Business Ethics- Re-write

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Running head: MCDONALD’S: GOLDEN ARCHES OF FAT

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MCDONALD’S: GOLDEN ARCHES OF FAT

McDonald’s: Golden Arches of Fat

Lucas Roland

MBA 6301-15J-3A17-S3, Business Ethics

Columbia Southern University

Introduction

Many corporate giants have come under fire in the last several decades. It is all to often that we find out that deception played a huge role in a corporation’s success. Marketing techniques that persuade a consumer to buy products under false pretenses can be seen as unethical business practices. This type of thought process can go both ways, one may say the consumer should do better research, and others may say it is the corporations responsibility to fully disclose the information in a clear and concise way. We have seen such instances where tobacco, alcohol, prescription drugs, etc. have been scrutinized under their marketing tactics. The shift towards a healthier tomorrow has companies marketing under different tactics and one that comes to mind quite easily is fast food. McDonald’s, a corporate giant who has been a front-runner for several decades has come under fire. During this essay we will cover McDonald’s, and their ethical dilemmas they have faced. We will look at the perception of the corporation in different cultures. McDonald’s needed to answer to the shift in consumers becoming more health conscious by switching focus. Last, we will cover how the leadership can cover the marketing of their products even if they are truly not a healthy product.

McDonald’s Overview and Ethical Oversight

McDonald’s is a corporate giant operating in 117 countries with nearly 32,000 stores. Primary operations for the fast food restaurant include Europe, Asia Pacific, and America (MarketLine, 2012). McDonald’s has been widely criticized in recent years for serving large amounts of foods high in saturated fat, salt, sugar and calories. Their marketing techniques are diverse and always finding a way into potential consumers through TV, radio, billboards, and newspapers. They sponsor major events such as the Olympic Games, The FIFA World Cup, and other major sporting events (MarketLine, 2012). McDonalds’ platform is spread far and wide.

The corporation has come under major fire over the last several decades for their contributions to American obesity. As noted, they are well known for their high fat, sodium, and sugar contents within their goods. Some have gone as far as “blatantly accusing

McDonald’s of “poisoning America” with its fat-laden burgers and fries” (Adams, 2005, p.297). Critics feel that the cheap products of fast-food menus, such as McDonald’s, and the portion sizes offered contribute to obesity, diabetes, heart disease, and a variety of other health problems (Adams, 2005). Going beyond the obesity in adults, the company, among others, has been ridiculed for targeting children.

McDonald’s has spent upwards of $42,000,000 on marketing their “kid friendly” Happy Meal in 2012 alone (Minsker, 2014). One of the biggest marketing campaigns in the world, which has been heavily scrutinized since the war on obesity in America, has accounted for tens of billions of dollars in medical costs (Adams, 2005). One teen went as far as suing the corporation, claiming that McDonald’s food and marketing practices heavily contributed to their obesity and health problems. The Pelman Vs. McDonald’s suit did not result in a win but it surely shined a light on the corporation’s questionable marketing tactics (Adams, 2005). The McDonald’s corporation has been viewed in varying perspectives around the world.

McDonald’s Perception Around the World

In the UK, McDonald’s has been rated one of the worst in ethics, even beyond companies such as Nike, Shell, and Adidas (Holmes, 2006). According to Paul Holmes (2006), “feedback about specific companies, the principal complaint against McDonalds was that its products have a detrimental effect on children, specifically their diet (41 percent)” (para.4). These tactics, along with the US, are seen as despicable based on the ability to interject into a child’s thoughts and create a compelling desire for their products. This reputation goes beyond the UK and into Australia where the company has won several awards, but not the types of awards that most businesses want to be known for. McDonald’s of Australia sustained a 10-year streak with three ‘Shame’ awards in the Parents’ Voice Fame and Shame Awards. Doctors, nutritionists, and parents of AU find that McDonald’s marketing tactics are shameful and the food is of poor quality for kids and adults alike (Australian Leisure Management, 2016). While this is just a couple of countries in which McDonald’s operates in, many more have called on the company to change their ways.

