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27/04/02 . by Paul Hawken* . Distributed by Food First . USA
McDonald's and Corporate Social Responsibility?
Including: Issues that McDonald's Did Not Deal with in their Report on Corporate Social Responsibility
The April 14th McDonald's Report on Corporate Social Responsibility www.mcdonalds.com/corporate/social/report/index.html is a low water mark for the concept of sustainability and the promise of corporate social responsibility. It is a melange of homilies, generalities, and soft assurances that do not provide hard metrics of the company, its activities, or its impacts on society and the environment. While movements towards transparency and disclosure are to be applauded, there is little of either in the report. That their report is based on the Global Reporting Initiative (GRIs) calls to question whether the GRIs have anything to do with the concept of sustainability or true corporate responsibility.
This is not a report about stakeholder rights as they would have one believe. It is a report about how a corporation that has been severely stung by bad publicity and declining earnings now wants to plead its case to its critics. It states that those NGOs that continue to criticize just don't want to make things better while ignoring what their critics are most concerned about.
The McDonald's Social Responsibility Report is like Ronald McDonald-a fantasy. It presupposes that we can continue to have a global chain of restaurants that serves fried, sugary junk food that is produced by an agricultural system of monocultures, monopolies, standardization and destruction, and at the same time find a path to sustainability. As the founder of The Natural Step (TNS) in the United States, I can say that nothing could be further from the idea of sustainability than the McDonald's Corporation.
The Report states that "being a socially responsible leader [their self-appointed term] begins a process that involves more awareness on the issues that will make a difference" McDonald's has known for decades that the food it serves harms people, promotes obesity, heart disease, and has detrimental effects on land and water. Addressing that one issue would make a difference. They have known about the detrimental effects of their food just as the tobacco companies understood the impact of their products. Yet they have done little to modify their menu. In the arena of social equity, McDonald's has resisted from its inception all attempts to organize its workers, and through industry trade organizations has consistently and intensely lobbied against raises in the minimum wage. To say McDonald's has actively worked to crush trade unions is an understatement.
It is good to see ideas about materials and reduced waste being promoted by corporate actors. But it is equally important to note that corporations who do that only have not changed in any major respect and may be using these superficial changes to avoid deeper structural issues that do address sustainability. Essentially, if corporations can make more money by using less stuff, less waste, less pollution, so much the better. But the nature of their corporate activity has not changed and that is certainly the case for McDonald's. For years it has promoted and demanded the least expensive standardized food for its chains. In so doing it has created powerful incentives for the centralization of food processing, agribusiness, and long supply lines, all of which reduce American food security. For McDonald's to announce that it now wants to have antibiotic free chickens is a slap in the face to the thousands of small poultry farmers who could not compete and were forced out of business by the agri-corporations that introduced the very industrial chicken practices that required antibiotics to avoid massive die-off of their flocks. Simply stated, standardized food destroys agricultural and biological diversity. Nothing could be more antithetical to the recovery of overstressed farmlands than fast food.
At this juncture in our history, as companies and governments turn their attention to sustainability, it is critical that the meaning of sustainability not get lost in the trappings of corporate speak. There is a growing worldwide movement towards corporate responsibility and sustainability, led in many cases by companies whose history and products have brought damage and suffering to the world. I am concerned that good housekeeping practices such as recycled hamburger shells will be confused with creating a just and sustainable world. Transnational corporations such as McDonalds and their associated lobbyists and trade associations have led efforts to Americanize trade through representatives at the WTO. They have prevented the strengthening of environmental and labor laws and they have led the effort to eliminate the ability of smaller, more vulnerable nations to determine their economic destiny. In other words, they embrace "sustainability" as long as they can make money and it doesn't change their overall purpose, which is to grow faster than the overall world economy and population and increase their share of the world's economic output to the benefit of small number of shareholders.
The question we have to ask is what is enough? Is it enough that one in five meals in the US is a fast food meal? Does that satisfy McDonald's? Or do they want that figure to be one in three, or how about one in two? How about the developing world? Does McDonald's want to see the rest of the world drink the equivalent of 550 cans of soda pop as do Americans? Do they think every third global meal should be comprised of greasy meat, fries, and caramelized sugar? They won't answer those questions because that is exactly their corporate mission. They have 29,000 restaurants with nearly 3,000 new ones added each year.
