Report on McDonald's: Governance, Risk, and Ethical Considerations

This report examines the governance, risk, and ethical considerations of McDonald's, focusing on its business practices and ethical dilemmas. The analysis covers various aspects, including the use of potentially unhealthy ingredients like sodium acid phosphate and acrylamide, and the company's environmental impact due to its factory operations and use of paper and plastics. The report explores the ethical issues related to the company's corporate governance, such as the impact of its menu on consumer health, particularly those suffering from heart diseases. It also discusses relevant theories, such as approaches to address unhealthy ingredients and introduce new products, and the importance of menu management. The report concludes with recommendations for the company to improve its practices, including contributing to CSR activities, introducing healthier food options, and sourcing fresh ingredients. The report also reviews the legal and regulatory compliance and the company's commitment to ethical issues and environmental concerns, which are critical to retaining its competitive market position.

Governance Risk and
Ethics

Table of Contents
INTRODUCTION .....................................................................................................................3
1..................................................................................................................................................3
2..................................................................................................................................................3
3..................................................................................................................................................4
4..................................................................................................................................................4
5..................................................................................................................................................5
6..................................................................................................................................................5
CONCLUSION..........................................................................................................................5
REFERENCES...........................................................................................................................7

INTRODUCTION
Governance ethics and risk are a system of moral principles which directly or
indirectly affects the people decision. Ethics are concerned with the that what is good or bad
for the society and individual (Daase and Friesendorf, 2010). In today business ethics are on
priorities basis and it affects the decision making process. The organisation have to maintain
their high ethical value which can give advantage from its own actions and satisfy the both
external and internal stakeholders.
1.
The present research is made on McDonald's which shows their governance risk and
ethics. They are trying to make aware about the faulty practices which are made by the
company to attract large number of customers (Demidenko and McNutt, 2010). The reason
for choosing this because it is multinational company and can easily get the information
about their ethical issues. This company provides the different food items such as burgers,
French fries, beverages and many more. The ethical dilemma of company is they are
providing the toys with happy meal.
2.
The case is unhealthy ingredients as these harm the health of consumers. These
ingredients includes the chemicals such as sodium acid phosphate, acrylamide and many
more which are banned by many countries. There are some controversy issues also mother
found the lizard in her French fries. Some times company uses bad ingredients which harmed
the customers health.
The corporate governance of McDonald's which has written on the company website
is that there success is built on the foundation of professional and personal integrity. There
are numerous customers around the world and trust on McDonald's. They earn the trust every
day by providing the safe food and delivering best quality of services and values. They build
trust by being ethical, dependable and truthful with the customers (Eon Rossouw and Van
Vuuren, 2010).

The ethical issues McDonald's does not have to contain many calories which can
directly effect on the consumer health. There are many customers who are suffering from the
heart diseases and consumers are loosing hope towards the consumption of the fast food. One
of the ethical issue of the company is that environmental issue. The company has opened the
more factories which impact on the air of the environment and it leads in pollution. They are
using the paper and plastics to serve the food which are contributing in the abuse of
environment (McDonald’s Business Ethics Project Report, 2017).
3
The theory for relevant case is that the organisation have use some approaches such as
cut out bad ingredients, introduce the new product in the market and add good ones. In cut
out bad ingredients is that the organisation have to replace the bad ingredients by using the
new ones. Through this it will not harm the people also. On other side, add good ones, in this
the organisation have to use proper ingredients which does not harm the health of people and
it should be used in appropriate manner (Moeller, 2011). The organisation has to made the
efforts to provide the healthier food to customers and these are constrained by some factors
i.e. the little agreements is done on healthy and junky foods that how they will define. In the
contrary the company have to introduce the new food according to the needs of customers.
The taste and preferences of customers are changing from time to time so they have to
provide the new food items to attract the youngsters.
4
The preservative of organisation theories which can provide the reliable theoretical
background through which it can understand the significance of managerial prospect of
menu. In McDonald's there are menu management issues which dose not provide the
ingredients which must be written with the food items. Through this the customers will not
aware about the what are ingredients are using by the company to provide a healthy food.
There are different strategies which can be use in literature such as the manager have to select
or innovate the unique menu items, they have to set the higher prices with the expectation of
the customers is that they are willing to pay a high prices of different foods items. The
managers have to present the unique items in menu cards which can create the positive image

in front of the customers (Pirson and Turnbull, 2011). The literature provide proper guidance
to customers according to their wants and easily meet out with their requirements.
5
There are many issues which are facing by the company such as ethical issue,
corporate government issues, environmental ethics, legal and regulatory compliance and
many more. The company has addressed ethical issues, environmental issues to retain in the
competitive market (Racz, Weippl and Seufert, 2010). For the company it is important to deal
with the environmental issues which protect the country form the pollution. In present case
study company is using the unhealthy ingredients which directly or indirectly harm the
consumer health. The ethical issue of McDonald's is that environmental ethics as they has
open a number of factories around the world to produce the products and these are leading in
pollution. The company have to follow the government rules and regulations which is
showing the ethical dilemma legally (Sanderson, 2012). It is the fault of organisation of not
producing the healthy food and to maintain the health of customers.
6
Activity/Week 1 2 3 4 5 6 7 8 9 10
Company chosen and analysis
Brief summary
corporate and ethical issues
Identification of theories \
Identification of key literature
Submit

CONCLUSION
From the above case study it is concluded that the company have to make the some
recommendation for offering the different items to customers. They have to take the actions
to contribute the funds in CSR activities. They have to introduce more healthy foods and
contains less calorie. For the customers they to provide the healthy and conscious food which
will balance their diets. The organisation have to purchase the fresh vegetables also.

REFERENCES
Books and Journals
Daase, C. and Friesendorf, C. eds., 2010. Rethinking security governance: the problem of
unintended consequences. Routledge.
Demidenko, E. and McNutt, P., 2010. The ethics of enterprise risk management as a key
component of corporate governance. International Journal of Social Economics.
37(10). pp.802-815.
Eon Rossouw, D. and Van Vuuren, L., 2010. Business ethics. Oxford University Press, 2010.
Moeller, R.R., 2011. COSO Enterprise Risk Management: Establishing Effective
Governance, Risk, and Compliance (GRC) Processes (Vol. 560). John Wiley &
Sons.
Pirson, M. and Turnbull, S., 2011. Corporate governance, risk management, and the financial
crisis: An information processing view. Corporate Governance: An International
Review. 19(5). pp.459-470.
Racz, N., Weippl, E. and Seufert, A., 2010, May. A frame of reference for research of
integrated governance, risk and compliance (GRC). In IFIP International
Conference on Communications and Multimedia Security (pp. 106-117). Springer
Berlin Heidelberg.
Sanderson, J., 2012. Risk, uncertainty and governance in megaprojects: A critical discussion
of alternative explanations. International journal of project management. 30(4).
pp.432-443.
Vaughan, G. and et. al., 2012. Ethical issues: The multi‐centre low‐risk ethics/governance
review process and AMOSS. Australian and New Zealand Journal of Obstetrics and
Gynaecology. 52(2). pp.195-203.
Weitzner, D. and Darroch, J., 2010. The limits of strategic rationality: Ethics, enterprise risk
management, and governance. Journal of business ethics. 92(3). pp.361-372.
Online
McDonald’s Business Ethics Project Report. 2017. [Online]. Available through:
<https://bohatala.com/mcdonalds-business-ethics-project-report/>. [Accessed on
16th March 2017].