McDonalds: Historic Shareholder Agreement Reached on Pesticide Use Reduction

Responding to shareholder concerns, McDonald’s Corporation has agreed to formally survey and promote best practices in pesticide use reduction within its American potato supply chain. As the largest buyer of potatoes in the US, McDonald’s commitment will support progress on this important issue, which affects the environment, public health, and farm employees.

This agreement led to the withdrawal of a shareholder resolution filed by the Bard College Endowment, Newground Social Investment, and the AFL-CIO Reserve Fund. This was the first shareholder resolution focused on environmental and worker health issues ever to be filed by a college or university endowment.

Through this agreement, McDonald’s has committed to: (1) survey its current U.S. potato suppliers; (2) compile a list of best practices in pesticide reduction that will be recommended to the company’s global suppliers (through the company’s Global Potato Board); and (3) communicate findings related to best practices to shareholders, and in the company’s annual corporate social responsibility (CSR) report.

The agreement was developed in collaboration between shareholders and McDonald’s, with support from the Investor Environmental Health Network. The agreement between McDonald’s and shareholders can be found on the SEC website at: http://www.sec.gov/divisions/corpfin/cf-noaction/14a-8/2009/bardcollege031109-14a8.pdf.

Bard College student Katherine Burstein, a member of the college’s Committee on Investor Responsibility, said: "The Bard community believes that colleges and universities can leverage their power as investors for positive social change. Through our work with the Responsible Endowments Coalition – which works on responsible investment issues with colleges and universities across the nation – we learned about the measures companies can take to reduce the undesirable effects of pesticide use, and decided to engage McDonald's on the issue.”

Newground Social Investment CEO Bruce Herbert, a member of the Board of Directors of the Institute for Children’s Environmental Health, said: “Because McDonald’s has such a commanding presence in the marketplace, this commitment offers the promise of significant reductions of pesticide use – which will benefit consumer health, as well as farm workers, local agricultural communities, and the environment.”

“Consumers, workers and our environment all suffer from over-use of pesticides,” said John Sweeney, President of the AFL-CIO. “As investors, we knew McDonald’s could take an important first step and we’re ready to work with the company to change and grow.”

Taun Toay, administrative member of Bard College’s Committee on Investor Responsibility, said: "Bard College prides itself on the progressive education it affords its students. Part of such an education should involve active citizenship, including a willingness to engage companies over issues of concern. Sound environmental policies reflect strong corporate governance and we are quite pleased that McDonald’s is taking further steps in that direction."

Dr. Richard Liroff, executive director of the Investor Environmental Health Network, said: “Leadership companies such as Sysco (which supplies Wendy’s), General Mills, and Campbell’s have already demonstrated that pesticide use reduction makes sense from both an environmental health and business perspective. We welcome McDonald’s stepping up to the plate and look forward to supporting the company’s efforts to reduce pesticide use in the future.”

ABOUT THE GROUPS

Bard College’s Committee on Investor Responsibility is composed of both students and administrators. Bard is a four-year liberal arts college founded in 1860, located in the Hudson Valley of New York State. http://www.bard.edu.

Newground Social Investment is a Seattle, WA based Registered Investment Advisor. Newground provides socially conscious (SRI / ESG) money management and shareholder engagement services to individuals, institutions, and not-for-profit clients. http://www.newground.net.

The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) www.aflcio.org/ is a voluntary federation of 56 national and international labor unions , representing 11 million members, including 2.5 million members in Working America, its new community affiliate. The AFL-CIO Reserve Fund is a long-term investor and works with Union and other worker-based pension, health and savings funds, worth some $6 trillion, holding the retirement and health security of millions of working families.

The Investor Environmental Health Network is a collaborative partnership of investment managers, advised by nongovernmental organizations, who are concerned about the financial and public health risks associated with corporate toxic chemicals policies. http://www.iehn.org.

The Responsible Endowments Coalition works to build and unify the college and university-based responsible investment movement, both by educating and empowering a diverse network of individuals to act on their respective campuses, and by fostering a national network for collective action. http://www.endowmentethics.org.