Progress and Performance

 

 

We’ve transitioned away from the former CSR and Sustainability Framework and its associated annual progress reports to the more dynamic environmental, social and governance (ESG) performance reporting website platform that we will use going forward. We will continue to add and streamline metrics on this site over time as our measurement capabilities grow, but we anticipate that it will take a reporting cycle or two to have a more consistent, comprehensive snapshot of our impact.

 

On this page:

Global Priorities – Beef Sustainability | Global Priorities – Packaging and Recycling | Global Priorities – Our Investment in People | Our Food – Chicken | Our Food – Fish | Our Food – Coffee | Our Food – Palm Oil | Our Planet – Energy Performance | Our Planet – Conserving Forests | Our People and Communities

 

Global Priorities – Beef Sustainability

As a part of our broader strategy, we have launched a new set of ambitious beef sustainability goals for 2020. These goals apply in each of our top 10 beef sourcing countries (U.S., Australia, Germany, Brazil, Ireland, Canada, France, New Zealand, U.K. and Poland), which collectively represent more than 85% of our global beef volumes.

Goal

Accelerate industry progress: By 2020, source a portion of our beef from suppliers participating in sustainability programs aligned with Global Roundtable for Sustainable Beef (GRSB) principles and criteria, and that meet McDonald’s requirements for each applicable market.

 

Progress

In 2016, we purchased a portion of our beef from a fully verified supply chain sustainability pilot program in Canada. This initiative is now being led by the Canadian Roundtable for Sustainable Beef (CRSB). Arcos Dorados – Latin America’s largest restaurant chain and one of the Company's largest Franchisees – sourced beef through the Novo Campo program during the Rio Olympics. Through these programs we are currently sourcing beef in two out of our 10 top beef sourcing countries from sustainability programs. We are actively collaborating with key national stakeholders to develop beef sustainability programs in our remaining eight markets.

 

Goal

Share knowledge and tools: By 2020, engage with beef producers through outreach projects to help develop and share best practices related to our Priority Impact Areas.

 

Progress

As of end of 2017, more than half of our top 10 beef sourcing countries are supporting or sponsoring beef producer sustainability groups or programs.

 

Goal

Promote Flagship Farmers: By 2020, use our Flagship Farmers program to select and showcase our most progressive suppliers.

 

Progress

As of end of 2017, three of our top 10 beef sourcing countries had recognized one or more beef producers as Flagship Farmers to work with peers and share their industry-leading processes and practices. The remaining seven countries will begin recognizing beef Flagship Farmers throughout 2018. In addition to adding these sustainability champions to the Flagship Farmer program, we're also focused on providing them with resources and tools that better enable and equip them to engage with other farmers and industry influencers. Broadening those opportunities will be a top focus in the years ahead.

 

Goal

Pioneer new practices: By 2020, set up McDonald’s progressive farm partnerships to trial and discover new practices related to our priority impact areas.

 

Progress

Four of our 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.

 

Goal

Conserve forests: 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. This is part of our Global Commitment on Forests and includes regions outside of our top 10 beef sourcing countries.

 

Progress

The first step for the Company was to identify the list of countries that we currently source beef from that have a high deforestation risk, as defined by the WWF Living Forests report. We are working with these countries and our suppliers, alongside expert consultants including Proforest and Agrotools to identify tailored risk mapping and implementation plans for these identified regions.

We’re also engaged in multi-stakeholder groups to address these issues, including:

 

Read more about beef sustainability

 

 

 

Global Priorities – Packaging and Recycling

As one of the world’s largest restaurant companies, we pledge to reduce overall use of packaging, drive innovation in sustainable packaging and in the recycling sector, and engage millions of customers in the thousands of communities we call home to adopt recycling behaviors as the norm.

Goal

By 2025, 100% of McDonald’s guest packaging will come from renewable,1 recycled1 or certified2 sources.

Interim target: 100% of fiber-based packaging will come from recycled or certified sources where no deforestation occurs by 2020.

 

Progress

50% achieved, including the U.S., U.K., Canada, France, Germany, Russia, Japan and China.

64% of our fiber-based guest packaging comes from recycled or certified fiber sources.

We will eliminate foam from our global System by the end of 2018.

