Introduction
Corporate social responsibility, also known as CSR, is becoming an essential element in the changing world due to the transformations led by globalisation to meet the expectations and demands of the stakeholders. Business corporations, civil organizations and public organizations are showing a strong commitment and promoting CSR by adopting CSR initiatives. In some organizations, they are in partnership with non-governmental organizations also known as NGOs. This paper discusses the subject of CSR and also studies how it is implemented by McDonald.
CSR Description
The wide-reaching effects of CSR in organizations have gradually become a marketing platform to reach out to the stakeholders around the world in a more approachable and sustainable way to promote and improve the public image. With more and more global corporations starting the CSR strategy, McDonald’s has started their CSR strategy by starting a CSR page on their homepage to improve the performance of social and environmental issues which is often placed by society at a given point of time.
McDonald is the leading global foodservice retailer with more than 30,000 local restaurants, serves 52 million people in more than 100 countries each day with an annual turnover of an average of more than $4 billion per year for the past 3 years (McDonald’s, 2007). Like other retail organizations, McDonald’s believed that they have a social and moral responsibility for the people around the world to produce a positive impact to the stakeholders although the bottom line is the concern of business in making profits. It even has its own corporate responsibility blog, which is dedicated solely to CSR.
“We want to open our doors to corporate social responsibility (CSR) at McDonald’s – to share what we’re doing and learn what you think,” Bob Langert, Senior Director for Corporate Social Responsibility at McDonald’s mentioned when asked about the purpose of the blog (McDonald’s blog, 2006). In McDonald’s social responsibility blog, McDonald’s focuses on five key areas: balanced active lifestyles, responsible purchasing, people, environment, and community. People are free to write their comments and engage in the discussion about the impacts of their business, responsibilities and performance provided they follow the terms and conditions stated in the blog.
Key Drivers of CSR
Haigh (Haigh et all, 2006) has argued that there are six sets of factors that are conventionally considered as promoting outcomes that are consistent with the core principles of social responsibility. They are intra organisational factors, competitive dynamics, institutional investors, end consumers, government regulators and non-governmental organizations. These four approaches to determining the justifications of CSR. Corporate entities are assumed responsible only for their own acquisitive behaviour and not for capitalism itself. This creates a number of undefined categories of obligations and forms that the social contract should take and rarely consider alternatives to neoliberalism, Self regulation is a proper normative ideal for corporate entities. Voluntary CSR reporting is assumed without examination to sufficiently acquit the firm of extra-legal responsibilities.
CSR Analysis
The unhealthy nature of fast food in McDonald’s maybe infamous which is commonly connected with obesity. McDonald’s tackles the problem by starting to put in nutrition information by using an iconic approach to display calories, protein, fat, carbohydrates and sodium on our food packaging. Dr Harvey Anderson, Professor of Nutritional Sciences, Physiology and Medical Sciences, faculty of medicine at the University of Toronto and member of McDonald’s global advisory council on balanced, active lifestyles claimed that the standardized approach to communicating key nutrient values to McDonald’s customers has been done in a way that is simple to understand, which he felt will make it a useful tool for those individuals looking to make more informed menu choices at McDonald’s (McDonald’s, 2006).
McDonald’s has been awarded by Black Enterprise magazine for its commitment to diversity for the third consecutive year. Black Enterprise named McDonald’s as one of the “40 Best Companies for Diversity” in its July 2007 issue. According to the magazine, McDonald’s excelled in the board of directors, supplier diversity, employee base and senior management. McDonald’s also received the highest mark in the advertising diversity rating category which assesses advertising dollars spent through media targeting black and ethnic minority audiences. (Black PR Wire, 2007).
“We continually strive to achieve an environment where everyone feels valued, accepted and rewarded. That dedication and unwavering commitment to diversity and inclusion allow us to recognize and appreciate the contributions that all individuals bring to our system including our employees, our franchisees and our suppliers,” said Don Thompson, President of McDonald’s USA (Black PR Wire, 2007).
