One McDonald’s Plaza
Chicago, IL 60607 USA
CHIEF SUSTAINABILITY OFFICER
Report created by Maribel Sabino
McDonald’s Corporation is an American fast food company. McDonald’s has become one of the world’s leading food service brands with more than 36,000 restaurants in more than 100 countries.
McDonald’s Corp. engages in the operation and franchising of restaurants. McDonald’s franchised restaurants are owned and operated under one of the following structures – conventional franchise, developmental license or affiliate. McDonald’s restaurants offer a substantially uniform menu, although there are geographic variations to suit local consumer preferences and tastes.
Company Sustainability Activity
McDonald’s believes that “delicious food can also be sustainable – for [their] customers, producers and the environment.” As one of the world’s leading restaurant brands, McDonald’s is using their Scale for Good initiative to make this vision a reality.
The company is committed to building a better McDonald’s and that includes using their scale to help address this defining issue for current and future generations.
In March 2018, McDonald’s became the first restaurant company in the world to address global climate change by setting a science based target to significantly reduce their greenhouse gas emissions.
The company will partner with Franchisees to reduce greenhouse gas emissions related to McDonald’s restaurants and offices 36% by 2030 from a 2015 base year. Through collaboration and partnership with their suppliers and producers, the Company also commits to a 31% reduction in emissions intensity (per metric ton of food and packaging) across their supply chain by 2030 from 2015 levels, approved by the Science Based Targets initiative (SBTi).
McDonald’s Corporation’s global priorities below include:
- Analysis of major social and environmental impacts of their food and their business.
- The material environmental and social issues that matter most to their customers and employees, Franchisees, suppliers and wider stakeholders.
- Prevent 150 million metric tons of C02 equivalents (CO2e) from being released into the atmosphere by 2030
- McDonald’s will partner with Franchisees to reduce greenhouse gas emissions related to McDonald’s restaurants and offices by 36% by 2030 from a 2015 base year
- McDonald’s commits to a 31% reduction in emissions intensity (per metric ton of food and packaging) across their supply chain by 2030 from 2015 levels
- By 2020, source a portion of their beef from suppliers participating in sustainability programs aligned with GRSB principles and criteria
- By 2020, engage with beef producers through outreach projects to help develop and share best practices related to their Priority Impact Areas.
- By 2020, use their Flagship Farmers Program to select and showcase their most progressive suppliers
- By 2020, set up McDonald’s progressive farm partnerships to trial and discover new practices related to their priority impact areas
- By 2020, in regions with identified risks relating to the conservation of forests, verify that the beef sourced from those regions comes from farms where primary forests and high conservation value lands are preserved
- Reduce the overall use of medically important antibiotics in their beef supply chain, focusing on their top 10 beef sourcing countries: Australia, Brazil, Canada, France, Germany, Ireland, New Zealand, Poland, the U.K. and the U.S.
Responsible Sourcing and Materials
- By 2020, all the wild-caught fish purchased for use in McDonald’s restaurants will be from verified sustainable sources
- Eliminate the use of antibiotics defined by the World Health Organization as Highest Priority Critically Important Antimicrobials (HPCIA) to human medicine as defined by the WHO from all chicken served by 2027
- Purchase 100% sustainable certified soy by 2020 in Europe
- Source chicken with improved welfare outcomes
- 100% of coffee to be sustainably sourced by 2020
Packaging and Recycling
- By 2025, 100% of McDonald’s guest packaging will come from renewable, recycled or certified sources.
- Interim target: 100% of primary fiber-based guest packaging will come from recycled or certified sources where no deforestation occurs by 2020
- Prioritize innovation of new materials and redesign of plastic packaging to be more recyclable and streamline material types and design packaging so that it’s easier for customers to recycle
- By 2025, recycle guest packaging in 100% of McDonald’s restaurants
- Partner with companies and non-profit organizations to support the development and expansion of recycling programs for plastics
- In 2019, McDonald’s committed to two renewable energy projects that will expand the amount of renewable energy available in the U.S. The energy generated by these virtual power purchase agreements (VPPAs) U.S. projects will be equivalent to over 2,500 restaurants-worth of electricity. Once online, McDonald’s portion of these two renewable energy projects will help to prevent approximately 700,000 metric tons of CO2e emissions each year2, which is equivalent to planting 11 million trees or taking over 140,000 cars off the road.
- McDonald’s restaurants in Austria, France, Germany, Portugal, Sweden, Switzerland, The Netherlands and UK/Ireland are close to sourcing 100% of the energy needed to power their restaurants from renewable sources as of 2018.
- 5% of the 36% reduction of greenhouse gas emissions target has been achieved, which represents a 2% reduction from the 2015 baseline. The US VPPA deals referenced above are expected to contribute an additional 16% of the progress towards their total target.
