The U.S. Securities and Exchange Commission this week denied a request by McDonald’s to avoid having shareholders vote on whether the company should conduct an audit of its civil rights practices.
The SEC told McDonald’s this week that the burger chain had to include a proposal by the SOC Investment Group that would urge the company’s board of directors to have a third party analyze its record on civil rights. Bloomberg first reported about the decision.
Union-backed and socially conscious investment groups have increasingly proposed such votes at publicly traded companies. And shareholders have been backing them. Shareholders of the iPhone maker Apple and the government services company Maximus recently approved such votes, for instance.
Four other companies, CitiGroup, Tyson, Blackrock and JP Morgan, have agreed to work with shareholders to pursue civil rights audits.
“Because of the SEC decision, McDonald’s shareholders will have their rightful opportunity to urge the fast-food chain to conduct a third-party assessment of its commitments to civil rights,” Dieter Waizenegger, executive director of the SOC Investment Group, said in a statement. He noted that the audit would encompass a review of policies on racial justice and sexual harassment that “are front-and-center for workers, consumers and shareholders alike.”
McDonald’s would not comment on the matter.
SOC proposed the audit question late last year. McDonald’s had been sued on multiple fronts over racial issues, including current and former franchisees, former executives and Byron Allen, who owns the Weather Channel, accusing the company of discrimination.
CEO Chris Kempczinski, meanwhile, generated a firestorm of criticism for a text he sent to Chicago Mayor Lori Lightfoot that effectively placed the blame for separate shootings of children in the city on the kids’ parents.
The burger giant had apparently asked the SEC to allow it to leave the question off its proxy statement, arguing that it would potentially hurt its defense in the discrimination lawsuits.
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