IFA 2021 - Week 1 - News

Daily News Clips

Friday, February 19, 2021

News Roundup

Good morning and happy Friday. Convention resumes on Monday, we hope everybody enjoyed Week 1.

Leading headlines, Congressman Hakeem Jeffries (D-NY-8) - Chair of the House Democratic Caucus and heavily favored to be the next Democratic Speaker of the House - released a video message congratulating the IFA Foundation's Black Franchise Leadership Council on the group's formation. "Entrepreneurship and small business ownership represent the heart and soul of our economy... thank you for your work, and we look forward to partnering together," said Rep. Jeffries. You can watch the video here.

Be sure to check out IFA and FRANdata's 2021 Economic Outlook for Franchising. The 32-page report, available to IFA members, breaks down topline macroeconomic trends, new forces like e-commerce, recovery data, and much more. You can access it here.

In franchise business news, McDonald’s announced yesterday that it will increase the diversity of its leadership team and will tie executive bonuses to the hiring of women and people from underrepresented groups. CEO Chris Kempczinski said in a message to the system that it would increase women in leadership roles—senior director and above—to 45% by the end of 2025, from 37% now. The company also said it would reach gender parity by the end of 2030. Kempczinski also said the company would increase the percentage of historically underrepresented groups in leadership roles to 35%, from 29%, by 2025. The company is also tying 15% of executives’ annual incentive bonuses to four “human capital metrics” that cover diverse hiring targets and fostering a culture of inclusion.

Lastly, and most importantly, in an image that captures how local franchises are often on the frontlines of every crisis, a photo of two Dominos workers in San Antonio has gone viral on Twitter. News4SA and KABBFOX29 shared the photo of the two trying to catch a breather after their weekend's worth of food had sold out in 4 hours. Their store was one of the only restaurants open as they sought to help feed Texans in one of the worst disasters to hit the state in years. You can click on the photo to read the full story by CBS Austin.

For Your Calendar

IFA 2021 Annual Convention

February 16-18 and 22-25, 2021

Learn more and register here.

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IFA's Annual Convention is franchising's biggest event for business development and personal growth. Whether you're a franchising veteran or just starting out, there are sessions designed for everyone. This is your chance to network and chart the future of the industry.

Diversity & Inclusion

McDonald's Will Tie Executive Bonuses To Its Diversity Goals

February 18, 2021 | Restaurant Biz

McDonald’s, facing mounting charges of discrimination in the U.S., on Thursday vowed to increase the diversity of its leadership team and will tie executive bonuses to the hiring of women and people from underrepresented groups.

CEO Chris Kempczinski said in a message to the system that it would increase women in leadership roles—senior director and above—to 45% by the end of 2025, from 37% now. The company also said it would reach gender parity by the end of 2030.

Kempczinski also said the company would increase the percentage of historically underrepresented groups in leadership roles to 35%, from 29%, by 2025.

The company is also tying 15% of executives’ annual incentive bonuses to four “human capital metrics” that cover diverse hiring targets and fostering a culture of inclusion. The other factors in bonuses include operating income growth and systemwide sales growth. Those payments can be substantial—for Kempczinski the incentive payment target is 180% of his annual salary.

“We recognize these issues weigh heavily on our people and have heard—loud and clear—that diversity, equity and inclusion are priorities for our entire team, from our crews to our senior leaders,” Kempczinski said. “We’re serious about holding ourselves and our leaders accountable to these foundational commitments.”

The hiring targets come as the Chicago-based burger giant has faced a number of discrimination lawsuits from both executives and franchisees—including one from what had been its largest Black U.S. operator filed just this week.

The franchisee lawsuits are critical of what is seen as the chain’s retreat from marketing to Black consumers, while also charging the company for steering Black franchisees into weaker stores and not giving them the same opportunities as their White counterparts. At the core of the complaint is a $700,000 revenue gap in 2018 between Black franchisees and the system average.

While McDonald’s had vigorously defended itself in those allegations, it also vowed to improve the culture of diversity within its system. In November, the company hired Reginald Miller its new global chief diversity and inclusion officer. That followed a promise in July to bolster diversity within its system.

The moves on Thursday were expressed as an update of those efforts. Executives will be required to meet annual targets on hiring diverse sets of leaders.

Senior leaders at the company have also vowed to create slates of diverse candidates for open officer roles, engaging with diversity groups in and out of the company, and strengthening their talent pipeline by mentoring more women and people of color.

“Our [diversity equity and inclusion] journey does not—and cannot—exist independently,” Kempczinski wrote. “It is deeply rooted in the values that make McDonald’s the thriving, vibrant brand it is today.”