Nature, Forests & Water

Jump To: Our Recent Progress | Focus on Forests and Natural Ecosystems | Focus on Nature and Biodiversity | Focus on Water

We aim to help build resilience with suppliers and farmers to help preserve natural ecosystems, enhance biodiversity and safeguard water.

This work is intricately connected to our efforts across Climate Action, Responsible Sourcing and Human Rights.

Our Recent Progress

• Refreshed our Commitment on Forests and Natural Ecosystems (PDF – 126 KB) (see Our Commitment, below) that details our efforts to eliminate deforestation and address conversion for commodities and regions where we can deliver the greatest impact.
  
  
• Further strengthened global sustainable sourcing policies and compliance processes that help bring our commitment to life.
  
  
• Engaged in a more sustainable landscape initiative in Kutai Timur, Indonesia, to help support local communities, smallholders and palm oil and rubber plantation workers to benefit from a more sustainably managed landscape that aims to reduce forestry and land-use emissions.
   

See our latest Purpose & Impact Report on the Goal Performance & Reporting page and Consumer Goods Forum’s Positive Coalition 2023 Report (PDF – 174 KB) for more information.

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Focus on Forests and Natural Ecosystems

Our Commitment

Back in 2015, following our endorsement of the New York Declaration on Forests (NYDF), we released our first Commitment on Forests. This was developed from our work to help protect forests dating back to 1989. In 2024, we refreshed our Commitment on Forests and Natural Ecosystems (PDF – 126 KB), to better reflect the evolution of industry best practices and standards and our progress to safeguard natural ecosystems. In it, we outline our commitment to eliminate deforestation¹ and address conversion² in our global supply chain by 2030, for commodities and regions where we can deliver the greatest impact – building on our 2020 milestones to support deforestation-free supply chains for our primary commodities (PDF – 6.2 MB).

The Company’s refreshed commitment extends beyond forests to actions that also help protect natural ecosystems and areas of high conservation value (HCV), alongside helping safeguard the people and communities who depend on these natural spaces. Solutions to help address the conversion of natural ecosystems take different forms in each area of the world. Best practices to establish a baseline, track progress and report the impact of actions related to conversion are still being developed, as is the technology to monitor conversion. Examples of the Company’s work to help address conversion include its participation in the Land Use Change Initiative in the U.S., which aims to evaluate the drivers and impacts of land use change, its support in Brazil of the Voluntary Monitoring Protocol for Cattle Suppliers in the Cerrado and its inclusion of conversion sourcing requirements for beef the Company purchases from the Brazilian Cerrado.

The updated commitment also reflects the link between deforestation and emissions associated with land use change, in line with the Science Based Target initiative’s (SBTi) Forests, Land and Agriculture (FLAG) framework and our climate goal (read more on our Climate Action page).

Our Global Supply Chain Approach

We are committed to helping drive industry transformation, supporting deforestation-free supply chains and addressing conversion at scale. We believe that, in addition to having a commitment regarding eliminating deforestation, it is important to take steps to understand the root cause of historic and potential future land use change, and to learn about the broader context for the communities in which we operate and buy from. We engage our suppliers to help ensure they understand our Commitment on Forests and Natural Ecosystems, how it applies to them and what our expectations are, as well as the technical details of our related sustainable sourcing policies. We are also engaging them on what they’re doing well and where there is room for improvement in terms of natural ecosystem protection.

Engaging Our Supply Chains

To further our efforts, we identify the areas where we can have the greatest positive impact in our supply chains:

• We collaborate globally with Proforest, World Wildlife Fund (WWF) and industry groups to help amplify impact.
  
  
• We maintain detailed sourcing requirements for all priority commodities, engaging suppliers to implement our requirements and achieve aligned goals across their own businesses.
  
  
• We analyze suppliers’ progress and adherence to our sustainable sourcing requirements and curate tailored suggestions to further align collective action on deforestation-free supply chains.
  
  
• We are collaborating with our suppliers to adhere to the European Union Deforestation Regulation (EUDR), as applicable to our priority commodities (read more about Sourcing Our Priority Commodities) as well as cocoa.
  

Sourcing Our Priority Commodities

Recognizing that each raw material is different and requires a tailored approach, under the McDonald’s Commitment on Forests and Natural Ecosystems we identified where McDonald’s can best use our scale for progress. Since 2015, we have prioritized the following commodities, considering their potential role as leading drivers of deforestation globally:

• Beef
  
• Soy (initially prioritizing chicken feed)
• Palm oil
• Coffee
• Fiber-based packaging (initially prioritizing primary guest packaging)
   

Where possible, we rely on reputable commodity-specific, third-party certifications to verify compliance with our sustainable sourcing policies. When suitable certifications are not available, we invest in external verification systems to monitor and address our potential impact, alongside our suppliers.

