Investors' Beef with the Overuse of Antibiotics in Meat Production

Antibiotics, even those important to hu­man medicine, are frequently used for rapid growth promotion in livestock and poultry and to prevent illness in animals living in cramped and unhealthy conditions. The FDA estimates that animal agriculture accounts for 70 percent of current U.S. antibiotic use. 

The overuse of antibiotics in the meat industry has been directly linked to the rise of antibiotic-resistant “superbugs” in the U.S. and across the world. According to the Centers for Disease Control, antibiotic resistance is responsible for 2 million infections and 23,000 deaths each year. 

This public health concern has prompted ICCR members to call on restaurant chains and meat producers to develop sourcing poli­cies that restrict antibiotic use in food produc­tion to therapeutic use only.

As the rise of superbugs continues to make headlines, consumers are declaring their pref­erences for more responsibly raised meat, both at the grocery checkout line and at restaurants. According to the NRDC, while overall per capita consumption of meat in the U.S. is declining slightly, sales of meat and poultry raised without routine use of antibiotics are up 25 percent. Several national chains have begun seizing on these trends by expanding their of­ferings of sustainably sourced meats, including Chipotle Mexican Grill and Panera Bread. 

A number of companies, however, are slower to respond to this trend. McDonald’s, for instance, made a positive initial step to­wards safeguarding the efficacy of antibiotics one year ago by establishing a policy to source only chickens raised without antibiotics es­sential to human medicine. The policy, which will go into effect in 2017, will not, however, encompass beef and pork -- mainstay meats in the restaurants’ menus. ICCR’s investors are pushing the company to expand its policy to include all the meat products that it serves. 

“What’s good for the goose, ought to be good for the gander, or in this case, the whole farmyard,” said Sr. Susan Mika of the Congre­gation of Benedictine Sisters of Boerne, TX, a McDonald’s shareholder and ICCR member.

Investors like Sr. Mika question what they see as McDonald’s double standard regarding its use of meat routinely treated with antibiot­ics. They contend that the unnecessary use of antibiotics in McDonald’s meat supply chain creates material risk for the company, includ­ing potential reputational damage and loss of market share as other restaurant chains adopt more sustainable policies, consumer demand for antibiotic-free meat increases and future regulation looms. 

Said Austin Wilson of As You Sow, “McDonald’s brand identity is tied to sustain­ability and responsibility; the brand is damaged by the company’s lack of progress on beef and pork antibiotics standards. We advocate detailed and comprehensive disclosure about how McDonald’s will expand antibiotic use policies throughout its meat supply chain, given the emerging health crisis and industry trends.”

Late last year the Benedictine Sisters refiled a shareholder resolution requesting that McDonald’s expand its antibiotics policy to encompass beef and pork. This resolu­tion was supported by nearly one-quarter of shareholders at the company’s annual meeting in May, proving the issue resonates widely with institutional investors. 

“Antibiotic resistance is a serious, global threat to human health,” said Lance B. Price, Ph.D., who is director of the Antibi­otic Resistance Action Center at the Milken Institute School of Public Health at George Washington University. “We need to see major reductions in use in this sector if we hope to win the war against superbugs.” 

ICCR’s antibiotics initiative challenges food companies and restaurant chains to:

• Adopt a policy (effective throughout both company-owned and contract farms), to protect human health, by restricting the non-therapeutic use (such as for growth promo­tion, feed efficiency, weight gain, or disease prevention) of antibiotics in the meat supply chain.

• Report on the amount of antibiotics used, and for what purpose, through to con­tract farmers.

• Adopt a management plan to reduce nu­trient pollution in its supply chain with specific goals for pollution prevention and reduction of wastewater discharge in company facilities and throughout the supply chain.

Said Mika, “When it comes to food safety and sustainability, McDonald’s needs to ac­cept the responsibility that comes along with being a major brand with the power to shape food trends. When the company announced its antibiotics-free chicken policy it made it clear it was in response to consumer demand. Why should its view on beef or pork be any different?”

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