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Global Economy

Investor urges McDonald's to do more animal welfare

The US multi-billionaire Carl Icahn wants to persuade the fast-food chain McDonald's to pay more attention to animal welfare when purchasing pork. Icahn nominated two confidants for election to the company's board of directors this year, McDonald's announced yesterday. Apparently he wants to change the way pigs are treated. The major shareholder, known as an activist investor, accuses the fast food chain of not meeting the commitments it made in 2012. At the time, Icahn criticized the company for using gestation cages for pigs in its supply chain, after which it announced that it would gradually oblige its suppliers to abandon so-called crate housing.

This involves confining sows to farrowing in cramped crates, a practice long denounced by animal rights groups and activists. Originally, McDonald's wanted to end this practice within ten years – i.e. by 2022. Icahn told the Bloomberg news agency last week that the company had not fulfilled this promise and instead postponed it until the end of 2024. The "unnecessary suffering" of these animals moves him.

Criticism also from animal protection organizations

That is why he has now started a fight for two seats on the board of directors. The billionaire investor nominated Leslie Samuelrich of Green Century Capital Management and Maisie Ganzler of Bon Appétit Management Company to stand for election at the 2022 AGM.

The Humane Society of the United States had already questioned McDonald's involvement in November. Instead of getting rid of the gestation crates, the company allowed pig farmers to "lock up pregnant pigs for six of the 16 weeks of gestation," said Josh Balk, vice president of livestock welfare at the animal welfare organization. He's known Icahn for over a decade. The investor will fight to prevent animal cruelty.

McDonald's explained that the group buys only around one percent of all pork production in the USA – for ham in burgers, for example. The company is also on track to source 85 to 90 percent of its supplies from sows not housed in pens by the end of this year.

By 2025, crate keeping is to be ended

The original plan was adjusted because the "current supply of pork in the US makes such a commitment impossible." In addition, this affects the company's efforts to provide customers with quality products at affordable prices.

According to McDonald's, the company intends to eliminate 100 percent of pigs from the controversial farm by the end of 2024. The company wants to achieve this goal “despite industry-wide challenges for farmers and producers such as the Covid 19 pandemic and global outbreaks of swine diseases”.

At the same time, the company counterattacked: Icahn was the majority shareholder of Viskase, a company that produces packaging for pork and poultry. "It is interesting that Mr. Icahn has not publicly asked Viskase to make commitments similar to those made by McDonald's in 2012."

Carl Icahn is known for taking large blocks of shares in public companies before committing to massive change. In the case of McDonald's, however, Icahn only owns 200 shares worth about $50,000, according to the company.

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