The facts of the case; McDonald's was accused of offering an unhealthy menu, insufficient nutritional information, and promoting its unhealthy choices directed towards children. It tried to fight off this perception by projecting a healthier face through advertisement, sponsoring sports programs, healthier menus and acquiring stake in healthy food chains. Ethical issues in the case; Whether or not McDonald's should promote its unhealthy menu, hide nutritional information and deceive consumers by advertising a health conscious face. In doing so, it will mislead consumers, can be penalized under consumer protection laws and taint its brand image. The norms, principles and values are that McDonald's is respected for its commitment to corporate social responsibility. Nickels, McHugh J. & McHugh S. (2003) have reported McDonald's as the most admired company in food services industry. Consumers trust McDonald's and expect high ethical standards from it. If McDonald's continues to deceive its consumers it will betray its loyal consumers. Alternative courses of actions; Option1, to continue deceiving its customers by selling the same menu hidden under healthy perceptions or Option2, commit to rolling out unhealthy food items gradually, introducing healthy foods and lower fat and calorie content of current offerings. The best course of action is to commit to health consciousness at strategic level and bring about meaningful changes. Consequences of each option; Option1, McDonald's will keep selling its unhealthy food in guise of healthy food, enjoy short term increase in revenue but risk its corporate image, consumer's trust and long term prospects. Option2, McDonald's is likely to jeopardize its core business as its burger loving consumers might switch to competitors and its strategic shift will be criticized by stake holders. It will save company repute and win long term customers. The ethical decision is Option2. McDonald's should offer healthier foods.
Ethics in Advertising
From this case an important ethical consideration is raised i.e. Ethics in Advertising. The compact oxford English dictionary (2005) defines ethics as a set of principles that influence conduct. These principles are derived from norms and values of society. The motivation to adhere to ethics comes from societal expectations of behavior and legislative compliance. "Advertising is any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor" (Kotler et al. ,2008, p486). Advertising is carried out to inform the customers and prospects about products, persuade them to buy a product or believe in offered values, remind them to create a brand recall and reinforce desired behavior and perceptions (Kotler et al. 2008, p487). As demonstrated in the case McDonald's was seen to initially promote its supersized meals to consumers through use of advertisements and in-house promotions. Such advertisements were directed towards children to influence current and future behavior. "Sales promotion is some sort of inducement" (Cravens & Piercy, 2005, p.354). It is imperative to note here that McDonald's has used extensive inducements through advertising campaigns showing Ronald McDonald with children. It builds the perception of a fun filled experience for these young impressionable minds and entices them with fancy little limited editions of Mac toys available with happy meals. The question that