Ethics Of Mcdonaldsintroduction And Stakeholders



Jun 25, 2019 The primary definition is a system of moral principles, and a secondary definition is that ethics are the rules of conduct as used by a specific group or culture. The McDonalds food industry has been criticized throughout their business career in terms of the ingredients within their products. In Mid-July, 2014, there was a scandal in Hong Kong, involving the McDonald's industry, which resulted in Hong Kong having to remove their famous 'Chicken McNuggets' and 'Chicken McBurger's' from their food menu. Define ethics, ethics in business and the important of ethics in business context II. Background of the business Introduce to McDonald’s III. Case Outline The case of unhealthy ingredients IV. Stakeholder (Direct and indirect) The people affected by the issue directly and indirectly V. Key Ethical Issue Consequences from this issue VI.

Throughout this course, the concept of ethical dilemmas and morality has been a key issue. Ciulla (2003) has highlighted numerous instances in which a number of organization (both private and nongovernmental) have found themselves caught between a ‘hard place and a rock’ in their decision making processes. It is important therefore to ensure that all decisions in business contexts have both moral and ethical inclinations.

This paper seeks to expound on the broader context of Ciulla’s assertions in the lieu of the fact that businesses will always encounter dilemmas. Particularly, the paper will highlight the McDonald’s case study from which it will analyze key concepts of various thinkers on the topic of business ethics.

They include power, self-interest, virtue, character, duty, intention, social utility, justice as fairness, the moral relationship of leaders and followers and the emotional relationships of leaders and followers.


Power and ethics are inexplicable in the sense that exercise of power requires ultimate use of ethical standards and morality. As such, it is important to notice that power has to be in relation to other people. Indeed, people cannot hold power if they do not use it in reference to other subjects within the society.

Considering the ethical and issues raised in McDonald’s case study where the company continues to reap huge profits from selling junk food, power it exercises is not morally upright. In fact, Marx Weber indicates that power should be in exercise only if leaders and followers stand to benefit (Kanungo & Mendonca, 1996).

Despite his dwelling on the concept of bureaucratic power, Weber says that power is the most important aspect of leadership and the followers should be the only people who grant it to the leaders. As such, the exercise of power should be reflective of customers’ will and should not be an instrument of suppressing the people whether in term of health or otherwise.

It is imperative to notice that business decisions at McDonald’s do not indicate the ability of people or customers to influence the course that the business takes. To this end, it is important for the leaders to ensure that their exercise of power benefits all stakeholders including the customers and the society.

Self Interest

According to business ethics analyst, Milton Friedman, businesses ought to act in self-interests. Friedman articulates that the sole objective of any business across the world is to increase the wealth and the profits for its owners.

In other words, Friedman points out that any business should not engage in issues that concern the society such as ethical business practice and corporate social responsibility but in the contrary, it should aim at increasing its profit margins through which the shareholders and the owners of the company will accumulate wealth (Kanungo & Mendonca, 1996).

According to him, it is not in the interest of any business to act in a way that pleases the society or customers while at the same it makes losses. Ciulla (2003) criticizes the concept of self-interest in the context of business by articulating that the business bears some obligations and responsibilities to its customers. Nevertheless, Friedman asks, ‘what is the paramount objective of any business?’

As such, it is important to make decisions in line with the major objectives of business without necessarily having to please the customers. Concerning McDonald’s case study, the business has achieved its prime goals of making profits despite specializing in unhealthy food (Ciulla et al., 2010).

To him, business should distance itself from the needs of the society and act in its self-interests that are driven by the need to increase its revenues and profits notwithstanding the consequences.


Ethics in business are fundamental aspects that make it thrive in the competitive and dynamic environment. This is an assertion by Ciulla (2003). All businesses should be virtuous and uphold the concept in every business decision. As elucidated by Confucius, ethics should guide all human aspects including businesses where leaders have the ability to practice it.

Confucius elaborates that virtue is the definition of human beings without which there would exist no morality and even life. Although Confucius is vague in his definition of virtue, it is important to notice that he articulates that a business should not sacrifice virtue for anything including life (Thompson et al., 2007).

