UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

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☑	Definitive Proxy Statement
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☐	Soliciting Material under §240.14a-12

McDonald’s Corporation

(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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☐	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11

Notice of Annual Shareholders’
Meeting and Proxy Statement

Chairman’s Letter

Dear McDonald’s Shareholders, Colleagues, Crew Members, Franchisees and Customers,

In my letter last year, I talked of hope for brighter days following a challenging year. As 2021 unfolded, it continued to bring extraordinary challenges around the world, from turbulence in global supply chains to continuing peaks in the COVID-19 pandemic. As a hallmark of the year we are now embarking upon, it is clear that once again society will be tested. At the time of my writing, we are weeks into a devastating humanitarian crisis that now extends far beyond Ukraine and has reverberated powerfully around the world. It is at times like this we are reminded that in our global and interconnected world, all quadrants of society have a collective responsibility to act. Throughout our history, McDonald’s has met uncertainty with an express focus on our people, our communities and our values. McDonald’s Board and Executive leadership relied upon these same fundamental principles when tracing the Company’s initial response to this crisis. In a first for our System, we took the significant step of pausing our operations across Ukraine, and then Russia. Knowing how deeply this would affect our people, we immediately made clear our intent to pay full salaries to our employees in both countries, while also funding $5 million to our Employee Assistance Fund for those confronting the human toll of war in Ukraine. And while the Arches dimmed in nearly 1,000 communities in Russia and Ukraine, Ronald McDonald House Charities (RMHC) kept their lights on, providing hope and humanitarian aid to families in need across the region. Exactly where this crisis goes is unclear, but our approach will continue to be guided by the same principles that have guided us in the past, with our values serving as our North Star. Therefore, as I reflect on 2021 in light of the continued challenges communities are facing today, looking at the powerful ways that McDonald’s can step forward when our communities need us, I believe there are many reasons to be both proud of our great System and hopeful for the role we will play in the future. 2021 was the start of a new chapter for McDonald’s. It was the first time we entered a year guided by our newly evolved growth strategy, Accelerating the Arches. The integration of McDonald’s values, purpose and mission within the strategy gave the entire McDonald’s community a deeper understanding of our role in the world and provides continued guidance as we navigate uncertainty and opportunity in equal measure. McDonald’s progress in 2021 showed we launched Accelerating the Arches at the right time. The past two years of previously unimaginable challenges have placed a renewed focus on the impact every brand has on the broader communities they serve. Trust has been placed in the spotlight, and consumers increasingly favor brands and businesses they believe in. It’s clearer than ever before that stewardship of our greatest asset – the McDonald’s Brand – is key to our success and to engendering trust in McDonald’s. Our efforts since the launch of Accelerating the Arches to recommit to a clear purpose to feed and foster the communities we serve have led to McDonald’s being one of the most admired brands in the world.¹ This was supported by yet another record year of business performance. For the full year, we achieved Systemwide sales² of $112 billion, with revenues of $23.2 billion; the highest ever reported annual comparable sales growth of 13.8% in the U.S., which represents over $5 billion of Systemwide sales² growth; and record operating income of more than $10 billion. All of this proves that McDonald’s can meaningfully deliver industry-leading financial results while focusing on areas of deep importance to each member of the McDonald’s community.

1	https://fortune.com/company/mcdonalds/worlds-most-admired-companies.
2	Consists of both Company and franchised sales.

2 McDonald’s
Corporation

Continuing to earn trust with meaningful action and accountability. Central to strengthening trust in the McDonald’s Brand is our focus on continued action, progress, reporting and accountability across pressing issues affecting our communities – both locally and globally. The Board recognizes that climate change is one of the most pressing issues of our time and was proud to oversee progress across a number of initiatives to strengthen our collective resiliency in the past year. A particular highlight was announcing our commitment to achieve net zero emissions across global operations by 2050. The Board, through its Sustainability & Corporate Responsibility Committee, drew on its diverse experience to support the development of the strategy, and through this committee, it will continue to oversee progress to ensure we hold the Company accountable to its targets. We formalized our climate ambition with specific targets included in our inaugural Climate Risk & Resiliency Report, guided by recommendations from the Task Force on Climate-related Financial Disclosures (TCFD). We also made significant progress on our ESG strategy more broadly, particularly on packaging and waste issues, including launching our new sustainable Happy Meal toy strategy and our additional $5 million commitment with the NextGen Consortium to continue work to accelerate and scale sustainable packaging solutions for the industry. The nature of our business means animal welfare is also a key focus in our ESG efforts and McDonald’s is making important progress across the entire supply chain. We know that our ability to serve safe, quality food comes from animals that are cared for properly, which is why in 2012 we became the first major brand to make a commitment to source from U.S. producers who do not use gestational crates for pregnant sows. We originally intended to achieve this commitment by the end of 2022, however, McDonald’s has had to extend that timeframe by two years due to industry-wide challenges for farmers and producers – such as the impacts from global outbreaks of African Swine Fever and the COVID-19 pandemic. Nevertheless, we remain committed to our goal. We are on track to achieve it by the end of 2024, and expect to reach 85% to 90% of our goal by the end of 2022. The impact of this is significant. Since we first made our commitment in 2012, an estimated 30% to 35% of U.S. pork production has moved to group housing systems. As we look forward, we look to continuing to promote further collaboration across the industry. We continued to demonstrate meaningful action on our purpose to feed and foster communities in 2021, but our work is never done. For as long as we continue to serve, we must always be there for our communities as a beacon of trust. Building a thriving System that reflects the communities we serve. The trust we build as a Brand is only possible because of the people representing it. The strength of our System remains our biggest competitive advantage, and our license to operate is dependent upon providing all three legs of the stool – our franchisees, suppliers and employees – with the platform and environment to thrive. We must also make sure the System reflects the rich diversity found in the communities where we operate. To formalize these areas of focus, the Compensation Committee of the Board implemented new metrics in 2021 that tie executive leadership’s compensation to objectives that mirror the values our System exemplifies in our communities every day. These incentive metrics include championing our Company values, improving diversity representation among leadership and fostering strong feelings of inclusion among employees. McDonald’s has made important progress this past year. We announced Global Brand Standards to reinforce our commitment to fostering safe, respectful and inclusive workplaces; our Mutual Commitment to Diversity, Equity & Inclusion with our suppliers, an important step to dismantle barriers to economic opportunity in their businesses and in the communities they serve; and a commitment to increase spending with diverse-owned media in the U.S. We also closed identified gender pay gaps across our corporate offices and Company-owned restaurants in the U.S., and in our owned markets around the world, and raised crew member wages at U.S. Company-owned restaurants. Supporting a world-class leadership team. Beyond our exceptional business performance, McDonald’s continues to champion values-based leadership. And I am proud that our SLT continues to demonstrate what that means. Everything McDonald’s achieved in 2021 strengthened my conviction that we have a world-class leadership team, complemented by the unique strengths of our dedicated System. It’s an unbeatable combination that was responsible for another record year.

2022 Proxy Statement 3

The strength of our leadership team is evidence of careful planning and attention by the Board, which takes seriously its role to ensure sustainable value creation for shareholders while acting on some of the world’s most pressing social and environmental challenges important to McDonald’s stakeholders. We will continue to optimize leadership to push the Brand forward while keeping the customer and our role in communities at the center. Last year’s global leadership appointments of Manu Steijaert as Executive Vice President and Chief Customer Officer, Morgan Flatley as Global Chief Marketing Officer, and Desiree Ralls-Morrison as General Counsel and Corporate Secretary were yet more evidence of our progress on that front. Strengthening our foundations to secure our long-term success. The past year was one in which the McDonald’s Arches stood as tall as ever, once again demonstrating why the “and” to our successful approach is working. Meaning, fulfilling our role as a leading business focused on sustainable performance, and living our purpose deeply. Being mindful of our role as a business and stretching further to impact society positively. Focusing on the year we’re navigating and setting our sights on the future. Achieving record business performance and continuing to strengthen the foundations of this great Brand to further cement our role as a force for good in the world. And, in addition to remaining focused on stewarding shareholders’ investments, the Board will continue to ensure the System, our customers and our communities are supported by McDonald’s. I want to thank the entire System for another memorable year of which we all should be proud. Each and every single person’s contributions help make the Brand what it is, and made this year yet another successful one for McDonald’s. Sincerely, Rick Hernandez
Chairman of the Board

4 McDonald’s
Corporation

Notice of 2022 Annual
Shareholders’ Meeting Your Vote is Important. Please consider the issues presented in the accompanying Proxy Statement and vote your shares using the WHITE proxy card as promptly as possible, even if you plan to attend the virtual meeting.

Important Voting Information

Please carefully review the proxy materials and follow the instructions below to ensure your vote is received by 10:59 p.m. Central Time on May 25, 2022 using one of the options below.

Registered Shareholders:If you hold shares through our transfer agent, Computershare:

	Internet Visit the website shown on your WHITE proxy card
	Telephone Dial the toll-free number shown on your WHITE proxy card (available 24/7)
	Mail If you received a WHITE proxy card by mail, you may mark, date, sign and return it in the postage-paid envelope furnished for that purpose

Beneficial Owners:If you hold shares through your bank or brokerage account:

	Internet Visit the website shown on your WHITE voting instruction form
	Telephone Dial the toll-free number shown on your WHITE voting instruction form (available 24/7)
	Mail If you received a WHITE voting instruction form by mail, you may mark, date, sign and return it in the postage-paid envelope furnished for that purpose

	Meeting Date and Time		Virtual Shareholders’ Meeting
May 26, 2022 9:00 a.m. Central Time		McDonald’s Corporation will have a virtual meeting at www.cesonlineservices.com/mcd22_vm. There will not be a physical location for the meeting, and you will not be able to attend the meeting in person.

We will send this notice, the accompanying Proxy Statement, the form of WHITE proxy card and our 2021 Annual Report, or the Notice of Internet Availability of Proxy Materials, beginning on or about April 8, 2022 to shareholders of record as of March 28, 2022 (the “record date”).

To McDonald’s Corporation Shareholders:

At our 2022 Annual Shareholders’ Meeting, you will be asked to vote upon the following proposals:

Agenda		Our Board’s Voting Recommendation
Proposal 1	Election of 12 Directors to serve until our 2023 Annual Meeting of Shareholders	“FOR ALL” OF OUR BOARD’S DIRECTOR NOMINEES
Proposal 2	Advisory vote to approve executive compensation	“FOR”
Proposal 3	Advisory vote to approve the appointment of Ernst & Young LLP as our independent auditor for 2022	“FOR”
Proposals 4 — 10	Advisory votes on seven shareholder proposals, each only if properly presented.	“AGAINST” EACH SHAREHOLDER PROPOSAL

In addition, we will transact any other business properly presented at the meeting, including any adjournment or postponement thereof, by or at the direction of our Board.

The accompanying Proxy Statement provides detailed information about the matters to be considered at the meeting. You should read the accompanying Proxy Statement carefully. We encourage you to participate in having your views reflected on the matters by voting as promptly as possible, even if you plan to attend the virtual meeting.

Barberry Corp., an activist investment firm affiliated with Carl Icahn (together with their affiliates, the “Icahn Group”), has notified us that it intends to propose two of its own director nominees for election at the meeting. Currently, the Icahn Group collectively holds 200 shares of our common stock. You may receive proxy solicitation materials, including a gold proxy card, from the Icahn Group. Our Board does NOT endorse any of the Icahn Group’s nominees and strongly recommends that you disregard any such materials, which do not reflect the views of our Board. We are not responsible for the accuracy of any information contained in any solicitation materials filed or disseminated by, or on behalf of, the Icahn Group or any of its affiliates or any other statements that they may otherwise make. The Icahn Group chooses which shareholders receive its proxy solicitation materials.

2022 Proxy Statement 5

Notice of 2022 Annual Shareholders’ Meeting

PLEASE VOTE AS SOON AS POSSIBLE on the WHITE proxy card and do not sign, return or vote any gold proxy card that may be sent to you by the Icahn Group. If you have any questions or require assistance with voting your WHITE proxy card, please contact our proxy solicitation firms at:

Innisfree M&A Incorporated

501 Madison Avenue, 20^th Floor
New York, New York 10022
Shareholders: (877) 456-3463 (toll-free
from the U.S. or Canada) or (412) 232-3651 (from other countries)
Banks and brokers: (212) 750-5833

Kingsdale Advisors

745 5^th Avenue, Suite 500
New York, New York 10151
(855) 683-3113 (toll-free in North America)
(416) 867-2272 (outside of North America)
contactus@kingsdaleadvisors.com

Important Notice Regarding the Availability of Proxy Materials for the Shareholders’ Meeting To Be Held on May 26, 2022. This notice, the accompanying Proxy Statement and our 2021 Annual Report are available free of charge at www.proxyvote.com.

Our Board unanimously recommends that you vote “FOR ALL” of our Board’s Director nominees on the WHITE proxy card and in accordance with our Board’s recommendation on each other proposal properly presented at the meeting. Our Board urges you to disregard any materials, including any gold proxy card, that may be sent to you by the Icahn Group. If you have already voted using a gold proxy card, you can revoke that proxy any time before it is exercised at the meeting by (i) following the instructions on your WHITE proxy card or WHITE voting instruction form to vote by internet or telephone, (ii) marking, dating, signing and returning your WHITE proxy card or WHITE voting instruction form in the postage-paid envelope provided or (iii) voting at the meeting. Only your latest dated, validly executed proxy counts.

How to Attend Our 2022 Annual Shareholders’ Meeting: Shareholders must register in advance to ask questions or vote at the meeting by using the control number located on their Notice of Internet Availability of Proxy Materials, proxy card, voting instruction form or other communication. Detailed instructions are set forth under “Meeting Information” on page 126. Only shareholders as of the record date may attend the virtual meeting.

We encourage you to vote and submit your WHITE proxy card as promptly as possible, even if you plan to attend the virtual meeting.

By order of our Board of Directors,

Desiree Ralls-Morrison
Executive Vice President, General Counsel and Corporate Secretary

McDonald’s Corporation
110 North Carpenter Street, Chicago, Illinois 60607
April 8, 2022

6 McDonald’s
Corporation

Table of Contents

Chairman’s Letter	2
Notice of 2022 Annual Shareholders’ Meeting	5
Proxy Summary	8
About McDonald’s	8
Highlights	11
Executive Compensation Highlights	15
Voting Matters and Recommendations	17
Forward-Looking Statements and Website Links	17
Background of the Solicitation	18
Election of Directors	22
PROPOSAL 1: Election of Directors	22
Contested Election	22
Election Mechanics	22
Director Qualifications	23
Biographical Information	25
Board and Governance Matters	37
Board Leadership	37
Board Composition and Succession Planning	37
Board Diversity	38
Process for Selection of New Director Candidates	39
Director Independence	40
Board Committees	40
Board Self-Evaluation	46
Board Oversight	46
Talent Management and Succession Planning	48
ESG: Our Purpose & Impact	50
Shareholder Engagement	56
Board’s Response to Shareholder Proposals	57
Other Governance Policies and Principles	57
Director Compensation	58
Executive Compensation	60
PROPOSAL 2: Advisory Vote to Approve Executive Compensation	60
Compensation Committee Report	61
Compensation Discussion and Analysis	61
Compensation Tables	76
Additional Compensation Matters	86
Audit & Finance Committee Matters	87
PROPOSAL 3: Ratification of the Appointment of Ernst & Young LLP as Independent Auditor for 2022	87

Audit & Finance Committee Report	88
Policy for Preapproval of Audit and Permitted Non-Audit Services	89
Auditor Fees and Services	89
Shareholder Proposals	90
PROPOSAL 4: Advisory Vote on Modifying the Threshold to Call Special Shareholders’ Meetings	91
Our Board’s Statement in Opposition	92
PROPOSAL 5: Advisory Vote on Report on Reducing Plastics Use	94
Our Board’s Statement in Opposition	95
PROPOSAL 6: Advisory Vote on Report on Antibiotics and Public Health Costs	97
Our Board’s Statement in Opposition	98
PROPOSAL 7: Advisory Vote on Disclosure Regarding Confinement Stall Use in the Company’s U.S. Pork Supply Chain	100
Our Board’s Statement in Opposition	101
PROPOSAL 8: Advisory Vote on Third-Party Civil Rights Audit	104
Our Board’s Statement in Opposition	105
PROPOSAL 9: Advisory Vote on Report on Lobbying Activities and Expenditures	110
Our Board’s Statement in Opposition	111
PROPOSAL 10: Advisory Vote on Report on Global Public Policy and Political Influence	113
Our Board’s Statement in Opposition	114
Stock Ownership	116
Communications with Our Board	118
Information on our 2023 Annual Shareholders’ Meeting	118
Transactions with Related Persons	119
Questions and Answers Regarding Proxy Materials and Voting Information	120
Meeting Information	126
Exhibit A: Supplemental Information Regarding Participants in the Solicitation	128

2022 Proxy Statement 7

Proxy
Summary

This Proxy Summary highlights key matters about our Company. We encourage you to participate in having your views reflected on the matters described herein by voting as promptly as possible, even if you plan to attend our virtual 2022 Annual Shareholders’ Meeting.

The Icahn Group has notified us that it intends to propose two of its own director nominees for election at the meeting. You may receive proxy solicitation materials, including a gold proxy card, from the Icahn Group. Our Board unanimously recommends that you vote “FOR ALL” of our Board’s Director nominees on the WHITE proxy card and in accordance with our Board’s recommendation on each other proposal properly presented at the meeting. Our Board urges you to disregard any materials, including any gold proxy card, that may be sent to you by the Icahn Group. Our Board does NOT endorse any of the Icahn Group’s nominees and strongly recommends that you disregard any such materials, which do not reflect the views of our Board. We are not responsible for the accuracy of any information contained in any solicitation materials filed or disseminated by, or on behalf of, the Icahn Group or any of its affiliates or any other statements that they may otherwise make.

If you have already voted using a gold proxy card, you can revoke that proxy any time before it is exercised at the meeting by (i) following the instructions on your WHITE proxy card or WHITE voting instruction form to vote by internet or telephone, (ii) marking, dating, signing and returning your WHITE proxy card or WHITE voting instruction form in the postage-paid envelope provided or (iii) voting at the meeting. Only your latest dated, validly executed proxy counts.

About McDonald’s

2021 Performance

In the face of ongoing global challenges, 2021 demonstrated what makes McDonald’s not just different, but unique. This includes the strength of our people, the scale of our supply chain, the resilience of our System (comprised of our Company, franchisees and suppliers) and the power of the McDonald’s brand.

In the first full year of our Accelerating the Arches growth strategy, we prioritized our MCD strategic growth pillars by focusing our efforts to maximize our marketing, commit to the core menu and double down on digital, drive-thru and delivery to create memorable experiences for our customers. These efforts allowed us to achieve full-year revenues of $23.2 billion, record Systemwide sales³ of $112.5 billion and operating income of $10.4 billion.

