McDonald’s Corporation is the world’s largest quick-service restaurant company, operating or franchising over 43,000 restaurants in over 100 countries and serving approximately 69 million customers daily, generating $25.9 billion in revenue in fiscal year 2024, approximately 95% of which comes from franchised locations. The company’s most current sustainability disclosure is the Purpose and Impact Progress Report 2024-2025, published in September 2025, aligned with GRI, SASB, TCFD, and the SBTi, and covering progress against its Scale for Good strategy and formal 2030 emissions targets. A companion 2024-2025 SASB Index provides the most granular emissions and sourcing data available.

McDonald’s sustainability profile is dominated by one structural fact: over 99% of its total GHG footprint, approximately 60.2 million MTCO₂e of 60.5 million MTCO₂e total in 2024, sits in Scope 3 supply chains, with beef production alone accounting for an estimated 30 to 35% of total emissions. SBTi validated both McDonald’s 2030 near-term targets and its 2050 net-zero commitment in 2023, making it one of the few major restaurant companies with independently validated full value chain targets aligned to 1.5 degrees Celsius. At the same time, its FLAG (Forest, Land and Agriculture) GHG targets are labeled “Facing Challenges” in its own Purpose and Impact Report, acknowledging that the most difficult half of its emission reduction agenda is not yet on track.

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_SASBIndex_2024_2025.pdf
https://corporate.mcdonalds.com/corpmcd/our-purpose-and-impact/our-planet/climate-action.html

Sustainability Strategy and Goals

McDonald’s sustainability strategy is organized under the Scale for Good framework, covering five pillars: Climate Action, Responsible Sourcing (with a focus on deforestation-free supply chains), Packaging and Waste, People and Communities, and Food Safety and Quality. The SBTi-validated 2030 targets commit McDonald’s to a 50.4% absolute reduction in Scope 1 and 2 emissions from company-owned restaurants and offices, a 50.4% absolute reduction in Scope 3 energy and industrial emissions from franchised and company-owned restaurants, and a 16% reduction in FLAG Scope 3 emissions from a 2018 baseline. The net-zero 2050 commitment covers the full value chain across Scope 1, 2, and 3.

Governance of sustainability is overseen by the Board’s Public Policy and Strategy Committee, with sustainability KPIs published annually in the Purpose and Impact Progress Report. McDonald’s franchised business model creates a structural complexity unique among food companies: approximately 95% of restaurants are independently owned and operated by franchisees who control day-to-day energy, packaging, and waste decisions, making system-wide alignment to corporate sustainability targets a franchise management and incentive design challenge, not just a capital allocation question.

Net Zero and Carbon Emissions

McDonald’s total GHG footprint in 2024 was approximately 60.46 million MTCO₂e across Scope 1, 2, and 3, up 0.34% from 60.25 million MTCO₂e in 2023. Total operational emissions (Scope 1 and 2) reached 212,567 MTCO₂e in 2024, a 34.64% decrease from 2023, indicating meaningful progress in direct operations. Scope 3 emissions at 60.25 million MTCO₂e remain effectively flat year over year, dominated by supply chain agriculture and food processing. McDonald’s 2018 baseline for Scope 1 and 2 is 471,948 MTCO₂e, against which a 50.4% reduction is required by 2030.

• Total GHG footprint (2024): approximately 60.46 million MTCO₂e (Scope 1, 2, and 3); up 0.34% from 60.25 million MTCO₂e in 2023​
• Scope 1 emissions (2024): 94,233 MTCO₂e​
• Total operational emissions, Scope 1 and 2 (2024): 212,567 MTCO₂e; down 34.64% from 2023​
• Scope 3 emissions (2024): approximately 60.25 million MTCO₂e; representing 99.6% of total GHG footprint​
• 2018 Scope 1 and 2 baseline: 471,948 MTCO₂e; 50.4% absolute reduction required by 2030​
• Net-zero target: 2050 (full value chain, Scope 1, 2, and 3); SBTi-validated in 2023​
• 2030 Scope 3 energy and industrial target: 50.4% absolute reduction from 2018 baseline​
• 2030 FLAG Scope 3 target: 16% absolute reduction from 2018 baseline; status labeled “Facing Challenges” in own report​
• GHG intensity (Scope 1, 2024): 3.64 tCO₂e per million USD revenue​
• McDonald’s is a signatory to the UN Race to Zero and has committed to the Business Ambition for 1.5°C​
• Sustainalytics ESG Risk Score (2025): 25.9, rated medium risk​
• MSCI ESG Rating (2025): A (average)​

Water Stewardship

McDonald’s restaurant water strategy targets efficient use across cooking, cleaning, and sanitation in over 43,000 locations globally. The company does not publish an absolute water withdrawal reduction target with a specific end year at the global system level, but includes water conservation as part of its restaurant environmental performance standards. In 2024, McDonald’s deployed water filtration systems across 700 US restaurant locations in partnership with Barranco, standardizing water quality for food preparation and customer use, with expansion to additional states planned for 2025.

