Since I’ve started writing this blog (I’m sorry, I refuse to concede that “blogging” is a real verb), readers often send me articles that might spur additional posts. A recent one came from Annette Bianchi, partner at Vantage Point Venture Partners (colleague, friend and cool Bernese Mountain dog owner) entitled, “The Sisters Bite Into McDonalds,” probably in response to the post I wrote about the Heart Attack Grill a few months back.
For those of you following the mega-burger trend, I am sad to report that the Heart Attack Grill’s 29-year old 575 pound spokesman recently died quite suddenly. The conjecture is he died from pneumonia complications after having the flu. While his obesity has not been directly linked to his death, the poor guy made his living eating the restaurant’s Triple Bypass Burgers. Obviously the death of a young person (or any person) isn’t funny, but I have to think that the company’s business strategy of giving anyone weighing over 350 pounds free food isn’t exactly the path to a long-term customer base. On the other hand, I guess if they eat for free it’s better if they aren’t around long enough to seriously cut into the company’s margins.
John Basso, owner of the Heart Attack Grill, was quoted in a recent ABC News story as saying that his free food promotion provides “food for thought” for some.
“They come in, stand on the scale in front of everyone. We cheer and throw a big mumu over them and then they eat as much as they like for free. That shocks people, and hopefully, some people on those scales go home and say, that was fun at the time, but I really need to do something about this,” Basso says.
Before owning the grill, Basso owned a Jenny Craig franchise and a fitness center, and says that despite pouring “his heart and soul into the diet and exercise industry,” he didn’t feel like he was reaching anyone. “I’m making more inroads now into people’s consciousness by working the other side,” he says.
Which brings me right back to Annette’s article, the focus of which is the preliminary shareholder proxy that McDonald’s recently filed with the SEC. Buried among the proposals to approve Board members and to consider more ecologically friendly beverage containers were two really worth noting. The first that caught my eye was a resolution to improve the welfare of chickens by switching to “controlled atmosphere killing.” This made me wonder if the chickens really care how they die on their way to becoming a McNugget? Do you think that once they know they are McNugget-bound they might actually take their own lives if they had the means? Anyway, that particular resolution was pretty gross. If you are still a fast food eater despite what you probably know about its health impacts, just read this part of the proxy and you will be cured of your cravings.
As for the focus of the earlier mentioned article, it highlights proposal number 11, placed there by the Sisters of St. Francis of Philadelphia. The Sisters are McDonald’s shareholders and their resolution asks the company to:
…issue a report, at reasonable expense and excluding proprietary information, within six months of the 2011 annual meeting, assessing the company’s policy responses to public concerns regarding linkages of fast food to childhood obesity, diet-related diseases and other impacts on children’s health. Such report should include an assessment of the potential impacts of public concerns and evolving public policy on the company’s finances and operations.
The Sisters of St. Francis of Philadelphia (the “Sisters”) are an order of Catholic nuns dedicated to looking after the poor, marginal and oppressed, according to their website. Their mission statement says:
“We are willing to take the necessary risks to be a healing, compassionate presence in our violent world, especially with women, children, and those who have no voice.”
It is a very noble goal indeed, and they are clearly thinking about their role to protect children’s health in offering up this shareholder proposal. In addition to pointing out that the Centers for Disease Control estimates that 1 in 3 US children born in the year 2000 will eventually be diagnosed with type 2 diabetes as a result of childhood obesity, the Sisters’ proposal adds a few other tidbits (a sampling below):
- In 2005, the National Academies Institute of Medicine (IoM) conducted a study concluding that fast food marketing influences children’s food preferences, diets and health in the US. (to which I say, um, duh)
- In a 2009 follow-up report, the IoM recommended that local governments take such actions as adopting zoning policies that restrict fast food establishments near schools and playgrounds and implementing zoning to limit the density of fast food restaurants in residential communities.
- The World Health Organization developed recommendations regarding marketing of unhealthy foods to children that urges governments to enact policies to reduce the impact of food marketing on children.
- In November 2009, a bill, “The Healthy Kids Act”, was introduced in Congress with the intent of curbing childhood obesity. The bill seeks to give the FTC and relevant federal agencies regulatory authority over food marketing.
- On April 27, 2010, Santa Clara County Board of Supervisors approved an ordinance that banned toys and other promotions that come with children’s meals that exceed set levels of calories, fat, salt, and sugar. The San Francisco Board of Supervisors adopted a similar measure in November 2010.
The Sisters conclude their proposal by stating that in November 2009, the Center for Science in the Public Interest released a report demonstrating that 88 percent of the products that McDonalds had deemed appropriate to market to children under the industry’s voluntary marketing initiative, the Children’s Food and Beverage Advertising Initiative, met no third-party nutrition standard. I hate that when that happens.
Given that the Sister’s orientation towards childhood healthy eating is somewhat adverse to McDonald’s fiscal health, you gotta wonder why in the heck the Sisters are holding McDonalds stock at all. But a quick review of their website holds the answer, at least the publicly stated answer. The Sisters view their mission to include “corporate social responsibility, “ meaning the use of their investment capital to “fulfill the congregation’s mission to “direct our corporate resources to the promotion of justice, peace, and reconciliation” and thereby to effect change toward social and environmental justice.” Now I know what those nuns wear under the penguin suit: a cape, tights and red leotard with “SuperMarket Man (or Woman) logo.
The Sisters have used their shareholder pulpit as a means to promote issues as diverse as access to healthcare for all, tobacco marketing targeted at the poor, environmental health, violence in the media, climate change and even labor and human rights issues. Talk about Sisters are Doing it For Themselves. You Go Girls! I find it very interesting and somewhat inspirational that an organization such as this can use their wallet to make a difference in the world.
However, there is a dark side. As I delved a bit further into the story, the Sisters’ of St. Francis website revealed a slightly more insidious reason for their attack on McDonalds: it’s their competition! The Sisters own Red Hill Farm, a six-acre organic farm in its eighth year of production. Red Hill farm, a commercial enterprise, offers over 30 types of mixed vegetables, berries, cut flowers, and herbs, as well as some off-farm products such as local meats, eggs, and dairy. No wonder they are trying to shut McDonald’s down…they want the revenue for themselves. The Sisters charge families $750 for a season’s worth of delivery produce. That same $750 could buy 750 children a McDonald’s McChicken sandwich off the dollar menu. For shame! Perhaps the Sisters think that by stuffing kids full of fresh green beans and okra they will save some number of chickens from death by McNugget. I’ll have to go back and check who sponsored that chicken resolution on the McDonald’s proxy.