The Tragedy of an Iconic Brand Unravelling

The best leaders are emotionally fit, bringing their strongest emotional selves to work each day. They model the “We Principles” of hope, generosity of spirit, and moral courage– leading with a “we” mindset instead of a “me” mindset. I’m sure you can think of someone who fits the ‘me’ and another who fits the ‘we’ mindsets. Unfortunately, when people in power lead from ego and entitlement, the negative impact of their behaviors trickle throughout the entire company. McDonald’s is an example on how not to lead with emotional fitness.

The spotlight has shone brightly on the king of fast-food chains lately, revealing the shortcomings in its culture, from sexual harassment investigations to discrimination lawsuits. In November 2019, McDonald’s fired CEO Steve Easterbrook for having a consensual relationship with an employee. McDonalds and Easterbrook parted ways, and since Easterbrook said there were no other incidents, he was allowed to keep his severance package, bonuses, and stock. A more recent investigation, however, revealed that he’d actually had three other physical relationships with employees that he covered up. Now, McDonald’s is suing to recoup his severance.

More recently, McDonald’s head of HR, David Fairhurst, was fired after reportedly making women at the company feel uncomfortable, and the board is now investigating the entire human resources department. And at the board level, an investment group has encouraged shareholders to vote Chairman Enrique Hernandez Jr. out. Talk about some disruption in key leadership positions!

Early September, McDonald’s was hit with a new class action lawsuit that accuses them of racial discrimination. 52 Black franchise owners allege that McDonald’s led them to open in low income, high crime areas, setting them up to fail.

It’s not a coincidence that all these issues are happening simultaneously. This is what a company unravelling looks like. With poor leadership at the top, the whole workplace becomes emotionally crippled.

Unfortunately, Easterbrook’s behavior isn’t out of the ordinary for fired CEOs. In 2018, more CEOs were ousted due to ethical violations rather than how they managed the company’s financial performance, according to a comprehensive study from PWC. These are immature people who have likely been put into power too soon. This isn’t about one’s age, it’s about gaining wisdom from life experience. As Chekhov says in his play The Cherry Orchard, the questions of life haven’t hurt them yet.

Mature leaders instinctively know how to check when they’re straying toward using power corrosively, and they course- correct as regular practice. I call this living an examined life, a Socrates concept that’s urgently needed today. These disciplines free them up to be in service to something greater, which is the organization, its people and its purpose, rather than their own self-interest. It means regularly asking, ‘Is this the right thing, not for me, but for the organization?’

The good news is that these practices aren’t just ‘the right thing to do.’ Research* bears out that companies where leaders are highly rated on compassion and integrity have a return on assets of over 9%, five times those who got low ratings on such qualities.

Leading with the “We” Principles of hope, a generous spirit, and moral courage are the ways to exemplify and model emotional fitness.  They are the legacy we give to our organizations and future leaders there, so the company will remain vital for decades to come.  

Let’s hope those now in charge at McDonald’s will brighten its golden arches, and save an iconic worldwide brand.

*Return on Character, Fred Kiel