McDonald's

Last edited by apocalypticbeef on July 14, 2008 - 8:27pm
Company Snapshot: 

Headquartered in Oak Brook Illinois, McDonald's operates more than 31,000 fast-food restaurants in almost 120 countries. McDonald's reported sales of $21.58 billion and employed 465,000 people in 2006.

Number of employees worldwide: 
447,000
Chief executive officer: 
Jim Skinner
2008 Global Fortune 500 rank: 
359
Corporate accountability
Accountability overview: 

McDonald's achieved a score of 85 on the Human Rights Campaign 2005 Corporate Equality Index which rates large corporations on policies that affect their gay, lesbian, bisexual and transgender employees, consumers and investors. The HRC Corporate Equality Index rates companies on a scale of 0 percent to 100 percent on factors.Human Rights Campaign, 09/18/2006

McDonald's donated $2 million to the Scripps Research Institute of La Jolla, California, raising doubts about the self-proclaimed independent research body’s ability to remain neutral. With the help of funding from McDonald’s, Scripps plans to release a study on the medical issue of child obesity. A press release issued by the Institute was headlined, "The Scripps Research Institute, McDonald's Align to Fight Childhood Obesity and Type 2 Diabetes," and describes McDonald's as "serving a variety of wholesome foods made from quality ingredients to millions of customers every day." It also states, "The relationship unites Scripps ... world-renowned scientists...with McDonald's 50-year legacy of supporting programs that promote children's health and wellness." According to the Institutes's philanthropy guidelines, the $2 million from McDonald's has secured the company a seat on the Scripps' "Council of 100" and the benefit of "private sessions specifically designed for them with....[r]esearch scientists." The collaboration was deemed a “publicity stunt” by bloggers at CarbWire, a diet industry website.Reuters, 09/13/2006

In 2006, CEO James A. Skinner earned $12.7 million in total compensation including stock option grants from McDonald's. AFL-CIO, 04/05/2006

According to the Social Investment Research Analyst Network (SIRAN), ten years after the Federal Glass Ceiling Commission recommended disclosure of diversity data as a way to remove barriers and promote women and minority advancement, most US companies still fail to fully disclose EEO data to the public. McDonald's is listed as one of the companies that does not provide full public disclosure. The company provides full disclosure only upon request.Social Investment Research Analyst Network (SIRAN), 12/07/2005

In 2005 McDonald's was ordered to pay $490,000 in damages to a former McDonald's restaurant manager for forcing him out of his position when the company discovered he had AIDS. Russell Rich had accrued 21 years of employment with McDonald's when in 1997 he learned he was infected with AIDS. The company pressured him to quit and he was subsequently left without health insurance and nearly died. Rich was awarded $5 million in a 2001 ruling on the case, but the decision was overturned due to mistakes made by the previous judge.Associated Press, 07/07/2005

In early 2003, BanTransFats.com sued McDonald's for inadequately informing the public of delays in its plans to reduce the use of trans fatty acids (TFAs) in its products. Joseph effectively argues that McDonald's failed to make clear to customers that the type of oil used to fry its foods (which contains TFAs) had not been changed. The company agreed to settle the case by donating $7 million to the American Heart Association and spending an additional $1.5 million to make its trans fat reduction plan public.BanTransFats.com, 02/11/2005

In May 2003 , 24 groups were awarded $10 million in a settlement with McDonald's after the company previously apologized for not giving the public "complete" information about the way its french fries are cooked. The court case was brought about by vegetarians who claimed they were fooled into thinking the fries were free from animal products. In 1990, McDonald's announced that it would cook its fries in vegetable oil, making them acceptable to vegetarians. However, in 2001 it was discovered that in North America the fries are first cooked at plants using beef fat, and then frozen before being shipped to outlets for further frying. The company acknowledged that it may have confused customers over its practices. McDonald's was forced to state that in India, where cows are considered sacred, its fries did not contain any beef. McDonald's offered 60 percent of the settlement to vegetarian groups, 20 percent to Hindu and Sikh groups, 10 percent to children's nutrition and hunger-relief efforts and 10 percent to promoting understanding of Kosher practices.BBC News, 05/20/2003