A valid report on sustainability and social responsibility must ask the question: What if everybody did it? What would be the ecological footprint of such a company? What is McDonald's footprint now? The report carefully avoids the corporation's real environmental impacts. It talked about water use at the outlets, but failed to note that every quarter-pounder requires 600 gallons of water. It talked about recycled paper, but not the pfisteria-laden waters caused by large-scale pork producers in the southeast. It talked about energy use in the restaurants, but not in the unsustainable food system McDonald's relies upon that uses 10 calories of energy for every calorie of good produced. "Sustaining" McDonald's requires a simple unsustainable formula: cheap food plus cheap non-unionized labor plus deceptive advertising = high profits. An honest report would tell stakeholders how much it truly costs society to support a corporation like McDonald's. It would detail the externalities borne by other people, places, and generations: The draining of aquifers, the contaminated waterways, the strip-mined soils, the dangerous abattoirs where migrant workers are employed, the inhumane, injury-prone dead-end jobs preparing chicken carcasses for Chicken McNuggets, the global greenhouse methane gas emitted by the millions of hamburger cows in feedlots, the impact of their $2 billion advertising and promotional campaigns to convince young people to demand their food, the ethics of using toys to induce small children into their restaurants. The list is longer than this. What the report is short on is candor, transparency and corporate honesty.
* Paul Hawken is the author of The Ecology of Commerce and Natural Capitalism. He is the founder of the Sausalito-based Natural Capital Institute and is on the advisory board of Food First/Institute for Food and Development Policy.
Issues that McDonald's Did Not Deal with in the Report on Corporate Social Responsibility
Compiled by Paul Hawken
1.McDonald's spends more on advertising than any other brand in the world.
2.It runs more playgrounds than any other private entity in the world.
3.It gives away more toys than any other private entity in the world.
4.During the vastly successful Furby giveaway in 1997, McDonald's sold 100 million Happy Meals to kids. Many of the meals were thrown away for the toy.
5.Every month, 90% of the children between 3 and 9 in America visit a McDonald's.
6.In a survey of nine and ten year olds, half of them said they thought that Ronald McDonald knew best what kids should eat. In China, kids said that Ronald McDonald was kind, funny, gentle, and understood children's hearts.
7.The Golden Arches are more widely known than the Christian cross in the world today.
8.McDonald's has 29,000 restaurants in the world and opens eight new ones a day.
9.Ray Kroc, the founder of McDonald's said this: "We have found... that we cannot trust some people who are non-conformists. We will make conformists out of them in a hurry... The organization cannot trust the individual; the individual must trust the organization."
10.The vast majority of workers at McDonald's lack full-time employment, do not have any benefits, have no or little control over their workplace, and quit after a few months.
11.McDonald's jobs have been purposely de-skilled so as to be able to hire minimum wage workers on an interchangeable basis. One-third of fast food workers speaks no English.
12.McDonald's and other chains are aiming for automated equipment that will require zero training and are nearly there. Nevertheless, they fight hard to retain hundreds of millions of dollars of government subsidies for "training" their workers. A worker has only to work for 400 hours for the chain to receive its $2,400 subsidy. In essence, the American taxpayer subsidizes low wages, automation, and turnover at fast food chains.
13.Turnover is 3-400% a year. 90% are paid hourly, have no benefits, and are scheduled to work only as needed.
14.Fast food pays a higher proportion of minimum wage to its workers than any other industry in America.
15.In the late 1990s, the real minimum wage in constant dollars was 27% lower than in the 1960s. Nevertheless, McDonald's and other chains vigorously opposed raising minimum wages at the Federal, state, or local level.
16.A typical McDonald's has fifty workers working 30 hours a week, thus avoiding the need for overtime.
17.Managers make an average of $23,000 and work 50-70 hours a week
18.Not one worker at McDonald's belongs to a union.
19.The only time a restaurant was unionized recently was in 1997 in Montreal. The restaurant was closed just before the union was certified.
20.McDonald's trade organization, the National Council of Chain Restaurants, has fought hard to prevent enforcement of OHSA regulations at fast food chains.
21.Fast food restaurants are robbed more often by their employees than any other business.
22.The average American now consumes three hamburgers and four orders of french fries per week.
23.Due in part to the industrialization of agriculture driven by the fast food industry, the United States is losing farmers so fast that it now has more prisoners than farmers.
24.The biggest seller of Coke is McDonald's. Americans already drink 56 gallons of soda per year. Coke wants to increase consumption of its products by 25% a year by focusing more on kids since the adult market is stagnant.