In this case, Confucius argues that it would be better if a business collapsed due to practicing virtuous behavior rather than it thrives under the pretext of poor and immoral actions. As such, the McDonald’s case study would revolve around the ability to take virtue as the most important aspect of business.

To this end, McDonald’s should attempt to provide goods that do not only satisfy the customers but also enhance their health and wellbeing. This is despite the seemingly high competition that may emanate from other competitors. The company ought to shy away from activities that demean people in search of improved profit margins and ensure that human dignity is the central most aspect of all human beings and businesses.



Bernard Williams asserts that character is the action that a person or businesses undertake consistently and should be the yardstick that measures the level to which a person upholds virtue ethics. Character should reflect the decisions that an organization takes and should be the most important aspect of any business.

According to Williams, any business has a history of either upholding or downplaying the importance of ethics (Phillips, 2006). McDonald’s has a character that does not reflect ethical business practices and as such, it is important for it to ‘begin afresh’ and nurture a character that seems to respect its customers.

He articulates that human society is not idealistic and businesses should embark on ensuring that every aspect of their decision reflects realism. While Kantian ethics incline to a perfect society, Williams is categorical that it is impossible to have a perfect business environment where every company is just and ethical in all its practices.

This implies therefore that various business holdings will ensure that the action that they take do not dent their character and respond to contemporary issues brought about by a dynamic contexts.

To this end, McDonald’s does not need to enhance a positive character at its expense owing to the fact that its shareholders also require to increase their wealth and profits. It is therefore important for the company to uphold its character while at the same time attempting to change things that it does not consider ethically and morally upright.


Immanuel Kant explains the concept of moral obligation and duty in a precise and a concise way. He articulates that an organization ought to act in the most rational way. To him, rationality entails ensuring that all actions that a person or an organization ought to derive the most benefits for all. First, leaders of an organization should ponder and ask themselves whether other people would act in a different way given a same situation.

If the answer is affirmative, it is morally wrong to undertake the same decision and the reverse is true (Thompson et al., 2007). Besides, it is important to question whether any decision that a company arrives at is demeaning to the human race. As such, if the decision by a company is in harmony with people’s dignity and does not erode human regard, it is right.

McDonald’s has the moral duty of ensuring that its activities do not undermine human dignity and promote the well-being of all people. It should therefore not focus on increasing its profits but ensure that the profits ought to increase the welfare of the society.

Kantian ethics also coincide with Taoism where any decision should be in a position to reduce conflicts. Conflicts amongst stakeholders of a business should be at their very minimum. To that end, McDonald’s should make decisions that do not result to conflicts but increase the benefits not only for the stakeholders but also for the stockholders.


What is a business intention? Yukl defines business intentions as the most fundamental objectives of an organization upon which it is founded. On the issues of ethical and moral obligations, he articulates that business intention should be typical of moral and ethical guidelines. An intention of a business should therefore shift from making profits and encompass other moral standpoints that are critical in its operations.

McDonald’s seeks to increase its profit margin despite engaging in morally ‘wrong’ decisions. This is in the manner that the company predisposes its customers to unhealthy living and eating habits. Nonetheless, Yukl (2012) asserts that it is difficult to judge what is good and what evil is. This reflects the standpoint held by Friedrich Nietzsche who asserts that human beings are not always able to judge right from good.

However, the consequences of a decision ought to inform every organization on the ‘morally right’ path. From this line of argument, it is critical to assume a ‘consequentialist’ approach to business’ practices in the sense that the effects of a certain practice should not be hazardous to the society (Yukl, 2006). This is not the case with McDonald’s and as such, its intention does not satisfy the moral and ethical threshold.

Social Utility

Social utility according to Ciulla (2004) is the society’s benefits from a specific business enterprise. The definition borrows a lot from Mill’s concept of utilitarianism. Mills says that utilitarianism is the backbone of any social or economic institution.

To him, utilitarianism is the most fundamental aspect of human society where ethics dictate that individuals should be able to increase human happiness in their decisions (Velasquez, 1992). This does not rule out business decisions though. Mills points out that all businesses should adopt strategies that not only increase their profits but also reduce human sufferance.

