McDonald's Corporate Social Responsibility

In this assignment I will be discussing the corporate social responsibility of McDonald’s and the 5 important characteristics. I will demonstrate my understanding of the six core characteristics using McDonald’s to support my ideas. McDonald’s is a well-known fast food restaurant with many cooperate social responsibilities such as opportunities for employees to build their career to supporting the community through charities. These are the positive factors that interest me the most within the business which has led me to make a decision on writing about McDonald’s.  I have chosen this topic because I have a wide range of understanding of the business as I have used their service and also perceived large amount praises on their cultural and ethical behaviours. Writing about the 5 characteristics of the business will provide me with a wide range of understanding on CSR and what effects it has on McDonald’s.

What is Corporate Social Responsibility?

(Investopedia, 2018) “Corporate social responsibility means self-regulated” this statement means the law does not say to be socially responsible but the businesses such as McDonald’s does these favours for the community or the stakeholders regardless of their famous brand and an excellent reputation. (Research Methodology, 2018) McDonald’s states “we serve and community involvement has always been part of our cultures.” This is to shows the contribution they have towards the community and how they are “ethical and socially active.” They show the impact they are having on the economic, social and the environment factors (CSR wire, 2018). Journal written by Karnini Wall Street (2010) states “large business is not in business just for profit, they intend to serve social purposes so they are sustainable.” This means some businesses may contribute to creating a positive reputation however serving the community will benefit the environment. Businesses such as Mc Donald’s is a well-known fast food company and known globally, however, they have an excellent CSR strategy which has increased their reputation.

Core Characteristics of Corporate Social Responsibility

Voluntary

Crane. A et al (2008) “These are activities that go beyond those prescribed by the law.” (PrivacySense.Net, 2015) Voluntary is “often without profit as a motive and with little or no government intervention.” This means the law does not force them to be kind toward the community, they do this because they care for the people in need. The values are the decisions we make and not a statement written down for businesses to follow. McDonald’s has a Ronald McDonald charity which has been helping families since 1974. On Ronald McDonald House Charity (2018) website states the charity is aiming for people to take part in the voluntary work and provide families whose family members are in the hospital a comfortable living place and provide them with the best care. (CSR Report, 2015) The business sends out their employees to also contribute a few hours to serve the public. This shows that business is considerate in the environment by sending their staff and having more employees to perform the service to gain profit. According to Jennifer Elks (2014), these steps toward the community creates a great image and “these sustainable goals are a key to the value chain of the business.” This means the business is capable of achieving and creating long-term visions which will bring a mass amount of success to the business.

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(CSR report, 2015) The business helps the employees and makes their working environment flexible. They support their employees by providing them with financial support such as retirement support and through various insurances for their welfare. They provide family support such as paid leaves, childbirth and a flexible system for parents to work shorter hours. McDonald’s provides the employees with regular health check-ups and other various support for employee’s welfare. From special paid leaves to incentives qualifications through the business. This shows they are socially responsible for the actions they undertake and take great care of their employees. It shows the employees are happy at work and also their special needs are being seen as important. Having a lot of incentives means people are willing to take on the McDonald’s staff roles and creating future plans within the businesses such as serving the customers to controlling the staff through management.

Crane. A., Matten. D., & Spence. L. (2008) “Externalities are positive and negative effects of economic behaviour which are borne by others and not taken into account.” This means the pollution or oil spills produced by companies which are affecting the environment. The externalities are addressed to reduce public health and have very little impact on the environment. In Elsevier B.V. (2018) article on summon suggests recycling is more expensive than landfilling from a purely financial perspective. This means it is important that the companies quantify, contribute and take part in adding into external costs, this is so there are different disposal options and it is not polluting the environment. Reducing the emission could decrease the “amount of global warming and human health,” whereas “disamenities could reduce nuisance and unpleasantness” which will have a positive effect on the public as they will be free from unhygienic and it will decrease health costs. (CSRwire, 2018)

Businesses such as McDonald’s are trying to reduce greenhouse gas. They are taking part in contributing to the external costs to reduce pollution, dirty waste and odour. In March 2018 McDonald’s announces that it will be in partnership with franchisees and the suppliers to reduce the greenhouse emission. This will reduce the number of greenhouse emissions from being released by their business. It will mean by 2030 the business will grow without emission. McDonald’s is taking part so the company is having little impact on the environment and decrease double the amount of emission they were creating. They will innovate and improve LED lights and energy efficient to save electricity, power, and energy which could be recovered. McDonald’s has taken on social responsibility, and they have created a long-term goal to manage externalities to help improve the environment, public health, and save energy.

