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McDonald’s Announces Global Effort to Increase Demographic Representation of Franchisee Base

McDonalds

McDonald’s Corporation further advanced its global diversity, equity, and inclusion (DEI) commitments with a focus on future franchises around the world. Building on its multi-year DEI planning and actions, the Company has announced a franchisee recruitment initiative to increase the number of franchisees from all backgrounds, including historically underrepresented groups, in McDonald’s U.S. and all McDonald’s International Operated Markets.

Worldwide, the effort – tailored for each market – will seek to increase ownership opportunities for new talent, both in terms of the number of individual restaurants owned as well as the number of qualified franchisees overall. McDonald’s will commit $250 million in the U.S. over five years to provide alternatives to traditional financing, to help candidates – who may face socio-economic barriers – join the McDonald’s System.

“During a period of record performance, we must challenge ourselves – even more – to invest in the future,” said McDonald’s President and Chief Executive Officer Chris Kempczinski. “The announcement to attract franchisees who represent the diverse communities we serve is fundamental to that goal and builds on McDonald’s rich history and pride in reflecting those we serve. With this action, we are taking another step forward in fostering an environment where equitable opportunity is part of the lived experience for all our communities.”

As McDonald’s continues to attract more franchisees who reflect the composition of the communities it serves, it is clear that upfront entry costs are a barrier to entry for many entrepreneurs who may have limited access to capital. This barrier may be particularly felt by candidates from different backgrounds, including historically underrepresented groups.

To address the issue, the Company will seek to reduce upfront equity requirements for eligible franchisee candidates. McDonald’s is also leveraging its network of banking partners to increase access to financing solutions that will reduce the barrier to entry for candidates. This program enables the Company to build on its strengths and continue to grow its already diverse franchisee base. As of 2020, individuals from historically underrepresented groups, including those that identify as Asian, Black, or Hispanic, accounted for 29.6% of all U.S. franchisees. Women also accounted for 28.9% of all U.S. franchisees.

“Access to capital continues to be a challenge in closing the wealth gap in the U.S. – particularly for minority entrepreneurs,” said Nicole Elam, President, and CEO, National Bankers Association, which is working with minority-owned and -operated banks to help get capital to diverse entrepreneurs. “Efforts that eliminate barriers to entry for aspiring entrepreneurs are critical in helping to bridge that gap – providing a foundation for a lifetime of opportunity and generational wealth creation. This is more important than ever. As the post-pandemic recovery continues, it is critical to support diverse entrepreneurs and the communities they serve.”

To attract additional qualified candidates, McDonald’s will significantly expand its franchisee recruiting and training efforts for all backgrounds, including for historically underrepresented groups, building upon its heritage and industry leadership in restaurant management training to support newly recruited franchisees and the broader System. In the U.S., McDonald’s also plans to harness the power of its System to support new franchisees through access to cross-functional resources and mentoring from experienced franchise owners, among other programs.

Similar learning and development programs are available to new franchisees in McDonald’s International Operated Markets where markets such as France, Italy, and Spain have built relationships with local business schools to create a curriculum covering a range of topics to support new franchisee success as they grow and develop in the market.

This initiative furthers McDonald’s global DEI ambition, building on bold actions in 2021, including setting corporate employee DEI representation goals at leadership levels (Senior Director and above) and aligning leadership accountability for meeting those aspirational representation goals; launching the Company’s Mutual Commitment to Diversity, Equity, and Inclusion (MCDEI), inviting the Company’s U.S. based suppliers to join the MCDEI pledge; and setting goals to increase purchases with diverse suppliers and allocation of marketing spend to diverse-owned media, content and production partners.

View more details on McDonald’s DEI programs and the new franchisee recruitment initiative here.

Source: McDonald’s

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