McDonald’s CSR Offerings
McDonald’s CSR offerings include five thrust areas and are People, Products, Place, Price and Promotion. This section provides details of how McDonald’s has implemented CSR in the thrust areas. A status analysis is also given for each thrust area (CSR 2006, p 5).
People
CSR Statement: McDonald suggests that it has a responsibility to create and maintain a work environment where all employees have a feeling that they are valued and respected. The company also provides training and other opportunities for its employees so that they have personal and professional growth and this would consequently foster job satisfaction.
Products
CSR Statement: McDonald states that it has a responsibility to provide a relevant variety of quality product choices that the customers trust. It also states that it would partner with suppliers who agree to operate their own business ethically and meet the social responsibility standards that are prescribed by McDonald’s.
Place
CSR Statement: McDonald states that it has a responsibility to manage its business by integrating environmental considerations into daily operations and by constantly seeking ways to add value to the community.
Price
CSR Statement: McDonald states that it has a responsibility to maintain the values and high standards and provide food that is affordable to a wide range of customers.
Promotion
CSR Statement: McDonald states that it has a responsibility to maintain and build trust with all the stakeholders by ensuring that the marketing and communications efforts are truthful and appropriate.
Assessment of the Actions taken by McDonalds to meet the CSR objectives
McDonald has provided a report that shows how the CSR Statement have been met. These have been explained in the section for the key areas of People, Products and Price.
Assessment for People CSR
McDonald’s has been criticised in the press for the low prospects that employees have and derogatory comments such as ‘McJob’ have been giving, The company has stated that it has taken measures to identify talent and offer such promising people opportunities for career advancement. The CEO has suggested that leadership development and talent management are the top priorities and has initiated the leadership institute where employees are taught the finer aspects of being leaders. The company has provided handouts and literature on the social responsibility of the company to its employees and has also carried this information on the websites and at employee conventions. McDonald has introduced a training program in 18 countries to integrate CSR into the corporate structure. The communication between the top management and the employees has been strengthened by providing webcasts where the employees can interact with the management. Interactive websites with a facility for chat has also been provided.
Assessment for Products CSR
McDonald’s has been severely criticised for the health problems and obesity caused by its food products. The company has introduced several product innovations that are designed to meet CSR obligations. Menu items such as salads, milk, vegetables, food, beverages and side food items have been added to the Happy Meal food product. These products are designed to lower the obesity and high cholesterol constituents. The company has also introduced printed information on the packaging that will state the constituents in the food items. To train the staff and other employees on the benefits of maintaining an active lifestyle, videos have been made in seven languages and distributed to the staff to create awareness and educate them on the problems. McDonald has also given away 15 million step meters and these were part of the Olympic sponsorship. To stop the advertisements from misleading the public, the advertisement communications have been reassessed and the advertisement staff made aware of the accountability that they need to follow. McDonald has also made its fish, poultry, beef and pork suppliers to be accountable for their operations through Project Kaleidoscope. Many suppliers have expressed their willingness and have participated in this activity. The company has introduced a certification system for all suppliers who supply poultry products directly to the company. McDonald also conducts regular audits for abattoirs and meat processing plants that process beef, poultry and pork. It has launched the Agricultural Assurance Program that involves farm produce suppliers, suppliers of fish and meat products. The company has reported that it has shifted the procurement of over 18000 metric tons of fish produce since the existing suppliers were not sustainable in their commitment. It has also introduced the Sustainable Agriculture Initiative in Australia, UK and Europe to ensure that the farm produces suppliers comply with their requirements.
Assessment for Place CSR
The huge number of restaurants with their large demands of power have made McDonald frame the Place of work as a thrust area. The company has used certain electricity energy management tools in some leading restaurants to monitor the use of energy consumption. The company has started using renewable packing to the extent of 83% and out of this about 31% is made of recyclable material. It has adopted a forest policy in Europe and this is directed at consumer packaging products and designed to reduce the content of forest products. The company raised almost 61 million on Worlds Children’ Day through the participation from the restaurants, suppliers and employees. The company has introduced a number of programs for its local markets.
