consume more fruits, vegetables and dairy with promotions like Kung Fu Panda and
Shrek Forever After.
We know we have more work to do. Continuously improving our performance in this area will be
a never ending journey. As we all know, it is sometimes not easy to get kids to eat fruits and
vegetables. For our part, we know the first step is offering a balanced array of options. Across
the globe, over 85% of McDonald's restaurants currently offer a fruit, vegetable or dairy offering
with Happy Meals, and currently, one out of three Happy Meal purchases in the U.S. comes with
Apple Dippers ,milk, juice or water.
Finally, we need to work together, take a systemic approach, and develop practical and
sustainable solutions. This is not an issue that can be solved by any one company, organization or
city. There are no quick fixes.
The average U.S. Happy Meal customer visits McDonald's 2-3 times a month (leaving 87-88
meals eaten at home and/or at other locations), and when they do, there is a wide variety of menu
options available to them. I don't think I can characterize the measure in San Francisco as
meeting my definition of a sustainable solution to the issue at hand.
Of course, I welcome other opinions. What do you think we as a society need to do to effectively
address childhood obesity?

From Heresy to Dogma: How Uncommon Bedfellows Changed the

Environmental Movement

The story began a year earlier when Environmental Defense Fund (EDF) wrote to McDonald's
requesting a meeting to discuss environmental issues. This led to a joint task force that examined
all aspects of the company's operations. EDF brought its experts to the table -- an economist, a
scientist, a chemical engineer and more -- while the McDonald's team included managers in
environmental affairs, law and operations.

Early reactions to the partnership were skeptical. The New York Times called it, "a highly unusual
deal." The Wall Street Journal reported that Ralph Nader, "wasn't impressed," saying that,
"grassroots environmental groups aren't convinced that McDonald's is serious about creating a
better environment." The Boston Globe quoted a toxic chemicals specialist: "It's like saying I'm
going to join a task force with the Mafia to discuss how to cope with the drug situation."
In fact, the alliance was very risky. Both sides stood to lose big if results failed to materialize. It
was a bold step in an era where businesses and environmentalists were more apt to meet in a
courtroom than in a corporate boardroom.

But it was a risk worth taking. In 1990, McDonald's was the largest single user of Styrofoam in
the country. If EDF could change the practices of company this size, it would produce a ripple
effect throughout the industry. To ensure objectivity and high impact, EDF would take no money
from McDonald's and would make all the results and innovations developed public.

In April 1991, EDF and McDonald's announced the results of their partnership -- a Waste
Reduction Action Plan with 42 initiatives to reduce waste in McDonald's' operations and supply
chain. Over the next decade, the company eliminated 300 million pounds of packaging, recycled
1 million tons of corrugated boxes, and reduced restaurant waste by 30 percent. The willingness
of McDonald's and EDF to set aside stereotypes and put their combined expertise to work finding
solutions was critical to this success.

Media coverage of the announcement was heavy and positive. An editorial in The Boston Herald
read "A win for consumers," and The New York Times commented that "McDonalds is at last
showing some McSense on the environment."

Twenty years later, what was heresy has now become dogma as more companies see the business
benefits of environmental innovation, and NGOs increasingly look to leverage the market clout
of corporations. For EDF, working with business is now a core part of the organization. The
basics of the EDF partnership model haven't changed -- we still accept no financial contributions
from our partners, and insist that the innovations we develop together are made public. This
allows us to push for big, bold goals that have industry-wide impact.

For McDonald's, this effort was the blueprint for further successful partnerships and spawned
nearly forty collaborations with a multitude of organizations to make a difference. The most
recent is with WWF, supporting the Sustainable Beef Symposium, and working with the beef
industry to improve sustainability in beef production globally.

These days, the need for private sector leadership is greater than ever. And the good news is that
even in the midst of a global recession, Corporate America hasn't shied away from investing in
environmental initiatives. That's why both of us are optimistic about the future. The light bulb has
gone off and smart companies are pursuing environmental benefits while flexing their market
power to bring supplier companies along for the ride. We all want a thriving economy and a
healthy planet and collaborations like the EDF/McDonald's partnership can help us all to be
working on all cylinders and through all channels to make this vision a reality.

Cargill recognized by McDonald's® USA for its animal welfare and

environmental efforts
Citing the ability to balance long-term sustainability goals with the need to perform
competitively, McDonald's USA has selected Cargill for its 2010 U.S. Sustainability Award.

One of Cargill's strengths is that when we face a challenge the best of the company comes
together to solve it," said Pete Richter, president, Cargill global McDonald's business unit. "This
award shows the progress we've made in leveraging our leadership in food and agriculture to
tackle complex economic, environmental and social challenges throughout our supply chains."

McDonald's U.S. Supply Chain Management team established the award three years ago to
recognize the importance of sustainability as an area of growing importance to the business.
"Cargill has demonstrated a proactive, systematic approach to understanding and seeking
solutions to address how our supply chain affects, and is affected by, the world around us," said
Susan Forsell, McDonald's vice president, quality systems.

McDonald's cited these examples of Cargill's accomplishments:

Managing and proactively improving animal handling practices in the company's red meat
business using remote video auditing;

Managing the administration of the research that will be conducted with the Coalition for
Sustainable Egg Supply. This research requires the coordination of suppliers, non-governmental
organizations and academia, and potentially will play a leading role shaping the egg industry of
the future;

Promoting science-based animal welfare programs through the North American Food Animal
Well-being Commission;

Sponsoring, with McDonald's, the World Wildlife Fund (WWF) Global Conference on
Sustainable Beef in Denver, Colorado, in November 2010. The conference is designed to reach
out and engage other beef industry leaders and trade associations to address sustainability
concerns; and

Establishing 2015 environmental goals for Cargill in energy efficiency, greenhouse gas intensity,
renewable energy use, and freshwater efficiency; as well as reporting annual progress against
those goals.

The U.S. Sustainability Award follows McDonald's recognition of five Cargill business units in
its "2010 Global Best of Sustainable Supply Report," which was released earlier this year, as well
as Cargill Meats Europe earning McDonald's European Sustainability Supplier of the Year
Award 2010. The award was announced in September at the company's U.S. Suppliers Summit in
Schaumburg, Illinois.