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McDonald's Issues First Worldwide Social Responsibility Report:

McDonald's Issues First Worldwide Social Responsibility Report:

Published 04-14-02

Submitted by McDonald's Corporation

OAK BROOK, IL - McDonald's Corporation today issued its first worldwide Social Responsibility Report.

"Social responsibility is not a project or a program. Acting responsibly is the way McDonald's does business," said Jack M. Greenberg, Chairman and Chief Executive Officer, McDonald's Corporation.

"Today, we formally report on our corporate citizenship around the world. It's what we've been doing, where we are today, and where we plan to go in the future. The enduring principles behind our commitment to social responsibility were built into our culture by McDonald's Corporation's founder, Ray Kroc, who spoke nearly a half century ago of the importance of giving back to the local communities in which we live and work."

The McDonald's Social Responsibility Report provides a global perspective on where social responsibility fits into the company's business strategies and provides a snapshot of McDonald's performance and progress in four broad categories, beyond just economic indicators: community, environment, people and marketplace. The full 46-page report is available at www.mcdonalds.com/corporate/social/.

"This report reflects the unique, local nature of McDonald's restaurant business -- restaurants mainly owned and operated by local men and women, who are involved in their communities, and give something back to them in different ways the world over, " added Mr. Greenberg.

Examples contained in the report under the community category, include McDonald's support of Ronald McDonald House Charities (RMHC) and its more than 200 Ronald McDonald Houses around the world that provide a "home away from home" for families with seriously ill children. Since 1984, RMHC and its global network of local chapters have provided more than $300 million for children's programs.

Under the people category, McDonald's outlines its people principles, advanced training and development efforts, commitment to a diverse workforce and aspirations to be the best employer in each community around the world.

The report also highlights ongoing global environment and marketplace initiatives:

· THE CENTER FOR ENVIRONMENTAL LEADERSHIP IN BUSINESS

Sustainable Agriculture

McDonald's has embarked on a new partnership with the Center for Environmental Leadership in Business, a division of Conservation International, to implement sustainable agriculture and conservation practices and standards within McDonald's global food supply network. This new partnership with the Center for Environmental Leadership in Business reflects McDonald's vision to enter a new phase of environmental work.

"We are enthusiastic about this new partnership and the opportunity to work with McDonald's to develop purchasing preferences with conservation in mind. We envision our collaboration producing sustainable agricultural guidelines and projects that have a far-reaching impact," said Glenn Prickett, Executive Director of the Center for Environmental Leadership in Business.

· ENVIRONMENTAL DEFENSE

McDonald's Passes $4 Billion Mark for Recycled Products;
Reducing Fluoroquinolone Antibiotic Use

Since first partnering with the Environmental Defense in 1989, McDonald's USA has made significant packaging changes. Most of these changes have been adopted globally and eventually adopted by the quick service industry as a whole.

"McDonald's Social Responsibility Report chronicles a strong record of environmental leadership," said Fred Krupp, Executive Director of Environmental Defense.

"Since our breakthrough partnership with them to replace the foam clamshell and reduce solid waste in the early 1990s, I have seen McDonald's continuously innovate and challenge itself, from packaging changes and energy conservation investments to their current efforts to reduce the use of animal antibiotics. "

Since 1990, McDonald's has now purchased more than $4 billion worth of products made from recycled materials. On a global basis, McDonald's has reduced packaging by 200,000 tons by redesigning items including straws, napkins, cups, fry cartons, and other packaging items.

Most recently, Environmental Defense and McDonald's worked together to study the effects of animal antibiotics. One of the outcomes of this work is that McDonald's USA asked its poultry suppliers a year ago to discontinue the use of fluoroquinolones - an antibiotic, therapeutic medication for chickens.

"Our work with McDonald's and our Alliance for Environmental Innovation clearly shows the value of companies leaving their preconceptions at the doorstep, and embracing environmental management as a core business strategy. Our partnership with McDonald's has been a template for others seeking to make a difference within their industries," said Mr. Krupp.

· THE NATURAL STEP

McDonald's Adopts Sustainability Strategy

McDonald's newest partner, The Natural Step (TNS), is helping McDonald's incorporate into its business what TNS describes as "the minimum system conditions" required for society to operate in balance with the rest of nature.

"McDonald's is demonstrating leadership by beginning to build sustainability into its strategy and operations. Management at McDonald's understands that this is a long journey. They are taking the first step by identifying their environmental and social impacts and building an integrated strategy to move forward. This is not only smart business leadership, it is responsible corporate citizenship, " said Catherine Gray, Executive Director, The Natural Step.