We also continued to advance the elements of our environmental, social responsibility and governance (“ESG”) strategy that help us fulfill our broader role across the communities in which we operate. This includes our pledge to put McDonald’s on the path to net zero emissions by 2050, our progress towards creating more sustainable Happy Meal toys, our $5 million commitment with the NextGen Consortium to continue work to accelerate and scale sustainable packaging solutions and our commitment to increasing advertising spend with diverse-owned media partners in the U.S. More information on these and other efforts can be found under “ESG: Our Purpose & Impact” on page 50.

We remain confident that our strategy will continue to deliver sustained, long-term profitable growth for our System and stakeholders.

	17%     Comparable Sales Growth
	21%     Systemwide Sales3 Growth
	>25%   of Systemwide Sales3 in Our Top Six Markets Came from Digital Channels

³ Systemwide sales include sales at all restaurants, whether operated by our Company or franchisees. While franchised sales are not recorded as revenues by our Company, management believes the information is important in understanding our financial performance because these sales are the basis on which we calculate and record franchised revenues and are indicative of the financial health of the franchisee base. Our Company’s revenues consist solely of sales by Company-operated restaurants and fees from franchised restaurants operated by conventional franchisees, developmental licensees and affiliates. Changes in Systemwide sales are primarily driven by comparable sales and net restaurant unit expansion.

8 McDonald’s
Corporation

	Proxy Summary

Company Values

At McDonald’s, we are guided by the five core values set forth below. These values were updated as part of our Accelerating the Arches growth strategy with input from our employees, franchisees, suppliers and customers on what makes them proud to be part of our McFamily. We believe that our people, all around the world, set McDonald’s apart and bring these values to life on a daily basis.

Serve:	Inclusion:	Integrity:	Community:	Family:
We put our customers and people first.	We open our doors to everyone.	We do the right thing.	We are good neighbors.	We get better together.

Our philosophy of “doing the right thing” is enshrined in our core values, and it guides not only the way we conduct our business, but also how we fulfill our broader role in the communities we serve.

Accelerating the Arches

In late 2020, we announced the Accelerating the Arches growth strategy. The strategy, which encompasses all aspects of our business as the leading global omni-channel restaurant brand, reflects a refreshed purpose, updated values and growth pillars that build on our competitive advantages. It focuses on the imperative that we deliver across five critical areas: our purpose to feed and foster communities; our mission to create delicious feel-good moments for everyone; our core values described under “Company Values” above; our growth pillars described below; and our foundation of running great restaurants and empowering our people.

2022 Proxy Statement 9

	Proxy Summary

We believe Accelerating the Arches builds on our inherent strengths by harnessing our competitive advantages and investing in innovations that will enhance the customer experience and deliver long-term growth.

In addition, we will continue to elevate our people practices in order to make people feel welcomed, valued and included within the McDonald’s community. We live by our values every day and are committed to fostering a safe, respectful and inclusive workplace, providing quality jobs and making opportunity open to all.

More information on Accelerating the Arches and our MCD growth pillars can be found under “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Strategic Direction” in our 2021 Annual Report on Form 10-K. More information on our mission and values can also be found on the “Our Mission and Values” section of our website at https://corporate.mcdonalds.com/corpmcd/our-company/who-we-are/our-values.html.

10 McDonald’s
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	Proxy Summary

Highlights

ESG: Our Purpose & Impact

Our purpose at McDonald’s is to feed and foster communities. As part of our Accelerating the Arches strategy, we have prioritized our role and commitment in the communities we serve to focus on the four areas depicted below and described in more detail under “ESG: Our Purpose & Impact” on page 50. More information on these topics, as well as on our impact strategies, goals and performance tracking, can also be found on the “Our Purpose & Impact” section of our website at https://corporate.mcdonalds.com/corpmcd/our-purpose-and-impact.html.

Food Quality and Sourcing	Our Planet
Our initiatives are focused on: Food Safety; Nutrition & Marketing Practices; Responsible Sourcing; Responsible Antibiotic Use; Animal Health & Welfare; Farming Communities; Supply Chain Human Rights; and Sustainable Agriculture & Beef. Recent highlights include:   Substantially achieved (95.0-99.9%) each of our 2020 responsible sourcing goals for our six priority commodities (beef, soy for chicken feed, coffee, palm oil, fish and fiber) as of the end of 2020   Updated our commitment to phasing out the use of gestation stalls for housing pregnant sows in the U.S. by the end of 2024, a two-year extension of our original goal—set in 2012—due to the impacts of COVID-19 and the global outbreak of African Swine Fever	Our initiatives are focused on: Climate Action; Packaging & Waste; Conserving Forests; and Water Stewardship. Recent highlights include:   Joined the United Nations Race to Zero campaign in 2021, committing to put McDonald’s on the path to net zero emissions by 2050   Released our inaugural Climate Risk & Resiliency Summary in 2021, guided by reporting recommendations from the Task Force on Climate-Related Financial Disclosures (TCFD), demonstrating our continued commitment to assessing, managing and disclosing climate-related risks and opportunities for our business
Community Connection	Jobs, Inclusion and Empowerment
Our initiatives are focused on the following areas: Community Support & Crisis Response; Ronald McDonald House Charities® (“RMHC”); and Food Waste & Donations. Recent highlights include:   Continued the five-year, $100 million commitment to RMHC that we set in 2020 to help RMHC continue increasing access to quality health care for children around the world   Donated $5 million in 2022 to our Employee Assistance Fund and support relief efforts led by the International Red Cross in response to recent developments in Ukraine and the resulting humanitarian crisis in Europe	Our initiatives are focused on: Diversity, Equity & Inclusion; Skills & Education; Human Rights & Respectful Workplaces; and People Safety. Recent highlights include:   In 2021, set goals to increase representation of women globally and historically underrepresented groups in the U.S. in leadership roles by 2025   Incorporated quantitative human capital metrics into our executives’ annual incentive compensation in 2021   In 2021, invited U.S.-based suppliers to sign a Mutual Commitment to DEI   In 2021, disclosed our corporate employee representation and EEO-1 data for the first time   In 2021, published an inaugural Diversity Snapshot, including data on employee, Board and franchisee representation, as well as supplier diversity

2022 Proxy Statement 11

	Proxy Summary

Governance Practices

Our Board is committed to good corporate governance. We have strong corporate governance practices, as highlighted in the below chart:

Board and Governance Practices
Independent Board Chairman   11 of 12 Directors are independent (all except CEO)   All standing Committees are independent (except Executive Committee, chaired by our CEO)   Annual election of all Directors   Majority voting standard for uncontested Director elections   Demonstrated commitment to diversity, with 50% of our Board comprised of diverse Directors (25% women and 25% racially/ethnically diverse)   50% of Directors joining our Board since 2015   Refreshed Director Selection Process guidelines align with Accelerating the Arches   No Directors who are current public-company CEOs serve on more than one outside board	Executive sessions of independent Directors scheduled for Board and Committee meetings   Annual Board and Committee self-evaluation   Regular succession planning and effective leadership transitions at the CEO, executive management and Board levels   No special interest Directors; our Director nominees represent the interest of all shareholders   No supermajority voting provisions   No “poison pill” (shareholder rights plan)   Board access to independent advisors   Directors are required to obtain the consent of our Chairman and Governance Committee Chair to serve on another public company board	Proxy access for Director candidates nominated by shareholders reflecting standard market practices   Meaningful threshold for shareholders to call special meetings   Robust Director stock ownership requirements   No Director hedging/pledging of Company stock   Public disclosure of corporate political contributions and certain trade association memberships   Significant shareholder outreach and engagement program   Directors may not serve on more than three public company boards (in addition to our Board)

Shareholder Engagement

We understand the importance of engaging with shareholders and are committed to regularly hearing our shareholders’ perspectives. Our Board and management team have developed a robust shareholder engagement program. Since our last Annual Shareholders’ Meeting, we reached out to shareholders representing nearly 50% of our outstanding shares of common stock. We engage on our business strategy and initiatives, results and financial performance, ESG initiatives, including those relating to environmental matters, human capital management, and diversity, equity and inclusion (“DEI”), executive compensation, and Board governance and refreshment. Members of management and our Directors participate in these discussions.

Shareholder feedback received through direct discussions and prior shareholder votes, as well as engagement with proxy and other investor advisory firms that represent the interests of a wide array of shareholders, is reported to our Governance Committee and other relevant Committees periodically throughout the year. We also review our practices against guidelines published by shareholders and proxy advisory firms.

12 McDonald’s
Corporation

	Proxy Summary

The following are highlights of our 2021 shareholder engagement program:

  Response to COVID-19   Company Values and Culture   Business Strategy and Performance   Board Oversight   Human Capital Management, including DEI   Board Governance, Composition, Tenure and Refreshment   Environmental, Social Responsibility and Sustainability Topics, including Climate Change   Executive Compensation

Ongoing Commitment to Board and Committee Refreshment

Our Governance Committee and Board believe that there should be a balance of institutional knowledge and fresh perspectives among our Directors, and remain committed to ongoing refreshment. Notably, 50% of our Directors have joined our Board since 2015.

January 2015	May 2016	May 2019	December 2019
Margaret Georgiadis elected as Director	Enrique Hernandez, Jr. appointed as Independent Chairman   Committee Chairpersons refreshed	Compensation Committee Chairperson refreshed	Catherine Engelbert elected as Director

August 2015	January 2019	November 2019	December 2019 - May 2020
Lloyd Dean and John Mulligan elected as Directors	Paul Walsh elected as Director	Christopher Kempczinski appointed as President and CEO and elected as Director	Committee membership refreshed

Additionally, our Governance Committee reviews our Director Selection Process guidelines annually. In 2020, our Governance Committee approved updated Director Selection Process guidelines to more closely align with our values and the strategic drivers associated with Accelerating the Arches. These updates highlight important areas of focus for our Company and investors, including cybersecurity, digital business models, human capital management, DEI and sustainability.

2022 Proxy Statement 13

	Proxy Summary

Overview of Directors

Following is an overview of our Directors, each of whom is standing for re-election at our 2022 Annual Shareholders’ Meeting. Our Board unanimously recommends that you vote “FOR ALL” of our Board’s Director nominees on the WHITE proxy card. Additional information regarding our Director nominees begins on page 23.

					Standing Committee Membership						Other Public
	Name	Director Since	Primary Occupation	Independent	AFC	CC	GC	SCR	PPS	EC	Company Boards
	Lloyd Dean	2015	CEO CommonSpirit Health								1
	Robert Eckert	2003	Operating Partner FFL Partners, LLC								3
	Catherine Engelbert	2019	Commissioner Women’s National Basketball Association								1
	Margaret Georgiadis	2015	CEO-Partner, Flagship Pioneering								1
	Enrique Hernandez, Jr. Independent Chairman	1996	Executive Chairman Inter-Con Security Systems, Inc.								1
	Christopher Kempczinski	2019	President and CEO McDonald’s Corporation								1
	Richard Lenny	2005	Non-executive Chairman Conagra Brands, Inc.								2
	John Mulligan	2015	EVP and COO Target Corporation								0
	Sheila Penrose	2006	Former Non-executive Chairman Jones Lang LaSalle Incorporated								1
	John Rogers, Jr.	2003	Founder, Chairman, Co-CEO and CIO Ariel Investments, LLC								3
	Paul Walsh	2019	Executive Chairman McLaren Group Limited								2
	Miles White	2009	Former Executive Chairman Abbott Laboratories								1*

* In February 2022, Caterpillar Inc. announced that Mr. White had decided not to stand for re-election to its board of directors at its 2022 annual meeting of shareholders.

AFC	Audit & Finance Committee	SCR	Sustainability & Corporate Responsibility Committee		Member
CC	Compensation Committee	PPS	Public Policy & Strategy Committee		Committee Chair
GC	Governance Committee	EC	Executive Committee		Financial Expert

14 McDonald’s
Corporation

	Proxy Summary

Executive Compensation Highlights

Our executive compensation program supports the following long-standing guiding principles, each of which drive the design, implementation and risk profile of our compensation program:

  Pay-for-performance;

  Drive business results with a focus on creating long-term shareholder value; and

  Pay competitively.

Performance-Based Compensation Philosophy

Our executives’ compensation opportunity is predominantly performance-based, consisting of both annual and long-term incentive awards subject to objective performance thresholds, as reflected in the below graphic:

93% 93% of CEO’s target total direct compensation opportunity* is performance-based 83% 83% of other named executive officers’ target total direct compensation opportunity* as a group is performance-based

* The above charts represent our CEO and other NEOs’ target total direct compensation for 2021, using their salaries, target Short-Term Incentive Plan (“STIP”) payouts, and ASC 718 values for equity awards granted in 2021.

Our Compensation Practices

What We Do

What We Do Not Do

Strong pay-for-performance alignment   Robust performance targets, and payouts under our incentive plans can vary significantly based on Company performance   Performance metrics support our growth strategy and align interests of management with interests of shareholders   STIP includes quantitative human capital metrics   Majority of total direct compensation paid over the long term   Significant stock ownership and retention requirements   Clawback provisions in equity agreements and STIP   Independent compensation consultant   Double-trigger change in control equity provisions   Annual compensation peer group review   Annual Say-on-Pay vote

Change in control agreements   Tax gross-up on perquisites   Repricing of stock options   Backdating of stock options   Encourage unreasonable risk taking   Employment agreements   Hedging or pledging

2022 Proxy Statement 15

	Proxy Summary

Compensation Program Summary for 2021

The following summarizes our key compensation elements and percentage of direct CEO pay opportunity for 2021:

	Key compensation elements and % of CEO pay opportunity	Primary metrics	Key terms
		N/A	Based on competitive considerations, scope of responsibilities, individual performance, tenure in position, internal pay equity and the effect on our general and administrative expenses
		Operating income growth (42.5%)   Systemwide sales growth (42.5%)   Human capital metrics (15%) NEW	Operating income growth requires our Company to balance increases in revenue with financial discipline to produce strong margins and a high level of cash flow    Systemwide sales is an important metric in a franchise business as income generation is closely correlated to sales growth and is also a measure of the financial health of our franchisees    Incorporated quantitative human capital metrics in 2021    Payouts are limited to 200% of the target award
	Performance-Based Restricted Stock Units (“PRSUs”)	Earnings per share (EPS) growth (75%)   Return on invested capital (ROIC) (25%)   Relative total shareholder return (TSR) (+/- 25 points)	Provide the right to receive a share of our common stock at the end of a three-year service period, subject to our Company’s achievement of two key financial metrics, EPS and ROIC    Also subject to a modifier based on relative TSR over the performance period compared to the S&P 500 Index    Payouts are limited to 200% of the target award    See page 71 for more information on PRSU metrics
	Stock Options	Share price increase	Provide value only if our share price increases (with an exercise price equaling the stock price on the grant date), which closely aligns executive pay with shareholder interests    Vest ratably 25% per year with a 10-year term

Commitment to Our Pay-for-Performance Philosophy

As a result of strong top and bottom-line financial results across the world, our NEOs nearly achieved the maximum payout factor with a Corporate STIP of 184.9% (inclusive of both financial and human capital metrics). However, the PRSUs that vested in early 2022 paid out below target (66.7%) due to the impact of the COVID-19 pandemic on our 2020 performance (despite strong performance in 2019 and 2021). These payouts demonstrate our Compensation Committee’s commitment to align payouts with Company performance over different time periods in order to drive long-term value creation for our shareholders.

16 McDonald’s
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	Proxy Summary

Voting Matters and Recommendations

We are asking shareholders to vote on the following matters at our 2022 Annual Shareholders’ Meeting:

Item to be Voted on		Our Board’s Voting Recommendation	Page
Management Proposals
Proposal 1	Election of 12 Directors to serve until the 2023 Annual Meeting of Shareholders of the Company and until such Directors’ successors shall have been elected and qualified	“FOR ALL” OF OUR BOARD’S DIRECTOR NOMINEES	22
Proposal 2	Advisory vote to approve executive compensation	“FOR”	60
Proposal 3	Advisory vote to approve the appointment of Ernst & Young LLP as our independent auditor for 2022	“FOR”	87
Shareholder Proposals
Proposals 4 – 10	Advisory vote on seven shareholder proposals, each only if properly presented	“AGAINST” EACH SHAREHOLDER PROPOSAL	90

Your vote is extremely important. Our Board unanimously recommends that you vote “FOR ALL” of our Board’s Director nominees on the WHITE proxy card and in accordance with our Board’s recommendation on each other proposal properly presented at the meeting. Our Board does NOT endorse any of the Icahn Group’s nominees. Our Board urges you to disregard any materials, including any gold proxy card, that may be sent to you by the Icahn Group.

Forward-Looking Statements and Website Links

This Proxy Statement contains forward-looking statements about future events and circumstances. Generally speaking, any statement not based upon historical fact is a forward-looking statement. Forward-looking statements can also be identified by the use of forward-looking or conditional words such as “could,” “should,” “can,” “continue,” “estimate,” “forecast,” “intend,” “look,” “may,” “will,” “expect,” “believe,” “anticipate,” “plan,” “remain,” “confident” and “commit” or similar expressions. In particular, statements regarding our plans, strategies, prospects and expectations regarding our business and industry are forward-looking statements. They reflect our expectations, are not guarantees of performance and speak only as of the date of this Proxy Statement. Except as required by law, we do not undertake to update such forward-looking statements. You should not rely unduly on forward-looking statements. Our business results are subject to a variety of risks, including those that are described in our 2021 Annual Report on Form 10-K and elsewhere in our filings with the Securities and Exchange Commission (the “SEC”). If any of these considerations or risks materialize or intensify, our expectations (or underlying assumptions) may change and our performance may be adversely affected.

Website links included in this Proxy Statement are for convenience only. Information contained on or accessible through such website links is not incorporated herein and does not constitute a part of this Proxy Statement.

2022 Proxy Statement 17

Background of the Solicitation

McDonald’s is committed to understanding and effectively managing environmental, social responsibility and governance (“ESG”) issues, including animal health and welfare considerations, through ongoing stakeholder engagement and robust governance structures. The Board of Directors, together with its long-standing Sustainability and Corporate Responsibility Committee (the “SCR Committee”), provides oversight of the Company’s business, operations, management and ESG commitments, which encompass McDonald’s animal health and welfare policies. McDonald’s continuously gathers internal and external insights to help evolve its ESG strategy, regularly reviews these issues and actively works towards relevant and aspirational ESG goals. The Company’s ESG tracking and reporting processes reflect input from stakeholders and are well-regarded by the investment community.

In February 2012, McDonald’s announced that it would require its U.S. pork suppliers to outline their plans to phase out the use of sow gestation stalls. Later, in May 2012, the Company communicated its goal of sourcing all pork for its U.S. business from U.S.-based producers that did not house pregnant sows in gestation stalls by the end of 2022. As an interim step, McDonald’s committed that by 2017, it would seek to source pork for its U.S. business only from U.S.-based producers who shared its commitment to phase out the use of gestation stalls for pregnant sows. These 2012 statements are collectively referred to as the “2012 Commitment.”