 

Goal

By 2025, our goal is to recycle3 guest packaging in 100% of McDonald’s restaurants. We understand that recycling infrastructure, regulations and consumer behaviors vary from city to city and country to country, but we plan to be part of the solution and help influence powerful change.

 

Progress

Currently, we recycle guest packaging in an estimated 10% of McDonald’s restaurants around the world. In some markets, we’re recycling at nearly 100% of our locations, and in others we’re just getting started.

12 of our top 16 markets now have recycling and litter programs and partnerships in place.

 

1. Recycled: Material that has been reprocessed from recovered [reclaimed] material by means of a manufacturing process and made into a final product or into a component for incorporation into a product. [ISO 14021:2016 “renewable” and “recycled” material.] Recycled material applies to plastics and fiber. Fiber-based packaging made from 100% recycled content must be third-party verified, unless certified under a chain of custody forest management standard.

2. Certified: Specifically, all guest packaging items (including hot cups, cold cups, carryout bags, folding cartons, clamshells, wraps, food service bags, napkins, salad bowls, Happy Meal cartons, drink carriers) made from paper/board sold to McDonald’s globally must be certified by FSC or Programme for the Endorsement of Forest Certification (PEFC). FSC is required when fiber is sourced from the following high-deforestation risk countries: Russia, China, Malaysia, Indonesia, Laos, Vietnam, Cambodia and Argentina by 2020.

3. Collection methods for recyclable materials will vary by market. Examples include, but are not limited to, tray collection of waste for back of counter separation, installed bins that allow guests to separate recycling from trash, collecting all waste in one bin and sending to a facility for separation and recycling.

Read more about packaging and customer recycling.

 

 

 

Global Priorities – Our Investment in People

Specific and measurable outcomes for the partnership’s goals will be agreed by ourselves and our partner non-governmental organization (NGO). The global partnership will be a success when the needs of both partners have been met.

For us, this means increased access to high-quality talent and improved employer reputation and trust in our brand. For the partner NGO, success will be measured by an increase in NEET (not in employment, education or training) youth who are placed and supported in employment and have a clear path for ongoing success.

Further success will be achieved as we and our partner come to be seen as global champions for education and skills, attracting other partners and stakeholders to address the issue more holistically across the globe.

Further success will be achieved as we and our partner come to be seen as global champions for youth employability, attracting other partners and stakeholders to address the issue more holistically across the globe.

Read more about Our Investment in People

 

 

 

Our Food – Chicken

Goal

Eliminate the use of antibiotics defined by the World Health Organization as Highest Priority Critically Important (HPCIA) to human medicine as defined by the WHO from all chicken served by 2027.1 Intermediary phases are planned.2

 

Progress

Since 2016, no chicken served in the U.S. is treated with antibiotics important to human medicine. In 2017, we released our new Global Chicken Antibiotics Policy.

 

Goal

Purchase 100% sustainable certified soy by 2020 in Europe.

 

Progress

In 2017, approximately 65% of soy used for chicken feed in our European markets was covered by ProTerra or Roundtable on Responsible Soy certification.

 

Goal

Animal health and welfare commitments on or before 2024:

  • Source broiler chickens raised with improved welfare outcomes. We plan to set targets, measure performance and report on key farm-level welfare outcomes across our largest markets.
  • Partner with technology companies, producers and suppliers to invest in the development of state-of-the-art digital monitoring systems to automate the gathering of key animal health and welfare indicators, including behavioral measures. Once established, these technologies will highlight potential areas for improvement in real time and will be among the first of their kind available at a commercial scale.
  • Conduct commercial trials in partnership with our largest global chicken suppliers to study the effect that certain production parameters have on key welfare indicators, as well as other sustainability outcomes, under large-scale, commercial conditions.
  • Establish a multi-stakeholder Advisory Council focused on chicken sustainability, which consists of academics, suppliers, animal welfare and environmental advocates, scientists and industry experts.
  • Require chickens to be raised in housing environments that promote natural behaviors such as pecking, perching and dust-bathing. These are encouraged through provision of perches, bales and access to floor litter 100% of the time and a minimum of 20 lux light intensity during daylight. These standards reflect recommendations from scientists in the U.S. and Europe.
  • Have all increased broiler welfare standards on farms audited by a third party.
  • In the U.S. and Canada, transition to sourcing chickens slaughtered by the use of Controlled Atmospheric Stunning (CAS), a Department of Agriculture-approved method that is recognized to be more humane for the animal, while also ensuring better conditions for workers. CAS is currently practiced by many approved suppliers for McDonald’s restaurants in Europe and Australia.

