McEthics

ByGroup – 2, Section - B

Ashuthosh GuptaAshwin Murali

Avadhesh KumarB U DeepankarBangaru Beulah

Bhaghat GBhanujeet Choudhary

About McDonald’s

• A multinational fast food giant that operates across 118 countries with 31000 restaurants serving 60 million customers a day.

• It is the first and largest fast food chain in the world• Pioneered an innovative business model (franchise)

in the fast food industry.• No of outlets: US - 18000+, UK – 1250+, France –

1200+, China – 1500+, India – 250+• Known worldwide for their burgers (Big Mac) and

French fries

Criticism against McDonald’s - McLibel Case

• Allegations of unethical practices• Criticized for serving fatty foods • Exploiting children with their advertisements• Cruelty to animals• Antipathetic to unions• Low wages to workers• False advertisement of nutritious food• Risked the health of most regular and long-term customers

Consequences of the McLibel Case• Massive International publicity• Publication of an acclaimed book and a TV

programme against McDonald’s• A documentary film about the trial• McSpotlight Website

Problems in Europe

• Resisted by local farmers’ union in France• Anti-Americanism due to Iraq war• Concern about health and nutrition – escalating rates

of obesity• Failure to provide a balanced menu• Insufficient information on nutrition and guidance• Promoting ‘supersize’ portions• Box office success of anti-McDonald’s film ‘Supersize

Me’ by Morgan Spurlock• Government regulations

Mc fights back

• Dropped supersize options• Range of new healthy options on the menu• New advertising campaign – “McDonald’s. But not as you

know it”• New menus sent to 17 million households in Europe• Nutritional labelling• Exercise and sports initiatives for young people – McDo Sports

Tour, McDo Kids Iron Tour• Sponsored UEFA Euro 2008 Football Championships• Association with local football clubs across UK

Continued…

Mc fights back• Long-term strategic realignment towards changing societal

values and expectations• Commitment to serve Rainforest-grown coffee in UK

restaurants• Used cooking oil reprocessed into biodiesel. This biodiesel used in their delivery trucks• McSpotlight website abandoned in 2005• The fight back was successful – steady growth in profits • By 2009, Europe was the firm’s highest growth region

Looking East• Potential Markets in India and China – worth

over $120 Billion• Problem of obesity in China• Consumers International’s Claim – Global

brands take advantage of lax laws in Asian countries

• Absence of nutritional information in their websites in China, Philippines and Hong Kong

• Continuation of unethical practices once practiced in Europe – online kids’ zones targeting children with unhealthy food

• Introduction of healthy corn soups in China, Vegetarian burger in India to appease the critics

• Yet to replicate the European model

Points to ponder – the issue of Ethics

• Reacting to the situation or really ethical?• Why wasn’t the European model replicated in

Asia?• Are Asians as health conscious as Europeans?• Really committed to the promotion of a

healthy lifestyle or just to appease the critics remains to be seen

Thank You