Cow/Calf

Alumbaugh: Why you should know Steve Easterbrook

I recently read a news release about the retirement of McDonald’s CEO Don Thompson and the naming of his replacement, Steve Easterbrook, who will take the helm of the fast-food giant on March 1. A UK-native, Easterbrook has served in a number of leadership positions within McDonald’s, including president of McDonald’s Europe and most recently as the company’s Chief Brand Officer.

Andrew McKenna, non-executive Chairman of the Board of Directors was quoted in the release, saying: "Steve is a strong and experienced executive who successfully led our UK and European business units and the Board is confident that he can effectively lead the Company to improved financial and operational performance."

A New York Times article reported that McDonald’s revenue in the quarter through December fell 7 percent, to $6.6 billion. Earnings dropped 21 percent, to $1.1 billion, from $1.4 billion in the same period a year ago.

In an interview, Easterbrook stated that the fast-food market isn’t growing, so McDonald’s must differentiate from its competitors. He said, “We have to find meaningful ways to connect with consumers.” He mentioned how quickly consumers’ sentiments can change and that McDonald’s needs to “stay close to customers.”

We don’t want to base our opinion on generalizations, but we do know the positions the European Union has taken on animal rights and the use of genetically modified organisms. Citizens there are basically wary of new technology and activist groups have a firm foothold on policy.

McDonald’s will protect its brand at all costs, and with Easterbrook’s background as brand officer, it’s likely this will continue to be a high priority.

How will that impact U.S. agriculture? I would venture to say that McDonald’s will take an even stronger stand with suppliers in terms of animal care, antibiotics and GMOs. If the company wants to further “differentiate” itself, it potentially could establish protocols that would be difficult for many producers to follow.

We already saw a sample of that attitude when Chipotle announced it was suspending one of its suppliers for not meeting its self-proclaimed “naturally raised” standards, which include no antibiotics, deep-bedded pens, and a “vegetarian diet” (which all pigs are fed). Chipotle believes these pigs live “happier, healthier lives.” That may be true for one or two “boss” sows, but not for the majority of females who must defend themselves against the more aggressive animals, and certainly not for many of their offspring who, without farrowing crates, will most likely get crushed.

National Public Radio did a thoughtful report on the situation, in which it considered the lack of practicality in Chipotle’s reasoning: “Consider slatted-floor housing: It's true that this is not a natural environment for pigs, but it allows farmers to handle large numbers of pigs. What Chipotle wants — pigs living in "deeply bedded pens" that they can dig around in — takes a lot more work, space and bedding material, such as straw.”

Chipotle’s marketing folks will readily defend their misleading videos and confusing messages. They’ve bought into the activists’ rhetoric, and it will be interesting to see if the leadership at the parent company does the same.

“I am honored to lead this great brand, and am committed to working with our franchisees, suppliers and employees to drive forward our strategic business priorities to better serve our customers," says Easterbrook.

Let’s hope, as suppliers, livestock producers, dairy farmers and egg producers are integrally engaged in the conversation with McDonald’s new leadership. If we’re not, you can bet that Congresswoman Louise Slaughter, the Union of Concerned Scientists and HSUS, among others who have definite agendas, will be bending their ears. 

 

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