McDonald’s president re-elected despite shareholder opposition
Photo courtesy of McDonald’s
McDonald’s chairman Enrique Hernandez and manager Richard Lenny were re-elected to the burger giant’s board on Thursday due to opposition from some union-affiliated investment firms over their handling of the departure of the former CEO Steve Easterbrook.
CtW Investment Group, the California Public Employees Retirement System (CalPERS) and others had opposed the reappointment of the two directors over the severance pay of Easterbrook – which he was allowed to continue after his retirement. dismissal due to a consensual relationship with an employee in 2019.
A proxy advisory firm, Glass Lewis, agreed with shareholders to push for their ouster, but another, Institutional Shareholder Services, said the company’s takeover lawsuit and the public fight against Easterbrook since then were proof that the council was doing its job.
McDonald’s sued Easterbrook in August, arguing that he had more business with employees than he initially admitted and therefore owed the company’s shares and other benefits that he was allowed to. to continue after his dismissal. These benefits are estimated to be worth well over $ 50 million.
Shareholder groups argued the company should have fired Easterbrook “for cause” in November. They also argued that he was treated differently from his former director of human resources, David Fairhurst, who was fired the day after Easterbrook’s dismissal for cause.
Meanwhile, franchisees of the hamburger giant seem to be increasingly interested in these issues. The National Owners Association, the company’s independent franchise association currently at odds with company management over a dispute over technology fees and other issues, shared the Glass Lewis report with other franchisees. He did not make a recommendation on the composition of the board.
It is unusual for franchisees to even consider getting involved in board votes, although many franchisees also own shares in McDonald’s stock. “Bring fresh blood,” said one operator in response to the survey. “Their handling of the Easterbrook case was shameful.
Several operators have said there should be current or former franchisees on the board. “Owner-operators should be represented on the board to show their respect and value to those on the front lines of this great brand,” said another operator.
Almost two-thirds of the company’s franchisees said in a survey obtained by Catering company that they were somewhat or very dissatisfied with the board of directors of the company. The survey included responses from 200 operators, or about 10% of the company’s franchise base. More than 70% of franchisees in the survey said they were dissatisfied with the company.