In 2003, McDonald's shareholders requested that the Board of Directors issue a report to shareholders by October 2003, reviewing McDonald’s animal welfare standards with the view to adopt and enforce consistent animal welfare standards internationally. Focusing on the disparity between McDonald's US and UK policies governing animal welfare and their policies for other international operations, the shareholders noted: "Our company has not made known any global program. McDonalds.com makes no reference to improved conditions in the raising of any animals (other than laying hens), transportation of any animals, use of experts, any programs or evaluation methods, performance objectives,or any process, programs, plans, or progress outside the U.S." PETA, 05/01/2003

Labor: 

According to the All-China Federation of Trade Unions, McDonald's violated China's labor laws because they were underpaying part-time workers. Minimum wage is 97 US cents per hour for part-time workers, but McDonald's pays only 52 US cents per hour.''China Radio International, 04/11/2007

Over 1,000 workers rioted in protest of the poor working conditions at the Merton factory in Guangdong province. According to China Labor Watch (CLW) dozens were injured. In their investigation at the Merton Company, CLW found that Merton factory failed to uphold international labor standards. Violations of worker rights included the following:

  • Salaries fell below the legal minimum, ranging between 600 and 800 yuan (or US$75.60 and US$100.80) a month
  • Routine workdays of 11 hours, 6 days a week
  • Monthly overtime hours of 70 per month with the threat of salary deductions if employees refused to work overtime. Chinese law states the legal maximum is 36 hours of monthly overtime
  • Denial of overtime pay
  • Denial of paid national holidays, vacation, and sick leave
  • Failure by Merton to provide adequate medical insurance or pension funds

Li Qiang, CLW’s executive director, remarked, “Chinese workers live at the bottom of the society. They have no means to voice their needs or to protect their lawful rights…. Tragedies such as the Merton riot were a result of the misguided social policy that overemphasizes economic growth and neglects labor rights.” Merton manufactures for companies such as McDonald’s, Disney, Time Warner, and Mattel.China Labor Watch, 07/27/2006

McDonald's has been criticized for rejecting a fair wage campaign launched by the Coalition of Immokalee Workers (CIW), a group of South Florida farm workers advocating a living wage for agricultural laborers. In March of 2005, CIW won a campaign against Taco Bell in which the company agreed to pay one penny more per pound for tomatoes, the increase to go directly to farm workers. CIW was hoping to reach a similar agreement with McDonald's, however the company denied CIW and instead signed onto a voluntary certification progam called the Socially Accountable Farm Employer (SAFE). Critics of SAFE claim that the organization has no real credibility. SAFE is controlled by board members of only two organizations and fails to address working conditions and wage concerns of actual farm workers. Participants in the SAFE certification program are only required to follow current U.S. laws regarding farm labor, which offer workers few protections. Some farm laborers in Immokalee earn a meager $8,000 per year. See related Progress Noted.AlterNet, 12/20/2005

According to a 2005 report by China Labor Watch titled “The Toy Industry in China: Undermining Workers’ Rights and Rule of Law,” highlights the violations of worker rights in toy plants in Dongguan City, Guangdong Province. The report specifically highlights the Kai Long manufacturing plant in Hong Kong, which exports toys for Hasbro, Mattel, McDonald’s, and KFC. Violations of international labor laws and those of China include:

  • Routine 14.5 hour workdays with only one day off a month
  • Wages at 59 percent of the local minimum wage standard in Dongguan City
  • No overtime compensation
  • Workers deprived of 43 percent of their legal wage, earning .0125 to .025 cents per toy they produce
  • Inadequate and unsanitary working conditions and dorm rooms
  • No insurance for regular workers
  • No independent trade unions

Li Qiang, the executive director of China’s Labor Watch commented: “Abusive conditions persist, threatening to undermine any gains made in workers’ standard of living and hindering the development of rule of law in China.”China Labor Watch, 09/01/2005