Confirmation of sow pregnancy typically occurs within four to six weeks after insemination and veterinary scientists believe that, within the context of commercial-scale agriculture, it is beneficial for the safety of the sows and viability of the embryos for inseminated sows to be isolated and kept out of group housing during this four-to-six-week period. In addition to these veterinary health considerations, sow safety and embryo viability are an important determinant of the commercial viability of sow breeding and farrowing operations and vital to ensuring affordability in pork production at the scale of U.S. consumer demand. Based on these considerations, after consulting with animal welfare advocates, agricultural experts and independent veterinary scientists, in 2012, McDonald’s began informing its U.S. pork processors and suppliers that if a sow was confirmed to be pregnant, then the producer would be required to remove that sow from a gestation stall and place it in group housing.

Because McDonald’s is not itself a pork supplier or farmer and because it only purchases approximately 1% of U.S.-produced pork, the success of the 2012 Commitment has always been dependent on the Company’s ability to source pork from suppliers and farmers who share the same vision and are able to comply with the 2012 Commitment.

Between 2012 and 2017, McDonald’s continued to engage with its suppliers and other partners to implement the 2012 Commitment. During this period, as part of the Company’s engagement with stakeholders, the Company held a number of discussions with the Humane Society of the United States (“HSUS”) regarding a range of animal health and welfare issues, including the Company’s sow gestation stalls commitment.

By 2017, McDonald’s had fulfilled its interim commitment to cease sourcing pork for its U.S. business from producers who did not share the 2012 Commitment.

McDonald’s continued to make significant progress on its 2012 Commitment between 2017 and 2021, increasing its sourcing volumes from producers who did not use gestation stalls for confirmed pregnant sows.

In August 2021, McDonald’s publicly disclosed that, because of disruptions caused by the COVID-19 pandemic and the African Swine Fever outbreak, the Company had encountered delays toward achieving its conversion rates with respect to its 2012 Commitment. In January 2022, McDonald’s announced that as a result of these disruptions, it was necessary to extend the timeline to meet the 2012 Commitment from the end of 2022 to the end of 2024.

On October 6, 2021, Matthew Prescott, Senior Director of Food & Agriculture at HSUS, informed McDonald’s that HSUS intended to submit a shareholder proposal for inclusion in McDonald’s Proxy Statement for the Company’s upcoming 2022 Annual Shareholders’ Meeting (the “HSUS Proposal”).

18 McDonald’s
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Background of the Solicitation

Following Mr. Prescott’s email, between October 2021 and March 2022, members of McDonald’s management team communicated through numerous emails, telephone calls and virtual meetings with representatives of HSUS. The discussions focused on the ongoing implementation of the 2012 Commitment and additional matters raised by HSUS.

On November 9, 2021, HSUS submitted to Desiree Ralls-Morrison, Executive Vice President, General Counsel and Corporate Secretary of McDonald’s, the HSUS Proposal, which is included as Proposal 7 in this Proxy Statement. The resolution included in the HSUS Proposal requests that, among other things, the Company confirm that the confinement of gestating pigs in individual stalls would be eliminated from its U.S. pork supply chain by 2022.

Between November 12, 2021 and January 6, 2022, Jeffrey Pochowicz, McDonald’s Senior Director of Corporate Governance and Assistant Secretary, Jennifer McColloch, McDonald’s Vice President and Chief Sustainability Officer, and other subject matter experts at the Company, twice met virtually with Mr. Prescott regarding the subject matter of the HSUS Proposal. The Company conveyed to Mr. Prescott the progress it has made toward fulfilling its 2021 Commitment, and the circumstances that led to the extension of the timeline to 2024.

On January 12, 2022, Carl Icahn called Mr. Pochowicz and indicated that he had been collaborating with HSUS on the HSUS Proposal, and that he planned to nominate two directors for election to the McDonald’s Board of Directors at the Company’s upcoming 2022 Annual Shareholders’ Meeting in connection therewith. On January 13, 2022, Christopher Kempczinski, President and Chief Executive Officer of McDonald’s and a member of the Board of Directors, had a telephone call with Messrs. Icahn and Prescott and Josh Balk, Vice President of Farm Animal Protection at HSUS. The participants discussed the matters raised in the HSUS Proposal and Mr. Icahn’s statement regarding director nominations. A further conversation took place on January 18, 2022 between Mr. Kempczinski and Mr. Icahn with respect to a letter from HSUS about the use of gestation stalls in its supply chain.

On January 19, 2022, Icahn Partners LP (“Icahn Partners”) sent a letter to Ms. Ralls-Morrison, in her capacity as McDonald’s Corporate Secretary, requesting McDonald’s form of director questionnaire and representation agreement required to be completed by an individual to be eligible as a nominee for election to the McDonald’s Board of Directors. These documents were provided to Icahn Partners on January 21, 2022.

On January 24, 2022, Enrique Hernandez, Jr., Chairman of the Board of Directors, and Mr. Kempczinski, had a virtual meeting with Mr. Icahn to discuss the matters raised by Mr. Icahn and HSUS, where Mr. Icahn asked about oversight of the 2012 Commitment.

On January 26, 2022, in response to Mr. Icahn’s request, McDonald’s delivered a letter from Mr. Kempczinski to Mr. Icahn. In this letter, Mr. Kempczinski explained that McDonald’s had a robust process to ensure that U.S. pork suppliers could demonstrate compliance with the 2012 Commitment, including requiring all suppliers to be able to trace pork raw materials back to the farm of origin and to report on their compliance with each shipment of raw materials. Mr. Kempczinski further explained that the Company’s tracking, reporting and governance process around the 2012 Commitment followed the same quality, accountability and transparency standards that governed all of McDonald’s ESG information and goals, including commonly accepted sustainability reporting frameworks to guide its reporting. Additionally, Mr. Kempczinski communicated to Mr. Icahn that McDonald’s also issued an annual Purpose and Impact Report to disclose ESG information and progress against the Company’s public goals. Finally, the letter emphasized that the McDonald’s Board of Directors, together with the SCR Committee, exercised rigorous oversight over the Company’s ESG disclosures and progress.

On February 1, 2022, McDonald’s held a conversation with HSUS that included Francesca DeBiase, Executive Vice President and Chief Global Supply Chain Officer, Katie Beirne Fallon, Executive Vice President and Chief Global Impact Officer, and Claire DiMattina, Senior Director, Public Policy. During this meeting, HSUS stated that its objective was for McDonald’s to completely eliminate the use of all gestation stalls in its worldwide pork supply chain. Representatives from McDonald’s responded that HSUS demands departed from the 2012 Commitment.

2022 Proxy Statement 19

Background of the Solicitation

On February 3, 2022, Mr. Icahn delivered a letter to Mr. Kempczinski. In this letter, Mr. Icahn stated that he would like McDonald’s to agree to all of the following:

1.	100% of national supply chain compliance with “part 1” of Proposition 12 [the California law regarding farm animal confinement] procurement standard by the end of 2023 (“part 1” referring to the language that “prohibits animals from being confined in a manner that prevents lying down, standing up, fully extending limbs or turning around freely”);
2.	100% of global supply chain compliance with “part 1” of proposition 12 procurement standard by 2024;
3.	100% of national supply chain compliance with “part 1” and “part 2” of proposition 12 procurement standard by 2025 (part 2 referring to the language that “prohibits confining a breeding pig with less than 24 square feet of usable floor space per pig”);
4.	100% of global supply chain compliance with “part 1” and “part 2” of proposition 12 procurement standard by 2026;
5.	SASB [(Sustainability Accounting Standards Board)] disclosure in accordance with the “Meat, Poultry & Dairy Industry” standard FB-MP-41 0a.1 which requests disclosure of the “percentage of pork produced without the use of gestation crates.” I did notice that under FB-FR-430a.2 in your current SASB disclosure, you reported progress towards the 2012 commitment but fail to disclose the “percentage of revenue from pork produced without the use of gestation crates” but I believe the “Meat, Poultry & Dairy Industry” standard is more appropriate in this context as it requests the disclosure of “percentage of pork produced without the use of gestation crates.” (To be clear, not the percentage of pork from reduced gestation crate usage which is what you currently report to SASB.)
6.	Two board designees for compliance verification; and
7.	Agreed upon public facing pledge that outlines McDonalds’ updated standards which comply with those set forth in Proposition 12.

Between February 4 and February 11, 2022, representatives of McDonald’s continued to discuss with HSUS the challenges with respect to the feasibility of completely eliminating the use of all gestation stalls in its supply chain while meeting customer demands. Such representatives also engaged with numerous pork producers, including those identified by HSUS, with respect to supplier availability.

On February 11, 2022, Scott Barshay of Paul, Weiss, Rifkind, Wharton & Garrison LLP, McDonald’s outside counsel, had a telephonic conference with Jesse Lynn, the General Counsel of Icahn Enterprises L.P. During the call, Messrs. Barshay and Lynn discussed the different views held by McDonald’s and Mr. Icahn.

On February 14, 2022, Mr. Barshay had a telephonic conference with Messrs. Icahn and Lynn. During this meeting, Mr. Icahn reiterated his views regarding the 2012 Commitment and the matters raised by HSUS, and Mr. Barshay explained McDonald’s position on these matters.

On February 16, 2022, Mr. Icahn discussed his views on McDonald’s acquisition of gestation stall-free pork in an interview on the Bloomberg Television network in which he stated “[w]e are probably 90% there from putting up a slate. You know, we’re not going to fool around with them anymore.”

On February 19, 2022, Barberry Corp., an investment firm controlled by Mr. Icahn, delivered, on behalf of itself and Mr. Icahn, a Notice of Nomination of Directors at the 2022 Annual Shareholders’ Meeting to Ms. Ralls-Morrison, nominating Maisie Ganzler and Leslie Samuelrich to stand for election of McDonald’s Board of Directors at the Company’s upcoming 2022 Annual Shareholders’ Meeting. The Company issued a press release with respect to the nomination on the following day.

20 McDonald’s
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Background of the Solicitation

On March 11, 2022, a representative of McDonald’s emailed Mr. Prescott to inform him that McDonald’s planned to include the HSUS Proposal in the Proxy Statement and also provided HSUS with a copy of the “Statement in Opposition” which follows Proposal 7 in this Proxy Statement.

On March 21, 2022, members of the Governance Committee of the McDonald’s Board of Directors (the “Governance Committee”) conducted virtual interviews with each of Mmes. Ganzler and Samuelrich.

On March 23, 2022, the Governance Committee held a regularly scheduled meeting to consider and discuss the credentials, qualifications, skill sets and past experience of director candidates. As part of this work, the Governance Committee reviewed the backgrounds and qualifications of the two candidates that had been nominated by Mr. Icahn. Following extensive discussion, the Governance Committee determined, based upon certain of its members’ interviews with Mmes. Ganzler and Samuelrich, and its review of biographical and other information with respect to the nominees provided in questionnaires and obtained through public records, that neither of Mmes. Ganzler and Samuelrich possessed the experience, expertise or qualifications that would allow them to add meaningful value with respect to the large majority of issues regularly faced by the McDonald’s Board of Directors. In particular, neither Ms. Ganzler nor Ms. Samuelrich has the knowledge or context that a candidate who has led a large corporation or had other “C-suite” experience or served on a public company board would have. Additionally, neither candidate has multinational or international experience or context or has significant experience or expertise on financial or complex supply chain issues. As such, the Governance Committee declined to recommend either of Mmes. Ganzler or Samuelrich be included in the Board of Director’s slate of director nominees for the Company’s 2022 Annual Shareholders’ Meeting.

On March 24, 2022, the McDonald’s Board of Directors held a regularly scheduled meeting at which the Governance Committee reported on its review of, and recommendations with respect to, each of Mmes. Ganzler and Samuelrich. Following extensive discussion, the Board determined to accept the recommendation of the Governance Committee that neither of the Icahn nominees be included in the Board of Director’s slate of director nominees for the Company’s 2022 Annual Shareholders’ Meeting.

Also on March 24, 2022, following the completion of the meeting of the McDonald’s Board of Directors, Mr. Barshay contacted Mr. Lynn to inform him that the McDonald’s Board of Directors had determined not to include either of Ms. Ganzler or Ms. Samuelrich as part of its slate of director nominees for the Company’s 2022 Annual Shareholders’ Meeting.

On March 28, 2022, McDonald’s filed its preliminary Proxy Statement with the SEC.

On April 4, 2022, the Icahn Group filed its preliminary proxy statement with the SEC.

On April 8, 2022, McDonald’s filed its definitive Proxy Statement with the SEC.

2022 Proxy Statement 21

Election of Directors

	Election of Directors Our Board unanimously recommends ALL of our Board’s Director nominees for election to our Board for a one-year term beginning in May 2022 and continuing until our 2023 Annual Shareholders’ Meeting and until their successors have been elected and qualified:
	Lloyd Dean	Margaret Georgiadis	Richard Lenny	John Rogers, Jr.
	Robert Eckert	Enrique Hernandez, Jr.	John Mulligan	Paul Walsh
	Catherine Engelbert	Christopher Kempczinski	Sheila Penrose	Miles White

  Our Board unanimously recommends a vote “FOR ALL” of our Board’s 12 Director nominees.

Contested Election

We encourage you to vote by proxy using your WHITE proxy card or WHITE voting instruction form as promptly as possible, even if you plan to attend our virtual 2022 Annual Shareholders’ Meeting. Our Board unanimously recommends that you vote “FOR ALL” of our Board’s Director nominees on the WHITE proxy card or WHITE voting instruction form.

Our Board does NOT endorse any of the Icahn Group’s nominees and strongly recommends that you disregard any materials, including any gold proxy card, that may be sent to you by the Icahn Group. Importantly, voting on a gold proxy card to “withhold” with respect to any of the Icahn Group’s nominees is NOT the same as voting “FOR” our Board’s Director nominees. This is because a vote on a gold proxy card to “withhold” with respect to any of the Icahn Group’s nominees will revoke any WHITE proxy card or WHITE voting instruction form you may have previously submitted. To support our Board’s Director nominees, you should vote “FOR ALL” of our Board’s Director nominees on your WHITE proxy card or WHITE voting instruction form.

If you have already voted using a gold proxy card, you can revoke that proxy any time before it is exercised at the meeting by (i) following the instructions on your WHITE proxy card or WHITE voting instruction form to vote by internet or telephone, (ii) marking, dating, signing and returning your WHITE proxy card or WHITE voting instruction form in the postage-paid envelope provided or (iii) voting at the meeting. Only your latest dated, validly executed proxy counts.

Election Mechanics

The Icahn Group has notified us that it intends to nominate two candidates for election to our Board at our 2022 Annual Shareholders’ Meeting, and such nominations were not withdrawn on or prior to the 10^th day before the date we first mailed the notice of the meeting to our shareholders. As a result, Director nominees will be elected by a plurality of votes cast, and the 12 Director nominees who receive the greatest number of votes will be elected to our Board for the following year. Any shares not voted “FOR” a particular Director nominee, whether as a result of a withhold vote or a broker non-vote (if applicable), will not be counted in that Director nominee’s favor and will not otherwise affect the outcome of the election (except to the extent they reduce the number of shares voted “FOR” such Director nominee).

All of our Director nominees have given their consent to be named as nominees for election and have indicated their intention to serve if they are elected. Our Board does not anticipate that any of our Director nominees will be unable to serve as a Director. If for some reason any of our Board’s Director nominees are unable to serve, or for good cause will not serve if elected, the persons named as proxies may vote for a substitute nominee recommended by our Board and, unless you indicate otherwise on the WHITE proxy card, your shares will be voted in favor of our Board’s remaining nominees. In the alternative, our Board may reduce the size of our Board, as permitted by our By-Laws. If any substitute nominees are designated prior to the meeting, we will file an amended proxy statement that, as applicable, identifies such nominees, discloses that such nominees have consented to being named in the amended proxy statement and to serve if elected, and sets forth certain biographical and other information about such nominees as required by SEC rules.

22 McDonald’s
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Election of Directors

Director Qualifications

Our Board is comprised of a diverse, highly engaged group of individuals that provides strong, effective oversight of our Company. Both individually and collectively, our Directors have the qualifications, skills and experience that are relevant to and contribute to our Board’s oversight of our Company’s global operations and long-term priorities, including our Accelerating the Arches growth strategy.

Importantly, each Director has senior executive experience, including having served as CEOs or high-level executives of large, complex, global organizations. Specifically, several Directors have leadership experience in the consumer products or food sectors, which is particularly relevant to our business as a leading global food service retailer. Our Board values expertise in our industry, information technology/cybersecurity, human capital management, DEI and sustainability matters, which continue to be important to Accelerating the Arches and focus areas for investors and other stakeholders. This experience, along with the other skills and attributes discussed below and described more fully in our Director Selection Process guidelines, is a key consideration in evaluating the composition of our Board.

Our Director nominees’ individual skills and experiences are set forth on the following pages. In addition, all of our Director nominees demonstrate the following qualities:

  Key Attributes and Skills of All Director Nominees

  High integrity and business ethics   Strength of character and judgment   Ability to devote significant time to Board duties   Desire and ability to continually build expertise in emerging areas of strategic focus for our Company   Demonstrated focus on promoting equality   Business and professional achievements   Ability to represent the interests of all shareholders   Knowledge of corporate governance matters   Understanding of the advisory and proactive oversight responsibility of our Board   Comprehension of their role as a public company director and the fiduciary duties owed to shareholders   Intellectual and analytical skills

2022 Proxy Statement 23

Election of Directors

In addition, our Director nominees contribute to our Board the individual experiences, qualifications and skills, as shown in the following matrix. The skills identified in the matrix are intended as a high-level summary and not an exhaustive list. The matrix is intended to depict notable areas of focus for each Director nominee, and not having a mark does not mean that a particular Director nominee does not possess that experience, qualification or skill. Director nominees have acquired these experiences, qualifications and skills through education, direct experience and oversight responsibilities. For information on our Board diversity, see page 38.

BRAND MANAGEMENT: Contributes to an understanding of how our business, standards and performance are essential to protecting and increasing the value of the McDonald’s brand

CUSTOMER-CENTRIC: Provides an understanding of our business, operations and customer-centric Accelerating the Arches growth strategy, focusing on our purpose, values and growth pillars

DIGITAL: Provides an understanding of how the 3 D’s (digital, delivery and drive-thru) leverage competitive strengths

FINANCE/CAPITAL MARKETS: Supports the oversight of our financial statements and strategy and financial reporting to investors and other stakeholders

GLOBAL EXPERIENCE: Contributes to an understanding of how our business is structured to enable the right level of support for our international markets, as well as the sharing of solutions across international markets

HUMAN CAPITAL MANAGEMENT: Provides an understanding of how we manage and develop our workforce, and how we focus on promoting equality throughout the organization

INFORMATION TECHNOLOGY/CYBERSECURITY: Contributes to an understanding of information technology capabilities, cloud computing, scalable data analytics and risks associated with cybersecurity matters

MARKETING: Provides awareness of culturally relevant approaches that effectively communicate the story of our brand, food and purpose

OTHER PUBLIC COMPANY BOARD: Demonstrates a practical understanding of organizations, processes, governance and oversight of strategy, risk management and growth

REAL ESTATE: Provides an understanding of how owning or leasing real estate, combined with co-investment by franchisees, enables us to achieve high restaurant performance levels

SUSTAINABILITY/CORPORATE RESPONSIBILITY: Contributes to an understanding of sustainability issues and corporate responsibility, and their relationship to our business and strategy

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Election of Directors

Further biographical information about each Director nominee, including his or her professional experience, Committee memberships, qualifications and other directorships is set forth on the following pages.

