Multiple news outlets are reporting that McDonald’s Corporation is the latest company to join the alleged trend to remove diversity, equity and inclusion (DEI) goals from their policies and operations. From the Associated Press:
Four years after launching a push for more diversity in its ranks, McDonald’s is ending some of its diversity practices, citing a U.S. Supreme Court decision that outlawed affirmative action in college admissions.
McDonald’s is the latest big company to shift its tactics in the wake of the 2023 ruling and a conservative backlash against diversity, equity and inclusion programs. Walmart, John Deere, Harley-Davidson and others rolled back their DEI initiatives last year.
McDonald’s said Monday it will retire specific goals for achieving diversity at senior leadership levels. It also intends to end a program that encourages its suppliers to develop diversity training and to increase the number of minority group members represented within their own leadership ranks.
McDonald’s said it will also pause “external surveys.” The burger giant didn’t elaborate, but several other companies, including Lowe’s and Ford Motor Co., suspended their participation in an annual survey by the Human Rights Campaign that measures workplace inclusion for LGBTQ+ employees.
Some news outlets credited the anti-DEI activism against Corporate America led by social media influencer Robby Starbuck, deservedly so.
But also, on November 15, 2024, NLPC submitted a shareholder proposal to McDonald’s for consideration at the company’s 2025 annual meeting. The measure, which was covered by Bloomberg, requests that the company remove all DEI-based incentives that are embedded in formulas to calculate bonuses for executives. An excerpt from the proposal:
McDonald’s Corporation (“Company”) has set leadership representation goals of 45 percent for women and 35 percent for “underrepresented groups” by the end of 2025. Additionally, the Company “aspires to increase U.S. systemwide spend with diverse-owned suppliers to 25% by the end of 2025.”
Pay for the Company’s executives includes incentives for progress towards “human capital metrics,” which “align with our strategic aspirations and hold executives accountable for efforts towards the Company’s DEI ambitions.” McDonald’s has devised a point system in its short-term incentive plan for attaining “diverse representation in leadership roles,” which also includes conversion of franchisee applicants into new restaurant owners, “and diversity of such new owners.” Calculation of the Company’s Human Capital Metrics points “progress” represents 15% of the payout to executives in its short-term incentives plan.
These metrics were drawn from McDonald’s own proxy statement and sustainability report materials. Our proposal requests that “the Board of Directors’ Compensation Committee … revisit its incentive guidelines for executive pay, to identify and consider eliminating discriminatory DEI goals from compensation inducements.”
We (NLPC) met with company officials on December 3 to further press our case for the removal of these incentives, citing their discriminatory nature and the corporate trend to move away from DEI. Following that meeting a McDonald’s official sent us links to an 8-K filing with the Securities and Exchange Commission from February, and to the company’s “Purpose and Impact Report.”
The 8-K outlines the approved payout structure for McDonald’s top executive officers, in which among “the metrics … viewed as a critical driver of the Company’s success” are a “measure [of] leadership’s efforts on key initiatives including the Company’s franchising strategy, employee engagement, and diversity, equity and inclusion.” And the “Purpose and Impact Report” is as loaded with DEI incentives as in any woke corporation’s sustainability disclosures.
Our contacts at McDonald’s gave us no indication of DEI changes since those communications, but they face the real prospect of our proposal presentation at the annual meeting, which will call further attention to the issue. With Robby Starbuck training his sites on the company, we see an additional pressure point that triggered this latest public statement, but we have several reasons to believe that what McDonald’s claims it will do are distinctions without a difference. From the company’s actual published announcement yesterday:
“Inclusion” is one of our core values and in 2024 “we opened our doors” to hundreds of millions of customers and two million crew people from all walks of life….
Our success has come through purposeful actions that have supported inclusion throughout our system. As we close out 2024, we want to highlight a few of our accomplishments that touch all three legs of the stool at McDonald’s:
Employees – We achieved strong leadership diversity with over 30% of our U.S. leaders from underrepresented groups. On pay equity, we achieved gender pay equity at all levels and in every market as you can see in our 2024 Purpose and Impact Report. The most recent employee Pulse Survey also highlighted that, 84% of employees feel that ‘McDonald’s is an environment that allows me to be myself’ and 78% of employees scored McDonald’s positively on our Inclusion Index overall.
Suppliers – We met our supplier diversity U.S. systemwide aspirational spend goal of 25% of diverse-owned supplier spend by the end of 2025, three years ahead of schedule.
Franchisees – We recruited the largest Registered Applicant (RA) pipeline in recent years, including the largest number of RAs from underrepresented groups in our history. In the U.S. we have made meaningful progress addressing cashflow gaps across our franchisee groups.
We are immensely proud of these accomplishments, but we are not satisfied.
As you can see, somebody in the diversity department at McDonald’s is “keeping count” of the racial, sexual orientation, and gender makeup of various metrics, with no stated intention to discontinue doing so. More:
McDonald’s will continue to transparently report our demographic information in our annual Purpose & Impact report with respect to the Board, employees and suppliers.
We are also excited to introduce a new concept: the power of OUR “Golden Rule” – treating everyone with dignity, fairness and respect, always. For the last several months, a small team has been working on refining our language to better capture McDonald’s commitment to inclusion….
In rebranding its DEI programs to align with the Supreme Court’s affirmative action decision, McDonald’s announced “a few practices that we plan to modify:”
- “We are retiring setting aspirational representation goals and instead keeping our focus on continuing to embed inclusion practices that grow our business into our everyday process and operations.” Translation: “We are going to do a better job of hiding our discrimination.”
- “We are pausing external surveys to focus on the work we are doing internally to grow the business.” Translation: Human Rights Campaign is toxic now, so we’re just going to quit filling out their questionnaires, but we’re still going to keep transgender surgeries and treatments (i.e. mutilations) for child dependents of our employees in their health insurance plans.”
- “We are retiring Supply Chain’s Mutual Commitment to DEI pledge in favor of a more integrated discussion with suppliers about inclusion as it relates to business performance.” Translation: “We are going to apply our DEI pressure to our contractors privately and not brag about it as much.”
- “We are evolving how we refer to our diversity team, which will now be the Global Inclusion Team. This name change is more fitting for McDonald’s in light of our inclusion value and better aligns with this team’s work.” Translation: “We are changing the name of our discriminatory ‘diversity’ department to something temporarily more acceptable. Like when they changed “global warming” to “climate change.”
There is no reason to believe companies are genuinely eliminating DEI — they are just going to hide it better. Executives, VeePees, and boards of directors are all indoctrinated products of woke Ivy League and state university business schools, and it will take a lot more than fleeting social media shaming to get them to permanently change their ways. It’s too easy to just carry out head-fakes and secret deception instead.
