Posted on 02/13/2015 7:54:45 PM PST by rickmichaels
CtW has called on McDonald’s to remake its board, saying directors of the struggling restaurant chain have been there too long and lack necessary experience.
A group that advises union pension funds has called on McDonald’s to shake-up its board, saying an upcoming CEO change will not be enough to lift it out its doldrums.
CtW Investment’s letter to the restaurant chain’s board Friday comes two weeks after the company announced Don Thompson would step down as CEO and be replaced in March by Steve Easterbrook, its chief brand officer who has been responsible for fixing the fast-food operator’s marketing and menu.
After years of growth, McDonald’s has hit a rough patch: 2014 was the first year with a decline in same-store sales in more than a decade. Last quarter was also the fifth straight quarter of declining same-store sales in the United States, where it has lost many customers because of an overly complicated menu, changing tastes, and defections to fast casual chains like Chipotle Mexican Grill .
The funds CtW advises own 2 million McDonald’s shares, or $190 million at Friday’s closing price and 0.2% of the company, and invest over $250 billion in the global capital markets.
“At this juncture, we believe it is critical for McDonald’s to have strong, independent board leadership,” CtW Executive Director Dieter Waizenegger wrote in the letter. “Fresh eyes are essential to drive the overhaul of the board’s composition, form a productive partnership with CEO Easterbrook in tackling the company’s strategic challenges, and restore the trust of long-term shareholders.”
CtW is calling on McDonald’s MCD 0.59% to come up with and publicly disclose plans to change the board’s leadership, and set up a board succession plan. The group faulted the board for having members who’ve been directors for too long- the average tenure has been 13 years– and for being to insular and tied to Chicago-area networks.
CtW made headlines last year with its opposition to the now concluded merger between Walgreen and Alliance Boots.
CtW said McDonald’s has been “complacent in not refreshing its membership earlier” given how much restaurant-going habits have changed, and pointed to how Coca-Cola, Starbucks Coffee and PepsiCo have been better at refreshing their board composition in the last few years.
“We respect and take seriously the views of all of our shareholders. The Board of Directors recently added a highly qualified new Director, appointed a new Chair of the Governance Committee and has made several senior management changes. Our Board is experienced, independent and committed to maximizing shareholder value,” McDonald’s said in a statement.
Eight of the 12 board members have a tenure of 10 years or more. A CEO failure, which McDonalds just had, is also a board failure given the board hires and oversees the CEO. New blood and new thinking is probably needed.
A lot of Americans prefer Mexican food. Go figure.
Will they serve breakfast until lunchtime now? Will they actually get good burgers?
I think it is worse than that.
The only time I am tempted to go into a McDonald’s is when I am in China or some other 3rd world place. They import cleanliness standards or seem to as well as the menu items.
When it comes to burgers, they are on the bottom of my list just below skipping a meal
I haven’t eaten at a fast food burger joint in years, or decades. Yuk!
Affirmative action burgers aint lovin it?
McDonalds hamburgers and cheeseburgers are the easiest thing going to eat one handed while driving. I stop and get a couple in the drive through when I am traveling but that is the only time I eat there.
Maybe if they’d stop killing babies, they get a lot of customers back.
Their coffee is surprisingly good.
Now you are talking, but if McD go ahold of that, God help us all....................
No, because there is not enough grill space when you consider the temperature differentials and cross contamination issues. And with all due respect, I venture that no matter what McD's did you would never consider their burgers good burgers. If they want to be profitable again they need to dump half the menu, and get back to Kroc's basics instead of trying to compete with everybody in every market.
McDonald’s is not our go to place... we like 5 Guys or Square 1 or even Dairy Queen for burgers...
I agree with that. And beef tallow for frying fries. People actually like that stuff — so it might sell.
1. Make your burgers like you used to.
2. Make your fries like you used to.
3. Forget the trendy new items.
4. Quit putting those nasty unripe apple slices in Kids Meals
5. Hire help that speaks some form of English and doesn’t look like they’d spit in my food
(psssst!), (Mickey D's), (I got one word for you), (EBT cards). (Well, that's actually two words but you get my drift).
When sizes go down and prices go up ... changing leadership will do nothing.
As do I.
I never eat "fast food". Have not since I had to when stuck in Barstow and had to be out at Ft Irwin at 0800.
That said, even when i do cook burgers at home, they are far from McD type fare, with jalapeno peppers and whatever else the spirit tells me to throw in there. Never to they have tomato, lettuce, buns, etc.
Not a bad idea considering a goodly portion of their most loyal clientele don't get up till the crack of noon.
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