Using the Accountability Framework initiative’s (AFi) Accountability Framework to guide our work, we pursue a range of other actions, as part of our sustainable sourcing policies, to bring our commitment to life for each priority commodity:

• Beef: Alongside Proforest, we developed the Company’s Deforestation-Free Beef Procurement Policy (PDF – 214 KB). We have detailed requirements to help support forest-positive beef sourcing from high priority regions in Brazil, Paraguay, Argentina and Australia. We work alongside our monitoring service provider, Agrotools, to utilize social and environmental criteria and monitor adherence to our policy, focusing on purchasing from producers that conserve forests and respect human rights. Read more about how we utilize monitoring technology and tailored supplier feedback to support a deforestation-free beef supply chain.
  
  
• Soy (for chicken feed): We require that all soy for the feed of chicken used in McDonald’s products is either sourced from low priority regions or, when sourced from high priority regions, must support responsible soy production.³ (See our definitions of low and high priority regions). Given the complexity of soy supply chains, we consider all soy for chicken feed linked to McDonald’s chicken products to fall into high priority regions, with the exception of chicken sourced in the U.S. and Canada. We support responsible soy production through the purchase of Round Table on Responsible Soy (RTRS) credits to cover estimated soy in feed for chicken outside of the U.S. and Canada. Several of our suppliers of chicken to Europe also use physical certification through ProTerra standards. We are actively engaging with suppliers to increase our visibility into embedded soy (soy that is transformed as an ingredient) as a further mechanism of how we work to protect natural ecosystems.

• Palm oil: We require that palm oil sourced for McDonald’s restaurants or as ingredients in McDonald’s products be covered by Roundtable on Sustainable Palm Oil (RSPO) certification or credits. All countries are considered high priority regions for palm oil and all volumes must meet this requirement. McDonald’s is committed to increasing traceability by requiring physical certification for the palm oil sourced for McDonald’s restaurants or as ingredients in McDonald’s products in the greatest volumes. Consistent with the Company’s Commitment on Forests and Natural Ecosystems, we support the work of the sector to strengthen the delivery of NDPE (no deforestation, no expansion on peat and no exploitation) in palm oil production and we have invested in a supply chain project with one of our key suppliers to cascade this work further upstream. Read more on our Responsible Sourcing page.

• Coffee: McDonald’s requires coffee sourced from Honduras, Indonesia and Vietnam to be Rainforest Alliance Certified™. Globally, we require suppliers to sustainably source their ground and whole bean coffee, including decaffeinated coffee, coffee used in espresso-based drinks, coffee brewed at restaurants and all coffee used in retail products. Sustainably sourced means coffee is either Rainforest Alliance, Fair Trade USA or Fairtrade International certified, or is coming from a McCafé Sustainability Improvement Platform (SIP) program. Read more about how we support a more sustainable coffee sourcing on our Responsible Sourcing page.
  
  
• Fiber: McDonald’s requires that our fiber-based primary guest packaging be sourced from Forest Stewardship Council^® (FSC^®) certified or FSC® controlled wood sources, with full chain of custody certification when the country of fiber origin includes Argentina, Cambodia, China, Indonesia, Laos, Malaysia⁴ and Vietnam. Outside these areas, FSC, Programme for the Endorsement of Forest Certification (PEFC) or Sustainable Forestry Institute (SFI) certification schemes are acceptable for suppliers to use.
   

We believe working alongside our suppliers to support adherence to the Company’s sustainable sourcing policies and requirements is critical to helping realize our Commitment on Forests and Natural Ecosystems. As such, the Company takes steps to help train and otherwise engage suppliers, including on corrective action plans, where appropriate. We also encourage our suppliers to work directly with producers around reintegration opportunities so that, together, we are helping build a more resilient and responsible supply chain that supports natural ecosystems and producer livelihoods.

Read more about our cut-off dates on deforestation by commodity/biome (PDF – 128 KB).

Human Rights and Forests

The Company’s Commitment on Forests and Natural Ecosystems includes respect for human rights, as set out in the McDonald’s Human Rights Policy (PDF – 120 KB) and informed by the Universal Declaration of Human Rights (UDHR). This is because we see respect for human rights as key to helping protect the well-being of people and the planet. As our commitment includes significant emphasis on people of all identities, including Indigenous and smallholders, we take steps to help ensure there are people-related elements in the Company’s sustainable sourcing policies.

The Paraguayan Chaco is home to 327 Indigenous communities, and one of our beef suppliers is collaborating with them. All producers in this biome are required by law to have ecological corridors running alongside their property. Our supplier worked with local Indigenous communities to sketch native wildlife living in these corridors and post these pictures as well as messages on roads nearby, to help the community support the safe movement of wildlife.