• Water filtration system deployment (2024): 700 US restaurant locations across 13 states​
• 700-location water filtration expansion planned for additional states in 2025​
• Waterless urinals deployed in 30 India restaurants: save over 150,000 liters per urinal annually​
• Farm-level water conservation: McDonald’s India partnered with farmers on micro-irrigation, watershed management, and crop protection, saving over 13 million liters to date​
• McDonald’s net-zero restaurant prototype tested in the UK (2021): includes water use reduction systems tested as a blueprint for new McDonald’s sites globally​
• No published global absolute water withdrawal target or net positive water commitment as of the 2024-2025 Purpose and Impact Report​
• CDP water score: not publicly disclosed as of the latest available ESG rating data​

Regenerative Agriculture

McDonald’s does not operate a formal branded regenerative agriculture program at the scale of Nestlé’s Nescafé Plan 2030, but its beef and dairy supply chain engagement covers regenerative and sustainable agricultural practices through the Global Roundtable for Sustainable Beef (GRSB), McDonald’s Flagship Farmer program, and supplier-level sustainability assessments. McDonald’s is a founding member of the GRSB and supported its Nature Positive and Climate 2030 goals, providing a framework for engaging beef suppliers toward lower-emission grazing and land management practices.

• GRSB founding member: McDonald’s supported GRSB’s Nature Positive and Climate 2030 goals for beef supply chains​
• McDonald’s Flagship Farmer program: engages top-performing farmers on advanced sustainability practices and farmer-to-farmer knowledge sharing​
• Beef supplier engagement for deforestation-free and lower-emission grazing: primary mechanism for FLAG GHG reduction in beef supply chain​
• Voluntary Monitoring Protocol for Cattle Suppliers in the Brazilian Cerrado: McDonald’s joined this monitoring protocol in 2023 to verify deforestation-free sourcing from the high-risk Cerrado savanna​
• No standalone branded regenerative agriculture target with a specific percentage of ingredients by a specific year, as of the 2024-2025 Purpose and Impact Report​

Deforestation and Biodiversity

McDonald’s Commitment on Forests and Natural Ecosystems commits the company to maintaining deforestation-free supply chains across its five primary deforestation-linked commodities: beef, soy, fiber-based packaging, palm oil, and coffee. As of 2023, 98.8% of beef and 100% of soy for chicken feed were sourced from deforestation-free supply chains. However, the FLAG Scope 3 GHG reduction target of 16% by 2030 is labeled “Facing Challenges” by McDonald’s, reflecting the pace of agricultural transformation required in Brazilian Amazon and Cerrado sourcing.

• Beef sourced from deforestation-free supply chains (2023): 98.8%; primary deforestation risk origins include Brazilian Amazon and Cerrado, Paraguayan and Argentine Chaco, and Australia​
• Soy sourced for chicken feed from deforestation-free supply chains (2023): 100% globally​
• Fish sourced from deforestation-free supply chains (2023): 93.8%​
• McDonald’s joined the Consumer Goods Forum’s Forest Positive Coalition in 2022​
• Deforestation-Free Beef Procurement Policy: developed in 2018; covers high-priority origins with supplier engagement requirements​
• FLAG Scope 3 emissions target (16% reduction by 2030): labeled “Facing Challenges” in 2024-2025 Purpose and Impact Report​
• 2030 commitment: eliminate deforestation from all primary commodity supply chains (beef, soy, fiber, palm oil, coffee)​
• A 2024 Anthropocene Foundation report identified a five-year accountability gap between McDonald’s deforestation-free commitments and its current sourcing policies, with no contracted sanctions for non-compliant suppliers in some commodity categories​

Packaging and Circular Economy

McDonald’s global packaging targets, with a 2025 deadline, commit to 100% of primary guest packaging from renewable, recycled, or certified sources and to providing recycling or composting access in all restaurants with developed waste infrastructure by 2025. As of 2023, 86.7% of primary packaging came from renewable, recycled, or certified sources. As of the 2024-2025 report, 90.9% of primary guest packaging meets this standard, with fiber-based packaging leading at 98.99%.

• Primary guest packaging from renewable, recycled, or certified sources (2024-2025 report): 90.9%; fiber-based packaging: 98.99%​
• 100% renewable, recycled, or certified materials packaging target: end of 2025​
• Reduction in virgin fossil fuel-derived plastics in Happy Meal toys since 2018: 63.7% as of 2023​
• Restaurants offering recycling or composting in markets with advanced waste infrastructure (2023): 88.3%​
• Circular economy model commitment: prioritizing reduce, reuse, and recycle across all packaging​
• 189 MW Virtual Power Purchase Agreement for US logistics: expected to support 100% renewable energy for McDonald’s USA entire logistics supply chain​
• 1,130 MW of wind and solar VPPA commitments in US: covering Illinois, Oklahoma, North Carolina, Ohio, and Texas​
• Clear labeling on packaging to guide customer recycling behavior: in progress across global markets​
• Net-zero restaurant prototype in the UK: furniture from recycled or certified materials by 2023; packaging from renewable, recycled, or certified sources by 2024​

Human Rights and Responsible Sourcing

McDonald’s human rights framework covers both its franchise-wide labor practices and its global supply chain through the Supplier Code of Conduct, a supplier social accountability program aligned with SMETA (Sedex Members Ethical Trade Audit) standards. At the franchise level, McDonald’s faces persistent wage theft allegations in the US, particularly in New York and California, where franchise operators have faced class action lawsuits for labor violations. Gender pay equity was achieved at all levels and in every market as of the 2024 Purpose and Impact Report.

