McDonald's pig policy fight escalates with board nominations

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A view of a McDonald's food restaurant logo sign.Image source, Getty Images

Billionaire Carl Icahn has stepped up his fight with McDonald's over the welfare of pigs used in its food chain.

Mr Icahn, whose no-nonsense reputation for shaking-up companies made him a Wall Street legend, wants to put two people on McDonald's board.

He owns only 200 McDonald's shares but, reportedly spurred on by his animal welfare activist daughter, that gives him leverage to agitate for change.

McDonald's says it has led the way in improving animal welfare standards.

The battle centres on claims about pregnant sows being kept in small crates, a practice Mr Icahn said was "obscene".

He said McDonald's had not lived up to a promise to phase out the sourcing of pork from pigs housed in so-called gestational crates, a practice targeted by animal rights activists.

Mr Icahn had asked all McDonald's pork suppliers in the US to move to "crate-free pork", along timeframes he had set.

Now Mr Icahn has proposed that Leslie Samuelrich and Maisie Ganzler stand for election at the 2022 annual meeting, a statement by the fast food giant said.

Image source, Getty Images

Activist investors such as Mr Icahn - one of a handful of feared corporate raiders said to have been the model for Gordon Gekko in the 1987 movie Wall Street - normally focus on companies they believe need restructuring.

But he told the Wall Street Journal earlier this month that he was moved to do something at McDonald's by his daughter, an animal lover who has worked for the Humane Society.

McDonald's pledged to stop ordering pork from suppliers putting pregnant pigs in crates back in 2012. The firm said it had "led the industry" since then and about a third of US pork suppliers have moved to group housing systems.

It said it expected to source 85% to 90% of its pork from these suppliers by the year's end. All of the pork it buys will come from these suppliers by 2024.

McDonald's said in a statement on Sunday that it would continue to work with the industry to improve standards, but that some of Mr Icahn's demands were unreasonable.

The chain also noted that Mr Icahn was the majority owner of Viskase, which makes and supplies packaging for the pork and poultry industry.

It added that he had "not publicly called" on Viskase to make similar commitments. Mr Icahn did not immediately respond to a BBC request for comment.

Image source, Getty Images
Image caption,
Carl Icahn has said he was moved to put pressure on McDonald's by his daughter

As the founder and controlling shareholder of Icahn Enterprises, Mr Icahn has a net worth of $16.8bn (£12.3bn), according to Forbes.

He previously spent several months advising former US President Donald Trump on regulatory reform, before stepping down amid controversy.

However, he is unlikely to succeed with the nominations, observers said.

"Mr Icahn's profile means McDonald's feels a need to respond even though his stake is so small," Mak Yuen Teen, a professor at NUS Business School in Singapore, told the BBC.

"It does seem that McDonald's has been rather slow in fulfilling this particular commitment made 10 years ago. It's only now that it's accelerating the fulfilment when activists are publicly highlighting it."

McDonald's said it sourced only approximately 1% of US pork production, and that it did not own any sows, or produce or package pork in the country.

It said the board would evaluate Mr Icahn's nominees "as it would any other candidates".

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Media caption,

"We're demanding McDonald's goes fully plant-based by 2025"