Read more about how we uphold human rights on our Human Rights page, as well as in our Human Rights Index, located in our Purpose & Impact Report appendix (PDF – 6 MB).

Aligning Our Approach With Best Practices and Leading Industry Associations

We look to external organizations and frameworks to help ensure our approach aligns with relevant best practices. We are engaged with various organizations, such as:

• We are members of the Forest Positive Coalition, a multi-company initiative to address commodity-driven deforestation. McDonald’s co-leads the Beef Working Group. Find out more about Commodity Roadmaps on the Consumer Goods Forum website and in our Consumer Goods Forum’s Positive Coalition 2023 Report (PDF – 174 KB).
  
  
• The AFi Private Sector Advisory Group.
  
  
• The Taskforce on Nature-related Financial Disclosures (TNFD) Forum.
  
  
• We were a founding member of the Global Roundtable for Sustainable Beef (GRSB) in 2011. Read more about our work with the GRSB on the Responsible Sourcing page.
  
  
• We are collaborating throughout the industry through the Voluntary Monitoring Protocol for Cattle Suppliers in the Cerrado to support best practices in addressing the potential social and environmental impacts in cattle supply chains in the Cerrado biome of Brazil.
   

Definitions

To help ensure we are reporting clearly and consistently against our commitments, and in conjunction with our work with experts and recognized frameworks such as the Afi’s Accountability Framework, McDonald’s commitments and expectations, as outlined above, reference the definitions set out below.

• Eliminate deforestation refers to McDonald’s global pledge to tackle deforestation, per our commitment, in our global supply chain by 2030, for commodities and regions where we can deliver the greatest impact. We use the term “supporting deforestation-free supply chains” on this page to reflect the actions we are currently taking to implement, measure and report progress toward our commitment.
  
  
• Deforestation refers to the loss of natural forest as a result of i) conversion to agriculture or other non-forest land use; ii) conversion to a tree plantation; or iii) severe and sustained degradation, as aligned with the definitions of the Accountability Framework
  
  
• High priority regions are defined as countries, biomes, municipalities or postcodes that are identified as areas where deforestation and/or attributable conversion has occurred historically as determined through regular assessments, including with third parties, that rely on the latest supply chain data and trends related to forests and natural ecosystems.
  
  
• Low priority regions refers to countries, biomes, municipalities or postcodes that are identified as areas without or with a low risk of deforestation and/or attributable conversion, as determined through regular assessments, including with third parties, that rely on the latest supply chain data and trends related to forests and natural ecosystems.
  
  
• Supporting deforestation-free supply chains refers to the work the Company is doing relative to priority commodities in its supply chains that are either sourced sustainably from high priority regions and comply with McDonald’s sustainable sourcing requirements as set out or are sourced from low priority regions.
  
  
• Conversion, as aligned with the Accountability Framework, refers to change or a loss of a natural ecosystem as a result of its replacement with agriculture or another land use, or due to a profound and sustained change in a natural ecosystem’s species composition, structure or function.
  
  
• Natural ecosystems, as defined by the Accountability Framework, refers to an ecosystem that substantially resembles – in terms of species composition, structure and ecological function – one that is or would be found in a given area in the absence of major human impacts. This includes human-managed ecosystems where much of the natural species composition, structure and ecological function are present.

Focus on Nature and Biodiversity

Natural ecosystems play a vital role in supporting biodiversity, as well as ensuring a thriving and resilient food system, and the United Nations (UN) has stressed the importance of forests to combatting climate change.

Developing Our Approach

We use policies and supplier engagement to encourage management practices that actively support biodiversity rather than relying on biodiversity offsets.

We also take steps to assess potential nature-related dependencies and risks, identifying opportunities to adapt and innovate for positive future impact. In 2021, McDonald’s joined the TNFD Forum to collaborate and contribute to the frameworks, metrics and solutions required to undertake these assessments, and to consider the complex interplay between each aspect. This included determining key metrics that will enable measurable progress in supporting nature and biodiversity throughout our value chain. With the TNFD recommendations finalized more recently, we are considering how this may impact our work in this space in the future. We also consider nature in our climate risk and resiliency work, which is reported in our Climate Resiliency Summary (PDF – 1.3 MB).

Advancing Regenerative Agriculture

We promote regenerative agriculture as a key tool for suppliers to help further the Company’s nature, forests and water strategies. 

The positive environmental impacts and biodiversity benefits from regenerative farming models are clear and measurable but there are also notable social benefits. By promoting regenerative agriculture, we can also support farming communities and create more resilient, economically viable systems for the long term.

See our Responsible Sourcing page for more information about how we promote regenerative agriculture principles, as well as our latest Purpose & Impact Report (PDF – 6 MB) for key examples of our current projects.