Biographical Information

Lloyd Dean | 71   INDEPENDENT
Chief Executive Officer	Director Since	Board Committees
CommonSpirit Health	2015	Audit & Finance, Compensation
Professional Experience: CommonSpirit Health, a non-profit, Catholic health system    Chief Executive Officer (2019 – Present) Dignity Health, one of the nation’s largest healthcare systems    President and Chief Executive Officer (2000 – 2019) Advocate Health Care, a healthcare organization    Chief Operating Officer (1997 – 2000) Director Qualifications: Mr. Dean brings to our Board over 25 years of leadership, management and strategy experience, which contributes an important perspective to our Board’s discussions of opportunities and challenges in a constantly changing business environment. In his career in executive management at leading healthcare organizations, Mr. Dean has led significant strategic, operational and financial transformations. Mr. Dean’s healthcare experience and knowledge of health and safety risks has enhanced his ability to oversee human capital management, particularly in light of the COVID-19 pandemic. Our Board also benefits from Mr. Dean’s finance, systems operations, service quality, human resources, customer-centric operations, community affairs, healthcare and regulatory experience. In addition, Mr. Dean’s qualification as an “audit committee financial expert” is an important attribute as a member of our Audit & Finance Committee. Other Directorships: Mr. Dean also serves on the board of Golden Arrow Merger Corp. Mr. Dean previously served on the board of Wells Fargo & Company.

Skills and Qualifications
Brand Management	Human Capital Management
Customer- Centric	Other Public Company Board
Finance/Capital Markets	Sustainability/ Corporate Responsibility

2022 Proxy Statement 25

Election of Directors

Robert Eckert | 67   INDEPENDENT
Operating Partner	Director Since	Board Committees
FFL Partners, LLC	2003	Public Policy & Strategy (Chair since 2016), Governance, Executive
Professional Experience: FFL Partners, LLC, a private equity firm    Operating Partner (2014 – Present) Mattel, Inc., a leading global toy company and entertainment franchise Chairman Emeritus (2013 – Present) Chairman of the Board (2000 – 2012)    Chief Executive Officer (2000 – 2011) Kraft Foods Inc., a packaged food company    President and Chief Executive Officer (1997 – 2000) Director Qualifications: Mr. Eckert brings to our Board an extensive understanding of business and product development, marketing, supply chain management and distribution, and consumer behavior gained from his experience as chief executive officer of large, global consumer brands and food companies with high performance expectations. In addition, through his role on other companies’ boards, Mr. Eckert has extensive experience in corporate governance, leadership development and succession planning, and finance. Other Directorships: Mr. Eckert also serves as the lead independent director of Amgen Inc., as chairman of the board of Levi Strauss & Co. and as a director of Uber Technologies, Inc.

Skills and Qualifications
Brand Management Customer- Centric Digital Finance/Capital Markets Global Experience	Human Capital Management Marketing Other Public Company Board Sustainability/ Corporate Responsibility

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Election of Directors

Catherine Engelbert | 57   INDEPENDENT
Commissioner	Director Since	Board Committee
Women’s National Basketball Association	2019	Audit & Finance, Public Policy & Strategy
Professional Experience: Women’s National Basketball Association (WNBA), a professional basketball league    Commissioner (2019 – Present) Deloitte LLP, an industry-leading audit, consulting, tax and advisory services firm    Chief Executive Officer (2015 – 2019) Deloitte & Touche LLP, audit subsidiary of Deloitte LLP    Chairman and Chief Executive Officer (2014 – 2015)    Partner (1998 – 2019) Director Qualifications: Ms. Engelbert brings to our Board a wealth of experience in global business operations, finance, leadership, brand, customer strategy, financial reporting and internal controls, and risk management matters having served as Commissioner of a professional sports league and as former chief executive officer of Deloitte LLP. Having led a firm of 100,000 professionals at Deloitte, she also provides our Board valuable insights on talent management and other human capital management matters. Ms. Engelbert also has strong leadership and governance experience from her previous roles on the private company board of Deloitte LLP and as chairman and chief executive officer of Deloitte & Touche LLP, and valuable regulatory experience from her roles on the Strategic Investment, Risk, Regulatory & Government Relations, and Finance & Audit Committees of the board of Deloitte LLP. As a certified public accountant, Ms. Engelbert further brings to our Board a deep understanding of accounting principles and financial reporting rules and regulations and her qualification as an “audit committee financial expert” is an important attribute as a member of our Audit & Finance Committee. Other Directorships: Ms. Engelbert also serves on the board of Royalty Pharma plc.

Skills and Qualifications
Brand Management	Global Experience
Customer- Centric	Human Capital Management
Digital	Marketing
Finance/Capital Markets	Other Public Company Board

2022 Proxy Statement 27

Election of Directors

Margaret Georgiadis | 58   INDEPENDENT
CEO-Partner	Director Since	Board Committees
Flagship Pioneering	2015	Audit & Finance, Sustainability & Corporate Responsibility
Professional Experience: Flagship Pioneering, a bioplatform innovation company    CEO-Partner (2022 - Present) General Catalyst, a venture capital firm    Endurance Partner-in-Residence, XIR (2021 – Present) Synetro Group, a private investment and strategic advisory firm    Managing Partner (2021 – Present) Ancestry, a global family history and consumer genomics company President and Chief Executive Officer (2018 – 2020) Mattel, Inc., a leading global toy company and entertainment franchise    Chief Executive Officer (2017 – 2018) Google Inc., a global technology company    President, Americas (2011 – 2017)    Vice President, Global Sales Operations (2009 – 2011) Director Qualifications: Ms. Georgiadis brings to our Board valuable strategy and development, finance, and leadership experience gained from her senior executive roles, including at Ancestry, Mattel and Google, and her positions at a private investment and strategic advisory firm. Her prior experience as a senior executive at large global businesses affords her a broad knowledge of global consumer businesses and marketing, as well as technology and cybersecurity, digital consumer insights, e-commerce, finance, leadership, and strategy and development. Her knowledge in these and other areas provides critical insights to our business, particularly as our Board considers the impact of technology, digital and cybersecurity risks. Ms. Georgiadis also has over 15 years of analytical and strategic experience at McKinsey & Company, a global management and consulting firm. In addition, Ms. Georgiadis’ qualification as an “audit committee financial expert” is an important attribute as a member of our Audit & Finance Committee. Other Directorships: Ms. Georgiadis also serves on the board of AppLovin Corporation. Ms. Georgiadis previously served on the board of Mattel, Inc.

Skills and Qualifications
Brand Management Customer- Centric Digital Finance/Capital Markets Global Experience	Human Capital Management Information Technology/ Cybersecurity Marketing Other Public Company Board Sustainability/ Corporate Responsibility

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Election of Directors

Enrique Hernandez, Jr. | 66   INDEPENDENT CHAIRMAN(SINCE 2016)
Executive Chairman	Director Since	Board Committees
Inter-Con Security Systems, Inc.	1996	Governance, Public Policy & Strategy, Executive
Professional Experience: Inter-Con Security Systems, Inc., a provider of security services to corporations, governments, diplomatic missions and non-profit organizations    Executive Chairman (2021 – Present)    Chairman and Chief Executive Officer (1986 – 2021) Nordstrom, Inc., a leading fashion retailer    Non-Executive Chairman and Presiding Director (2006 – 2016) Director Qualifications: Mr. Hernandez is executive chairman and former chairman and chief executive officer of Inter-Con Security Systems, Inc., a privately owned global security company, providing knowledge of physical and electronic security. He also has been a director of several large public companies in various industries. In particular, Mr. Hernandez served for five years as lead director and ten years as non-executive chairman and presiding director at Nordstrom, Inc., a large publicly traded fashion retailer known for its customer service and brand management, providing him with significant experience in corporate governance, leadership development, succession planning and finance. Through his extensive experience managing complex, people-oriented organizations, Mr. Hernandez is well-suited to oversee the important human capital management element of our business. Mr. Hernandez’s experience also facilitates our Board’s oversight and counsel regarding strategy and business development, as well as legal and regulatory matters. Other Directorships: Mr. Hernandez also serves on the board of Chevron Corporation. Mr. Hernandez previously served on the boards of Nordstrom, Inc. and Wells Fargo & Company.

Skills and Qualifications
Brand Management	Global Experience
Customer- Centric	Human Capital Management
Digital Finance/Capital Markets	Information Technology/ Cybersecurity Other Public Company Board

2022 Proxy Statement 29

Election of Directors

Christopher Kempczinski | 53
President and Chief Executive Officer	Director Since 2019	Board Committees Executive (Chair since 2019)
McDonald’s Corporation
Professional Experience: McDonald’s Corporation    President and Chief Executive Officer (2019 – Present)    President, McDonald’s USA (2017 – 2019)    Executive Vice President – Strategy, Business Development and Innovation (2015 – 2016) The Kraft-Heinz Company, a packaged food company    Executive Vice President of Growth Initiatives and President of Kraft International (2014 – 2015)    President of Kraft Canada (2012 – 2014)    Senior Vice President – U.S. Grocery (2008 – 2012) Director Qualifications: Mr. Kempczinski is President and CEO of our Company, having previously served as President of McDonald’s USA, where he was responsible for approximately 14,000 McDonald’s restaurants. He first joined our Company in 2015, overseeing global strategy, business development and innovation. In these roles, he has been instrumental in identifying new ideas and best practices to accelerate growth to increase the overall value of the McDonald’s System. His experience leading our U.S. business and overseeing global strategy contributes an important Company perspective to our Board, and he was the architect of Accelerating the Arches. This experience and deep knowledge of the food industry strengthen our Board’s knowledge and understanding as it oversees our operations and strategy. Other Directorships: Mr. Kempczinski also serves on the board of The Procter & Gamble Company.

Skills and Qualifications
Brand Management	Human Capital Management
Customer- Centric Digital Finance/Capital Markets Global Experience	Marketing Other Public Company Board Real Estate Sustainability/ Corporate Responsibility

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Election of Directors

Richard Lenny | 70   INDEPENDENT
Non-Executive Chairman	Director Since	Board Committees
Conagra Brands, Inc.	2005	Compensation (Chair since 2019), Sustainability & Corporate Responsibility
Professional Experience: Conagra Brands, Inc., a leading branded food company    Non-Executive Chairman (2018 – Present) Information Resources, Inc., a market research firm    Non-Executive Chairman (2013 – 2018) FFL Partners, LLC, a private equity firm Senior Advisor (2014 – 2016)    Operating Partner (2011 – 2014) The Hershey Company, an industry-leading snacks company Chairman, President and Chief Executive Officer (2001 – 2007) Director Qualifications: Mr. Lenny brings to our Board extensive knowledge of strategy and business development, finance, marketing and consumer insights, supply chain management and distribution, sustainability and social responsibility matters gained from his experience as a chief executive officer of a global retail food company with a major consumer brand. He previously served in executive-level positions at Kraft Foods, Nabisco Biscuit and Snacks and the Pillsbury Company, providing him extensive experience with major consumer brands in the food industry. His current and former board leadership positions in several notable large public companies, including in one of North America’s leading food companies, give him a broad understanding of governance issues facing public companies and strong leadership insights. Other Directorships: Mr. Lenny also serves as non-executive chairman of Conagra Brands, Inc. and as the lead independent director of Illinois Tool Works Inc. Mr. Lenny previously served on the board of Discover Financial Services.

Skills and Qualifications
Brand Management	Human Capital Management
Customer- Centric Digital Finance/Capital Markets Global Experience	Marketing Other Public Company Board Sustainability/ Corporate Responsibility

2022 Proxy Statement 31

Election of Directors

John Mulligan | 56   INDEPENDENT
Executive Vice President and Chief Operating Officer Target Corporation	Director Since 2015	Board Committees Audit & Finance (Chair since 2016), Public Policy & Strategy, Executive
Professional Experience: Target Corporation, a general merchandise retailer Executive Vice President and Chief Operating Officer (2015 – Present) Executive Vice President and Chief Financial Officer (2012 – 2015) Senior Vice President, Treasury, Accounting and Operations (2010 – 2012) Director Qualifications: Mr. Mulligan brings to our Board extensive experience in finance, global supply chain, operations, e-commerce, real estate and human resources gained from his service in senior executive roles at a leading general merchandise retailer. His service at a retailer known for its focus on creating an exceptional guest experience brings customer-centric experience to our Board. In addition, his experience in digital and technology issues, including cybersecurity risks, is an important asset as our Board considers these topics and their potential impact on our Company. In addition, Mr. Mulligan’s qualification as an “audit committee financial expert” is an important attribute as our Audit & Finance Committee Chair. Other Directorships: None.

Skills and Qualifications
Brand Management	Human Capital Management
Customer- Centric Digital Finance/Capital Markets Global Experience	Information Technology/ Cybersecurity Marketing Real Estate

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Election of Directors

Sheila Penrose | 76   INDEPENDENT
Former Non-Executive Chairman	Director Since	Board Committees
Jones Lang LaSalle Incorporated	2006	Sustainability & Corporate Responsibility (Chair since 2016), Governance, Executive
Professional Experience: Boston Consulting Group, a global management consulting firm    Executive Advisor (2021 – Present; 2001 – 2008) Jones Lang LaSalle Incorporated, a leading professional services firm that specializes in real estate and investment management Non-Executive Chairman (2005 – 2020) Northern Trust Corporation, a financial services firm    President, Corporate and Institutional Services (1994 – 2000) Director Qualifications: Ms. Penrose brings to our Board extensive experience in, and knowledge of, finance and real estate, both of which are areas of significance to our Company. She is well-versed in strategy and business development, finance, and leadership development and succession planning. Ms. Penrose also has significant experience in corporate governance from her service on other public company boards, including as former non-executive chairman at Jones Lang LaSalle Incorporated. In addition, having co-founded the Corporate Leadership Center, a non-profit organization that partners with leading institutions to offer programs in executive leadership development, Ms. Penrose contributes to our Board’s strong human capital management expertise. Other Directorships: Ms. Penrose also serves on the board of Jones Lang LaSalle Incorporated.

Skills and Qualifications
Brand Management Customer- Centric Finance/Capital Markets Global Experience	Human Capital Management Marketing Other Public Company Board Real Estate Sustainability/ Corporate Responsibility

2022 Proxy Statement 33

Election of Directors

John Rogers, Jr. | 64   INDEPENDENT
Founder, Chairman, Co-Chief Executive Officer and Chief Investment Officer	Director Since 2003	Board Committees Compensation, Governance
Ariel Investments, LLC
Professional Experience: Ariel Investments, LLC, a privately held institutional money management firm    Founder, Chairman, Co-Chief Executive Officer and Chief Investment Officer (1983 – Present)    Chief Executive Officer (1983 – 2019), Co-Chief Executive Officer (2019 – Present) Ariel Investment Trust, an investment company consisting of mutual funds managed by Ariel Investments, LLC    Trustee (2000 – Present; 1986 – 1993) Director Qualifications: Mr. Rogers brings to our Board broad knowledge of finance, leadership development and succession planning, as well as strategy and business development gained from his experience as a long-serving chief executive officer of an institutional money management firm. Mr. Rogers’ investment management knowledge also provides a unique perspective on shareholder relations. Mr. Rogers is passionate about diversity, equity and inclusion and brings perspective to our Company’s corporate responsibility and community affairs initiatives. His service on other public company boards adds global, customer-centric and brand management experience to our Board. Other Directorships: Mr. Rogers also serves on the boards of Nike, Inc., The New York Times Company and Ryan Specialty Group Holdings, Inc. Mr. Rogers previously served on the board of Exelon Corporation.

Skills and Qualifications
Brand Management Customer- Centric Finance/Capital Markets Global Experience	Human Capital Management Other Public Company Board Sustainability/ Corporate Responsibility

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Election of Directors

Paul Walsh | 66    INDEPENDENT
Executive Chairman	Director Since	Board Committees
McLaren Group Limited	2019	Compensation, Sustainability & Corporate Responsibility
Professional Experience: McLaren Group Limited, a privately owned luxury automotive and technology group    Executive Chairman (2020 – Present) L.E.K. Consulting, a global strategy consulting firm    Advisor (2014 – Present) TPG Capital LLP, a private investment firm Advisor (2014 – Present) Bespoke Capital Partners LLC, an investment company    Operating Partner (2016 – 2021) Compass Group PLC, a leading food service and support services company    Chairman (2014 – 2020) Avanti Communications Group plc, a leading satellite operator providing internet and data services    Chairman (2013 – 2019) Diageo plc, a multinational beverage company    Chief Executive Officer (2000 – 2013)    Chief Operating Officer (2000) Director Qualifications: Mr. Walsh brings to our Board substantial corporate leadership experience and knowledge of consumer-centric companies gained from his experience as former chief executive officer of a large multinational corporation. His experience at Diageo brings broader food and beverage industry perspective. He also has held executive-level finance positions, including as chief financial officer of Grand Metropolitan Foods and Intercontinental Hotels. Throughout his career, Mr. Walsh has built success and growth at his companies through the deployment of effective brand marketing strategies, which brings valuable perspective to our Board. His background as a UK national based in London provides international diversity on our Board. Other Directorships: Mr. Walsh also serves as chairman of the board of Vintage Wine Estates, Inc., as non-executive chairman of Chime Communications Limited and as a director of FedEx Corporation. Mr. Walsh previously served as executive chairman of Bespoke Capital Acquisition Corp. and on the boards of Avanti Communications Group plc, Compass Group PLC, HSBC Holdings plc, RM2 International, S.A. and TPG Pace Holdings Corp.

Skills and Qualifications
Brand Management Customer- Centric Digital Finance/Capital Markets	Global Experience Human Capital Management Marketing Other Public Company Board

2022 Proxy Statement 35

Election of Directors

Miles White | 67    INDEPENDENT
Former Executive Chairman	Director Since	Board Committees
Abbott Laboratories	2009	Governance (Chair since 2014), Public Policy & Strategy, Executive
Professional Experience: Abbott Laboratories, a global healthcare company    Executive Chairman (2020 - 2021) Chairman and Chief Executive Officer (1999 - 2020) Director Qualifications: Mr. White brings to our Board extensive knowledge of strategy and business development, global operations, finance, leadership development and succession planning, corporate governance, and regulatory and public policy matters gained from his experience as former chairman and chief executive officer of a global healthcare company. Mr. White’s healthcare experience and knowledge of healthcare technology advances has also enhanced his ability to oversee human capital management, particularly in light of the COVID-19 pandemic. In addition, Abbott’s focus on developing consumer products and technologies brings customer-centric, marketing, digital and healthcare knowledge to our Board. We also benefit from Mr. White’s strong experience in addressing the needs of a global public company, as well as insights into our Board’s responsibility to oversee management and operations matters. As our Governance Committee Chair, Mr. White leads our Board’s succession planning and Director candidate selection process, and he is periodically involved in shareholder engagement. Other Directorships: Mr. White also serves on the board of Caterpillar, Inc.* Mr. White previously served as executive chairman of Abbott Laboratories. * In February 2022, Caterpillar Inc. announced that Mr. White had decided not to stand for re-election to its board of directors at its 2022 annual meeting of shareholders.