• Gender pay equity: achieved at all levels and in every market as of the 2024 Purpose and Impact Report​
• Supplier Code of Conduct: covers labor rights, health and safety, anti-corruption, and environmental standards for all direct suppliers​
• Franchise wage theft: class action lawsuits filed in New York (2024) against multiple McDonald’s franchise operators; McDonald’s Corporation seeks arbitration clause protections against co-defendant liability​
• Forced arbitration clauses in worker contracts: over 65% of low-wage workers in the US face forced arbitration preventing class actions, per US Department of Labor; directly limits McDonald’s restaurant worker legal recourse​
• SMETA-aligned audits: used to evaluate social and ethical compliance across supplier facilities​
• No published living wage commitment for franchise workers across the global system​
• DEI policy change (January 2025): McDonald’s removed aspirational representation goals from public disclosures; recommitted to inclusive internal practices without numerical targets​

Nutrition and Health

As one of the world’s largest food service companies, McDonald’s has a significant influence on global dietary patterns. The company’s nutrition strategy includes balancing its core menu with options across calorie ranges, publishing nutrition information, advancing responsible marketing to children, and transitioning Happy Meal toys away from fossil-fuel-based plastics. McDonald’s does not publish a formal target to increase the proportion of its revenue from healthier product categories.

• Happy Meal toy virgin fossil fuel-based plastic reduction since 2018: 63.7% as of 2023​
• Menu balance: broad calorie range options available, with calorie information displayed on menu boards in all markets where legally required​
• Responsible marketing to children: McDonald’s adheres to IFBA (International Food and Beverage Alliance) commitments on child-directed marketing standards​
• Access to Nutrition Initiative (ATNI) franchise sector assessment: McDonald’s participates in ATNI retail engagement; no individual company ranking published for restaurant operators​
• No published formal target for increasing the proportion of revenue from nutritionally superior product categories​
• Net impact ratio: per Upright Project analysis, McDonald’s has a net impact ratio of -43.3%, with positive contributions in jobs and economic activity offset by negative impacts in physical disease categories and GHG emissions​

Community and Social Impact

McDonald’s most significant community program is its franchised employment model, which employs approximately 2 million people across its system globally. The Ronald McDonald House Charities (RMHC) network supported approximately 7.9 million individuals in 2024 across 67 countries. McDonald’s supplier diversity program partners with diverse-owned businesses, including a commitment to increase spending with Black-owned and other minority-owned suppliers in the US.

• Ronald McDonald House Charities (RMHC): supported approximately 7.9 million individuals globally in 2024​
• Gender pay equity: achieved in all markets​
• Supplier diversity: ongoing program to increase procurement with minority-owned businesses; no published percentage target or absolute spend commitment in 2024-2025 disclosure​
• DEI recommitment (January 2025): inclusive internal practices maintained; aspirational numerical diversity representation goals retired​
• Inclusion commitment: pay equity maintenance, diverse employee pipeline retention, and inclusive hiring practices embedded in regular business operations​
• Employment in system: approximately 2 million workers system-wide across company and franchisee-operated restaurants​

Governance and Transparency

McDonald’s Purpose and Impact Progress Report is prepared in alignment with GRI, SASB, TCFD, and SBTi, and is reviewed by the Board’s Public Policy and Strategy Committee. SBTi validated both the 2030 near-term targets and the 2050 net-zero commitment in 2023. The company self-rates its progress against each major commitment in the report using a traffic light system; FLAG Scope 3 targets and deforestation-linked commodity commitments are both labeled “Facing Challenges,” a degree of self-disclosure unusual among major QSR operators.

• SBTi target validation: 2030 and 2050 targets validated in 2023; aligned to 1.5-degree warming scenario​
• Purpose and Impact Report aligned to GRI, SASB, TCFD​
• Board oversight: Public Policy and Strategy Committee oversees sustainability strategy​
• Self-reported progress rating system: “On Track,” “Facing Challenges,” and “Goal Met” categories used transparently​
• FLAG Scope 3 target: “Facing Challenges” as of 2024-2025 report​
• Deforestation-free commodity commitments: labeled “Facing Challenges” in the 2024-2025 report​
• MSCI ESG Rating: A (average) in 2025​
• Sustainalytics ESG Risk Score: 25.9, rated medium risk in 2025​

Technology and Innovation

McDonald’s sustainability innovations span renewable energy virtual power purchase agreements, net-zero restaurant design, supply chain renewable energy procurement, and packaging design improvements.

