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McDonald's CEO: The clown stays

Steve Easterbrook got an earful at his first annual shareholder's meeting as chief executive of McDonald's (MCD).

Teachers, labor and public health advocates all took Easterbrook to task, accusing the fast-food giant of a litany of bad deeds, from participating in the destruction of rain forests to the roles McDonald's plays in U.S. schools and in the nation's obesity epidemic.

The executive's rough reception came amid a second day of protests outside of McDonald's Oak Brook, Illinois, headquarters, with hundreds of demonstrators calling on the company to raise wages for all of its workers.

During the shareholder's meeting, Easterbrook took umbrage to repeated requests that McDonald's stop using Ronald McDonald, Happy Meals and other promotions geared to appeal to children, while insisting the company can be a "change agent for good."

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"We've seen McDonald's double-dealing in a number of ways," said Jesse Sharkey, vice president of the Chicago Teachers Union, pointing to what the restaurant chain has dubbed "McTeacher's Nights" as an example of the company using schools to "market junk food to children." At the events, touted as a means of helping raise funds for schools, McDonald's invites teachers to "work" behind counters while students order McDonald's food.

"Stop sending Ronald McDonald into schools. Your reputation as a bad corporate actor is behind lagging sales," said former U.S. Air Force pilot Casey Hinds, a mother and public health advocate. "Progressive corporations don't tell kids that fast-food is loving. Ronald McDonald is the Joe Camel of fast foods."

Hinds and other activists at the meeting did not dissuade Easterbrook, who took the helm of the chain in March, from repeating his mantra that he intends to remake McDonald's into a modern, "progressive" purveyor of hamburgers and fries.

"When it comes to children, the moves we have made across our Happy Meals have been substantial. We've helped parents encourage kids to eat more food and low-fat dairy," said Easterbrook, saying the company has sold more than 1 billion bags of sliced apples.

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From its inception, McDonald's has worked to "give back to communities," Easterbrook said. And, if a teacher were to approach a local owner or operator of a McDonald's franchise and ask for support for a literacy program or anti-bullying effort, then it's "entirely appropriate in helping educate kids. That's what a responsible business does and that's what McDonald's will continue to do," said Easterbrook to applause.

"With regards to Ronald, he's here to stay," said Easterbrook, responding to requests from activists at the meeting that McDonald's retire Ronald the clown. "Since he acquired his new outfit, he's feeling trendier and more confident," added the executive, who listed literacy and anti-bullying efforts as issues in which the clown plays important roles.

Easterbrook and McDonald's were also accused of hypocrisy for the decision to hike wages at company-owned stores but not at those run by franchisees, while fighting an increase in the federal minimum wage through the National Restaurant Association (NRA), an industry association that lobbies on the issue.

"We know that McDonald's is one of two top contributors to the NRA's poverty agenda -- will you start working with groups like ROC, will you walk away from the NRA?" asked Roberto Clack, a Chicago organizer with Restaurant Opportunities Center United (ROC), a national group that advocates for restaurant workers.

"I'm incredibly proud of the announcement we made around company-owned employees. When the paychecks come on the first of July, 70,000 people will be incredibly grateful," said Easterbrook in responding to criticism over its wage practices, adding that McDonald's franchise owners make their own decisions on pay.

Starting in July, McDonald's will boost wages for workers at company-owned locations to a dollar more than the local minimum wage. That will raise the average hourly wage for those workers to more than $10 an hour by the end of 2016. But the change will apply to only 90,000 employees; most McDonald's workers are employed by independently operated franchises.

As for the NRA, Easterbrook downplayed the connection, saying "a business such as ours has all sorts of business affiliations."

Easterbrook replaced Don Thompson, a 25-year veteran of the company who departed after less than three years as its CEO amid slumping sales and profits.

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