McDonald's Corporation
MCD
Consumer Discretionary
2
exclusion reasons
2 themes
This page is part of our public exclusion list — a transparency tool that shows which companies we screen out and why. It is not investment advice, and it is not an accusation. But it is subject to change as our understanding of the facts evolves.
McDonald's has been cited for child labor violations across its franchise network in multiple states. In November 2023, a U.S. Department of Labor investigation found the operator of five Pittsburgh-area McDonald's locations employed 34 minors in violation of federal law. This followed a May 2023 case where three Kentucky franchisees paid $212,000 in fines for similar violations, and a December 2022 case where a franchisee in New Jersey illegally scheduled 14- and 15-year-olds for excessive hours and late shifts at 13 locations. Additional violations were documented in Louisiana and Texas in July 2023.
While McDonald's corporate policy prohibits child labor in its supply chain and franchise operations, these repeated, independent investigations by the Wage and Hour Division demonstrate a systemic pattern of non-compliance within its business model. The company's reliance on a vast network of franchisees, who operate approximately 95% of its U.S. restaurants, creates recurring enforcement gaps where child labor laws are violated.
McDonald's has faced legal claims alleging its products and operational practices have contributed to preventable deaths. In the landmark 2003 class-action lawsuit *Pelman v. McDonald's Corp.*, plaintiffs argued the company's food products were more dangerous than average and that its marketing contributed to health injuries. While the specific claims were ultimately dismissed on legal grounds, the litigation highlighted public and legal scrutiny of the health impacts associated with the company's core business model.
Separately, a Texas jury awarded a $27 million verdict against McDonald's in a case finding that lax security at one of its restaurants led to a fatal shooting. This verdict directly ties the company's operational and safety decisions to a preventable death on its premises.
Research Sources
18 organizations
Related Exclusions
Wondering what we do invest in?
The Naughty List
A digest of changes to our exclusion list — new additions, removals, and the evidence behind them. We review the list continuously as new evidence surfaces.
Companies appear on our exclusion list based on our investment judgment — not because they've done anything illegal. This is a difference of values and opinion, not an accusation of wrongdoing. Exclusion does not constitute a recommendation against investing in any company, and absence from the list does not constitute a recommendation to invest.
This information is provided for educational and transparency purposes only and should not be relied upon as investment advice. Data is drawn from independent watchdogs, NGOs, government registries, and Ethical Capital's ongoing research — see Research Sources for the full list.
Ethical Capital LLC is a state-registered investment adviser in Utah (CRD #316032). Registration does not imply a certain level of skill or training.