• 1,130 MW total US VPPA commitments (wind and solar): five projects in Illinois, Oklahoma, North Carolina, Ohio, and Texas, enough to power approximately 8,000 McDonald’s restaurants​
• VPPAs contribute approximately 2.5 million MTCO₂e of avoided GHG emissions per year once fully online​
• 189 MW VPPA for logistics supply chain (2023): expected to cover 100% of US logistics electricity with renewable energy​
• Net-zero restaurant prototype (UK): tested energy-efficient HVAC, LED lighting, solar panels, water conservation systems, and sustainable materials as a blueprint for global new restaurant design​
• Happy Meal toy innovation: 63.7% reduction in virgin fossil fuel-derived plastics since 2018 through material substitution design​
• Recycling and composting infrastructure: 88.3% of restaurants in advanced infrastructure markets provide customer recycling or composting access​

Global Partnerships and Advocacy

McDonald’s key sustainability partnerships span renewable energy (Renewable Energy Buyers Alliance, VPPA counterparties), sustainable beef (Global Roundtable for Sustainable Beef, WWF), deforestation (Consumer Goods Forum Forest Positive Coalition), seafood (Marine Stewardship Council, Aquaculture Stewardship Council), and climate (UN Race to Zero, SBTi, IFBA).

• Global Roundtable for Sustainable Beef (GRSB): founding member; supports Nature Positive and Climate 2030 beef goals​
• Consumer Goods Forum Forest Positive Coalition: joined in 2022​
• Renewable Energy Buyers Alliance (REBA): VPPA partnership for US renewable energy procurement​
• WWF partnership: sustainable beef and deforestation-free supply chain engagement​
• UN Race to Zero: signatory; SBTi Business Ambition for 1.5°C signatory​
• MSC and ASC certification: required for McDonald’s fish and seafood sourcing through Filet-O-Fish and other fish menu items​
• IFBA: responsible marketing to children commitment; membership in international food company advocacy body on nutrition standards​

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_SASBIndex_2024_2025.pdf
https://trellis.net/article/mcdonalds-new-strategy-bring-renewable-energy-its-supply-chain/

Progress vs. Target Tracker

Commitment	Target	Current Status	Assessment
Net-zero full value chain (Scope 1, 2, 3)	By 2050; SBTi-validated	Long-term; SBTi-validated in 2023; FLAG trajectory “Facing Challenges”	Needs monitoring
50.4% absolute reduction in Scope 1 and 2	By 2030 (vs. 2018 baseline of 471,948 MTCO₂e)	Scope 1 and 2 (2024): 212,567 MTCO₂e; down 34.64% from 2023; significant progress ​	On track
50.4% absolute reduction in Scope 3 energy and industrial	By 2030 (vs. 2018 baseline)	Scope 3 total at 60.25 million MTCO₂e; up 0.34% year over year ​	Needs monitoring
16% FLAG Scope 3 GHG reduction	By 2030 (vs. 2018 baseline)	Labeled “Facing Challenges” in 2024-2025 report; beef and land-use emissions remain dominant ​	At risk
100% primary packaging from renewable, recycled, or certified sources	By end of 2025	90.9% achieved in 2024-2025 reporting period; gap of 9.1 percentage points remains ​	At risk
Fiber-based packaging from renewable, recycled, or certified sources	By end of 2025	98.99%; essentially on target ​	On track
Recycling and composting access in all restaurants (advanced markets)	By 2025	88.3% of eligible restaurants as of 2023 ​	Needs monitoring
Deforestation-free beef supply chains	By 2030	98.8% of beef from deforestation-free supply chains (2023); labeled “Facing Challenges”	Needs monitoring
Deforestation-free soy for chicken feed	By 2030	100% achieved globally (2023) ​	On track
Deforestation-free fish sourcing	By 2030	93.8% (2023) ​	On track
Gender pay equity	Ongoing	Achieved at all levels and in every market ​	On track
63.7% reduction in virgin fossil fuel plastics in Happy Meal toys	Since 2018	Achieved as of 2023 ​	On track
1,130 MW US VPPA renewable energy	By project completion	Five projects contracted; in construction and operation phases ​	On track

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://tracenable.com/company/mcdonalds/ghg-emissions
https://tracenable.com/company/mcdonalds/climate-targets

Key Sustainability Innovations and Technologies

McDonald’s sustainability innovations span large-scale renewable energy procurement, net-zero restaurant design, supply chain renewable energy extension, and packaging circularity.

