I am asked to assess how McDonalds could improve their operations ethically.

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Name: Mirwais Haidari

BND Business Studies Year 2 Group 1

Unit 38 – M1

Lecturer: Rose Ajani

Task 1b) I am asked to assess how McDonald’s could improve their operations ethically.



Stakeholder: A stakeholder is an individual or a group affected by or has an effect on, the business. It can include internal stakeholders such as employees and managers and external stakeholders such as shareholders, banks, customers, suppliers, competitors.

Impact on the business and stakeholders of the way the business operates

A business is a separate entity from its owners that is made up of an interlinked system where the way the system is run and operated affects all the external areas as well as external stakeholders that are part of this system. The way McDonalds operate has a direct impact on the business itself and its stakeholders as they are influenced by the business’s performance, position, reputation and size. As far as the business is concerned, unethical behaviour would have implications on the business such as lack of revenue, bad image, deterioration of reputation and profitability, whereas good ethical behaviour would help McDonalds expand and grow profitably while improving on its existing reputation. The stakeholders would flourish if the business’s performance is positive in an ethical manner. For instance, shareholders of McDonalds would get good long lasting returns in the form of dividends if the business is ethically friendly as the business will benefit from long term business relationship with its customers and suppliers, hence allowing long term profits for the business.

Implications of operating ethically

  1. Adapting business behaviour

We live in a world which is inter-linked and the availability of state-of-the-art communication systems have made the act of instantaneous interaction possible. The rumour of an incident spreads so fast that if McDonalds do something unethical in its London restaurant, the whole world would know about it within minutes. Therefore, a large-scale business like McDonalds today takes their ethical responsibilities very seriously. They are therefore prepared to adapt their behaviour to avoid accusations of doing wrong, as McDonalds’ corporate governance statement shows; “McDonald’s success is built on a foundation of personal and professional integrity. Hundreds of millions of people around the world trust McDonald’s. We earn that trust everyday by serving safe food, respecting our customers and employees and delivering outstanding Quality, Service, Cleanliness and Value. We build on this trust by being ethical, truthful and dependable.” In order to avoid consequences due to unethical behaviour, they must address ethical issues to make sure the company’s employees and stakeholders know about it.

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  1. Responding to ethical pressures

This is one of the implications of operating ethically. There is growing pressure placed on McDonald’s management to take account of ethical concerns. Human right activists and environmental pressure groups are examples of groups exerting pressure on McDonalds. The company in return exert pressure on their own trading partners such as suppliers, farmers, employees to follow socially responsible policies.

  1. Implementing ethical practices

In order to operate ethically, many businesses including McDonalds have begun to implement ethical practices in their operational activities. McDonald’s fast food chains increasingly work to offer healthy options. ...

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