McDonald's CEO gets grilled at first annual meeting

Thu May 21, 2015 7:42pm EDT
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By Lisa Baertlein and Ross Kerber

LOS ANGELES/BOSTON (Reuters) - McDonald's Corp (MCD.N: Quote) shareholders defied executives at its annual meeting on Thursday, approving a proposal to make it easier to nominate directors to the board of the fast-food chain and taking its new CEO to task over wages, advertising and its food.

McDonald's Chief Executive Steve Easterbrook, who took the helm on March 1, is fighting on numerous fronts as he works to turn around the company, which saw profit and revenue fall in 2014 after service times slowed and nimbler rivals picked off customers with menus that appeal to growing appetites for fresher, less-processed food.

Despite opposition from McDonald's, 61 percent of voting shareholders said yes to a proposal that would make it easier for long-term investors to list director candidates on company proxy materials.

The UAW Retiree Medical Benefits Trust brought the proxy access proposal before investors because "McDonald's board needs to be more accountable for these performance lapses," the Trust's Corporate Governance Director Cambria Allen said at the meeting, which was closed to media but accessible via webcast.

Thousands of protesters swarmed McDonald's headquarters for two days of rallies that are part of a multi-year, union-supported campaign for better wages and working conditions at the world's biggest restaurant chain.

The day before the meeting, New York City Comptroller Scott Stringer and three other officials who are fiduciaries to large public pension funds challenged McDonald's and other companies, saying they might be jeopardizing their own futures by returning excessive amounts of cash to investors via the buybacks.

Earlier this month, Easterbrook said McDonald's turnaround plan would include returning up to $9 billion to investors through dividends and share repurchases.

Stringer called proxy access at McDonald's "the perfect antidote for a board whose turnaround plan prioritizes share buybacks over long-term value creation."   Continued...

A McDonald's logo is seen at one of the chain's restaurants in San Francisco, California, May 6, 2015. REUTERS/Robert Galbraith