"Results cannot be expected to happen overnight. What McDonald's has embarked on
is a long-term vision and strategy for moving its company and supply chain toward sustainability. If it can achieve this vision and move toward sustainability, it will have a profound positive impact on business, people, and the planet far into the future."

· BUSINESS FOR SOCIAL RESPONSIBILITY

Global Template for Continuous Social Responsibility Growth & Improvement

Non-governmental organization Business for Social Responsibility (BSR) began working with McDonald's in 2000 to assist the company in creating an internal process to examine strengths, areas for improvement, and future opportunities. McDonald's commissioned this internal social responsibility assessment to formalize a process and establish benchmarks against which it could begin enhancing its social responsibility performance.

"Every large company faces significant challenges in addressing the demanding requirements of our global society. Recently, transparency and accountability have become widely recognized as essential aspects of responsible business practices," said Robert H. Dunn, Chief Executive Officer of Business for Social Responsibility (BSR).

"McDonald's Social Responsibility Report represents an important effort and commitment by the company to provide all of its stakeholders with useful information about issues McDonald's is seeking to address. This kind of disclosure builds on the company's best leadership traditions."

· ANIMAL WELFARE

Working with Independent Experts to Help Drive Improvements

Using guidelines established by a leading animal welfare expert, McDonald's works with its suppliers to audit their processing facilities to ensure the humane treatment of farm animals. In the U.S., McDonald's introduced guidelines for the improved treatment of egg-laying hens. Building upon this work, McDonald's formed the restaurant industry's first independent board of academic, industry and animal protection experts, the McDonald's Animal Welfare Council, to advise the company on issues regarding the welfare of farm animals.

There are many other examples of McDonald's partnership with leaders in this field, notably in the United Kingdom where McDonald's is supporting future of farming and animal welfare projects in partnership with Oxford University and the Royal Society for the Prevention of Cruelty to Animals.

"McDonald's has ushered in a new era of responsibility and accountability for animal welfare. They have helped encourage collaboration and cooperation among industry, non-government organizations, academia, and other stakeholders so that we can work together to make a difference," said Dr. Joy Mench, University of California at Davis, Department of Animal Science, and a member of McDonald's Animal Welfare Council.

"I am impressed by McDonald's efforts to develop animal welfare standards for processing plants, and I am encouraged by the dialogue and actions taken to establish guidelines. For example, I have seen the tangible results of the new laying hen guidelines, and they have greatly improved the living conditions of hens."

· FOOD SAFETY

International Scientific Advisory Council;

Leading Scientists Help Advance Safest Practices

In 2001, McDonald's established the International Scientific Advisory Council, a panel of leading scientists and medical experts, to advise McDonald's on Bovine Spongiform Encephalopathy (BSE). Members of this council review industry practices and McDonald's system initiatives in BSE prevention. With this council, McDonald's is strengthening its beef safety program. Independent validation of its food safety programs is key to ensuring the trust and confidence of McDonald's consumers.

"To my mind, McDonald's has truly set a new standard for customer trust in their objective and thorough consideration of the critical issues of supply and validation," stated Dr. Neil Cashman, University of Toronto, Center for Research in Neurodegenerative Diseases.

"As a member of McDonald's International Scientific Advisory Council, I have been continuously impressed with the corporation's high degree of professional responsibility and deep commitment to food safety. As a physician and scientist, it has been gratifying to see McDonald's aggressive pursuit of current research and expertise to address important issues like BSE."

Greenberg Acknowledgements

"The advice, expertise and candid counsel of these NGO and scientific leaders and other third party experts has been absolutely invaluable to McDonald's," said Mr. Greenberg. "Their impact is not only seen throughout this report, but is reflected in our worldwide business practices and culture.

"These leaders have educated us and helped McDonald's turn understanding into action. There is still work to be done. We know we are not perfect. But McDonald's around the world remains committed to making a difference, being more transparent and continuing to build on our heritage of giving back to the communities in which we do business."

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McDonald's Corporation

McDonald's Corporation

McDonald's is the world's leading global food service retailer with more than 35,000 locations serving approximately 70 million customers in more than 100 countries each day. More than 80% of McDonald's restaurants worldwide are owned and operated by independent local business men and women.

To learn more about the company's sustainability initiatives, please visit www.aboutmcdonalds.com/mcd/sustainability and follow us on Facebook (www.facebook.com/mcdonaldscorp) and Twitter (www.twitter.com/mcdonaldscorp).

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