McDonald’s Ties Executive Pay to Diversity Targets

McDonald’s will tie executives’ pay to diversity goals and aims to hit gender parity in management by the end of 2030 as the company tries to overhaul its workplace culture. Fifteen percent of the company’s annual bonuses will be used to reach these targets, McDonald’s said in the statement.

The world’s biggest restaurant chain on Thursday said the company aims to increase the number of women in leadership roles to 45 percent from 37 percent by 2025. It also wants to boost “historically underrepresented groups” in leadership positions to 35 percent from 29 percent over the same time frame, CNN reported.

“We’re serious about holding ourselves and our leaders accountable,” Chief Executive Chris Kempczinski said in the letter sent to employees.

In July, amid the protests sparked by the death of George Floyd, McDonald’s announced it would among other things enhance “efforts to attract and recruit diverse franchisees.”

Former CEO Steve Easterbrook was fired in 2019 for violating company policy by engaging in a relationship with an employee. Around the same time, McDonald’s also dismissed its chief people officer. “Under their leadership, a party culture flourished,” according to a report from the Wall Street Journal. The fast food chain started an investigation into its human resources department last year for possible misconduct.

In November, the company hired a new chief of diversity, equity and inclusion.

The targets announced Thursday follow lawsuits filed in September and October by current and former black franchisees alleging that the company discriminates against black operators by relegating them to unprofitable, low income, predominantly Black neighborhoods. McDonald’s has denied the allegations.

Earlier this week, another Black franchise operator sued the company citing similar complaints. McDonald’s said in response that it had “invested significantly” in his restaurants and that it “will review the complaint and respond accordingly.”

McDonald’s said it would enhance “efforts to attract and recruit diverse franchisees,” and for the first time the company is releasing a full breakdown of U.S. employees by race, ethnicity and gender.

About Catherine Smith

Catherine Smith is a newcomer to Washington D.C. She met and married an American journalist and moved to D.C. from the U.K. She graduated with a B.A. in Graphics, Media, and Communications and worked in design and retail in the U.K.

Photo: (Photo by Jakub Porzycki/NurPhoto via Getty Images)

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