25.McDonald's makes most of its profits on Coke, about a 91% gross margin. The food is a come-on which is why it is both sold and purchased at the lowest possible prices.
26.The Center for Science in the Public Interest calls Coke liquid candy. Each can contains ten teaspoons of sugar. A significant number of teen boys are drinking five cans a day.
27.30% of American public high schools now sell fast food inside the schools.
28.McDonald's uses a computer program called Quintillion that uses satellite imagery, GPS maps, and demographic tables to automatically site new restaurants. As one observer noted, McDonald's uses the same equipment developed during the cold war to spy on their customers.
29.For decades McDonald's cooked their fries in 93% beef tallow, which meant the fries had more saturated fat than a hamburger. In 1990, they changed to vegetable oil after being hammered by critics. Recently, McDonald's was sued by a vegetarian Indian lawyer in Seattle when it was discovered that the natural flavor used by McDonald's in their french fries was made from beef.
30.McDonald's is the largest purchaser of beef in the world.
31.McDonald's buys from five large meatpackers. These companies have gained a stranglehold over the industry (just as in potatoes) that has driven down prices. Over the last twenty years 500,000 cattle ranchers have gone out of business. Over that time, the rancher's share of every beef dollar has fallen from 63 cents to 46 cents. The suicide rate amongst farmers and ranchers in the US is three times the national average.
32.To satisfy and take advantage of the world wide growth of fast food, the large chicken and beef packers in the US are buying out local companies all over the world. Cargill, IBP, Tyson's control the world meat industry because of fast food chains.
33.Chicken McNuggets were also cooked in beef tallow until public outrage caused McDonald's to stop. Even in vegetable oil, Chicken McNuggets contain twice the fat per ounce as a hamburger.
34.Every time you eat a hamburger, you are eating anabolic steroids, antibiotics, and fecal matter. You can read it again. And it will still be true. You are better off eating a carrot dropped in your toilet than eating one dropped in your kitchen sink if you buy and use packaged meat.
35.Feedlot cattle are also given shredded packaging, cardboard boxes, cement, and sawdust to put on weight.
36.Cattle that go into hamburgers drink dirty swill water and dirty food. Until 1997, they were fed millions of dead cats and dogs purchased from animal shelters. They still eat dead pigs, horses, and poultry. (And chickens are fed dead cattle).
37.Cattle are also fed chicken manure, which may contain tapeworms, Giardia, antibiotic residues, arsenic and heavy metals. Federal inspectors report that animals that are visibly diseased, cattle infected with measles, tapeworms, and covered with abscesses are slaughtered and processed into meat. This is why the industry and the USDA are pushing meat irradiation rather then safety, health, and inspections as a solution.
38.One-fourth of the cows slaughtered is worn-out dairy cattle, animals most likely to be riddled with diseases, cancers, and antibiotic residues. McDonald's relies heavily on old dairy cows because they are lower in fat, cheaper, and allow them to say all their meat is raised in the US.
39.Modern day slaughter houses and meatpacking plants are literally worse than in the day of Upton Sinclair. The rate of injury, mutilation, amputation and dismemberment of workers is extraordinary. Rapes, sexual harassment, and fondling of immigrant women are widely known. Most workers are immigrants and dare not report them.
40.In congressional testimony, it has been revealed that injury reports are regularly and routinely falsified at meatpacking houses. All fast food chain meat comes from these four or five houses.
41.Both the meatpackers and the fast food industry have been major supporters of the Republican right wing.
42.The rate of obesity in the US is double what it was in the 60s. In children, it is double what it was in the 70s. The children of the United States are now the "fattest, least fit generation ever."
43.In 1991, only four states had obesity rates of 15% of higher. Today, 37 states do. Fifty million Americans are obese or super obese. Obesity is second only to smoking as a cause of mortality in America today.
44.The annual health costs to America stemming from obesity are $240 billion. The costs are exactly double fast food chain revenues.
45.Between 1984 and 1993, the number of fast food restaurants doubled in Great Britain. Obesity doubled over the same period.
46.The EU found that 95% of the ads there encouraged kids to eat foods high in sugar, salt, and fat. The company running the most ads aimed at children was McDonald's.
47.According to consumers polled by Restaurants and Institutions magazine in 2000, the lowest-quality food of any major hamburger chain was served at McDonald's.
Most of these facts are culled from Fast Food Nation by Eric Schlosser. The book is extensively footnoted with citations for the above.
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