Skills and Qualifications
Brand Management Customer- Centric Digital Finance/Capital Markets	Global Experience Human Capital Management Marketing Other Public Company Board

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Board and Governance Matters

Board Leadership

Our Board has determined that having separate Chairman and CEO roles currently serves the best interests of our shareholders. Our independent Chairman oversees corporate governance matters, and our CEO leads our business. In addition, independent Directors chair each of our Board Committees (other than the Executive Committee, which is chaired by our CEO). Our Board believes that this structure promotes effective oversight, strengthens our Board’s independent leadership and supports our commitment to strong governance, each of which drives enhanced shareholder value.

Our Chairman oversees our Board and facilitates the flow of information between management and our Board. This fosters open dialogue and constructive feedback among our independent Directors and management. Further, our Chairman leads a critical evaluation of our management, business practices and culture, as well as oversight of Company strategy. Our Board assesses its leadership structure annually to confirm it continues to meet the evolving needs of our Company and best serves the interests of our shareholders.

Enrique Hernandez, Jr. was elected as our independent Chairman in May 2016 and has been re-elected as our Chairman each year since then in view of his accomplishments in this role and his extensive knowledge of our operations and governance. Mr. Hernandez has significant experience with Company strategy, business practices and management of human capital, and he has facilitated strong independent Board oversight during his tenure.

Board Composition and Succession Planning

Our Board is comprised of a diverse, highly-engaged group of Directors with a wide range of skills and experiences who each contribute to overall Board and Committee effectiveness. Each of our Directors is a dynamic leader whose experiences and perspectives are continually evolving as he or she navigates today’s fast-paced, ever-changing business environment, both as a Director of McDonald’s and in his or her other professional roles.

Our Governance Committee is primarily responsible for maintaining a strong and diverse Board through robust succession planning processes, which include recommending Directors for re-election and identifying new Director candidates who will bring complementary skills and varied perspectives to our Board. Our Governance Committee evaluates and determines the most impactful and desirable mix of characteristics, skills, experience and diversity for our Board as a whole, as well as the qualifications and attributes of individual Directors and Director candidates. When identifying new Director candidates and recommending them to the full Board, our Governance Committee considers the qualifications discussed on page 23.

Our Governance Committee strives to achieve an appropriate balance of Board continuity and refreshment through a mix of newer and longer-tenured Directors. Our Governance Committee and Board believe that a balance of institutional knowledge and perspectives from Directors who have more recently joined our Board best serves our shareholders’ interests, and that long tenure does not itself impair a Director’s independence, but often enhances a Director’s ability to apply independent judgment. While our Governance Committee and Board consider tenure in evaluating the overall effectiveness of our Board, it is not a dispositive factor. Our Governance Committee and Board also consider each Director’s availability and willingness to serve on our Board, recognizing that it is a significant time commitment.

As our strategic priorities continue to evolve and in consideration of potential retirements and departures, our Governance Committee proactively evaluates our Board’s composition and succession planning to facilitate smooth transitions and continuity of skills, experience and diversity in the boardroom.

2022 Proxy Statement 37

Board and Governance Matters

Board Diversity

Due to the global and complex nature of our business, our Board believes it is important that its composition embodies a diverse set of viewpoints and practical experiences. Our Board also believes having Directors with different genders, races and ethnicities contributes to a balanced and effective Board. Our Governance Committee and Board consider diversity in a broad sense. As later discussed, when seeking new Director candidates, our Governance Committee actively endeavors to include women, racial and/or ethnic minorities and geographically diverse persons in the candidate pool. In addition to gender, race and ethnicity, our Directors bring, among other attributes, diverse experiences, skills, perspectives and geographies. We believe this provides the skills and backgrounds that are important to drive our strategy and support our values. As shown below, 50% of our Board is currently comprised of Directors who are women or racially or ethnically diverse. See “Process for Selection of New Director Candidates” on page 39 for more information on how our Governance Committee and Board consider diversity in the Director identification and nomination process.

The following diversity matrix sets forth the self-identified diverse attributes of our Directors.

SELF-IDENTIFIED RACE/ETHNICITY

African American or Black

Hispanic or Latino

White or Caucasian

SELF-IDENTIFIED GENDER

Female

Male

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Board and Governance Matters

Process for Selection of New Director Candidates

Our Governance Committee, together with our Board, maintains a robust policy for the consideration of potential Director candidates and is responsible for establishing criteria, screening candidates and evaluating the qualifications of persons who may be considered for service as a Director, including candidates nominated or suggested by shareholders. Our Governance Committee also retains independent third-party search firms, consultants and other advisors, as appropriate, to help identify, screen and evaluate potential Director candidates and to enhance our Board’s preparedness in the event of an unplanned Director departure.

Our Director Selection Process affirms our commitment to inclusiveness by setting forth our policy of considering diversity in the Director identification and nomination process. Our Governance Committee proactively seeks diverse Director candidates to provide representation of varied backgrounds, perspectives and experience in the boardroom to support the global demands of our business. When seeking new Director candidates, our Governance Committee actively endeavors to include women, racial and/or ethnic minorities and geographically diverse persons in the candidate pool. However, our Governance Committee does not assign specific weights to any single criterion, and no particular criterion is necessarily applied to all prospective Director nominees. As part of its annual review of our Board composition and Director nominees, our Governance Committee assesses the effectiveness of its approach to diversity.

Our Governance Committee reviews our Director Selection Process annually. In 2020, our Governance Committee updated it to more closely align with our values and the strategic drivers associated with Accelerating the Arches. These updates highlight important areas of focus for our Company and investors, including cybersecurity, digital business models, sustainability, human capital management and DEI.

The following graphic more fully describes our selection process for new Directors:

Ongoing Succession Planning		Our Governance Committee considers the current and long-term needs of our evolving business and seeks potential Director candidates consistent with our Director Selection Process guidelines, in light of current Board structure, tenure, skills, diversity and experience.
Identification of Candidates		Our Governance Committee engages in a search process to identify qualified Director candidates, which includes the use of an independent search firm to assess whether candidates’ skills, experiences and backgrounds align with our business strategy and values. Our Governance Committee considers, among other attributes, the qualifications and skills described under “Director Qualifications” on page 23 and “Board Diversity” on page 38.
Meeting with  Candidates		Potential Director candidates are interviewed by our Chairman, CEO and Governance Committee Chair.
Decision and  Nomination		Our Governance Committee recommends, and our full Board nominates, the Director candidates best qualified to serve the interests of our Company and shareholders.
Election		Shareholders consider the Director nominees and elect Directors at our Annual Shareholders’ Meeting to serve one-year terms. Our Board may also elect Directors on the recommendation of our Governance Committee throughout the year when determined to be in the best interests of our Company and shareholders. In that case, such Directors would stand for re-election by shareholders the following year.

2022 Proxy Statement 39

Board and Governance Matters

Shareholders may suggest Director candidates for consideration by our Governance Committee by writing to our Governance Committee and providing the suggested candidate’s name, biographical data, qualifications and written consent to (i) be considered as a Director nominee, (ii) provide information as described in our By-Laws if requested to do so and (iii) serve as a Director if elected. Shareholders who wish to nominate Director candidates for election by shareholders at our Annual Shareholders’ Meeting may do so in accordance with the nomination provisions set forth in our By-Laws.

Our Director Selection Process is available on our website at https://corporate.mcdonalds.com/corpmcd/investors/corporate-governance/governance-resources.html.

Director Independence

Our Corporate Governance Principles require that all non-management Directors be independent under applicable law and stock exchange listing standards, as well as under our Standards on Director Independence. Independence is determined by our Board after reviewing pertinent facts and circumstances and taking into consideration all applicable laws, regulations and the listing standards of the New York Stock Exchange (the “NYSE”), as well as the requirements set forth in our Standards on Director Independence. It is important to determine that each Director is free of any relationship with our Company or management that may impair, or appear to impair, his or her ability to make independent judgments. In doing so, our Board considers relationships involving Directors and their immediate family members and relies on information derived from Company records, questionnaires and other inquiries.

The relationships reviewed by our Board in its most recent determination involved commercial relationships with companies at which Directors or their immediate family members then served as employees, officers, partners or had a 10% or more interest.

These commercial relationships involved our purchases of products and services in the ordinary course of business that were made on arm’s-length terms in amounts and under other circumstances that did not affect Director independence.

Based on its review, our Board determined that none of our non-management Directors has a material relationship with our Company and that all of them are independent. Currently, our non-management Directors are Lloyd Dean, Robert Eckert, Catherine Engelbert, Margaret Georgiadis, Enrique Hernandez, Jr., Richard Lenny, John Mulligan, Sheila Penrose, John Rogers, Jr., Paul Walsh and Miles White. Our Board determined that Christopher Kempczinski s not independent given his role as our CEO.

Our Standards on Director Independence are available on our website at https://corporate.mcdonalds.com/corpmcd/investors/corporate-governance/governance-resources.html.

Board Committees

Our Board currently has six standing Committees: Audit & Finance; Compensation; Governance; Public Policy & Strategy; Sustainability & Corporate Responsibility; and Executive. All Committee members (except for our CEO, who only serves on our Executive Committee) are independent under the rules of the NYSE and our Standards on Director Independence. In addition, Directors who serve on our Audit & Finance Committee and Compensation Committee satisfy additional, heightened independence and qualification criteria applicable to Directors serving on such Committees under NYSE listing standards.

Each Committee has the responsibilities set forth in its respective charter, all of which have been adopted by our Board. Other than our Executive Committee, all standing Committees review their respective charters at least annually, and any changes are recommended to our full Board for approval. All standing Committee charters are available on our website at https://corporate.mcdonalds.com/corpmcd/investors/corporate-governance/governance-resources.html.

The current membership and primary responsibilities of each standing Committee are summarized on the following pages. Each standing Committee also has risk oversight within its respective areas of accountability as discussed under “Risk Oversight” beginning on page 46.

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Board and Governance Matters

Audit & Finance Committee

Committee Members: John Mulligan (Chair) Lloyd Dean Catherine Engelbert Margaret Georgiadis All members are financially literate and qualify as an “audit committee financial expert” as defined by the SEC Meetings in 2021: 8 Relevant Areas of Focus:   Oversee financial reporting, accounting, control and compliance matters   Appoint, retain, compensate and evaluate our independent auditors   Review audit scope and results with independent and internal auditors   Review material financial disclosures, disclosure controls and procedures (“DCPs”) and internal controls over financial reporting (“ICFR”)   Pre-approve all audit and permitted non-audit services   Evaluate management’s processes to assess and manage enterprise risk   Oversee global compliance program, including Sarbanes-Oxley and tax compliance   Oversee financial risk and financial risk management   Oversee our financial policies and strategies, including our capital structure, dividend policy and plans for share repurchases   Oversee any investigations related to specific cybersecurity or technology incidents

Our Audit & Finance Committee establishes its meeting calendar for the following year during the fourth quarter and typically addresses the following key matters throughout the year:

2022 Proxy Statement 41

Board and Governance Matters

Compensation Committee

Committee Members: Richard Lenny (Chair) Lloyd Dean John Rogers, Jr. Paul Walsh Meetings in 2021: 5 Relevant Areas of Focus:   Oversee the design and administration of our executive compensation programs and policies   Approve business goals and objectives in compensation programs, evaluate performance and approve executive compensation   Establish, amend, review and administer our incentive plans   Review the use of compensation programs to motivate and retain executives   Assess risk associated with our executive compensation programs and corporate incentive plans   Oversight of compensation-related shareholder proposals   For more information, see “Compensation Discussion and Analysis” beginning on page 61

Our Compensation Committee establishes its meeting calendar for the following year during the fourth quarter and typically addresses the following key matters throughout the year:

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Board and Governance Matters

Governance Committee

Committee Members: Miles White (Chair) Robert Eckert Enrique Hernandez, Jr. Sheila Penrose John Rogers, Jr. Meetings in 2021: 6 Relevant Areas of Focus:   Advise as to Board structure (including composition and size), leadership and operations, as well as Committee memberships   Set criteria for Board membership   Develop Board succession plans and make recommendations to our Board on succession matters   Consider and recommend Director candidates for election, re-election or to fill vacancies   Manage responses to shareholder proposals (including oversight of governance-related shareholder proposals)   Oversee shareholder engagement   Evaluate Director and Board performance   Recommend non-management Directors’ compensation   Review Corporate Governance Principles and oversee governance risks   Consider trends in corporate governance and present recommendations to our Board, as appropriate 

Our Governance Committee establishes its meeting calendar for the following year during the fourth quarter and typically addresses the following key matters throughout the year:

2022 Proxy Statement 43

Board and Governance Matters

Public Policy & Strategy Committee

Committee Members: Robert Eckert (Chair) Catherine Engelbert Enrique Hernandez, Jr. John Mulligan Miles White Meetings in 2021: 4 Relevant Areas of Focus:   Review and monitor our long-term strategy development and implementation   Monitor global impact and reputation   Monitor trends, regulatory matters and other items that do or could materially affect our business   Oversee franchisee relations   Review and monitor government affairs, strategies and priorities   Review and monitor tax strategy   Review compliance with our Political Contributions Policy   Review employees’ compliance with our Standards of Business Conduct   Review and monitor our strategy and processes relating to cybersecurity and technology risks, and consider potential remedies to any strategic and process gaps identified by the Audit & Finance Committee   Review other risks related to public policy and strategy matters   Oversight of public policy and strategy-related shareholder proposals

Our Public Policy & Strategy Committee establishes its meeting calendar for the following year during the fourth quarter and typically addresses the following key matters throughout the year:

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Board and Governance Matters

Sustainability & Corporate Responsibility Committee

Committee Members: Sheila Penrose (Chair) Margaret Georgiadis Richard Lenny Paul Walsh Meetings in 2021: 5 Relevant Areas of Focus:   Review and monitor our strategies and efforts to address sustainability and brand trust   Oversee important sustainability priorities and other matters, including corporate philanthropy   Review and monitor the development and achievement of our sustainability goals and metrics   Review global sustainability communication plans and reporting   Review risks related to sustainability and corporate responsibility matters   Review and monitor Company culture and human capital management matters, including workplace health and safety, respectful workplace and DEI   Oversight of sustainability and corporate responsibility-related shareholder proposals

Our Sustainability & Corporate Responsibility Committee establishes its meeting calendar for the following year during the fourth quarter and typically addresses the following key matters throughout the year:

Other Committees

Our Executive Committee may exercise most Board powers during the periods between Board meetings. The members of our Executive Committee are Christopher Kempczinski (Chair), Robert Eckert, Enrique Hernandez, Jr., John Mulligan, Sheila Penrose and Miles White. Our Executive Committee did not meet during 2021.

In July 2020, our Board formed a Special Committee to oversee our Company’s legal action against our former CEO and related matters, in recognition of the importance of dedicated Board oversight on issues that pose particular risks to our Company. Our Board later expanded the Special Committee’s responsibilities to include the review and evaluation of additional claims made against our directors and officers as a result of related matters. The Special Committee met 13 times in 2021, remaining actively engaged and receiving frequent reports and updates from management and counsel. In December 2021, the Special Committee guided our Board in securing the successful resolution of the legal action against our former CEO.

2022 Proxy Statement 45

Board and Governance Matters

Board Self-Evaluation

Our Board believes that a self-evaluation process is important to its ongoing effectiveness. Our Governance Committee oversees the annual self-evaluation of our Board. The following describes the process by which our Board carried out these self-evaluations over the past year:

Annual Board and Committee Self-Evaluation		The self-evaluation process sought individual Director feedback on our Board’s role, Committee structure, relationship with management, meeting agendas, oversight of strategy and risk, and other Board-related topics.
Independent Third Party Generates Report		To protect anonymity and the integrity of our evaluation process, an independent third party compiled evaluation responses into a report for our Governance Committee Chair.
Discussion of Results		Our Governance Committee Chair presented the results of the self-evaluation to our Board.
Incorporation of Feedback		Our Board assessed the progress in the areas targeted for improvement from the prior evaluation, and developed action plans that, when implemented, would enhance our Board’s and Committees’ effectiveness over the next year. Items requiring follow-up are monitored on an ongoing basis by our Board and committees.

Board Oversight

Risk Oversight

Under our Corporate Governance Principles, our full Board is responsible for overseeing our enterprise-wide risk management (“ERM”) framework. The ERM framework is designed to identify, assess and prioritize strategic, financial and reputational risks with the potential to have a sustained impact on our Company. We periodically review the ERM framework and incorporate learnings to drive transparency and strategic decision-making. Management is responsible for the design and execution of the ERM framework. Our internal auditors also support risk identification and risk monitoring within our Company. The ERM framework leverages internal risk committees comprised of cross-functional leadership, which meet regularly to evaluate and prioritize risk in the context of Accelerating the Arches, with further escalation to our CEO, Board and/or Committees, as appropriate.

Our Board exercises oversight of the ERM framework, both as a full Board and through its standing Committees. An important element of our Board’s oversight involves regular interaction among our Board and senior management regarding our risk exposures and mitigation effects as they relate to our business strategy, operations and values. Our Board also annually reviews strategic and enterprise risks and considers, among other items, our mitigation and overall strategy, competitive landscape, capital structure and management succession planning.

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Our Board’s risk oversight process is further described as follows:

As shown in this graphic, each of our Audit & Finance, Compensation, Governance, Public Policy & Strategy and Sustainability & Corporate Responsibility Committees is responsible for overseeing risks within its respective areas of accountability. Additionally, under our Committees’ charters, each Committee has resources and access to outside advisors. The Committees report to our Board any risks that they conclude may be reasonably likely to be significant to our Company and regularly update our Board on their particular risk oversight activities. Our Board also considers evolving risks, such as those relating to talent management and ESG.

More information about specific risks we face is set forth in our filings with the SEC, as described under “Forward-Looking Statements and Website Links” on page 17.

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Strategy Oversight

Our Board believes that a fundamental understanding of our business, strategy and industry assists it in the effective discharge of its duties. As part of its oversight role, our Board regularly reviews our Company’s performance.

Our Board also holds an annual strategy session with our senior leadership team and other members of management who present our Board with important information about our strategic priorities. In 2021, our Board reaffirmed our Accelerating the Arches growth strategy, a plan which encompasses all aspects of our business as the leading global omni-channel restaurant brand. It also articulates our purpose to feed and foster the communities we and our franchisees serve around the world, values that define us and guide our actions and behaviors, and growth pillars that build on our competitive advantages.

Our Board’s engagement in our business and oversight of our strategy provides it with important perspectives for the ever-changing business environment.