VPPA Renewable Energy Program: 1,130 MW US Portfolio

McDonald’s virtual power purchase agreements (VPPAs) represent one of the largest renewable energy procurement programs in the global quick-service restaurant industry. The five US VPPA projects, located in Texas, Illinois, Oklahoma, North Carolina, and Ohio, combine for 1,130 MW of wind and solar capacity, enough to power approximately 8,000 McDonald’s restaurants, and are projected to avoid approximately 2.5 million MTCO₂e of GHG emissions annually once fully online. Unlike renewable energy certificates (RECs) that match existing generation, VPPAs fund the construction of new renewable capacity, adding wind and solar to the US national grid in line with additionality principles required by the GHG Protocol Market-Based approach. The 2023 addition of a 189 MW logistics VPPA in Texas extends renewable coverage to McDonald’s USA entire logistics supply chain, a first for any major US restaurant company.

Net-Zero Restaurant Prototype

In 2021, McDonald’s opened a net-zero pilot restaurant in Market Drayton, UK, testing energy-efficient HVAC, LED lighting, on-site solar generation, high-efficiency kitchen equipment, water conservation technology, and certified sustainable interior materials as an integrated system. This prototype is the blueprint for new McDonald’s restaurant design globally, targeting deployment of these standards at scale across new builds and major refurbishments. The restaurant also features packaging from renewable, recycled, or certified sources, establishing a closed-loop packaging and materials standard for the global estate. The UK prototype represents McDonald’s most advanced integration of operational Scope 1 and 2 reductions in a consumer-facing format.​

Deforestation-Free Beef Supply Chain Monitoring

McDonald’s deforestation-free beef program in the Brazilian Amazon and Cerrado, the two highest-risk sourcing geographies globally for beef-linked deforestation, combines supplier contractual requirements, satellite monitoring through the Monitoring Protocol for Cattle Suppliers, and GRSB governance standards. The Cerrado Voluntary Monitoring Protocol, joined in 2023, adds a cross-industry surveillance layer covering indirect cattle supplier relationships beyond the first-tier packing plants that are directly contracted to McDonald’s. Reaching 98.8% deforestation-free beef while sourcing from Brazil and Australia, both high-risk geographies, is a genuine operational achievement, though the remaining 1.2% and the pace of FLAG GHG reduction indicate that satellite monitoring must be paired with farm-level transition support to deliver the 16% FLAG GHG reduction by 2030.

Happy Meal Toy Plastic Reduction

McDonald’s Happy Meal toy plastic transformation program reduced virgin fossil fuel-derived plastics in Happy Meal toys by 63.7% from a 2018 baseline, through material substitution from polypropylene to recycled, paper-based, and certified sustainable alternatives. Happy Meals are distributed to approximately 10 million children daily globally, making this packaging transformation materially significant in the single-use plastic reduction ecosystem. The substitution program also reflects McDonald’s response to UK single-use plastics regulations and EU toy packaging standards, both of which accelerated regulatory compliance deadlines.​

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://corporate.mcdonalds.com/corpmcd/our-stories/article/Renewable-Energy.html
https://trellis.net/article/mcdonalds-new-strategy-bring-renewable-energy-its-supply-chain/

Measurable Impacts

McDonald’s Purpose and Impact Progress Report 2024-2025, SASB Index 2024-2025, and third-party emissions data provide the following multi-year performance data.

• Total GHG footprint (2024): approximately 60.46 million MTCO₂e (Scope 1, 2, and 3); up 0.34% from 60.25 million MTCO₂e in 2023​
• Scope 1 emissions (2024): 94,233 MTCO₂e​
• Total operational emissions, Scope 1 and 2 (2024): 212,567 MTCO₂e; down 34.64% from 2023​
• Scope 3 emissions (2024): approximately 60.25 million MTCO₂e; 99.6% of total footprint​
• Scope 3 FLAG GHG target trajectory: “Facing Challenges”​
• Primary guest packaging from renewable, recycled, or certified sources (2024-2025): 90.9%; fiber-based packaging: 98.99%​
• Virgin fossil fuel plastic reduction in Happy Meal toys since 2018: 63.7%​
• Restaurants with recycling or composting access in advanced markets (2023): 88.3%​
• Deforestation-free beef (2023): 98.8%; deforestation-free soy for chicken feed: 100%; deforestation-free fish: 93.8%​
• VPPAs: 1,130 MW US wind and solar portfolio contracted; projected 2.5 million MTCO₂e avoided annually when fully online​
• Gender pay equity: achieved in all markets and at all levels​
• RMHC community reach (2024): approximately 7.9 million individuals supported globally​
• Sustainalytics ESG Risk (2025): 25.9 medium risk​
• MSCI ESG Rating (2025): A (average)​

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://tracenable.com/company/mcdonalds/ghg-emissions
https://corporate.mcdonalds.com/corpmcd/our-purpose-and-impact/our-planet/climate-action.html

Challenges and Areas for Improvement

McDonald’s faces five material challenges, with the franchised structure amplifying the difficulty of four of them.

