27 April 2006 | Helen Gilbert
Fast-food giant McDonald's has been named the most unethical firm in the world because of its business conduct, including the way it treats its suppliers.
The firm was ranked least ethical in an index compiled by the Fraser Consultancy, which assessed 42 brands from sectors ranging from food to fashion.
The report, The Ethical Reputation Index
, was based on responses from more than 1,300 consumers. It assessed how ethical practice influences consumers in their purchasing.
McDonald's picked up the worst rating, with 35 per cent of the UK population describing the way it treats suppliers, staff, customers and the environment as poor or very poor. Nike and Shell also occupied the worst 10 slots, as did Barclays, BP and Camelot. Oil and fuel were the worst-rated sectors, followed by clothing.
Workforce exploitation was the most important ethical concern for consumers (34 per cent). Eighty-five per cent of respondents believed Adidas exploits its workforce through low pay, long hours or poor working conditions, while 78 per cent think Nike is guilty of the same. In addition, 74 per cent said they would be less likely to buy from a firm if they heard something negative about its ethics.
Karen Fraser, managing director of the Fraser Consultancy, said the report showed consumers do not change their opinions of companies quickly. "Good ethical reputations have to be earned," she told SM
A spokesperson for the Ethical Trading Initiative said the study showed a gap between consumer concern and awareness of what progressive companies are doing.
"Nike, while ranked poorly, is widely acknowledged by those who work in ethical trade as having responded positively to consumer pressure to change," she said. "This points to the need to educate consumers about what ethical trade is, what companies should be doing and what questions should be asked."
McDonald's said that it could not comment until it had seen the report. In the same week the fast-food giant launched a poster campaign to address the public's negative conceptions of work at the company.