Information Security Oversight

Our Public Policy & Strategy Committee has oversight of our strategy and processes relating to information risk management, including risks related to cybersecurity, data privacy and technology, and considers potential remedies to any strategic or process gaps that may be identified by our Audit & Finance Committee during its review of any specific cybersecurity or technology incidents. Our Global Chief Information Officer and Chief Information Security Officer biannually report to our Public Policy & Strategy Committee on cybersecurity and other technology-related risks and recent developments. These officers oversee our dedicated information risk management team, which works in partnership with our internal audit department to review information technology-related internal controls with our independent auditors as part of the overall internal controls process. Annual third-party security measure assessments are also conducted, including penetration testing and an overall review of program maturity using applicable security frameworks. We also maintain a cyber insurance policy designed to reduce the risk of loss resulting from security breaches.

ESG Oversight

We have a long history of commitment to incorporating environmentally sustainable and socially responsible practices into our business operations. Our Sustainability & Corporate Responsibility Committee monitors and oversees our strategies and management of ESG issues, as well as our development and achievement of sustainability goals and metrics. Our Sustainability & Corporate Responsibility Committee regularly reports to our Board regarding its activities. In addition, from time to time as circumstances warrant, other Committees and/or our full Board receive reports on our management of ESG issues.

Talent Management and Succession Planning

Our human capital management and succession planning, including initiatives relating to promoting diversity within our workforce and across the System, are important components of our strategy. Attracting, developing and retaining talent is key to our ability to continue to drive long-term sustainable growth. Our Sustainability & Corporate Responsibility Committee is responsible for reviewing and monitoring Company culture and human capital management matters, including workplace health and safety, respectful workplace and DEI.

We strive to ensure a diverse succession slate and consider DEI in succession planning discussions. To that end, our Board regularly reviews short- and long-term succession plans for our CEO and other senior leadership positions. In assessing possible CEO and other senior leadership candidates, our independent Directors identify the skills, experiences and attributes they believe are required to be an effective leader in light of our global business strategies,

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opportunities and challenges. This process is designed to prepare us for both expected successions, such as those arising from anticipated retirements and those occurring when executives leave unexpectedly or due to death, disability or other unforeseen events.

In 2021, Desiree Ralls-Morrison joined McDonald’s as General Counsel and Corporate Secretary, Morgan Flatley became our Global Chief Marketing Officer and Manu Steijaert became our first-ever Chief Customer Officer.

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Board and Governance Matters

ESG: Our Purpose & Impact

Our purpose at McDonald’s is to feed and foster communities. When we say “billions served,” we are talking about serving our communities, customers, crew, franchisees, suppliers, producers and farmers. We believe there is a difference between being in a community and being part of one.

As part of our Accelerating the Arches strategy, we have prioritized our role and commitment in the communities we serve to focus on four areas: food quality & sourcing; our planet; community connection; and jobs, inclusion & empowerment. These focus areas and related highlights are summarized below. More information on these topics, as well as on our impact strategies, goals and performance tracking, can be found on the “Our Purpose & Impact” section of our website at https://corporate.mcdonalds.com/corpmcd/our-purpose-and-impact.html.

Food Quality and Sourcing

The safety and quality of our food is a top priority. We source delicious, quality ingredients in responsible ways because how our food is produced, and where it comes from, matters to our customers, communities and the environment. This includes supporting farming communities and the people, locally and globally, who produce and raise our food.

By engaging and partnering with our supply chain, comprised of a global network of suppliers, producers and farmers, we work together toward commitments that support more sustainable production, so we can continue to serve our customers delicious meals they know and love.

Our food quality & sourcing initiatives are focused on the following areas:

Food Safety. We work closely in collaboration with a robust network of suppliers, producers and farmers to ensure safe food is the number one priority for everyone in our value chain. Our Global Food Safety Strategy ensures we integrate food safety into the design of food, packaging, equipment, restaurants, operational procedures and employee training. Our Global Food Safety Structure provides dedicated resources in global food safety risk management and food safety standard development and training.

Nutrition & Marketing Practices. We constantly evaluate our menu to identify ways to evolve our offerings while maintaining the great taste our customers know and love. We have a team of food experts who are passionate about food and looking for the latest flavor and ingredient innovations. We are also proud of our long history as an industry leader in responsible marketing to children. We recognize the role we play as a global food company and are actively involved in self-regulation focused on this important issue.

Responsible Sourcing. We approach responsible sourcing holistically, considering our impact on the planet, the livelihoods of the people who produce our food, the communities in which they live and the well-being of the animals on which we rely. We set standards for our sourcing, including in our Supplier Code of Conduct, and engage closely with our supply chain to ensure these standards are upheld. We want to ensure that our sustainable sourcing programs drive lasting, meaningful outcomes on critical issues for people, animals, the environment and our business.

Animal Health & Welfare. Because our ability to serve safe, quality food comes from animals that are cared for properly, we are using our size and global reach to improve the health and welfare of animals in our supply chain. We encourage industry and cross-sector collaboration, relying on strategic and personal relationships with experts who provide guidance on our policies and implementation strategies in each of our local markets. To achieve positive impact in this area, we focus on creating objective, third-party verified systems to measure our performance against industry standards and key animal welfare indicators, working with recognized subject matter experts and academics to access guidance and challenge the way we think, and leveraging our global scale in local markets to help drive the right outcomes.

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Responsible Antibiotic Use. We are committed to the responsible use of antibiotics. Our Vision for Antimicrobial Stewardship outlines our approach to responsible antibiotic use and commitment to address antimicrobial resistance within our supply chain. It seeks and promotes animal production practices that refine antibiotic selection and administration and, where possible, reduce and replace antibiotics with long-term alternative solutions to prevent disease and protect animal health and welfare. We remain committed to the treatment of sick animals aligned with herd veterinarian direction to support the safety of the consumer food supply chain.

Farming Communities. The strength and resiliency of our supply chain comes from our strong collaborations and partnerships with our farmers, ranchers, growers and other producers. We work closely with them to support economically viable farming and improve access to knowledge, tools and best practice farming methods that lead to positive social, economic and environmental benefits in their communities.

Supply Chain Human Rights. Our commitment to respecting human rights is set out in our Human Rights Policy, which applies to our Company and wholly owned subsidiaries worldwide. The success of the McDonald’s System lies in our trusted relationship with suppliers, all of whom must—regardless of the cultural, social or economic context—meet our expectations regarding fundamental rights for all people. Suppliers must also meet our high standards and treat their employees with fairness, respect and dignity. Suppliers are required to commit to upholding the standards contained in our Supplier Code of Conduct and to hold their supply chain, including subcontractors and third-party labor agencies, to the same standards contained in the Code. McDonald’s incorporates due diligence through third-party audits conducted by external firms to assess compliance and then work with suppliers to remediate as appropriate. We expect, and provide guidance to assist, suppliers to meet the standards for human rights, workplace environment, business integrity and environmental management contained in the Code.

Sustainable Agriculture & Beef. We believe our food can be produced in a way that not only protects the environment and contributes positively to a thriving global food system, but also helps rehabilitate and enhance ecosystems around farms through better soil health, improved water management and increased biodiversity. We have made it a global priority to champion sustainability efforts across our supply chain, starting in the areas where we believe we can have the largest impact, such as beef, and helping take sustainable farming practices to scale. This includes working with experts and our beef supply chain globally to advance research that quantifies the impacts and outcomes of sustainability practices to continuously advance the science that will help solve the challenges we face with communities, farmers, producers and our suppliers around the world.

Recent Highlights
	Substantially achieved (95.0-99.9%) each of our 2020 responsible sourcing goals for our six priority commodities (beef, soy for chicken feed, coffee, pam oil, fish and fiber) as of the end of 2020
	Updated our commitment to phasing out the use of gestation stalls for housing pregnant sows in the U.S. by the end of 2024, a two-year extension of our original goal—set in 2012—due to the impacts of COVID-19 and the global outbreak of African Swine Fever
	Continued to make progress toward the five Global Happy Meal Goals we set in 2018 across 20 major markets to evolve the Happy Meal to make balanced meals more accessible to families

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Board and Governance Matters

Our Planet

In partnership with our franchisees, suppliers and producers, we are finding new and innovative ways to drive climate solutions, help keep waste out of nature and help preserve natural resources. From minimizing how much packaging we use to investing in renewable energy and partnering to advance sustainable and regenerative agriculture practices—we want to help protect our planet for communities today and in the future.

Our planet-related initiatives are focused on the following areas:

Climate Action. We believe climate change is the most pressing environmental issue of our time. We are proud that, in 2018, we became the first global restaurant company to set a science-based target, approved by the Science Based Targets initiative (SBTi), to significantly reduce greenhouse gas (GHG) emissions. More recently, we joined the United Nations Race to Zero campaign, pledging to put McDonald’s on the path to net zero emissions by 2050.

Packaging & Waste. We are using our scale and reach to help implement and accelerate solutions to help keep waste out of nature and valuable materials in use. To achieve this, our priorities include eliminating unnecessary packaging through design innovation, introducing reusable solutions and encouraging behavior changes, shifting materials to renewable, recycled or certified sources, increasing recycling and reuse solutions, and closing the loop by using more recycled materials.

Conserving Forests. Forests play a vital role in creating oxygen, absorbing greenhouse gas emissions, and providing food, water and shelter for people, plants and animals. We have been on a journey to conserve forests for more than three decades, and we are committed to driving industry transformation and supporting deforestation-free supply chains at scale. Our Commitment on Forests, which sets our vision for achieving this goal, applies to all commodities and every region that we source from, as well as to all suppliers to the McDonald’s System. We are committed to eliminating deforestation from our global supply chains by 2030.

Water Stewardship. Water is one of the world’s most precious resources, and we recognize its stewardship as an important sustainability area. Water stewardship practices are embedded in our sourcing requirements and restaurant operations practices, and we expect suppliers and franchisees to use water responsibly. We also include water in our Global Sustainable Sourcing Guide, which is updated as we establish new targets, assess emerging risks and develop best practices. We have partnered with experts like the World Wildlife Fund and the World Resources Institute to identify water risks and create a stewardship approach that drives actions and improvements across our value chain, including sourcing, processing, transport and our restaurants. Through the actions we are taking across our supply chain and in restaurants, we are seeking to reduce our overall water footprint, especially related to agriculture and row crops.

Recent Highlights
	Joined the United Nations Race to Zero campaign in 2021, committing to put McDonald’s on the path to net zero emissions by 2050
	Released our inaugural Climate Risk & Resiliency Summary in 2021, guided by reporting recommendations from the Task Force on Climate-Related Financial Disclosures (TCFD), demonstrating our continued commitment to assessing, managing and disclosing climate-related risks and opportunities for our business
	99.6% of our beef, soy sourced for the feed of chicken used in our products, palm oil, coffee and fiber used in guest packaging volumes supported deforestation-free supply chains as of the end of 2020
	Made a three-year, $5 million commitment in 2021 with the NextGen Consortium to continue work to accelerate and scale sustainable packaging solutions for the industry

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Community Connection

Being part of the community means supporting people every day, and especially when they need it most. This is why we are proud to support the Ronald McDonald House Charities^® (“RMHC”). We also donate millions of pounds of food from our supply chain every year, as well as hot meals from our restaurants, to communities in times of need and crisis.

Our connections with the community focus on the following areas:

Community Support & Crisis Response. Our business thrives when our communities thrive. Because most McDonald’s restaurants are run by independent franchisees, we have deep roots in communities. We have also established shared value relationships with community-based organizations around the world, which help provide us and our franchisees with direct insights into issues and challenges facing our communities. Our community strategies focus on three key areas: local support, including sponsorships, funding and resources, such as to local RMHC chapters; volunteering, including through our Global Volunteer Program; and crisis response, including addressing disasters through our partnership with the Red Cross.

Ronald McDonald House Charities. Through a network of over 260 chapters in 62 countries and regions, RMHC enables families to stay together near world-class care facilities when a child is diagnosed with a life-threatening illness. Our owner/operators, employees, suppliers and customers have supported RMHC since 1974.

Food Waste & Donations. We believe good food and precious resources should never go to waste, and we want to use our scale to help tackle this global challenge. We work with our supply chain and restaurants to help ensure our food serves its purpose, and we donate meals and ingredients to feed families in need in local communities across the globe. Our Global Food Disposition Policy helps ensure that food is not wasted. The policy was put in place to support our suppliers and distributors globally to dispose of food in alignment with a food waste hierarchy, including food donations. In 2020, we expanded salvage methods and updated the policy so ingredients like meat, lettuce, milk and cheese could be donated directly to charities—reaching communities faster and in greater quantities than ever before. In the U.S., we actively engage our franchisees and suppliers in our food waste and donations strategy by providing assistance in finding local donation partners.

Recent Highlights
	Donated $5 million in 2022 to our Employee Assistance Fund and support relief efforts led by the International Red Cross in response to recent developments in Ukraine and the resulting humanitarian crisis in Europe
	Continued to partner with our crew, franchisees, suppliers, producers and farmers to serve food in our communities, offering free ‘Thank You Meals’ to healthcare workers and first responders
	Continued the five-year, $100 million commitment to RMHC that we set in 2020 to help RMHC continue increasing access to quality health care for children around the world

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Board and Governance Matters

Jobs, Inclusion & Empowerment

McDonald’s has always been a people business. Fostering safe, respectful and inclusive workplaces wherever we do business is integral to our Company, and we will continue to hold ourselves to the highest standards. We are helping to promote bright futures by providing access to education and the opportunity to develop skills in the communities we serve and through accelerating equity and inclusion across our business. Whether it’s providing access to local education, tuition assistance or job-readiness programs, we—together with our franchisees and suppliers—make opportunity open for all. Guided by our core values, we are also committed to being better allies, sponsors and leaders, helping to create a future where equality, fairness and opportunity are not just goals, but the lived experience of everyone.

Our jobs, inclusion & empowerment initiatives focus on the following areas:

Diversity, Equity & Inclusion. Our aspiration is that no matter where you are in the world, when you interact with McDonald’s, inclusivity and equity are evident. We believe that a diverse workforce is critical to our success, and we are committed to making this a continued priority for our Company. Our DEI strategy is designed to drive accountability across the System to better represent the diverse communities in which we operate, accelerate cultures of inclusion and belonging, and further dismantle barriers to economic opportunity.

Skills & Education. At McDonald’s, people are the face of our brand and critical to our success. Our ambition is to leverage our scale to provide training and education programs to help build a positive future for everyone, no matter where they are in their lives. For those who choose to build a career with McDonald’s, our training, education and leadership development programs can take them to the highest levels of our organization. From apprenticeship opportunities, to language and technical skill training, to support for continuing education and competitive benefits, we are committed to helping staff and Company-owned restaurant employees continue their path forward, and we encourage franchisees to do the same.

Human Rights & Respectful Workplaces. We and our franchisees are committed to fostering environments where everyone is equally empowered to realize their full potential. Upholding human rights and cultivating respectful workplaces protects the integrity of our brand and fuels our success. Our commitment to respecting our people and their rights is set forth in several of our policies, including our Standards of Business Conduct, Human Rights Policy, Global Statement of Principles on Workplace Violence Prevention, and Global Statement of Principles Against Discrimination, Harassment and Retaliation. We also encourage franchisees to uphold these principles and to adopt their own similar policies.

People Safety. Nearly two million people work within a Company-owned or franchised McDonald’s restaurant globally across nearly 40,000 locations worldwide. We have a responsibility to protect the safety, health and wellness of everyone who enters one of our restaurants—whether it’s the employees in our corporate offices, the team members in a restaurant or the customers enjoying a meal. With our international markets and franchisee partners, we promote robust health and safety measures in restaurants, including implementing safety programs, setting goals and providing access to well-being resources and training.

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Recent Highlights
Announced Global Brand Standards in 2021—aimed at advancing a culture of safety—that the nearly 40,000 McDonald’s brand restaurants across the globe must adhere to, with assessments to hold them accountable   Raised hourly wages at Company-owned McDonald’s USA restaurants in 2021, with average hourly wages expected to reach $15 an hour by the end of 2024   In 2021, set goals to increase representation of women globally and historically underrepresented groups in the U.S. in leadership roles (Senior Director and above) by 2025, measuring progress towards achieving both goals incrementally on an annual basis beginning in 2021	Incorporated quantitative human capital metrics into our executives’ annual incentive compensation in 2021 to hold leadership accountable   Committed to close pay gaps identified in annual equal pay gap analyses for gender globally and for historically underrepresented groups in the U.S. Our 2021 pay gap analysis showed that we have substantially achieved equal pay for women globally (99.85%) and that there was no pay gap disfavoring historically underrepresented groups in the U.S.   In 2021, invited U.S.-based suppliers to sign a Mutual Commitment DEI – committing to promote DEI within their own organizations	In 2021, launched a franchisee recruitment initiative to help increase the number of new franchisees from all backgrounds   McDonald’s USA and its U.S. franchisees set goals in 2021 to increase Systemwide national investments in diverse-owned media companies in the U.S. by the end of 2024   In 2021, disclosed our corporate employee representation and EEO-1 data for the first time   In 2021, published an inaugural Diversity Snapshot, including data on employee, Board and franchisee representation, as well as supplier diversity

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Board and Governance Matters

Shareholder Engagement

Our Board and management team are highly receptive to feedback and have a robust shareholder engagement program. Notably, our shareholder engagement since our last Annual Shareholders’ Meeting has focused on topics including ESG initiatives, including those relating to environmental matters, human capital management and DEI, executive compensation, and Board governance and refreshment.

The following graphics illustrate elements of our shareholder outreach and engagement, which are ongoing throughout the year, as well as certain items that take place more specifically before, during and after our Annual Shareholders’ Meeting:

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Board’s Response to Shareholder Proposals

Accountability to our shareholders continues to be an important component of our success. Every year, following our Annual Shareholders’ Meeting, our Governance Committee considers the voting outcomes for shareholder proposals. In addition, our Governance Committee and other Committees, as appropriate, consider proposed courses of action in light of the voting outcomes for shareholder proposals under their oversight.

At our 2021 Annual Shareholders’ Meeting, an advisory shareholder proposal requesting to allow shareholders to act by written consent received support of approximately 42% of shares voted. While the majority of our shareholders rejected the proposal (for the sixth time in the past eight years, each time proposed by the same shareholder proponent or his affiliates), our Board and Governance Committee carefully considered the voting results and continued to seek investor feedback, as they have done in prior years. Our Board continues to believe that our shareholders have an effective suite of rights to express their views, effect change between Annual Shareholders’ Meetings and ensure Board accountability. Importantly, the failure of this proposal to receive majority support year after year demonstrates that the majority of our shareholders continue to support our current governance practices.

Other Governance Policies and Principles

Corporate Governance Principles

Our Governance Committee regularly reviews our Corporate Governance Principles and other governing documents and policies to confirm their appropriateness in light of our current and expected long-term circumstances, as well as evolving practices. Our Corporate Governance Principles are available on our website at https://corporate.mcdonalds.com/corpmcd/investors/corporate-governance/governance-resources.html.

