McDonald’s

No leading practices were identified for the company in the governance and strategy measurement area.

Protection of terrestrial natural ecosystems
In 2015, McDonald’s announced its commitment to eliminate deforestation from its global supply chains by 2030. It has prioritised the raw materials where it has the most impact, including beef, soy for chicken feed, palm oil and coffee, and its policy covers all commodities and all regions. Its commitments also cover its supply chain as well as elements like high-carbon stock areas and peatlands. McDonald’s has disclosed its process for achieving these targets and as of 2020, around 99% of its beef, soy for chicken feed, palm oil and coffee.

Plastic use and packaging waste
McDonald’s demonstrates leading practices in this area, by setting a target to source 100% of its guest packaging from renewable, recycled or certified sources, and to recycle guest packaging in 100% of McDonald’s restaurants, by 2025. The company has also set interim targets towards this goal and reports progress against all targets. While it also discloses qualitative and quantitative evidence on this topic, sets targets and reports progress, it has not yet achieved 100% sustainable packaging across its operations.

No leading practices were identified for the company in the nutrition measurement area.

No leading practices were identified for the company in the social inclusion measurement area.

Sustainable development strategy
McDonald’s discloses having conducted an identification and prioritisation process to define issues that are of most importance to its stakeholders and where the company can have the greatest impact. It has also set targets that cover issues related to the environment, social inclusion, and nutrition measurement areas. However, the company has an opportunity to enhance transparency and reporting in this area.

Governance and accountability for sustainability
McDonald’s has assigned accountability for and oversight of its sustainable development strategy to its highest governance body. As part of its Board, the company has set up the Sustainability and Corporate Responsibility Committee, which monitors and provides input on the management of environmental and social issues. Furthermore, as of 2021, the company has included human capital metrics into its annual compensation for its CEO and executive members. However, the company can improve by including metrics around environment and nutrition into its remuneration policy.

Stakeholder engagement

While the company has conducted stakeholder engagement activities and discloses a brief overview of the issues raised via these activities, it has an opportunity to disclose how it identifies its most relevant stakeholders, along with information on how the outcomes of the engagement process are integrated into the company’s sustainable development strategy.

Scope 1, 2 and 3 GHG emissions
McDonald’s discloses qualitative and quantitative information regarding its GHG emissions. Approved by the Science Based Targets initiative and aligned with a 2-degree trajectory, the company has a reduction target to cut emissions by 36% by 2030 from a 2015 base year. The company also has a target to reduce 31% in emissions intensity across its supply chain by 2030 from 2015 levels. The company has an opportunity to strengthen its commitment by aligning its targets with a 1.5-degree trajectory.

Food loss and waste
While the company is addressing food loss and waste in its own operations through its Global Food Disposition Policy which includes a waste hierarchy, it has an opportunity to disclose a commitment by setting targets to reduce food loss and waste across its own operations and quantitative data to demonstrate that it is reducing food loss and waste in its own operations and supply chain.

Animal welfare, and antibiotic use and growth-promoting substances
While the company has a commitment on animal welfare that addresses animal welfare issues in its sourcing policy, it does not apply to all key species, geographies or products that are relevant to the company. Regarding antibiotic use, the company has a commitment on prohibiting the use of prophylactic antibiotics this does not apply to all of the company’s relevant key species, geographies and products.

Availability of healthy foods
The company discloses its progress in offering more healthy and nutritious food and in simplifying ingredients in in its Happy Meal bundles. It has also set a target to reduce the level of saturated fats, calories, added sugars and additives in its products. However its commitments only cover Happy Meal bundles and its targets only apply to some parts of its business.

Accessibility and affordability of healthy foods
The company does not disclose a commitment to address food insecurity by improving the accessibility and affordability of healthy and nutritious foods. While the company discloses its actions around food loss and waste but has no commercial strategies to improve availability of healthy foods.

Clear and transparent labelling
The company discloses a commitment of compliance with national regulations regarding labelling as well as commits to making nutritional information available for all consumers, in particular around its Happy Meal bundles. However it has an opportunity to make nutritional information of all its menu items more visible to consumers not only online, but also at point-of-sale.

Responsible marketing
The company is committed to responsibly marketing to and communicating with children. It conducts work at industry level regarding these topics and is part of various multilateral pledges and partnerships. The company’s Global Marketing to Children Guidelines primarily address its Happy Meal bundles and is applicable across 100% of its operations. The company has an opportunity to increase disclosure regarding budgetary elements around this topic as well as by setting time-bound targets.

Child labour
While the company commits to prohibiting child labour in its own operations and requires its suppliers to adhere to the same standard, it has an opportunity to disclose a coordinated and consistent monitoring system for both its own operations and supply chain.

Forced labour
The company indicates that it will not use forced labour and requires that its supply chain adheres to the same standard. It also requires its suppliers to not retain the workers’ personal documents or restrict workers’ freedom of movement.

Living wage
The company does not disclose that it pays its workers a living wage or requires its suppliers to do the same. Neither has it set targets to do so in the future.

Farmer and fisher productivity
The company has set up programs that address farmer and fisher productivity, such as its Flagship Farmers, which allows for knowledge sharing amongst McDonald’s suppliers of raw materials. While McDonalds has disclosed some metrics regarding the scope of the program, the company has not yet disclosed other quantitative metrics relevant for this indicator, such as average increase in yields, amongst others. The company has therefore an opportunity to increase transparency by disclosing more metrics, as well as by systematically measuring the outcomes of the program.

Land rights
While the company requires its suppliers to commit to recognising and respecting the legitimate tenure rights related to the ownership and use of land of local communities, by adhering to free, prior, and informed consent, it has an opportunity to disclose a commitment for its own operations.

McDonald’s discloses a commitment towards the respect of human rights and provides evidence of a due diligence process that includes identification and assessment of salient human rights risks and impacts. The company also provides a grievance mechanism that is available to both internal and external individuals. There is room for the company to improve its policies by publicly committing to workers’ rights and disclosing a global process to integrate and act on human rights risks.

Although the company is committed to preserving the health and safety of its employees, this commitment does not extend to its supply chain. No further evidence of policies or commitments related to decent work were found in the public domain, including around paying a living wage, collective bargaining, workforce diversity, and gender equality and women’s empowerment. As such, McDonald’s does not demonstrate via its disclosures that it provides secure, safe and healthy workplaces where workers are fairly renumerated and have a meaningful say in decision-making.

McDonald’s discloses policies and statements on personal data protection and bribery and corruption, but there remains an opportunity for these to be strengthened as well as for increased disclosure. Similarly, the company could disclose commitments regarding responsible lobbying and a global tax strategy.