FLAG Scope 3 Emissions Not on Track

McDonald’s 16% absolute FLAG Scope 3 GHG reduction target by 2030 is labeled “Facing Challenges” in the company’s own report. Beef and dairy supply chain methane and land-use change emissions are the dominant sources of the 60.25 million MTCO₂e Scope 3 footprint. Reducing FLAG GHG by 16% requires transitioning beef production practices across supply chains in Brazil, Australia, Argentina, Paraguay, and other high-risk geographies from conventional to lower-emission grazing models. McDonald’s currently has no feed additive program equivalent to Nestlé’s dairy methane initiative, and its beef supply chain transition relies heavily on voluntary supplier engagement, GRSB commitments, and certification-based procurement rather than farm-level co-investment in methane reduction technology.

100% Sustainable Packaging Target Gap

McDonald’s committed to 100% of primary guest packaging from renewable, recycled, or certified sources by end of 2025. The 2024-2025 report shows 90.9%, leaving a 9.1 percentage point gap with the deadline effectively passed. The remaining 9.1% represents the most technically and commercially difficult packaging categories: flexible wraps, coffee cup laminates, multi-compartment containers, and Happy Meal components that require material innovation, supply chain substitution, and in some cases regulatory approvals in multiple markets simultaneously. Fiber-based packaging at 98.99% confirms the challenge is concentrated in plastic-containing and multi-material formats, not in mainstream paper packaging.

Franchised Structure and Sustainability Alignment

Approximately 95% of McDonald’s restaurants are independently operated by franchisees who make independent decisions on energy purchasing, waste management, and water use. This structural feature means that corporate sustainability targets are dependent on franchisee behavior change, which requires incentive structures, training programs, and lease and franchise agreement clauses that McDonald’s must design and enforce without direct operational authority. The 88.3% recycling and composting access figure in advanced markets in 2023 reflects this challenge: 11.7% of eligible restaurants have not implemented recycling access despite a 2025 target, and McDonald’s cannot mandate compliance in the way an integrated operator can.

Labor Rights and Wage Theft in Franchise Operations

In 2024, multiple class action lawsuits were filed against McDonald’s franchise operators in New York for wage theft, including hourly underpayment, unlawful deductions, and retaliation against workers who raised complaints. McDonald’s corporate entity seeks to avoid co-defendant liability through franchise structure defenses and forced arbitration clauses, creating a governance gap: the company publishes gender pay equity achievements at the corporate level while franchise workers face systematic wage violations with limited legal recourse. The New York EmPIRE Act, under consideration in 2024 to 2025, would allow workers to bypass forced arbitration clauses, creating a new legal exposure for franchise chains including McDonald’s.

DEI Governance Rollback and Representation Accountability

In January 2025, McDonald’s retired its aspirational numerical diversity representation goals from public disclosures. This change reduces accountability for workforce representation progress across its approximately 2 million-person system. The company’s own research shows diversity of franchise ownership and supplier diversity are material to long-term community engagement and brand trust in its most economically diverse markets, including the US, India, Brazil, and South Africa. Removing numerical disclosure removes the measurement mechanism required to independently verify whether inclusive internal practices produce measurable outcomes.

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://tracenable.com/company/mcdonalds/ghg-emissions
https://www.adirondackdailyenterprise.com/news/2024/05/mcdonalds-franchise-owners-fight-wage-theft-crackdown/

Future Plans and Long-Term Goals

McDonald’s forward roadmap through 2025 and 2030 concentrates on closing packaging gaps, advancing beef supply chain deforestation-free monitoring, and driving FLAG GHG reductions.

• Achieve 100% of primary guest packaging from renewable, recycled, or certified sources by end of 2025; close the 9.1% remaining gap​
• Complete construction and commissioning of all five US VPPA wind and solar projects (1,130 MW)​
• Extend logistics VPPA model beyond the US to other key operating markets including France, the UK, Germany, and Australia​
• Reach 100% deforestation-free sourcing across beef, soy, fiber, palm oil, and coffee supply chains by 2030​
• Achieve 16% FLAG Scope 3 GHG reduction by 2030 vs. 2018 baseline; develop farm-level methane reduction programs for beef supply chains​
• Achieve 50.4% absolute reduction in Scope 3 energy and industrial GHG emissions by 2030 vs. 2018 baseline​
• Achieve 50.4% absolute reduction in Scope 1 and 2 GHG emissions by 2030 vs. 2018 baseline, building on the 34.64% operational reduction in 2024​
• Scale net-zero restaurant prototype from UK pilot to global new restaurant design standard​
• Achieve net-zero full value chain GHG emissions by 2050​

Compared to Yum! Brands (KFC, Taco Bell, Pizza Hut), McDonald’s holds SBTi-validated targets while Yum! Brands achieved a 25% absolute Scope 1 and 2 reduction from company-owned restaurants by 2024, a meaningful achievement given its franchise-heavy model, but without an equivalent FLAG GHG target or publicly validated full value chain net-zero commitment. McDonald’s 1,130 MW VPPA renewable energy portfolio is substantially larger than any competitor in the QSR sector. McDonald’s 98.8% deforestation-free beef is a recognized industry benchmark in a sector where most competitors have not yet established comparable commodity-level deforestation tracking.