Engaging in ‘junk food’ industry might as such seem lucrative for McDonald’s but it increases human sufferance. To this end, it is important for the company to augment social utilitarianism decisions for the society to start reaping the benefits of its already thriving business.

McDonald’s should shift its goals and objectives to begin introducing foods that alleviate the poor eating habits of individuals instead of solely focusing on the urge to expand its business empire.

In such ventures as corporate social responsibility activities that educate the society on the dangers that ‘junkie food’ predisposes to the society, the company may be able to bring about happiness to the society. As such, it would increase its public image and uphold social utilitarianism (Northouse, 2003).

Justice as Fairness

John Rawls expounds on the concept of Justice as a fair practice in the contemporary business environment. He postulates that a business should enhance justice in that the original position of human intrinsic rights ought to be the focal point of any decision. Despite the current ethical dilemma that McDonald’s is experiencing, the decision should not violate any of the rights.

His ethics revolve around the fact that no decision of a leader should be in a position to trample on the rights of the rest. To him, business ethics entail holding the importance of justice. Company’s leader ought o ask the question whether the decision is detrimental to the rights of its customers and the society (Yukl, 2006).

While this is true to a large extent, McDonald’s should seek other avenues through which it can continue increasing its revenues. Justice is an ethical practice in business since it increases the extents to which companies enhance fairness.

The Moral Relationship of Leaders and Followers

Leadership is only defined in the context of followers. Heifetz (1994) asserts that no person can ascend to any position of leadership without the legitimacy of the followers. Followers should therefore be the major stakeholders of leadership where the leader only influences their actions towards the achievement of a specific goal.

As elucidated by Weber, any leader should hold the followers as the most important contributors of his/her actions. Thus, leaders should make decisions that do not demean the followers. Instead, leaders ought to increase the participation of followers through teamwork and motivation.

In the context of McDonald’s, the manager ought to consult the followers and assist them in arriving at a decision that is agreeable to all of them (Martindale, 2011). However, the leaders ought to guide them through morally informed practices and explore all aspects of leadership.

The Emotional Relationship of Leaders and Followers

Although leadership entails moral relationship with followers, it is imperative for leaders to be wary of emotions emanating from all aspects of management. The leaders ought to maintain practices that do not undermine the importance of emotionality in the context of business.

Indeed, it is important to highlight that Arendt says that emotional intelligence is a major tool of leadership where leaders understand various situations that may evoke emotions.

Arendt articulates that the management of a company should always strive to understand the emotionality of the followers and involve all members (Goleman, 2000). To this end, McDonald’s leaders should involve all employees in making an ethical decision that is beneficial not only to the society but also to the customers.


In sum, various concepts are relevant in analyzing the McDonald’s Case. The most important of them all being virtue, social utility, self interests, moral obligation and duty, and organization’s character.

The organization should be willing to uphold Kantian ethics in enhancing utilitarianism in which its decisions should increase happiness. In addition, it is important to make virtue an important aspect of the company that increases its positive character.


Ciulla, J. (2003). The Ethics of Leadership. New York: Thompson-Wadsworth Publishers.

Ciulla, J. (2004). Ethics, the heart of leadership. Westport, CT: Praeger Publishers.

Ciulla, J., Clancy, M. & Solomon, C. (2010). Honest Work: A Business Ethics Reader. Westport, CT: Praeger Publishers.

Goleman, D. (2000). Working with Emotional Intelligence. New York: Publisher: Bantam Books.

Heifetz, R. (1994). Leadership without easy answers. Cambridge, MA: Harvard University Press.

Kanungo, R. & Mendonca, M. (1996). Ethical dimensions of leadership. Thousand Oaks, CA: Sage Publishers.

Martindale, N. (2011). Leadership Styles: How to handle the different personas. Strategic Communication Management, 15 (8), 32–35.

Northouse, P. (2003). Leadership: Theory and practice. Thousand Oaks, CA: Sage Publishers.

Phillips, J. (2006). CEO Moral Capital. Ontario, Canada: University of Western Ontario Press.