Vietnamese laborers staged a two-day strike to protest unfair work conditions and alleged labor violations at a the Keyhinge Toys Vietnam Co Ltd factory which makes toys found in McDonald's Happy Meals. The facility employs nearly 10,000 workers, all of whom walked out over complaints of mandatory 12-hour shifts without overtime pay, monetary penalties for using the toilet and verbal abuse. McDonald's did not comment on specific allegations, however the company did respond to settle the situation.The Scotsman, 05/14/2005

In August 2001 a McDonald's operating in Surrey, England was fined 12,000 pounds for overworking some of its child employees. McDonald's was found guilty of working some of its school-age employees late into the night on school days, often without rest breaks. It was revealed that a 15-year-old girl served burgers and fries for 16 hours during a Saturday. A McDonald's spokeswoman said the company usually only hired employees above school-leaving age, and deeply regretted the lapse.BBC News, 07/31/2001

In a 2001 report done by Human Rights Watch which analyzed the 23 complaints filed since 1994 when NAFTA was enacted, McDonald's was named as a violator of workers' rights in the U.S., Canada, and Mexico.Human Rights Watch, 04/16/2001

Environment and product safety: 

McDonald's scored a 22 out of 100 in "The Climate Counts Company Scorecard Report." The report judged companies on their commitment to reversing climate change. The creation, manufacturing, and transportation of goods greatly contribute to pollution.Climate Counts, 06/18/2007

The Amazon rainforest is home to nearly 10% of the world's mammals, 15% of the world's known land-based plant species, and about 220,000 people from over 180 different indigenous nations. However, an estimated 1.2 million hectares of what was once rain forest have been destroyed, mostly illegally, to grow soybeans for animal feed. Greenpeace’s report entitled, “Eating up the Amazon,” highlights the connections between rain forest destruction, rapid expansion of soy farming, and the chickens used to make McNuggets, distributed in McDonald’s European restaurants. McDonald’s purchases its chicken from Sun Valley Foods. Sun Valley is a division of Cargill, the leading corporation in Amazon soya production. Greenpeace forests campaign coordinator, Gavin Edwards, stated: “Supermarkets and fast food giants, like McDonald's, must make sure their food is free from the links to the Amazon destruction, slavery and human rights abuses.” Greenpeace is currently finding alternatives to Amazon soya for animal feed in McDonald’s chicken products. Greenpeace USA, 04/06/2006

In August 2005 California Attorney General Bill Lockyer filed suit against nine producers of potato chips and french fries concerning toxic contents in their popular foods. Lockyer is seeking a court order requiring the companies to warn consumers that some of their food products are made with acrylamide, a chemical identified by the state as a human carcinogen. Plaintiffs in the case include McDonald's, Burger King, KFC, Frito Lay, H.J. Heinz, Proctor & Gamble and Wendy's. In April 2007, KFC agreed to display the warning and pay $341,000 in civil penalties. As of July 2007, McDonald's is still contesting the lawsuit.CorpWatch, 04/25/2007

In August 2002 McDonald's and the United Nations Children's Fund (UNICEF) came under fire for a partnership in which money will be donated to UNICEF through the sale of certain food items at specific locations of the fast-food chain. Critics say that UNICEF, as "the world's foremost advocate for children" should be dedicated to the well-being, including good health and nutrition, of children everywhere, while McDonald's "Big Macs and Happy Meals are popular, but ...high in fat, sugar and calories, and a cause of obesity and Type 2 diabetes."CorpWatch, 08/01/2002

In 2001, a Toronto family initiated a $11.2 million (US) lawsuit against McDonald's Canada after a severed rat's head was partially ingested by a nine-year old girl. The remains of the rat's head was found between the toppings of a Big Mac. According to the lawsuit shortly after biting into the sandwich the girl noticed the rodent "complete with eyes, teeth, nose and whiskers. " The suit also claims "the rat and the Big Mac sandwich were partially ingested by [the girl]." The case was dismissed in March 2001.Findlaw.com, 03/26/2001

Location(s)

Headquarters
McDonald's Plaza
Oak Brook, IL, 60523
United States
See map: Google Maps