Comparison of CSR with Wal-Mart
For this paper, a study has been done for Wal-Mart (Wal-Mart CSR, 2004). The company has different thrust areas for CSR and they are Ecology, Education, Nutrition, Health and Others.
It is clear that while McDonald’s has initiated CSR measures to tackle its business activities and involves its employees and suppliers, Wal-Mart has taken up CSR measures that directly involve the public. These are explained in the next section.
CSR for Ecology
Wal-Mart has been accused of causing widespread damage to the ecology and the environment. In response to this, the company has introduced reforestation of woodlands and public parks where trees are planted. It has also taken up beautification work such as maintenance of traffic islands and has also introduced measures to clean up and renovate public gardens and parks (Wal-Mart CSR, 2004, p: 11).
CSR for Education
Realising that education was an important area, Wal-Mart has introduced measures to provided equipment to schools and helped in setting up Children’s libraries besides being involved in children’s sporting events. It has also helped in speech therapy activities, taken up maintenance of schools and helped in the learning and leisure activities for children. Understanding the need for small entrepreneurs, has extended help for them and conducted quality workshops and also promoted conferences for small entrepreneurs. The company has stated that 49, 758 people have benefited from its activities (Wal-Mart CSR, 2004, p: 11).
CSR for Nutrition
Wal-Mart has realised the importance of proper nutrition and has been involved in a number of food safety programs. It has started an awareness program called the child malnutrition program where the health of malnourished children is evaluated. It is the main donor for many food banks. Understanding the importance of nutrition among families in developing countries has created many backyard vegetable gardens and family farms. Wal-Mart stated that 721,435 people have benefited from its CSR campaign (Wal-Mart CSR, 2004, p: 11).
CSR for Health
Wal-Mart has given a lot of importance to health among the people and has introduced many programs for improving health. It has provided the facility for children suffering from cancer, care for physically challenged people, people suffering from diseases such as cerebral palsy, breast cancer, congenital cataracts and spina bifida. The company has promoted many fairs for a checkup of eyes, breast cancer detection, dental checkups, health and hygiene, female sexual health problems and so on. Wal-Mart has stated that a total of 32, 121 people have benefited from its health CSR(Wal-Mart CSR, 2004, p: 11).
CSR in other areas
Wal-Mart has introduced a number of measures in areas such as care for homeless and abandoned children and home construction activities. It has also extended marketing and administrative support for many organizations and supported brigades in food drives and disaster management. The company has stated that a total of 990 people have benefited from its activities (Wal-Mart CSR, 2004, p: 11).
Conclusion
A detailed study of CSR at McDonald’s has been done. The main thrust areas are People, Products, Place, Price and Promotion. The study has examined how the CSR vision is implemented. A comparative study of CSR at Wal-Mart has also been done.
References
- CSR, 2006, ‘McDonald’s 2006 Worldwide Corporate Responsibility Report‘, Web.
- Estallp María de-los Ángeles Gil, Fernando Giner de-la Fuente, Carles Gríful-Miquela, 2007, ‘The Importance of Corporate Social Responsibility and Its Limits ’Journal of International Atlantic Economic Society, Volume 13, pp: 379-388
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- Maloni Michael J, Brown Michael E.. 2006, ‘Corporate Social Responsibility in the Supply Chain: An Application in the Food Industry, Journal of Business Ethics, Volume 68, pp: 35-52
- McDonald’s 2007, About McDonald’s, Web.
- McDonalds 2007, Our values, Web.
- McDonalds 2006, 2006 Worldwide Corporate Responsibility Report, Web.
- Nicole, N 2007, Black PR Wire, Press release.
- Prout Jerry, 2006, ‘Corporate responsibility in the global economy: a business case’, Journal of Society and Business Review, Volume 1, Issue 2,pp: 184-191
- Wal-Mart CSR, 2004, ‘Corporate Social Responsibility 2004’.