MCDONALD'S CORPORATION | Phase Out Routine Medically Important Antibiotics Use in Supply Chain at McDonald's Corporation

Status
AGM passed
AGM date
Previous AGM date
Resolution details
Company ticker
MCD
Lead filer
Resolution ask
Adopt or amend a policy
ESG theme
  • Social
ESG sub-theme
  • Public health
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Consumer Discretionary
Company HQ country
United States
Resolved clause
RESOLVED: Shareholders request that McDonald’s adopt an enterprise-wide policy to phase out the use of medically-important antibiotics for disease prevention purposes in its beef and pork supply chains. The policy should include, in the discretion of board and management, global sourcing targets with timelines, metrics for measuring implementation, and third-party verification.
Whereas clause
WHEREAS: The World Health Organization (WHO) and the U.S. Centers for Disease Control and Prevention2 (CDC) report that antibiotic resistance is a global public health crisis that threatens to reverse many medical advances made over the last century.

According to the CDC, antibiotic use, both in food animals and human medicine, is the “single most important factor” driving this crisis.3 Nearly two-thirds of medically important antibiotics sold in the U.S. are intended for livestock use4 with around 80 percent of those sales consisting of cattle and swine (originally cited at the FDA website under Animal Veterinary News). McDonald’s is the single largest purchaser of beef in the U.S. and a major buyer of pork.5

In 2018, McDonald’s published its Global Vision for Antibiotic Stewardship in Food Animals which included a goal to prohibit routine preventive use of antibiotics by meat suppliers and committed to developing “species-specific policies outlining our requirements and implementation timelines for suppliers providing chicken, beef, dairy cows, pork and laying hens for use in McDonald’s restaurants.” It also announced the goal of setting reduction targets for medically-important antibiotics across 80 percent of its global beef supply by the end of 2020.

McDonald’s did not fulfill its promise. In March 2022, it replaced its commitment to set targets for ‘reducing use’ of medically important antibiotics with targets for the ‘responsible use’ of the drugs.

However, if responsible use does not incorporate absolute reduction targets, then McDonald’s pledge is not aligned with the WHO’s imperative to achieve absolute antimicrobial reductions (inclusive of medically important antibiotics) by at least 30-50% by 2030.6

By changing its 2018 promise, McDonald’s exposes itself to reputational risk.

Consumer demand for meat raised with limited or no antibiotics is high – surveys have found that the majority of consumers are more likely to eat at restaurants that serve such meat. U.S. producers, including Tyson, supply beef raised without antibiotics. Failure to offer meat raised with minimal antibiotics endangers McDonald’s market share.

1 https://exploreanimalhealth.orq/antibiotics-used-farm­animals/#:~:text=Some%20antibiotics%20are%20approved%20for.druq%20used%20in%20human%20medicine.

2 https://www.cdc gov/drugresistance/bjggest threats.html

3 https://www.cdc,goy/drusresistance/odVar-threats-2013-508 pdf

4 https://amr-revieworg/sjtes/defau!t{fjles/Antjmjcrobjals%20in%20agriculture%20and%20the%20enyironment%20-%20Reducing%20unnecessary%20use%20and%20waste.pdf

5 http·//www.chicaaotribune.com/business/ct-mcdonaIds-antibiotjcs-0824-biz-20170823-storv.htmI

6 https://www who iTVNews/item/25-11-2022-guadrjparUte-welcomes-new-oouuca!-commitments-in-fight-aaainst-antimicrobial-resistance
Supporting statement
SUPPORTING STATEMENT: A policy meaningful to shareholders would include:

• Establishment of a glidepath for the phase out, inclusive of interim reduction targets;

• A commitment to annual disclosure of enterprise-wide antibiotic use including reporting by shared class of antibiotics1

How other organisations have declared their voting intentions

Organisation name Declared voting intentions Rationale
EFG Asset Management For
Wesleyan Assurance Society For
Anima Sgr For Considering growing public health concerns regarding the use of medically-important antibiotics in the animal farming industry and the increased consumer interest in the conditions under which food is grown, produced and processed, investors would benefit from the adoption of a policy to phase-out the use of these antibiotics, including quantitative disclosures and time-bound absolute reduction targets.

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