McDonald's to Cut Greenhouse Gases in Push to Boost Reputation

(Bloomberg) -- McDonald’s Corp., on a quest to boost sales by improving its image, is vowing to cut its greenhouse-gas emissions.

The world’s largest restaurant chain is adding LED lights and more efficient kitchen equipment, such as grills and fryers, in a bid to reduce emissions at its restaurants and offices by 36 percent by the year 2030 from 2015 levels.

Changes to beef production, meanwhile, will lower greenhouse gases from the company’s supply chain by 31 percent, McDonald’s said. Suppliers are experimenting with new paddock-style grazing practices, in which herds are rotated across sections of pasture. That allows the land to recover and reduces gases from cattle.

The company says the combined effect will be the equivalent of taking 32 million cars off the road for a year.

“We believe this will drive growth and drive our business,” said Francesca DeBiase, chief supply chain and sustainability officer. “These are expectations that our customers have.”

Image Efforts

Chief Executive Officer Steve Easterbrook has been trying to improve the public’s perception of the fast-food chain since taking the reins in 2015. Under his guidance, McDonald’s has replaced some frozen hamburger patties with fresh beef and renovated aging stores, while removing antibiotics from chicken and introducing buns without high-fructose corn syrup. Last year, the chain laid out a plan to help the beef industry become more sustainable.

The environmental moves follow the goal the chain set earlier this year to recycle trash at all of its 37,000 restaurants globally by 2025. As part of that effort, McDonald’s said it would make some food packaging more environmentally friendly. It has also pledged to help protect water supplies, promote animal welfare and preserve forests at cattle ranches that supply its beef.

Companies are trying to respond to consumers’ growing environmental awareness. Tyson Foods Inc., which processes beef, pork and chicken, said last month that it plans to cut greenhouse-gas emissions 30 percent by 2030. And it invested in Beyond Meat, a U.S. company that makes plant-based burgers. Pork producer Smithfield Foods Inc. said in 2016 that it planned to cut emissions 25 percent by 2025.

McDonald’s is working with agriculture giant Cargill Inc. on the efforts. But going green will require the cooperation of the company’s franchisees, who own and operate about 90 percent of its locations worldwide.

On that front, it isn’t clear how much of the burden that independent owners will take on. The restaurant chain declined to declined to say how much it, or its franchisees, will invest to cut greenhouse gases.

“We need to be investing in areas that are important to our customers,” DeBiase said. “Climate change is the biggest environmental issue of our time.”

--With assistance from Megan Durisin

To contact the reporter on this story: Leslie Patton in Chicago at lpatton5@bloomberg.net.

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Jonathan Roeder

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