Thompson, A., Strickland, A. & Gamble, J. (2007). Crafting and executing Strategy the quest for competitive advantage concepts and cases. Boston: McGraw-Hill Irwin.

Velasquez, M. (1992). Business Ethics: Concepts and Cases. Englewood Cliffs, NJ: Prentice Hall.

Yukl, G. (2006). Leadership in Organizations. Upper Saddle River, NJ: Prentice-Hall.

Yukl, G. (2012). Leadership in Organizations. Upper Saddle River, NJ: Pearson/Prentice Hall.

McDonald’s Case Study

In her book, Ciulla (2003) provides many cases that exhibit the concept of leadership in the context of an organization. Ethical leadership is imperative since it provides an organization with an important platform for decision-making.

Besides, it is through excellent leadership skills that organizations are able to enhance their effectiveness. Ciulla (2003) depicts McDonalds as an organization that has various leadership issues. McDonald’s case is important in highlighting key aspects of ethical leadership that include the ability of the firm to meet its goals.

This paper seeks to provide a rationale for choosing McDonald’s case study for the course-spanning task. In addition, the paper will provide the ethical issues that the case exhibits and rationalize them using various thinkers’ perspectives.

McDonald’s case study gives the reader some meaningful insights regarding the ability of leaders to exercise their skills to derive the greatest good for all stakeholders. Some of the major thinkers about utilitarianism had it that all organizations should draw inspiration from Kantian and utilitarian philosophies. This is to enhance the greatest good for all individuals involved in the running of the organization.

McDonald’s case is important in providing insights on ethical leadership. In particular, theoretical frameworks regarding ethical leadership explicate that a leader should be steadfast and ensure that all leadership principles are the focus of organizational leadership. According to ethical thinker, Yukl, leadership ethics dictate that leaders should show respect towards others and portray honesty (Ciulla et al., 2010).

In addition, all actions that a leader undertakes should drive the organization towards achievement of justice for all the stakeholders of the organization. With that in mind, McDonald’s case depicts a situation where the organization faces a dilemma.

To what extent does the organization bear responsibility based on individual actions? Is it morally right to reap profits from selling junk food yet the food is not healthy? Ciulla et al. (2010) say that one of the most outstanding aspects of the case study is that the company’s responsibility over its managers is contentious.

The rationale is that the organization should be in the forefront in enhancing that all its objectives and goals draw inspiration from ethical theories and models. This way, the company will be in a position to understand the actual decision to embark on. McDonald’s should make decisions that derive the highest happiness to all its stakeholders.

The management should be able to understand that an organization is a reflection of the society and all the decisions it makes ought to coincide with the organization’s goals of building the community with others. Ciulla (2004) explicates that the ultimate ends of the principle of greatest happiness is the ability to increase pleasure (in both quality and quantity) and minimize pain.

As such, McDonald’s management should be in the forefront of embarking on decisions that do not only increase the enjoyments of the stakeholders but also derive the enjoyment in the greatest possible way (Thompson et al., 2007). It is through abovementioned actions that the leaders will not only exercise ethical leadership but also increase the effectiveness of the organization for the attainment of its goals.


In essence, Ciulla (2003) provides numerous case studies that organizations should use to acquire some ethical leadership skills. McDonald’s case study offers the reader an opportunity to explore various aspects of ethical leadership.

Ranging from principles to the theoretical frameworks, the case presents a perfect scenario where all the aspects of leadership are available to a myriad of organizations. To end with, the case is extremely important in highlighting the origins and objectives of ethics in leadership.


Ciulla, J. (2003). The Ethics of Leadership. New York: Thompson-Wadsworth Publishers.

Ciulla, J. (2004). Ethics, the heart of leadership. Westport, CT: Praeger Publishers.

Ciulla, J., Clancy, M. & Solomon, C. (2010). Honest Work: A Business Ethics Reader. Westport, CT: Praeger Publishers.

Thompson, A., Strickland, A. & Gamble, J. (2007). Crafting and executing Strategy the quest for competitive advantage concepts and cases. Boston: McGraw-Hill Irwin.

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