Case-study Report – Case Study Example

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Ethical Issues and McDonald’sIntroductionThis report examines ethical criticisms that have been made against McDonald’s in Europe in recent years, including accusations of unfair labour practises, false advertising, inappropriately targeting children in its advertising, and generally representing the evils of globalisation by unfairly competing against local businesses. Although these criticisms have been directed at McDonald’s, there are aspects of them that generally apply to the fast-food industry, and to some extent, any large international enterprise. In this report, the responses of McDonald’s to these criticisms will be analysed in the context of social responsibility and ethical theory and practise, and recommendations as to how the company could avoid similar problems in the future will be offered. Criticisms Exposed in the ‘McLibel’ TrialThe significance of the lengthy ‘McLibel Trial’ detailed in the case study is that the final outcome was a finding by the court that Steel and Morris, the couple McDonald’s had charged with libel, had substantially proven their claims that McDonald’s exploited children with their advertising, was responsible for cruelty to animals, was apathetic to labour unions and paid its workers low wages, falsely advertised its food as nutritious, and risked the health of its regular customers.

The ruling of the court changed these criticisms from mere accusations or opinions into actual wrong actions that McDonald’s had taken, making the company’s response to them not just a matter of responding to public perceptions, but steps towards correcting some bad practises. The effect of the ruling, and what makes the issues generally applicable to the fast-food industry and other businesses, was to impose or at least strongly suggest that McDonald’s adopt a more communitarian business ideology (Lodge, 1990 in Velasquez, 1992: 139-140); in other words, that the company should expect that what defines its social responsibility will be decided by society as a whole – and in extreme cases, the courts acting on behalf of society – and conduct its business accordingly.

Issue #1: Targeting Advertising at ChildrenThe case study does not specify the nature of the advertising, but notes that the court ruling in the ‘McLibel’ case determined that the advertising ‘exploits children, ’ implying that McDonald’s was taking advantage of young people’s immaturity in decision-making to encourage them to eat McDonald’s food, even though McDonald’s food was unhealthy.

McDonald’s response to the issue was to distribute information to households explaining its new, healthier menu options for children, launch an exercise initiative intended to educate young people about the benefits of exercise and a balanced diet, and partner with football associations to support training for coaches. The key part of McDonald’s actions here was making a complete change in their message – through advertising or other means – to young customers, from one, inferring from the case study, in which McDonald’s generally-unhealthy menu of burgers, sodas, and fries could be consumed without negative health consequences to one in which a healthy diet and lifestyle is promoted.

McDonald’s response was clearly a reaction to a specific criticism, even though the company characterised it as part of long-term strategic planning. The overall objective for the company was to minimise the damage for its stakeholders caused by its reputation, with the focus being on the two most important stakeholders: its customers and shareholders. In this it was following a practical pattern of stakeholder development.

The new menu choices, change in message, and new, participatory, “healthy” initiatives were presented as building value for stakeholders, amoralising the problem in the process (Crane & Matten, 2007: 154); in other words, McDonald’s presented its actions not as fixing a fault but as new and valuable features and benefits for its patrons (Steuer, Langer, Conrad & Martinuzzi, 2005: 272-273; Milne, Tregidga & Walton, 2009: 1233).

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