McDonald's is basically a minor financial supporter of its own Ronald McDonald House Charities and should immediately stop linking longtime spokes-character Ronald McDonald with it, says a consumer advocacy group in a scathing report.
The 30-page report, funded by Corporate Accountability International and The Small Planet Fund, charges that McDonald's is mostly using the charity as a branding device for its food sales because the corporation, itself, contributes so little to the charity. While McDonald's reaps 100% of the "branded benefit" from the charity, it contributes only about 20% of the money, the report charges.
"McDonald's giving does not match its rhetoric," says Michele Simon, a public health lawyer who authored the report dubbed "Clowning Around with Charity: How McDonald's Exploits Philanthropy and Targets Children."
The report does not accuse McDonald's of doing anything illegal with its namesake charity. The issues it highlights are ethical. Among the report's recommendations: McDonald's should rename Ronald McDonald House Charities and junk Ronald McDonald as a spokesman.
McDonald's has no such plans. And McDonald's officials blast the report's findings.
"McDonald's categorically rejects this self-serving and biased document and stands proud of the significant financial support and volunteer hours we have and will continue to provide to Ronald McDonald House Charities and other charities worldwide," says Bridget Coffing, senior vice president of corporate relations, in a statement.
By linking Ronald McDonald, in particular, to the charity, "McDonald's gains an emotionally-loaded marketing vehicle while shielding itself from critics," the report concludes.
Simon says that McDonald's contributes between $5.3 and $10 million to its namesake, global charity, according to publicly available data that the advocacy group reviewed.
Even then, the report is extra careful not to criticize what the charity, itself, does — which is providing housing for parents of children who are hospitalized with serious illnesses. The report calls the charity "vitally important."
Globally, Ronald McDonald House Charities gets less than one-quarter of its revenue from McDonald', the report says. And at the local level, the regional chapters and local Ronald McDonald Houses often get as little as one-tenth of their revenue from McDonald's.
Even McDonald's customers, the report charges, contribute as much as 1.5 times more to the charity than does McDonald's itself.
"Most people think that McDonald's funds Ronald McDonald House Charities 100%," says Simon. "This is a disconnect between what most people think and reality."
On its website, for example, The Los Angeles Ronald McDonald House, which is one of the nation's largest with 75 rooms, notes, "although our House shares a brand name with McDonald's Corporation, less than 10% of our annual $2 million budget comes as a result of financial contributions from the company's local owner / operators."
But executives from Ronald McDonald House Charities say they wouldn't exist without help from McDonald's. "Ronald McDonald House Charities helps approximately 12,000 families every single night around the world," says Sheila Musolino, chief operating officer of the charity. "This would not be possible without McDonald's."