McDonald’s Handling of Ethical Implications

McDonald’s has been clearly exiled for several ethical violations in which they have had to answer to. The core objectives of the people calling for change stem from McDonald’s not clearly stating the nutritional values of their products, people over indulged, and we have an obesity crisis on our hands. Also, the company has been shunned for their marketing tactics to children. They utilize triggers for children such as well-known cartoon characters and such to attract children to their establishment. McDonald’s fired back at the critics saying that people have to maintain responsibility for their own diet and a fast food restaurant, such as McDonald’s, is not forcing their hand (Adams, 2005). The courts agreed and as the case of Pelman Vs. McDonald’s was thrown out. The judge declared that the company was right but did make light of the actions of the organization to be in question when marketing their products (Adams, 2005). With the light shinning brightly, McDonald’s made some swift changes in the past several years.

Restaurant reimaging has been quite an expensive endeavor for McDonald’s, and while their numbers have been particularly steady, they know that a shift towards a healthier tomorrow is storming the US and other countries. Beyond the façade of brick and mortar reimaging, the company has revamped their offerings beyond their fetal attempt at offering a few salads in the 90s. They have created a McDonald’s Advisory Council on Healthy Lives in attempts to educate the public while offering honest nutritional facts about their menu choices. After the 2004 film “Supersize Me” aired McDonald’s quickly reacted by eliminating supersize menu options for their value meals (Adams, 2005). More recently, the company “no longer markets some of its less nutritional options to children and said it also planned to include offerings of fruits and vegetables in many of its adult menu combinations” (Storm, 2013, para.1). Their stance is that they have made changes in order to better not only the US but also other countries that suffer from the obesity epidemic. The social responsibility of the company has changed in efforts to save face.

Leadership Instilling an Ethical Culture

Organizations such as McDonald’s need to breathe ethical business practices from here on out to ensure they do not endure a financial collapse based on a consumer backlash. Mihaela Constantinescu and Muel Kaptein’s (2014) article on mutual enhancement of responsibility positions moral responsibility in the corporate setting can be credited to an individual, the corporation, or both. Leaders of McDonald’s need to put emphasis on moral responsibility from both the individual and corporate levels to shape better outcomes from the choices made to market their products. A focus on mutual responsibility and holding those individuals of a corporation equally responsible can help promote the business in a positive light.

Transparency seems to be what most consumers are interested in. Marketing products into the trends of consumers is necessary for McDonald’s to stay at the top of the industry. The initiative proposed by the corporation is one of the most positive outcomes of the unethical business practice allegations (Stein, 2014). Transparency holds everyone in the corporation accountable for their actions. It goes full circle with mutual accountability from individual to corporate level.

Conclusion

Corporations must act in an ethical manner and consumers are speaking out about the way businesses continuously undermine their health and safety. McDonald’s is a poster child for these actions and they have been heavily scrutinized. The efforts put forth by the corporation may have never been so swift if it weren’t for consumers finally getting to the source of obesity. The trends for consumers dictate how a business will operate and we have seen a call for transparency and accountability. Just because a business has not been called out for their unethical behavior yet, does not mean their day will not come. With the use of internet and social media consumers are much more powerful than ever before.

References

Adams, R. (2005). Fast Food, Obesity, and Tort Reform: An Examination of Industry Responsibility for Public Health. Business Society Review, 110(3), 297-320. Retrieved from Business Source Complete Database.

Australian Leisure Management. (2016). McDonald’s Australia Shamed for Marketing Techniques that Target Children.

Constantinescu, M., & Kaptein, M. (2015, June). Mutually enhancing responsibility:

Holmes, P. (2006). McDonald's Has Worst Ethical Reputation in U.K.. Retrieved from

MarketLine. (2012). McDonald’s Corporation Case Study.

Minsker, M. (2014). Is Kid-Targeted Marketing Unethical? CRM Magazine, 18(8), 19.

Stein, N. (2014). Why McDonald’s is Betting on Transparency for its New Marketing Campaign.

Storm, S. (2013). With Tastes Growing Healthier, McDonald’s Aims to Adapt Its Menu.