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Focus on Water

Water is vital to our business. We need safe, readily available water to run our restaurants and serve the drinks our customers love. Additionally, to create our iconic food items, we rely on agricultural products, which in turn depend on finite freshwater sources.

Water is increasingly scarce, and we believe that we need to treat every drop as precious. We recognize that water stewardship is important for the Company’s business strategy and resiliency, in addition to benefits for the people and the planet.

Shaping Our Water Strategy

We’re working to conserve water, use it responsibly and efficiently and further build resiliency within the McDonald’s System. The Company has a history of supporting water stewardship efforts, both at restaurants and within its supply chains, including reporting to CDP Water since 2016, which is made available to investor signatories of CDP. We are currently identifying best practices for mitigating water risks that are scalable.

In addition, we have undertaken internal water risk analysis through the Task Force on Climate-related Financial Disclosure (TCFD) modelling and, in 2021–2022, conducted water efficiency pilots in restaurants across the US. The results were used to recommend internal restaurant standards around efficiency and use reduction.

Read more in our Climate Resiliency Summary (PDF – 1.3 MB).

Water Stewardship in Our Supply Chains

We have signaled to suppliers, through our Supplier Code of Conduct, the importance of conserving and safeguarding water. We have created an internal supplier water checklist to demonstrate the importance of them being able to answer key water questions related to resiliency, in alignment with our value: Integrity – We do the right thing.

Due to the size and scale of the Company’s supply chain, collaboration on creative initiatives is key to driving change. To help advance our understanding of water risk in the U.S. and how it impacts our suppliers, we conducted a water risk assessment of suppliers, using the World Resources Institute (WRI) Aqueduct tool, to identify areas of high-water risk.

This work will help inform our strategy to address water stress in regions where our priority categories are sourced from.   

Encouraging Supplier Action

We encourage suppliers, though self-managed excellence, to identify and manage their key water-related risks and opportunities. In the Paraguayan Chaco, for instance, our beef raw material suppliers utilize water innovations to collect rainwater as drinking water for cattle and irrigate agricultural land.

We also encourage suppliers to report to CDP Water. For example, one of our largest subsidiaries, Arcos Dorados, Latin America and the Caribbean’s largest restaurant operator, ensured 100% of their suppliers in 2022 reported to CDP Water, as outlined in our Social Impact and Sustainable Development Report (PDF – 11 MB).

Water Stewardship in Restaurants  

We focus on water quality, availability, efficiency and stewardship for our restaurants, and – recognizing available and quality varies from region to region – take a localized approach to water management. This includes utilizing, where feasible, initiatives such as low-flow devices, rainwater harvesting, collection and reuse, condensation recovery and greywater use for restrooms and use of native and/or drought-tolerant landscaping, rain gardens and permeable pavements.

These efforts have seen most progress in the U.S., where our restaurant construction and remodel standards now include low-flow urinals and high-efficiency faucets that use less water. We capture learnings from projects and, where relevant, share them with other restaurants.

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Footnotes

¹ "Eliminate deforestation" refers to McDonald’s global pledge to tackle deforestation, and all of the social and environmental criteria in our Commitment on Forests in our agricultural and forestry supply chains. In alignment with the definitions of the Accountability Framework initiative (AFi), we use the term “supporting deforestation-free supply chains” below to more accurately reflect the actions we are taking to implement, measure and report progress toward our Commitment on Forests.

² As aligned with Accountability Framework Initiative, conversion refers to: change of a natural ecosystem to another land use or profound change in a natural ecosystem’s species composition, structure or function.

³ Soy (for chicken feed). Scope: Includes all soybean volume used in the feed of chicken sourced for McDonald’s products by all chicken suppliers to the McDonald’s System and all McDonald’s restaurants owned and operated by the Company and its Franchisees that sell chicken. Europe refers to Austria, Azerbaijan, Belarus, Belgium, Bulgaria, Croatia, the Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Moldova, the Netherlands, Norway, Poland, Portugal, Romania, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, the U.K. and Ukraine. Countries with regions currently identified as high-deforestation priority regions for soy include Argentina (Chaco biome), Brazil (Amazon and Cerrado biomes) and Paraguay (Chaco biome). Given the complexity of soy supply chains, we consider that, unless demonstrated, all of McDonald’s sources of soy for chicken feed fall into high-deforestation priority regions, with the exception of chicken sourced in North America, where soy used in chicken feed is locally produced and considered low risk. Exclusions: Soy used as an ingredient in McDonald’s products sold in restaurants, for example, soy oil.

⁴ Product sourced from facilities in Russia, but for sale in active markets is still included within our data sets, despite our decision to exit Russia in 2022. This includes fish from Russian fisheries or fiber from Russian forests.

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