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If you were the CEO of McDonalds how would you prioritize sustainability relative to other supply chain goals (e.g., ensuring food safety and managing costs)? In order to prioritize a sustainability initiative against a supply chain goal, a corporation must have a basic working definition of sustainability, corporate guidance, and a leadership team that can empower the organizational resources to achieve the vision outlined by a Chief Executive Officer. As CEO, I understand that sustainability is a balancing act for any organization and my sustainability vision must weigh the specific performance indicators perceived to enhance sustainability against the corporate biosphere created by the environmental, financial and social viability factors. The concept of considering environmental, economic and social interaction is referred to as the triple bottom line and McDonalds must balance its sustainability initiatives within the organizations existing profit model and create a synergetic and lasting relationship among its customers, employees, planet and profits. With my basic understanding of a working definition intact, I would ensure that the Vice President of Corporate Social Responsibility understands my working definition of sustainability and engage his assistance in developing a strategic vision that outlines the corporate sustainability vision, principles and specific guidelines for the entire global organization. In developing my global supply chain vision and guidelines, I would develop the organizational sustainability policy with an understanding that McDonalds is a global organization that serves customers in different regions of the world and the policy must allow weighting of sustainability initiatives by region. Therefore, my sustainability policy would be specific in outlining the overarching McDonalds organizational principles and guidelines, but kept void of any hard metrics that prevent flexibility in achieving regional sustainability initiatives in the social environment in which the McDonalds brand operates.

As CEO, I must maintain perceptive that McDonalds is a highly decentralized global organization and relies on its corporate leadership to gain regional insight of the initiatives that are important to the regional customer base. Therefore, I would require that each Area of the World leader establish weighted performance indicators and an action plan that balances region specific sustainability initiatives with suppliers, governmental organizations, and non-governmental organizations against overall product quality, safety and cost. Although, my overall vision requires a weighted balance of product quality, safety and cost, the prioritization of these factors would be continually reviewed by region and additional action plans developed when a regional sustainability initiative cannot conform to my corporate philosophy that balances product quality and safety against profits.

2. How should McDonalds reconcile different sustainability expectations and priorities around the world with the understanding that local practices can impact the global brand? McDonalds is sensitive to the impact that local practices can have on the global brand and it is determined to be a global sustainability leader. Worldwide continuity of every sustainability practice is very difficult, but McDonalds is steadfast in its mission to reconcile any sustainability practice that tarnishes the belief that the organization is doing the right thing. The organization is founded on public trust and to remain a visionary in sustainability practices, corporate leadership must rely on McDonalds Area of the World Leadership to review the regional operating environment for those sustainability practices that are common among all regions and industries and compare those commonalities among disparate practices that a certain region might experience. Once common practices are established, McDonalds must confront the problems associated with any harmful practice that does not comply with global sustainability practices and have the potential to damage the consumer trust or the global corporate image. To reconcile the varied sustainability expectations and priorities around the world, McDonalds must utilize the Corporate Sustainability Leadership team to engage local industries, competitors and governments to develop acceptable sustainability practices that align with established global practices, principles and guidelines. McDonalds has the resources, ability and influence and must utilize its Sustainable Supply Chain Working Group to lead efforts to change any local practices known as harmful or non-compliant to global industry standards. However, to effectively engage a sustainability problem that is inherent throughout a local region, McDonalds must not approach the situation with a one-sided corporate directive. The organization must employ the expertise and experience of all stakeholders. These stakeholders include all supply chain contributors that have an impact on the harmful sustainability practice and span from the resource initiator through the supply chain to the end user. It must be expected that some trade-offs will be required from all parties, but buy in from all stakeholders is the key to success in reconciling a locally established sustainability practice that does not meet the worldwide expectation of the McDonalds brand image.

3. How should McDonalds engage suppliers, activists, and other stakeholders in its sustainable supply chain efforts? To remain a sustainability leader in the restaurant industry, McDonalds must actively engage suppliers, activists and the key stakeholders that support the organizations supply chain. By initiating positive and long lasting relationships with all stakeholders, McDonalds retains the ability to drive sustainable supply chain initiatives that are common among all stakeholders, while also maintaining the ability to change, improve or enforce the sustainability practices that the organization believes are important and fundamental to the global brand image.

Diagram 1 depicts my vision of a process flow diagram on active engagement between the McDonalds organization and regional supply chain stakeholders. Once a regional sustainability initiative is determined or a sustainability problem discovered, McDonalds must engage the regional stakeholders. The fundamental goal of engaging a regional issue is to find balance between the corporate sustainability vision, principles and guidelines and the regional sustainability initiative. In the diagram below, the red area depicts the corporate vision, principles and guidelines outlined by the Supply Chain Leadership Board. Within the corporate structure, the corporate stakeholders are equal players that have established commonly accepted practices, guidelines and key performance indicators that align with the overall corporate sustainability philosophy. The yellow area depicts the regional supply chain stakeholders that exist within a regional area. Within this regional structure, the corporation actively seeks to bring these stakeholders to a common forum and treats them as equal participants in forming or changing a sustainable practice. By fostering discussion and policy development among equal players in the supply chain process, McDonalds builds personal ownership in a sustainability effort through positive and long-term relationships that seek to employ sustainability measures that co-exist within the region and within the McDonalds corporate sustainability vision.

Supply Chain Leadership Board Corporate Sustainability Vision, Principle & Guidelines Corporate Area of the World Leadership

Local Industries

Local Competitors

Local Government

Regional Sustainability Initiative or Problem Manufactures Farmers Abattoirs Regional Customers and Society

Suppliers Distributors

Activists NGOs

4. How is sustainability affected by the consolidation occurring in the food industry and the longer term relationships sought by participants throughout the supply chain? Consolidation and long-term relationships affect sustainability in the food industry in two primary forms: (a) Positively: Through consolidation and long-term relationships, sustainability compliance is achieved through the major stakeholders in the supply chain. These stakeholders set the global or regional sustainability practice and all minority stakeholders must adhere to the sustainability practice. Minority stakeholders who do not comply with the sustainability practice are forced to change through a loss in business or through direct pressure from the majority stakeholders.

(b) Negatively: Long-term relationships within the supply chain and consolidations can also have a negative impact on sustainability innovations. As consolidation occurs and relationships strengthen, those stakeholders with large market share in an industry gain influence over the other stakeholders in the supply chain, which can include the customers themselves. Therefore, as consolidation occurs, larger stakeholders have an ability to forego sustainability initiatives or halt progress in improving sustainability practices. The McDonalds corporation must maintain a keen awareness to these challenges and utilize their longterm relationships to influence those stakeholders whom hold a larger market share or influence over an industry. Through consolidating efforts in sustainability, building trust and foster strong relationships with all stakeholders, McDonalds can utilize its unique positional power of a global brand to initiate sustainably goals in any market.