Outside Board Service

It is expected that, before accepting an offer to serve on another public company board, a Director will consider whether that service will compromise his or her ability to perform his or her present responsibilities to our Company. Our Board has a policy providing that Directors may not serve on more than three public company boards (in addition to our Board). Our CEO and other management Directors, if any, may only serve on one public company board (in addition to our Board). Moreover, in the event of any conflicts in scheduling between our Board and any board that Directors may subsequently join, Directors shall commit to prioritizing their attendance obligations with our Board. Prior to accepting an invitation to serve on another public company board, each independent Director is required to provide notice to our Corporate Secretary, Chairman and Governance Committee Chair, and to obtain the consent of our Chairman and Governance Committee Chair, otherwise such Director shall offer to submit his or her resignation from our Board to our Governance Committee Chair. Our Governance Committee Chair shall then determine whether to accept or reject such offer. Our Governance Committee reviews our policy on outside Board service as part of its annual review of our Corporate Governance Principles, and recommends to our Board any appropriate changes.

Codes of Conduct

Each year, our Directors must confirm that they have read and will comply with our Code of Conduct for the Board of Directors. Our employees, including executive officers, are subject to our Standards of Business Conduct. These codes are available on our website at https://corporate.mcdonalds.com/corpmcd/investors/corporate-governance/governance-resources.html. If we make any amendments to these codes (other than technical, administrative or other non-substantive amendments) or grant any waiver, including an implicit waiver, from a provision of these codes to our CEO, CFO, chief operating officer, chief accounting officer or controller (or persons performing similar functions), we will disclose the nature of such amendment or waiver, its effective date and to whom it applies on our website or in a report on Form 8-K filed with the SEC.

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Board and Governance Matters

Meeting Attendance

Directors are expected to attend all meetings of our Board and the Committees on which they serve, as well as our Annual Shareholders’ Meeting. Our Board met seven times in 2021, and our Committees met the number of times set forth on pages 41 - 45.

On average, our Directors attended 98% of the total number of meetings of our Board and the respective Committees on which they served in 2021, and each Director attended at least 75% of such meetings. In addition, all Directors attended our virtual 2021 Annual Shareholders’ Meeting.

Executive Sessions

Independent Directors meet regularly in executive sessions without management present. An executive session is typically scheduled immediately before or after each regular Board meeting. Our Chairman presides at such executive sessions, except in such matters as may involve his re-election or compensation, or our Board’s leadership structure, in which case our Governance Committee Chair presides. Executive sessions are also regularly scheduled in connection with Committee meetings, other than our Executive Committee, throughout the year.

Director Orientation and Continuing Education

Upon joining our Board, Directors participate in an orientation that includes introductions to members of our senior leadership team and provides information about our operations, performance, strategic plans and corporate governance practices. In addition, members of senior leadership and other speakers are periodically invited to attend portions of Board and Committee meetings to provide updates on business and general industry trends, as well as governance, regulatory, legal and financial matters.

Directors are encouraged to participate in continuing education programs to stay informed of developments in corporate governance and issues relating to the operation of public company boards. Directors also conduct periodic visits to our restaurants and, of course, are McDonald’s customers. For more information on how Directors oversee and remain informed on Company strategy, see “Strategy Oversight” on page 48.

Director Compensation

Non-management Directors are compensated for their service on our Board, as described below. Directors who are also Company employees do not receive any compensation for their service as Director.

Our Governance Committee annually evaluates the compensation of non-management Directors. Consistent with this practice, in 2021, the independent compensation consulting firm Frederic W. Cook & Co., Inc. performed a comprehensive review of our non-management Director compensation, including benchmarking director compensation at peer and similarly-sized companies, using the same peer group as is used for executive compensation review and described under “Compensation Discussion and Analysis” beginning on page 61. Informed by the results of this review, our Governance Committee recommended that no changes be made to our Director compensation program.

Our Director compensation currently consists of: (i) an annual cash retainer of $115,000; (ii) an annual grant of common stock equivalent units with a value of $185,000 under our Directors’ Deferred Compensation Plan (the “Directors’ Plan”); (iii) an annual cash retainer of $30,000 for our Audit & Finance Committee Chair; and (iv) an annual cash retainer of $25,000 for each Director serving as Chair of our Compensation, Governance, Public Policy & Strategy or Sustainability & Corporate Responsibility Committee. In addition, we match up to $10,000 of charitable contributions made annually by Directors to certain types of tax-exempt organizations.

Common stock equivalent units granted to Directors are credited to an account in the Directors’ Plan that reflects the gains, losses and dividends associated with a notional investment in our common stock. In addition, Directors may defer all or a portion of their cash retainers in the form of additional common stock equivalent units under the Directors’ Plan. Common stock equivalent units so credited are based on a per-share price equal to the closing price of our common stock on the date the units are credited. Amounts credited are deferred until the Director’s retirement from our Board or a date specified by the Director. A Director may elect that all or a portion of the credited common stock equivalent units be paid in a lump sum or equal annual installments over a period of up to 15 years, beginning after retirement from our Board. In the event of death, amounts are paid in a lump sum. All amounts paid from the Directors’ Plan are paid in cash.

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The following table summarizes the compensation received by each non-management Director serving in 2021:

Name	Fees earned or paid in cash ($)(1)	Stock awards ($)(2)	All other compensation ($)(3)	Total ($)
Lloyd Dean	115,000	185,000	10,600	310,600
Robert Eckert	140,000	185,000	10,600	335,600
Catherine Engelbert	115,000	185,000	10,600	310,600
Margaret Georgiadis	115,000	185,000	10,600	310,600
Enrique Hernandez, Jr.	365,000	435,000	10,600	810,600
Richard Lenny	140,000	185,000	5,600	330,600
John Mulligan	145,000	185,000	10,600	340,600
Sheila Penrose	140,000	185,000	10,600	335,600
John Rogers, Jr.	115,000	185,000	10,600	310,600
Paul Walsh	115,000	185,000	10,600	310,600
Miles White	140,000	185,000	10,600	335,600

(1)	As described above, Directors may defer all or a portion of their retainer earned in the form of additional common stock equivalent units under the Directors’ Plan.
(2)	Amounts in this column represent the aggregate grant date fair value of common stock equivalent units computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”) and granted to each non-management Director who served on our Board during 2021. As discussed above, this column also includes 1,077 RSUs granted to Mr. Hernandez in 2021 in connection with his service as Chairman, with an aggregate grant date fair value of $250,000. These RSUs shall be payable in either shares of our common stock or cash, at our discretion, and shall vest on the later of his retirement from our Board or the first anniversary of the grant date.
(3)	Represents our matching gifts of charitable contributions to tax-exempt organizations for participating Directors that were received in 2021 and a McDonald’s gift card provided to Directors as prepayment for their food and beverage expenses at McDonald’s restaurants.

Cumulative Outstanding Stock Awards as of December 31, 2021

Name	Outstanding stock awards
Lloyd Dean	9,797
Robert Eckert	63,611
Catherine Engelbert	1,641
Margaret Georgiadis	7,350
Enrique Hernandez, Jr.(1)	95,621
Richard Lenny	37,878
John Mulligan	6,643
Sheila Penrose	29,724
John Rogers, Jr.	60,794
Paul Walsh	3,058
Miles White	18,613

⁽¹⁾ Includes 8,931 RSUs granted to Mr. Hernandez in connection with his service as Chairman from 2016 through 2021.

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Executive Compensation

Advisory Vote to Approve Executive Compensation

  Our Board recommends that you vote “FOR” this proposal.

We are asking shareholders to approve, on an advisory basis, pursuant to Section 14A of the Exchange Act, the compensation of our named executive officers for 2021, including the Compensation Discussion and Analysis (the “CD&A”), compensation tables and related material disclosed in this Proxy Statement.

As fully described in the CD&A, our executive compensation program is guided by the following long-standing principles: (i) pay for performance; (ii) drive business results with a focus on creating long-term shareholder value; and (iii) pay competitively. Our executives’ compensation opportunities are predominantly performance-based. Our Compensation Committee has established challenging financial performance targets, and payouts under our incentive plans can vary significantly based on Company performance.

The Company’s strong 2021 performance has continued to prove the strength of our people, the scale of our supply chain, the resilience of our System and the power of McDonald’s brand. Guided by our strategic plan, referred to as Accelerating the Arches, the Company focused on meeting the changing needs of our customers by harnessing competitive advantages that are essential to our future growth.

The Company’s strong 2021 Systemwide sales and operating income performance produced a Corporate STIP payout factor for NEOs of 184.9% (inclusive of both financial and human capital metrics). Despite strong performance in 2019 and 2021, the performance-based restricted stock units awarded to our executives in 2019 had a payout factor of 66.7% due to the impact of the COVID-19 pandemic on our 2020 results. These payouts underscore the Committee’s commitment to align payouts with Company performance in order to drive long-term value creation for our shareholders.

For the reasons expressed above and discussed in more detail in the CD&A, the Board believes the Company’s executive compensation program effectively motivates strong performance while balancing risk, thereby aligning the interests of our executives with the interests of our shareholders.

Consistent with our past practice, we are asking shareholders to approve an advisory vote on executive compensation. Although this vote is advisory and non-binding, our Board values the opinion of our shareholders and our Compensation Committee will review the voting results as well as our ongoing dialogue with shareholders when considering future executive compensation decisions.

We currently hold our advisory vote on executive compensation annually, and the next advisory vote on executive compensation is expected to occur at our 2023 Annual Shareholders’ Meeting.

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Executive Compensation

Compensation Committee Report

The Compensation Committee (the “Committee”) has reviewed and discussed the CD&A with McDonald’s management. Based on this review and discussion, the Committee recommended to the Board of Directors that the CD&A be included in this Proxy Statement and the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

Respectfully submitted,

The Compensation Committee

Richard Lenny, Chair
Lloyd Dean
John Rogers, Jr.
Paul Walsh

Compensation Discussion and Analysis

This CD&A describes the Company’s executive compensation program and provides insights into the Committee’s process and rationale for reviewing and implementing the compensation program. To enable easier navigation of the information provided below, we have organized the disclosure into the following sections:

Table of Contents

	Our 2021 Year in Review	62
	Named Executive Officers	63
	Compensation Guiding Principles	63
	Aligning Compensation with Business Strategy	64
	Compensation Setting Process	65
	Performance-Based Compensation Metrics	67
	Direct Compensation Elements	68
	Adjustments to Reported Results	72
	Other Compensation Elements	73
	New Hire Compensation	74
	Compensation Policies and Practices	74
	Mitigating Risk in Executive Compensation	75

2022 Proxy Statement 61

Executive Compensation

Our 2021 Year in Review

Business Performance

The Company’s 2021 performance has continued to prove the strength of our people, the scale of our supply chain, the resilience of our System and the power of McDonald’s brand. Guided by our strategic plan, referred to as Accelerating the Arches, the Company focused on meeting the changing needs of our customers by harnessing competitive advantages that are essential to our future growth. The Company prioritized our strategic growth pillars by maximizing our marketing, committing to the core menu items and doubling down on digital, drive-thru and delivery to create memorable customer experiences.

These efforts resulted in broad-based momentum, despite the challenging and evolving macro-economic environment, including a comparable sales increase of 17% over 2020 and 8% over 2019. The following graphics highlight the Company’s strong performance on financial metrics that drive our business and are key elements of our incentive compensation plans.

Systemwide Sales*	Operating Income*	Earnings Per Share*
21%	41%	59%

* As reported in our Annual Report on Form 10-K for the year ended December 31, 2021

Compensation
The Company’s strong 2021 Systemwide sales and operating income performance produced a Corporate STIP payout factor for NEOs of 184.9% (inclusive of both financial and human capital metrics). However, despite strong performance in 2019 and 2021, the performance-based restricted stock units awarded to our executives in 2019 had a payout factor of 66.7% due to the impact of the COVID-19 pandemic on our 2020 results. These payouts underscore the Committee’s commitment to align payouts with Company performance over different time periods in order to drive long-term value creation for our shareholders.

The following graphics illustrate the significant variance in STIP and PRSU payouts over the last three years as a result of our strong pay for performance alignment.

Historical STIP Payouts*		Historical PRSU Payouts
*	STIP includes multiple performance metrics each year, including operating income as a primary financial metric in each of these years.	*	PRSU payouts include multiple performance factors each year, including total shareholder return (TSR) in each year.
**	Represents GAAP growth rate.

For more detailed information on the Company’s incentive plans and the calculation of our payout factors, see “Performance-Based Compensation Metrics” and “Direct Compensation Elements” beginning on pages 67 and 68, respectively.

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Named Executive Officers

Our named executive officers (or NEOs) for 2021 are listed below:

Christopher Kempczinski President and Chief Executive Officer	Joe Erlinger President, McDonald’s USA
Kevin Ozan Executive Vice President and Chief Financial Officer	Desiree Ralls-Morrison Executive Vice President, General Counsel and Corporate Secretary
Ian Borden President, International

Compensation Guiding Principles

The Company is guided by the following long-standing principles: (i) pay for performance; (ii) drive business results with a focus on creating long-term shareholder value; and (iii) pay competitively. These principles drive the design, implementation and risk profile of our compensation program.

Throughout the year, management engages in dialogue with a significant portion of our shareholders on a variety of topics, including our executive compensation program (for more details, see the “Proxy Summary” beginning on page 8). The Committee considers feedback received through these direct discussions with investors as well as prior “Say on Pay” results. Accordingly, the Committee considered the approval by approximately 93% of the votes cast for the Company’s 2021 Say on Pay vote and determined that the Company’s compensation guiding principles and compensation elements continued to be appropriate and did not make any changes to the Company’s executive compensation program in response to the 2021 Say on Pay vote.

Strong support for our executive compensation program at our 2021
Annual Shareholders’ Meeting.  

First Principle: Pay for Performance

Our executives’ compensation opportunity is predominantly performance-based. As shown in the graphic to the right, for 2021, 93% of our CEO’s target total direct compensation opportunity was performance-based. This graphic reflects the impact of the 2021 increase in the value of the annual equity grant to Mr. Kempczinski (as discussed further below under “Long-Term Incentive Compensation”). In addition, for the NEOs other than Mr. Kempczinski, approximately 83% of the target total direct compensation opportunity for 2021 was performance-based (excluding one-time sign-on bonus and certain time-based equity awards for Ms. Ralls-Morrison in connection with her hire).

Our incentive plans are based on a variety of strategic financial metrics that are aligned with our key measures of long-term sustainable growth. Beginning in 2021, the STIP includes quantitative human capital metrics that reinforce the importance of our Company’s values and hold executives accountable for making progress on DEI goals (as discussed further below under Aligning Compensation with Business Strategy). The Committee has established challenging performance targets, and payouts under our incentive plans can vary significantly based on performance.

* The above chart represents the CEO’s target total direct compensation for 2021, using Mr. Kempczinski’s salary, target STIP payout, and ASC 718 values for equity awards granted in 2021.

KEY 2021 METRICS

STIP		PRSUs
	Operating income growth		Earnings per Share (“EPS”) growth
	Systemwide Sales growth		Return on Invested Capital (ROIC)
	Human Capital Metrics		Total Shareholder Return (TSR)

2022 Proxy Statement 63

Executive Compensation

Second Principle: Drive Business Results and Long-Term Value Creation

While we believe it is important to reward success against short-term goals, our overall focus is on driving long-term shareholder value. The Committee regularly considers how the Company’s compensation program drives its current business strategy, as described below. In order to incent long-term value creation, we have generally delivered more than 75% of our CEO’s compensation opportunity in the form of equity awards that vest over several years.

Third Principle: Pay Competitively

Our compensation program is designed to attract, engage and motivate talented executives critical to our success. The Committee monitors the compensation practices of our peer group of companies with which we compete for talent. Additionally, the Committee considers internal pay equity, as described below, when making executive compensation decisions.

Aligning Compensation with Business Strategy

Philosophy

The Committee annually reviews the executive compensation program to evaluate whether the program and performance metrics support the Company’s business strategy. The Committee assesses the effectiveness of the program each year and refines the metrics as needed to reflect the most important elements of business performance in a given year. As a result of such review and assessment, the Committee retained the financial metrics of Systemwide sales and operating income, but added human capital metrics, as described in more detail below.

2021 Awards

The evolving macroeconomic operating environment and consumer expectations informed the development of the new Accelerating the Arches growth strategy the Company announced in November 2020. Accelerating the Arches is a strategic framework for delivering growth that builds on the Company’s competitive advantages, while also driving greater impact in the communities we serve. Consistent with this strategy and current consumer behavior, the 2021 STIP metrics are designed to increase executives’ focus on driving key top and bottom-line measures, Systemwide sales growth and operating income growth.

In order to drive progress on our DEI priorities, the Committee also introduced new human capital metrics to the 2021 STIP. These new human capital metrics include four quantitative metrics for 2021 focused on championing our Company values, improving diversity representation among leadership, and fostering strong feelings of inclusion among employees.

For 2021, STIP metrics consisted of Systemwide sales growth (42.5%), operating income growth (42.5%) and human capital metrics (15%).

2022 Awards

Consistent with its Accelerating the Arches growth strategy, the Committee will utilize the same primary performance metrics under the 2022 STIP as under the 2021 STIP. In late 2021, the Company launched a new franchisee recruitment initiative designed to increase the number of franchisees from all backgrounds. In order to incent success of this initiative, Messrs. Borden and Erlinger will be eligible for an additional payout modifier based on the achievement of a quantitative performance metric measuring increased diversity in our franchisee pipeline. The maximum impact of this modifier for Messrs. Borden and Erlinger is to increase their 2022 STIP payouts by up to 15 percentage points (their maximum payout remains at 200% of target).

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Executive Compensation

Compensation Setting Process

As discussed above, the Committee reviews our overall executive compensation program to evaluate whether it remains aligned with current business objectives and evolving best practices. The following highlights the Committee’s annual review process.

Number of meetings: 5 throughout 2021 Agendas: Determined by the Committee Chair with the assistance of our Chief People Officer Attendees: The Committee, members of management (including our Chief People Officer), representatives from FW Cook and, when appropriate, other external professional advisors	Input from our compensation consultant	FW Cook, the Committee’s independent compensation consultant, reviews and provides input on overall compensation design and NEO target compensation opportunities.
	Other considerations	The Committee considers peer data and market benchmarking pay data obtained from various sources.
	Role of management	Management provides the Committee with its perspectives on compensation matters. No member of management is involved in decisions regarding their own compensation.

The Committee Chair regularly reports to the Board following Committee meetings. Further, the Committee Chair, along with our Chairman, lead the independent directors in the evaluation of our CEO’s performance. Based upon the results of this performance evaluation and informed by input from FW Cook, the Committee reviews and approves CEO compensation.

Internal Pay Equity

The Committee considers the following in determining the amounts reflected in our direct compensation opportunities: competitive considerations, relative scope of responsibilities, individual performance, tenure in position, and the effect on our general and administrative expenses. In addition, as circumstances warrant, we may provide compensation to executives outside of our regular compensation structure in connection with their hiring, promotion or retention (see “New Hire Compensation” below for more information related to sign-on awards received by Ms. Ralls-Morrison). This permits us to meet specific business objectives without distorting pay equity. The Company does not discriminate based on gender, race, religion, age or any other similarly protected personal characteristics.