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://sustainablefoodbusiness.com/yum-brands-2024-global-citizenship-sustainability-report/

Comparisons to Industry Competitors

McDonald’s is benchmarked against Yum! Brands (KFC, Taco Bell, Pizza Hut) and Restaurant Brands International or RBI (Burger King, Tim Hortons, Popeyes), two of the three largest global QSR operators by restaurant count.

QSR Sector Sustainability Metrics

Metric	McDonald’s	Yum! Brands	Restaurant Brands International (RBI)
Net zero target	2050, full value chain; SBTi-validated 2023	SBTi near-term targets for Scope 1 and 2; no published full value chain 2050 net-zero commitment	Net zero by 2050; SBTi near-term targets submitted
Scope 1 and 2 target	50.4% absolute reduction by 2030 (vs. 2018 baseline); SBTi-validated	46% absolute reduction by 2030 (vs. 2019 baseline); SBTi-approved	50% absolute reduction in Scope 1 and 2 by 2030; SBTi-submitted
Scope 1 and 2 progress	Operational GHG down 34.64% in 2024; total Scope 1 and 2 at 212,567 MTCO₂e ​	25% absolute reduction achieved for company-owned restaurants by 2024 vs. 2019 ​	Progress reported; specific 2024 figure not publicly verified in available sources
FLAG / Scope 3 supply chain target	16% FLAG reduction by 2030; labeled “Facing Challenges”	No published FLAG-specific GHG target	No published FLAG-specific GHG target
Total Scope 3	60.25 million MTCO₂e (2024); 99.6% of total footprint ​	Dominantly supply chain; specific total not verified in public 2024 report	Dominantly supply chain; specific total not publicly verified
Deforestation-free beef	98.8% (2023); Brazilian Amazon, Cerrado, Australian origins tracked ​	In progress; no equivalent published percentage	Beef sourcing standards in progress; no equivalent published percentage
Deforestation-free soy	100% of soy for chicken feed globally ​	In progress	In progress
Packaging sustainability	90.9% primary packaging from renewable, recycled, or certified sources; fiber at 98.99% ​	In progress across KFC, Taco Bell, Pizza Hut formats	100% recyclable or compostable packaging target by 2025 for Tim Hortons; progress not fully verified
Renewable energy	1,130 MW US VPPA portfolio; 189 MW logistics VPPA ​	On-site solar and PPAs for company-owned restaurants ​	Renewable energy programs in progress; no equivalent VPPA scale
Labor rights	Gender pay equity achieved in all markets; franchise wage theft lawsuits ongoing in US	94% cage-free egg sourcing; wage data not equivalent to direct comparison ​	Wage and labor standards under franchise agreement governance
CDP climate score	Not publicly disclosed as a standalone score ​	Not publicly disclosed as a standalone score	Not publicly disclosed as a standalone score

McDonald’s holds a structural governance advantage over Yum! Brands and RBI in three areas: SBTi-validated full value chain net-zero commitment including FLAG sector targets, the largest VPPA renewable energy portfolio in the QSR industry, and the most advanced published deforestation-free beef sourcing program, at 98.8%, of any major burger chain. The persistent challenge that McDonald’s shares with all three QSR peers is the franchise governance gap: all three rely on independently owned franchisees for the majority of their restaurant-level environmental performance, and none has yet published a binding franchise agreement clause that enforces minimum environmental standards with financial sanctions for non-compliance.

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://sustainablefoodbusiness.com/yum-brands-2024-global-citizenship-sustainability-report/
https://www.yum.com/wps/portal/yumbrands/Yumbrands/news/press-releases/yum+brands+publishes+new+global+citizenship+and+sustainability+report

What to Watch: 12 to 18 Month Indicators

Three signals over the next 12 to 18 months will determine whether McDonald’s closes its most material sustainability gaps or faces escalating scrutiny on FLAG emissions, packaging, and franchise labor governance.

FLAG Scope 3 GHG Reduction Inflection Point

McDonald’s 16% FLAG Scope 3 GHG reduction target by 2030 is its hardest commitment, labeled “Facing Challenges” in its own report. With four years remaining to 2030, the next 12 to 18 months represent the point at which McDonald’s must demonstrate an acceleration in beef supply chain methane and land-use change reductions beyond deforestation-free verification alone. If McDonald’s launches a formal beef methane reduction program, including feed additive trials or verified low-emission grazing pilots, in the next 12 to 18 months, it would mark a structural pivot from deforestation-only supply chain engagement to full FLAG GHG management. Absence of such a program announcement by the next Purpose and Impact Report would confirm that the 16% FLAG target will be missed.