 

Progress

These commitments were announced at the end of 2017.

 

1. These commitments apply to chicken raised for sale at McDonald’s restaurants in Australia, Canada, France, Germany, Italy, Ireland, the Netherlands, Poland, Russia, South Korea, Spain, Switzerland, U.K. and U.S.

1. 2017: 100% of chicken served in the U.S. is free of antibiotics important to human medicine.
January 2018: HPCIAs will be eliminated in broiler chicken for Brazil, Canada, Japan, South Korea, the U.S. and Europe, with an exception for Colistin for Europe only; implement all other elements of the Global Chicken Antibiotics Policy across all markets, including a prohibition on routing preventative use.
End of 2019: HPCIAs will be eliminated in broiler chicken for Australia and Russia, and Europe plans to have removed Colistin.
January 2027: HPCIAs will be eliminated in all other designated markets around the world. Our goal is to have this policy implemented before this date.

Read more about responsibly sourced chicken.

 

 

 

Our Food – Fish

Goal

By 2020, all the wild-caught fish purchased for use in McDonald’s restaurants will be from verified sustainable sources.

 

Progress

Globally, all of the whitefish for McDonald’s Filet-O-Fish is sourced from sustainably managed fisheries, and McDonald’s has achieved MSC certification in North America, Europe and Brazil.

We’re working on a strategy to support the development of sustainability standards for aquaculture to guide our future purchases.

 

Read more about our approach to sustainable fish.

 

 

 

Our Food – Coffee

Our first Coffee Sustainability Report (pdf, 3.13MB) shows our journey so far and aligns closely with our Commitment on Forests.

Goal

100% of coffee verified as supporting sustainable production by 2020.

 

Progress

In 2016, 56% of our coffee was sourced sustainably through Rainforest Alliance, UTZ, Fair Trade International and Fair Trade USA certification, as well as McCafé SIP-approved programs.

 

Goal

By 2018, all coffee from high-deforestation risk regions will be sourced from Rainforest Alliance Certified farms.

 

Progress

In 2016, 44% of coffee grown in high-deforestation risk countries was Rainforest Alliance Certified, and we are on target to achieve this goal by 2018. Coffee from high-deforestation risk countries constitutes 6% of our global supply in 2016.

 

Read about our approach towards sustainably sourced coffee.

 

 

 

Our Food – Palm Oil

Goal

By 2020, 100% of the palm oil used in McDonald’s restaurants worldwide and as ingredients in McDonald’s products will support sustainable production.

 

Progress

In 2017, 100% of the total volume was certified as supporting sustainable production. Our volumes of mass balance certified oils increased from 11.6% in 2016 to 36% in 2017. 

By Roundtable on Sustainable Palm Oil (RSPO) chain of custody system:

  • 63% verified using book and claim certificates (the minimum level of verification currently required according to our palm oil policy).
  • 36% Mass Balance
  • 1% Segregated
  • .2%  Identify Preserved

Goal

All centrally managed suppliers of restaurant and par-fry oil must:

  • Be active members of the RSPO and report through the RSPO Annual Communications of Progress.
  • Have a public commitment to eliminate deforestation and supporting strategy.
  • Have a strategy for traceability to the mill and plantation level.
  • Be committed not to source from peatlands, high conservation value land and high carbon stock forests.
  • Be committed to uphold human rights at the plantation level and Free and Prior Informed Consent.
  • Have a third-party verification process.
  • Have a strategy to address any open grievances.

 

Progress

In 2016, all direct suppliers of restaurant and par-fry oils submitted documentation outlining that they have policies and programs in place to fulfil the requirements outlined in our Sustainable Palm policy.

 

See also progress toward our goals for eliminating deforestation.

Read more about our approach toward sustainably sourced palm oil and how we’re committed to conserving forests.