Practices and Values

Practises and values are about a strategy that deals with many social issues to overcome the needs of individuals. This could be called philosophy or set of values to underpin these practises. It is something the business does for public and does not raise any questions upon it. (Panmore Institute, 2018) McDonald’s has many sets of values which have enabled the business to achieve their potential goal. McDonald’s value is “we place the customer experience at the core of all we do.” The businesses missions are very clear, and they have formed their long and short-term goals through their mission statements. They want to achieve and innovate their business to enable them to grow.

The business wants to provide high-quality food to meet the needs of their customers. They have a healthy menu alongside fast food so they could meet all target audiences. “They are committed to their people” this means they are ready to take on diverse backgrounds and provide the best training to their employees to improve their experience. They give back to their communities and they make their employees gain knowledge on how they could help the community. They support the Ronald McDonald charity to create a better environment. Their values are socially responsible because they are helping others and they have made a mass amount of improvements to help the community such as reducing greenhouse gas emission. They do this without the law to show the capability of the business of helping the communities and meeting their needs.

Multiple Stakeholder Orientation

Crane. A., Matten. D., & Spence. L. (2008) this characteristic means the business should not always focus on the benefits they will gain by just taking care of their shareholders. However, the business also has a responsibility for consumers, employers, suppliers, and local communities in order to survive. The example I have chosen benefits its employees through a lot of incentives.

CSR report (2015) McDonald takes good care of their employees, and they have made a lot of improvements. They have a welfare program by giving financial support such as retirements benefit system and have a lot of insurances to support their employees. The businesses have flexible working hours, so employees could work whenever they are available, this will benefit the parents with children and those who may be caring. They support the families by giving them a paid leave if they have had childbirth and they have nursing leave system. They also have a special birthday paid leave so the employees do not have to work on their celebration day. This means the business has a good culture of taking good care of their employees. While working at McDonald’s it is possible for employees to make their way up and play a role in new jobs. This is an opportunity to extend their careers and making their way up to achieve.

However, McDonald’s has also been involved in child labour. In a Telegraph article (Rennie. D, 2000) it states that “14 Years have been found making toys in South Chinese sweatshop for a supplier to the hamburger chain.” “It was reported that they were paid 2 Renmibi (£2) an hour for the unlimited number of hours.” This shows the business was not monitoring their suppliers and only focused on their own employees within their organisation. It is important that business is monitoring where their supplies are coming from and if they are also taking care of their employees by giving them a fair wage and having a safe environment to work.

Beyond Philanthropy

Baines. P (2016) Philanthropy and CSR is to be effective which is also known as the non-profit sector.  This means it’s the businesses that engage with the charities and gives a portion of their wealth to the charity to contribute and support the people that in need of help. The business has CSR in place. “This could be investing some of their time and knowledge toward helping the community.” It is being loyal to their customers by giving back to the local public. Crane. A., Matten. D., & Spence. L. (2008) “Philanthropy is corporate largesse for less fortunate.” This is what businesses do for the local communities. (McDonald’s, 2018) for example, McDonald’s has a scheme that every time customers buy a happy meal a “penny is donated to support the programs and services.” This shows that people will buy more of their Happy meals and it will help the people in need of help will be supported. This will go toward the Ronald McDonald Family room, Ronald McDonald care mobile and Ronald McDonald House.

Social and Economic Alignment

(Crane. A., et al 2008) social and economic is defined as what benefits can social alignment bring to the company. “While CSR maybe about having a narrow focus on impressing the shareholders and raising their profit, however some believe it should not affect the profitability of the business. “It is about self- interest where social and economic responsibilities are aligned.” It is how businesses could be economically stable through their social actions. The businesses want to use the social strategy to raise their profitability. (RMHC, 2018) Using Ronald McDonald charity as an economic source could be beneficial for McDonald’s as they contribute 1p to the charity every time a customer purchases a Happy meal. This shows they have a strategy to promote their Happy meal brand through a social alignment to satisfy their customers and make them feel involved in helping the community.