- In 2016, McDonald’s began purchasing a portion of their beef from a fully verified supply chain sustainability pilot program in Canada.
- As of June 2018, five of their top 10 beef sourcing countries are supporting or sponsoring beef producer sustainability groups, tools or programs.
- As of January 2019, seven of McDonald’s top 10 beef sourcing countries have recognized one or more beef producers as Flagship Farmers to work with peers and share their industry-leading processes and practices.
- As of June 2018, four of McDonald’s top 10 beef sourcing countries have one or more pioneering projects underway or have a Progressive Farm Partnership in progress to test the scalability of key research.
- McDonald’s is engaged in multi-stakeholder groups to address these issues, including: Collaboration for Forests and Agriculture (CFA), TFA2020, GRSB and other local beef sustainability roundtables, GRSB/GTPS Joint Working Group on Forests Leadership Committee
Responsible Sourcing and Materials
- As of July 2019, all chicken suppliers to Australia and European markets have eliminated the usage of HPCIAs in their chicken supply chain. For new suppliers in Russia (added after July 2018), an extension has been granted until the end of 2021, to enable them to responsibly convert their supply chain to colistin-free.
- In 2018, approximately 74% of the soy volumes used in the feed of chickens supplied to their restaurants in Europe was covered by a combination of ProTerra or Roundtable on Responsible Soy certification.
- In 2018, 57% of their ground and whole bean coffee (64% of restaurant coffee globally and 3% of U.S. and Canada retail coffee) was sourced sustainably through Rainforest Alliance, UTZ, Fairtrade International and Fair Trade USA certification schemes, as well as McCafé SIP-approved programs.
- As of the end of 2018, 97% of McDonald’s global coffee supply is verified as compliant with their Commitment on Forests.
- In 2018, 98% of the fish for the Filet-O-Fish was sourced from sustainably managed wild-caught fisheries, assessed and verified annually against the McDonald’s Sustainable Fisheries Standard by the Sustainable Fisheries Partnership.
- 100% of McDonald’s palm oil supply has been Roundtable for Sustainable Palm Oil (RSPO) certified since 2017
Packaging and Recycling
- As of 2018, McDonald’s is approximately 60% of the way to their goal of guest packaging to come from renewable, recycled or certified sources.
- Globally, McDonald’s is 80% of the way to achieving their interim target to source 100% of primary fiber-based guest packaging from recycled or certified sources where no deforestation occurs by 2020.
- As of 2018, McDonald’s recycles guest packaging in an estimated 10% of McDonald’s restaurants around the world.
UN Sustainable Development Goals
UN SDGs Compliance
- McDonald’s is committed to serving delicious food, sourced in a way that is better for both the planet and the communities.
- In 2013, McDonald’s began working with the Alliance for a Healthier Generation to develop a comprehensive plan for 20 major markets to increase customers’ access to fruit, vegetables, low-fat dairy and water.
- McDonald’s and its independent Franchisees employ over a million people worldwide at any given point in time.
- In 2018, McDonald’s launched a new initiative called Youth Opportunity, with a global goal to reduce barriers to employment for two million young people by 2025, through pre-employment job readiness training, employment opportunities, and workplace development programs.
- McDonald’s joined the Global Initiative on Decent Jobs for Youth, a United Nations led multi-stakeholder initiative, to help accelerate efforts to tackle the youth employment challenge.
- McDonald’s prioritizes responsibly sourcing their food and packaging to continue sourcing high-quality raw materials long into the future. This includes making the most efficient use of natural resources, and minimizing negative impacts on people and the planet.
- The Company aspires toward supporting a more circular economy by focusing on the sourcing and manufacturing of their ingredients and materials, and considering what happens to packaging waste along the supply chain, in McDonald’s restaurants and in their communities.
- Climate Change is the biggest environmental issue of our time, affecting customers, employees, and everything from their supply chain to the thousands of communities around the world in which they operate their restaurants. As the world’s largest restaurant company, McDonald’s is using their scale to help address this defining issue for current and future generations.
- McDonald’s is committed to working with suppliers, governments, producers and other corporate and NGO partners to eliminate deforestation from their global supply chains, and promoting responsible forestry and production practices that benefit people, communities and the planet.
- McDonald’s is driving meaningful change across all of their Scale for Good initiatives by partnering within the McDonald’s system as well as externally with other stakeholders and organizations to tackle global issues collaboratively.
McDonald’s is committed to incorporating sustainability within their business model. Despite this, the company lacks transparency, specific goals and KPIs.
While there is an effort to sustainably source the materials and products, reduce emission and address climate change, they have no primary certificates, and have not received any awards or listings related to sustainability. For these reasons, McDonald’s Corporation has received a rating of D.
Analyst Outlook: Negative
McDonald’s lacks transparency in regards to their sustainability initiatives.