100% Sustainable Packaging Closure or Gap Disclosure

McDonald’s end of 2025 deadline for 100% primary packaging from renewable, recycled, or certified sources passed with the company at 90.9%. The 2026 Purpose and Impact report will confirm whether the target was closed, revised, or missed. The 9.1% remaining gap covers the most technically complex packaging categories in the restaurant industry: flexible wraps, plastic-lined cups, and multi-material food containers. If McDonald’s discloses a revised 2027 or 2028 timeline with a credible material innovation plan, this will be received differently by stakeholders than a simple target revision without technical underpinning. Third-party verification of packaging recyclability claims is also increasingly expected, given the EU Green Claims Directive and UK Green Claims Code enforcement activity in 2025 and 2026.

Franchise Labor Governance and EmPIRE Act Exposure

The New York EmPIRE Act, which would allow workers to bypass forced arbitration clauses and pursue employers directly for wage theft, health and safety violations, and retaliation, was under active legislative consideration in 2024 to 2025. If passed, it would fundamentally change the legal exposure of McDonald’s Corporation as a franchisor for franchisee labor violations, eliminating the arbitration clause defense that currently protects McDonald’s from co-defendant liability in the multiple New York franchise wage theft cases. The 12 to 18 month window will determine whether the Act advances to a vote, whether McDonald’s corporate entity intervenes with a proactive franchise labor standards framework, and whether the wage theft lawsuits produce settlement outcomes that establish a new precedent for franchisor co-liability in the US QSR sector.

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://www.adirondackdailyenterprise.com/news/2024/05/mcdonalds-franchise-owners-fight-wage-theft-crackdown/
https://anthropocenefii.org/downloads/AFII_McDonalds_Deforestation.pdf

McDonald’s sustainability record through FY2024 presents a company that has made genuine and industry-leading commitments in renewable energy procurement, deforestation-free commodity sourcing, and SBTi-validated full value chain target architecture, while facing structural challenges in FLAG GHG reduction, packaging completion, and franchise labor governance that no incremental program upgrade can fully resolve at current pace. The 34.64% operational Scope 1 and 2 reduction in 2024 and the 1,130 MW VPPA portfolio are commercially credible outcomes. The 98.8% deforestation-free beef from Brazilian Amazon and Cerrado sourcing regions is the most advanced published deforestation tracking standard in the QSR industry. The SBTi validation of both the 2030 and 2050 targets in 2023 provides independent governance credibility that no other major burger chain has matched.

The self-reported “Facing Challenges” status on FLAG emissions and deforestation-linked commodity targets is an important act of disclosure transparency that McDonald’s peers have generally not replicated. Most major food service companies either do not publish equivalent commodity-level deforestation tracking or do not publicly label their own underperformance. McDonald’s self-disclosure model provides a governance benchmark that practitioners benchmarking QSR sustainability programs should specifically note.​

Three strategic takeaways for practitioners benchmarking or replicating this approach:

• VPPAs as a scalable QSR renewable energy model: McDonald’s VPPA strategy, which funds the construction of new renewable generation capacity rather than purchasing existing certificates, is the most commercially scalable renewable energy approach available to franchise-heavy operators who cannot mandate on-site solar installation across franchisee-owned properties. Practitioners in asset-light or franchise-operated businesses, where direct control of energy infrastructure is limited, should evaluate VPPA portfolios as the primary renewable energy mechanism for achieving Scope 2 and Scope 3 energy targets, rather than relying on energy attribute certificate markets that do not contribute to new renewable capacity.
• SBTi FLAG targets are now the credibility threshold for food service companies: McDonald’s SBTi-validated FLAG Scope 3 target is the only independently verified agricultural GHG commitment in the global QSR sector. As the EU Corporate Sustainability Reporting Directive’s mandatory Scope 3 reporting requirements, including FLAG sector emissions, come into full enforcement from 2026, every food service company operating in the EU market will be required to disclose agricultural land-use GHG in its Scope 3 inventory. Practitioners in food service should adopt FLAG-sector accounting now, as companies that lack FLAG emissions baselines will be structurally disadvantaged in meeting CSRD mandatory disclosure and in responding to investor Scope 3 engagement.
• Franchise governance as a material sustainability risk, not a structural exemption: McDonald’s faces mounting evidence that franchised operations represent a material governance gap, not an operational category that can be excluded from sustainability accountability. The EmPIRE Act wage theft exposure, the 11.7% packaging compliance gap among eligible franchised restaurants, and the “Facing Challenges” status on FLAG targets all reflect decisions made at the franchisee level that corporate governance cannot currently compel. Practitioners designing sustainability programs for franchise-dependent business models should embed minimum environmental and labor standards into franchise agreement renewal conditions, with financial performance indicators tied to waste, energy, packaging compliance rates, and verified living wage payment, as the only mechanism that makes franchise-level compliance enforceable rather than aspirational.

Source

https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_ProgressReport_2024_2025.pdf
https://corporate.mcdonalds.com/content/dam/sites/corp/nfl/pdf/McDonalds_PurposeImpact_SASBIndex_2024_2025.pdf
https://trellis.net/article/mcdonalds-new-strategy-bring-renewable-energy-its-supply-chain/