(CSRwire, 2018) McDonald’s has also linked when Franchise to reduce greenhouse gas. This is a benefit to the public because it will reduce the amount of health issues created by the company pollution. (Schwab. T, 2018) “We are looking for ways to incorporate soil health initiatives into our supply chain sustainability programs through managed grazing practices and regenerative agricultural practices,” The businesses will gain economic benefits through this process because they are trying to create a better image, reputation and name while the report states they are increasing the amount of beef burgers they sell which means they are trying to hide the negative effects on the environment by creating a good social alignment.

Conclusion

In conclusion, McDonald’s is a very successful business with and without social responsibility. I have learnt the importance of CSR and the effects it has on businesses overall. Doing a favour for the public benefits the business through creating good image and attracting their customers. McDonald’s could work on increasing their social actions by taking more responsibility over their charity by promoting it a lot more on their packages and on other promotional site. This will make their charity more recognised and it will have more contribution over the Ronald McDonald charity. McDonald’s has a good culture and I have learnt that they are very keen about taking care of their employees and their customers and they have made a lot of innovation to help their stakeholders. However they could work on adding a healthy option in their menu so it is accessible for more target audiences.

Bibliography

• Crane. A., Matten. D., & Spence. L. (2008) Corporate Social Responsibility: readings and cases in a global context. (Accessed on 14/12/2018)
• Mc Donald’s (2018) ‘Values in Action’ https://www.mcdonalds.com/us/en-us/about-us/values-in-action.html (Accessed on 10/12/2018)
• Research Methodology (2016) ‘Overview of McDonald CSR’ https://research-methodology.net/overview-of-mcdonalds-csr/ (Accessed on 10/12/18)
• CSR Report (2015) ‘McDonald’s CSR Report’ (Accessed on 12/10/2018)
• RMHC (2018) ‘Helping Stay Close’ https://www.mcdonalds.com/us/en-us/community/giving-back-with-ronald-mcdonald-house.html (Accessed on 10/12/2018)
• Australian Human Rights Commissions (2018) ‘What is CSR’ https://www.humanrights.gov.au/publications/corporate-social-responsibility-human-rights (Accessed on 12/12/2018)
• M I’M lovin it (2018) ‘Mission and Values’ https://corporate.mcdonalds.com/mcd/our_company-old/mission_and_values.html (Accessed on 12/12/2018)
• PrivacySense.Net (2015) ‘Voluntary Sector’ http://www.privacysense.net/terms/voluntary-sector/ (Accessed on 12/12/2018)
• CSRwire (2018) ‘CSR News’ http://www.csrwire.com/press_releases/40864-McDonald-s-Becomes-the-First-Restaurant-Company-to-Set-Approved-Science-Based-Target-to-Reduce-Greenhouse-Gas-Emissions (Accessed on 12/12/2018)
• Telegraph -Rennie. D (2000) ‘McDonald in Child Labour claim’ https://www.telegraph.co.uk/news/worldnews/asia/hongkong/1368114/McDonalds-in-child-labour-claim.html (Accessed on 13/12/18)
• Elsevier B.V. (2018) ‘Pricing landfill externalities: Emissions and disamenity costs in Cape Town, South Africa’ https://www-sciencedirect-com.libaccess.hud.ac.uk/science/article/pii/S0956053X11002571 (Accessed on 13/12/2018)
• Baines. P (2016) ‘Philanthropy vs. Corporate social responsibility’ https://www.theceomagazine.com/business/philanthropy/philanthropy-vs-corporate-social-responsibility/ (Accessed on 13/12/2018)
• Schwab. T (2018) ‘The company has an ambitious-sounding plan to curb its emissions. But can it really take a meaningful stance on climate change while selling more Big Macs?’ https://newfoodeconomy.org/mcdonalds-greenhouse-gas-emissions-reduction-pledge-beef/ (Accessed on 14/12/2018)