 

 

 

Our Planet – Energy Performance

Energy consumption 1

McDonald's Company-Owned Restaurants (Top 9 Markets)

20143

20154

20165

Direct energy consumption: kWh/GC2

0.268

 0.233

0.210

Indirect energy consumption: kWh/GC

1.197

 1.121

 1.120

Overall energy consumption: kWh/GC

1.465

 1.353

  1.330

Overall energy consumption: GWh

2,983

  2,829

  2,295

 

Franchise Restaurants (Top 9 Markets)

2014

2015

20165

Direct energy consumption: kWh/GC

0.476

0.128

0.372

Indirect energy consumption: kWh/GC

 1.382

1.218

1.120

Overall energy consumption: kWh/GC

1.858

1.346

1.492

Overall energy consumption: GWh

16,472

 16,646

12,315

1. These figures represent estimates based on the best available energy data in our top nine markets. Currently we do not have Company-owned restaurants in Brazil or Japan. We worked with Aligned Incentives for the data analysis of our energy consumption data.

2. GC represents total transactions for the calendar year. “Direct” energy data reflects the use of natural gas, propane, fuel oil and liquefied petroleum gas. “Indirect” energy data reflects electricity usage. We categorized it in this fashion to show their relationship to Scope 1 and Scope 2 of our estimated System-wide GHG emissions.

3. 2014 figures reflect primary data from 4,066 out of 4,229 Company-owned restaurants and 5,983 out of 22,234 Franchisee restaurants in our top nine markets, totaling 10,049 out of 26,893 restaurants overall. Primary energy data was extrapolated to estimate energy consumption for all restaurants in the markets and ownership types reported. The top nine markets included approximately 74% of the restaurants worldwide (26,893 out of 36,258 as of December 31, 2014).

4. 2015 figures reflect analysis of primary energy data from at least 4,127 Company-owned restaurants and 5,778 Franchisee restaurants in our top nine markets, totaling 9,905 out of 26,842 restaurants in those markets overall. Primary energy data was extrapolated to estimate energy consumption for all restaurants in the markets and ownership types reported. The top nine markets included approximately 73% of the restaurants worldwide (26,842 out of 36,525 as of December 31, 2015). We have continued to enhance our extrapolation methods over time as additional data has become available.

5. 2016 figures reflect analysis of primary energy data from 3,645 Company-owned restaurants and 7,032 Franchise restaurants in our top nine markets, totaling 10,677 out of 27,453 restaurants in those markets overall. Primary energy data was extrapolated to estimate energy consumption for all restaurants in the markets and ownership types reported. The top nine markets included approximately 73% of the restaurants worldwide (27,453 out of 37,590 as of December 31, 2016). We have continued to enhance our extrapolation methods over time as additional data has become available, leading to more statistically significant results with reduced uncertainty.

 

Greenhouse gas (GHG) emissions

GHG Protocol Categories2

20141,2

20152

20162

Company-Owned Restaurants, Worldwide

Total Estimated GHGs (Megatons of CO2 Equivalents) 3

Direct (Scope 1)

0.178

0.193

0.182

Indirect (Scope 2)

1.775

2.030

1.780

Franchise Restaurants, Worldwide (Part of McDonald's Scope 3)

Total Estimated GHGs (Megatons of CO2 Equivalents) 3

Franchise: Direct

1.114

1.142

1.043

Franchise: Indirect

7.261

7.402

5.800

1. For our 2014 analysis, we worked with Enviance to launch an updated methodology to estimate GHG emissions from McDonald’s restaurant energy use and refrigerant emissions worldwide. This team, now at Aligned Incentives, continued our methodology improvements and analysis for 2015 and 2016.

2. Best available primary energy data from our top nine markets (see table above) was extrapolated to estimate energy consumption and GHG emissions for all restaurants worldwide as December 31, 2014 (36, 258 restaurants), December 31, 2015 (36,525 restaurants) and December 31, 2016 (27,453 out of 37,590). Refrigerant emissions were estimates using input/output analysis of McDonald’s data and U.S. industry average emissions information.

3. Enviance addressed uncertainty in GHG emissions estimates by conducting 1 million Monte Carlo simulations to establish 95% confidence intervals around each data point for 2013–2015. Aligned Incentives addressed uncertainty in GHG emissions estimates by conducting 100,000 Monte Carlo simulations to establish 95% confidence intervals for each data point for 2015–2016.

 

Read about how we’re addressing climate change and looking at every aspect of our restaurant design.

 

 

 

Our Planet – Conserving Forests

Goals

Eliminate deforestation in our beef, chicken (including soy in feed), palm oil, coffee and the fiber used in consumer packaging by 2020.

Eliminate deforestation from our global supply chain by 2030.

Progress in Beef Sourcing

The first step for the company was to identify the list of countries that the Company currently sources beef from that have a high deforestation risk, as defined based on WWF Living Forests report.1 We are working with these countries and our suppliers, alongside expert consultants including Proforest and AgroTools to identify tailored risk mapping and implementation plans for these identified regions.

We’re also engaged in multi-stakeholder groups to address these issues, including:

  • Collaboration on Forests and Agriculture.
  • Global Roundtable for Sustainable Beef and other local beef sustainability roundtables.
  • Joint Working Group on Forests Leadership Committee, part of the Global Roundtable.

Progress in Chicken Sourcing

We are committed to sourcing soy for chicken feed in a sustainable way that does not contribute to deforestation, and have identified the regions that we are sourcing soy from with high deforestation risks. In 2016, 50% of soy used for chicken feed in our European markets was covered by Roundtable on Responsible Soy (RTRS) or Proterra certification. We are developing a strategy for the other identified regions.  

In October 2017, we, along with 23 other global companies, launched a statement of support (pdf, 44KB) for the objectives of the Cerrado Manifesto (pdf, 400KB), reaffirming our individual and collective commitment to halting forest loss associated with agricultural commodity production and recognizing the critically important role played by the Cerrado for its role in climate change mitigation, biodiversity, water and agricultural production.

Progress in Palm Oil Sourcing

Our aim is to have all palm oil used in our restaurants and as ingredients in McDonald’s products be verified to support sustainable production through a combination of certification, traceability and risk mapping. In 2016, 99.82% of the total volume was certified as supporting sustainable production.

By chain of custody system:

  • 87.3% verified using book and claim certificates (the minimum level of verification currently required according to our palm oil policy).
  • 11.7% was verified using Roundtable on Sustainable Palm Oil (RSPO) Mass Balance.
  • Less than 1% was verified using an RSPO segregated method.

We are committed to further shift our palm oil toward RSPO Mass Balance certified and RSPO segregated. Our suppliers are expected to be active members of the RSPO and report through the RSPO Annual Communications of Progress, as well has having a policy in place to conserve forests.

Progress in Fiber Sourcing

By 2020, all virgin fiber for our customer packaging sourced from high-deforestation risk regions will be Forest Stewardship Council (FSC) certified, and the Company will also maintain its preference for FSC-certified virgin fiber from other regions. The FSC standard prohibits deforestation, including conversion of natural forests to plantations. As of 2016, 64% of McDonald’s fiber-based packaging comes from third-party verified recycled or certified fiber (FSC, PEFCTM or PEFC-endorsed) sources.

Progress in Coffee Sourcing

In 2016, 44% of coffee grown in high-deforestation risk countries was Rainforest Alliance certified, and we are on target to achieve this goal by 2018. Coffee from high-deforestation risk countries made up 6% of our global supply in 2016.

1. In order to better focus our efforts, we have mapped out and identified a list of countries that have a high deforestation risk, as defined in the WWF Living Forests report, and that we currently are sourcing from: Fiber – Argentina, Cambodia, China, Indonesia, Laos, Malaysia, Russia and Vietnam. Coffee – Honduras, Indonesia and Vietnam. Palm oil – Indonesia and Malaysia. Soy – Argentina, Bolivia, Brazil and Paraguay. Beef – Argentina, Australia, Bolivia, Brazil, Colombia and Paraguay.

 

Our People and Communities

Community investment

Along with Franchisees and suppliers, McDonald’s generates jobs and makes capital investments that help build stronger communities around the world. In 2016, these amounted to $4.2 billion.

 

Year

Capital Expenditure

Income Taxes Paid

2013

$2.8B

$2.5B

2014

$2.6B

$2.4B

2015

$1.8B

$2.0B

2016

$1.8B

 $2.4B

 

The Company also matches funds raised by Company employees up to $5,000 ($10,000 for a Vice President or Board member). Each year, this equates to more than $1 million, doubling the efforts of our people. We also run a payroll giving scheme so that Company employees can donate to charities of their choice in a tax-efficient way.