Independent Compensation Consultant

The Committee has the sole authority to retain and dismiss an independent compensation consultant and has engaged FW Cook as its consultant. FW Cook also advises the Governance Committee on non-employee director compensation. Consistent with its Charter, the Committee regularly considers FW Cook’s independence. In 2021, the Committee concluded that FW Cook is independent and that its work for the Committee did not raise any conflicts of interest. Management may not engage the Committee’s consultant for any purpose.

2022 Proxy Statement 65

Executive Compensation

Peer Companies

Consistent with our goal of providing competitive compensation to incent and retain executive talent, we review total direct compensation compared to levels at peer companies that we believe are reflective of our business. When we set executive compensation targets, we use the market median for each compensation element as a reference point; however, we do not specifically target any element of compensation at a particular percentile.

Annually, based on input from FW Cook and management, the Committee selects a peer group comprised of companies with which we compete for talent, including our direct competitors, major retailers, producers of consumer branded goods and companies with a significant global presence. In identifying the Company’s peer group, the Committee considered the Company’s industry classification (under the S&P’s Global Industry Classification Standard), and the revenues and market capitalization of potential peer companies as well as peers of peers, among other criteria.

As a result of its annual review, the Committee retained the same peer group for 2021 that was used to evaluate 2020 pay decisions, in particular given the unique and uncertain macroeconomic environment created by the COVID-19 pandemic during 2020 and 2021. Our 2021 peer group and statistics comparing these companies to McDonald’s in terms of size and performance are included in the following graphics.

3M Company	Kellogg Company	The Procter & Gamble Company
Best Buy Co., Inc.	Kimberly Clark	Starbucks Corporation
Carnival Corporation	The Kraft Heinz Company	Target Corporation
The Coca-Cola Company	Lowe’s Companies, Inc.	Walgreens-Boots Alliance, Inc.
Colgate-Palmolive	Marriott International	Wal-Mart Inc.
FedEx Corporation	Mondeléz International, Inc.	Yum! Brands Inc.
General Mills, Inc.	NIKE, Inc.
Johnson & Johnson	PepsiCo

			McDonald’s vs. Peer Group
Financial Comparisons	McDonald’s*		Percentile	Rank	Sample Size
Revenues (most recent fiscal year)	$	23.2	32%	16	out of 23
Market Capitalization (12/31/21)	$	200.03	73%	7	out of 23
Systemwide Sales (most recent fiscal year)	$	112.14	91%	3	out of 23
1-Year TSR (12/31/21)*	27.81%		82%	5	out of 23
3-Year TSR (12/31/21)*	62.15%		50%	12	out of 23
5-Year TSR (12/31/21)*	153.12%		82%	5	out of 23

* Dollars in millions. Data retrieved from Bloomberg Terminal and verified using CapitalIQ. TSR is non-annualized.

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Executive Compensation

2022 Peer Group

In 2021, the Committee conducted an extensive analysis of our peer group with the support of management and FW Cook and determined that the peer group for 2022 should be updated in light of the Accelerating the Arches strategy and the associated impact on our talent needs. As part of this analysis, the Committee reviewed the peer group through the following screens.

  Covered Industries: continued current related industries (restaurants and leisure, retail, consumer products and food and beverage) and added technology as a result of the importance of digital capabilities in the Company’s growth strategy.   Size: focused on peers that fall within the general size parameters, specifically companies with revenue and a market cap in the range of 0.25 to four times those of the Company.   Strategic Criteria: iconic global brand, global business and talent market competitor. The Committee’s analysis yielded a smaller peer group of 16 companies for 2022. The new group reflects 14 companies that were part of our 2021 peer group, the addition of two technology companies and the removal of eight companies who are viewed as less relevant using the above screens. The graphic to the right illustrates the specific changes to our peer group for 2022. Companies Added to Peer Group: Mastercard Visa Companies Removed From Peer Group: 3M Company Best Buy Co., Inc. Carnival Corporation FedEx Corporation General Mills, Inc. Kellogg Company Kimberly Clark Lowe’s Companies, Inc.

Performance-Based Compensation Metrics

Our 2021 compensation program was comprised of both annual and long-term incentive awards, based on objective performance metrics (both absolute and relative), as well as our stock price performance, as reflected in the graphic below:

			The Committee takes a holistic approach to establishing performance targets under the Company’s incentive compensation plans.   The Committee recognizes the importance of achieving an appropriate balance between rewarding executives for strong performance over both the short- and long-term, and establishing realistic but rigorous targets.   The Committee focuses on the need to motivate and retain executives, without encouraging excessive risk taking.   In setting these objective performance targets, the Committee considers the Company’s financial objectives and the economic, industry and competitive environments.
	42.5%	Operating Income Growth
	42.5%	Systemwide Sales Growth
	15%	Human Capital Metrics
	75%	EPS Growth
	25%	ROIC
	+/- 25 points	Relative and Absolute TSR
	100%	Share Price Increase

2022 Proxy Statement 67

Executive Compensation

Incentive Awards – 2021 Payouts

The Committee established rigorous targets that were closely aligned with our business plans. As a result of strong top and bottom-line financial results across the world, our NEOs nearly achieved the maximum payout factor with a Corporate STIP of 184.9% (inclusive of both financial and human capital metrics). However, despite strong performance in 2019 and 2021, the PRSUs that vested in early 2022 paid out below target (66.7%) due to the impact of the COVID-19 pandemic on our 2020 performance. The below-target payouts for these PRSUs, despite the strong performance in two of the three years in the performance period, demonstrates our commitment to our pay for performance philosophy and our emphasis on creating long-term shareholder value. See “Short-Term Cash Incentive (STIP)” on page 69 and “Long-Term Incentive Compensation” on page 71 for more information on the payouts with respect to these awards.

The following graphics highlight the Company’s results against the performance targets established for the key financial metrics in the Company’s incentive plans.

2021 STIP PERFORMANCE VS TARGETS

Systemwide sales	Operating income growth
2019 PRSUs VS TARGETS
EPS*	ROIIC*

*	2019-2021 compound annual EPS growth.
**	2019-2021 ROIIC.

Direct Compensation Elements

Annual Compensation

Base Salary

To maintain competitiveness and internal pay equity, the Committee considers market practice, scope of responsibilities, individual performance, tenure in position, internal pay equity and the effect on our general and administrative expenses. In early 2021, the Committee approved increases to the base salaries of our NEOs to better align their compensation relative to comparable roles within our peer group, as illustrated in the following table. In determining Ms. Ralls-Morrison’s base salary upon her hire in April 2021, the Committee considered the compensation for General Counsels in our peer group as well as internal pay equity.

Named Executive Officer	2020 Salary*($)	2021 Salary*($)
Christopher Kempczinski	1,250,000	1,313,000
Kevin Ozan	880,000	910,000
Ian Borden**	664,000	815,000
Joseph Erlinger	775,000	815,000
Desiree Ralls-Morrison	N/A	800,000

*	Effective March 1 of applicable year.
**	Mr. Borden is paid in Canadian dollars, with a salary of CAD 850,000 for 2020 and CAD 1,045,000 for 2021.

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Executive Compensation

Short-Term Cash Incentive (STIP)

For 2021, the STIP was aligned with the Company’s Accelerating the Arches growth strategy and rewarded growth in Systemwide sales, operating income and performance against quantitative human capital metrics. Systemwide sales is an important metric in a franchise business as income generation is closely correlated to sales growth and is also a measure of the financial health of our franchisees. Operating income growth requires the Company to balance increases in revenue with financial discipline to produce strong margins and a high level of cash flow. In 2021, the Committee introduced four new quantitative metrics focused on human capital to the STIP, which reinforces our Company’s values and holds executives accountable for making progress on DEI goals. 2021 STIP METRICS

In light of the uncertainty in the global economic environment due to the pandemic, the Committee established a target performance range for both Systemwide sales and operating income. The chart below provides the Systemwide sales and operating income growth necessary to achieve threshold, target and maximum payouts under the 2021 STIP for Corporate:

2021*	Threshold	Target*	Maximum
Systemwide sales growth	0%	8-12%	21%
Comparable operating income growth	0%	19-26%	41%

*	Payout percentage interpolated for results that fall between each of the performance levels specifically identified.
**	Achievement of any performance level in the range would have resulted in a target payout.

Performance Versus 2021 STIP Target

The following table shows the Systemwide sales and operating income targets and results under 2021 STIP for each of the segments. STIP payouts are capped at 200% of target.

	Systemwide Sales (42.5% weighting)				Operating Income* (42.5% weighting)
Dollars in billions	Target Systemwide Sales** ($)	Target 2021 Systemwide Sales Growth Over 2020** (%)	2021 Systemwide Sales ($)	2021 Systemwide Sales Growth Over 2020 (%)	Target 2021 Operating Income** ($)	Target 2021 Operating Income Growth Over 2020** (%)	2021 Adjusted Operating Income ($)	2021 Adjusted Operating Income Growth Over 2020 (%)
Corporate	100.7-104.5	8-12	110.5	18	8.4-8.9	19-26	9.8	39
U.S.	41.2-42.9	2-6	46.0	13	4.0-4.2	5-11	4.8	25
International Operated Markets (“IOM”)	34.9-36.1	14-18	37.8	24	4.3-4.5	29-35	4.9	48
International Developmental Licensed Markets (“IDL”)	24.6-25.6	11-15	26.8	20	1.2-1.3	11-15	1.4	21

*	The 2021 operating income target and results above have been adjusted in accordance with the Committee’s pre-established guidelines. See page 72 for further information on the Committee’s guidelines as well as 2021 STIP adjustments.
**	Under the payout curves, the Committee established a performance range or the achievement levels that would have resulted in a target payout for these goals.

2022 Proxy Statement 69

Executive Compensation

With respect to human capital, the Committee established quantitative metrics to measure the Company’s performance. NEOs earned 5 STIP points for each human capital metric achieved with achievement of three metrics corresponding to a target-level payout of 15 STIP points. In early 2022, the Committee reviewed our performance with respect to the quantitative human capital metrics under the 2021 STIP and determined that the NEOs earned 10 STIP points (66.7% of target) by achieving two of the four human capital metrics. Although the Company increased representation of underrepresented minorities in leadership roles (senior director and above), the specified metric was not achieved resulting in no STIP points earned.

Please refer to the chart below for more details on these metrics and our achievement.

Category	Metric	Metric Achieved	STIP Points
Values	Meet or exceed specified McDonald’s Values Index* score		5
Representation	Meet or exceed specified increase in global representation of women in senior director and above positions		5
Representation	Meet or exceed specified increase in U.S. representation of underrepresented minorities in senior director and above positions	—	0
Inclusion	Meet or exceed specified McDonald’s Inclusion Index*score	—	0
			Total STIP Points: 10 Performance factor: 66.7%

* Comprised of employee survey questions that measure the extent to which employees believe the Company is taking actions to support our values and produce an inclusive environment.

Individual 2021 STIP Payouts

The 2021 STIP target and actual payouts for the NEOs are shown in the table below.

Named Executive Officer	Applicable Team Factors	Performance Factors	Target 2021 STIP Payment as Percentage of Salary (%)*	2021 Target STIP Payout ($)	2021 STIP Payout ($)	2021 STIP Payment as Percentage of Target (%)
Christopher Kempczinski*	Corporate (85%)	205.7	180	2,363,400	4,368,745	184.9
	Human Capital (15%)	66.7
Kevin Ozan	Corporate (85%)	205.7	120	1,092,000	2,018,562	184.9
	Human Capital (15%)	66.7
Ian Borden	IOM (42.5%)	185.9	110	896,500	1,532,408	170.9
	IDL (21.25%)	178.3
	Corporate (21.25%)	205.7
	Human Capital (15%)	66.7
Joseph Erlinger*	U.S. (63.75%)	225.0	110	896,500	1,767,484	197.2
	Corporate (21.25%)	205.7
	Human Capital (15%)	66.7
Desiree Ralls-Morrison**	Corporate (85%)	205.7	90	493,151	911,590	184.9
	Human Capital (15%)	66.7

*	In 2021, the Committee increased the 2021 STIP targets for Messrs. Kempczinski (from 170% to 180%), Ozan (from 110% to 120%), Borden (from 90% to 110%) and Erlinger (from 100% to 110%), to improve market competitiveness and to better align their compensation internally.
**	Ms. Ralls-Morrison’s 2021 STIP target pro-rated based on her start date of April 26, 2021.

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Executive Compensation

Long-Term Incentive Compensation

Setting 2021 Equity Award Values

The Committee considers market practice, scope of responsibilities, individual performance, tenure in position, internal pay equity and the effect on our general and administrative expenses in setting equity award values in an effort to maintain market competitiveness and internal pay equity. In order to energize and retain our most critical senior leaders and in recognition of their essential role in leading the business through a strong recovery from the impact of COVID-19 and to drive further growth over the next several years, the Committee approved an increase in the 2021 values of the annual equity awards granted to certain NEOs, including Messrs. Kempczinski, Ozan, Borden and Erlinger. The Committee believes that awarding this increase is consistent with our pay-for-performance philosophy and further aligns the interests of our executives with the long-term interests of our shareholders.

The following table illustrates the 2021 increase in annual equity award value for the NEOs who received an award in 2020:

Named Executive Officer	2020 Award Value ($)	2021 Award Value ($)
Christopher Kempczinski	9,500,000	14,000,000
Kevin Ozan	3,600,000	7,000,000
Ian Borden	1,900,000	4,250,000
Joseph Erlinger	2,250,000	4,500,000

Performance-Based Restricted Stock Units

PRSUs provide the right to receive a share of McDonald’s stock, subject to certain vesting requirements, and accrue dividend equivalent rights that are reinvested in additional PRSUs and earned in proportion to and only to the extent the underlying PRSUs vest. These awards also align the interests of our NEOs with those of our shareholders by delivering payouts in the form of Company stock.

PRSUs granted in 2021 will vest on the third anniversary of the grant date, subject to the Company’s achievement of two key financial metrics, EPS growth (weighted 75%) and ROIC (weighted 25%). The Committee implemented ROIC as a metric for 2021 awards replacing Return on Incremental Invested Capital (“ROIIC”) that was used in previous years. ROIC considers balance sheet metrics beyond capital expenditures, ties more readily to U.S. GAAP metrics and is the more commonly reported metric by our peer companies. The Committee incorporated the planned level of share repurchase in setting the EPS targets. The PRSUs are also subject to a modifier based on the Company’s relative TSR measured over the three-year performance period versus the S&P 500. The Committee believes this balanced set of metrics encourages executives to increase profitability and efficiently and effectively use capital, which will enhance shareholder value.

The PRSUs are also subject to a cap of 100% of target if the Company’s absolute TSR for the three-year performance period is negative, which further supports our commitment to ensuring that the interests of executives are aligned with those of our shareholders.

Maximum payout of PRSUs is limited to 200% of the target award (calculated as a cap of 175% of target based on EPS and ROIC results, subject to a modifier of up to an additional 25 percentage points based on the Company’s relative TSR versus the S&P 500 Index over the performance period), plus any dividend equivalents earned on the PRSUs.

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Executive Compensation

The chart below provides the compound annual EPS growth and ROIC necessary to achieve threshold, target and maximum payouts for the 2021-2023 PRSUs.

2021-2023*	Threshold	Target	Maximum
Compound annual EPS growth	0.0%	10.0%	14.0%
3-year ROIIC	15.0%	17.5%	17.5%

* Payout percentage interpolated for results that fall between each of the performance levels specifically identified.

Cumulative TSR vs. S&P 500 Index Modifier
0 - 19%	-25%
20 - 39%	-12.5%
40 - 59%	0%
60 - 79%	+12.5%
80 - 100%	+25%

In 2019, the Committee granted PRSUs to our executives, which were subject to EPS, ROIIC and relative TSR performance metrics for the 2019-21 performance period. Despite the challenges presented by the COVID-19 pandemic, both the Company’s EPS growth and ROIIC exceeded threshold performance levels and the Company’s TSR was at the 40^th percentile compared to the S&P 500 Index, resulting in the PRSUs vesting at 66.7% of the target amount in early 2022. Although the targets for the 2019 PRSUs were set prior to the time when the Committee could have contemplated the impact of the COVID-19 pandemic, consistent with our pay for performance philosophy, the Committee determined not to adjust the performance targets or performance outcomes resulting from the impact of COVID-19 with respect to the 2019 PRSUs.

In addition to the PRSUs awarded as part of the annual grant cycle, from time to time, a NEO may receive a service-based restricted stock unit (“RSU”) award as part of a new hire package or as a retention or promotional incentive. In 2021, Ms. Ralls-Morrison received grants of RSUs in connection with her hiring, as more fully described below under “New Hire Compensation.”

Stock Options

Options granted to our NEOs have an exercise price equal to the closing price of our common stock on the grant date, a term of ten years and vest ratably over four years, subject to continued service. Options provide value only if our share price increases, thereby closely aligning executive pay with shareholder interests. The Company’s policies and practices regarding option grants, including the timing of grants and the determination of the exercise price, are described on page 75.

Adjustments to Reported Results

In order to focus our executives on the fundamentals of the Company’s underlying business performance, certain adjustments that are not indicative of ongoing performance may be approved for purposes of incentive-based compensation. Our goal is to align incentive payouts with underlying business results that our investors use to measure performance, as opposed to allowing special gains or losses from having a significant impact on payouts.

The Committee considers potential adjustments pursuant to pre-established guidelines, including materiality, to provide consistency in how the Committee views the business. The graphic below illustrates the three categories (“strategic”, “regulatory” and “external”) of items the Committee may exclude from financial results for purposes of determining incentive payouts. In addition, the Committee excludes the effects of foreign currency translation (either positive or negative) for purposes of incentive payouts since changes in foreign exchange rates may cause our reported results to appear more or less favorable than business fundamentals indicate.

The Committee may approve adjustments to reflect events in the prior period and/or the results achieved during the applicable performance period to account for items not indicative of underlying performance, in STIP and/or PRSUs. Individual adjustments may have a positive or negative impact, and in any given year, aggregate adjustments may increase or decrease incentive payouts.

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2021 STIP ADJUSTMENTS TO OPERATING INCOME
		Category	Adjustments	Amount of Adjustment ($)*
	STRATEGIC	Asset impairment and gains/losses related to strategic initiatives, including restructurings, acquisitions, divestitures and developmental licensee transactions	Excluded gains associated with partial divestment of ownership in McDonald’s Japan (Corporate and IDL) Excluded losses and potential future gains associated with the sale of McD Tech Labs	(353) 50
	REGULATORY	Changes in tax or accounting law or regulations	N/A	N/A
	EXTERNAL	Extraordinary, unforeseeable events, such as natural disasters or the impact of social or political unrest that are outside of management’s control	N/A	N/A

* Pre-tax amounts in millions. The amounts in the table for each segment sum to the total adjustments identified below for the respective segment.

The following chart provides the net adjustment (other than for foreign currency translation), by segment, made to 2021 operating income for purposes of calculating STIP payouts.

Corporate	$(303) million
U.S.	N/A
International Operated Markets (IOM)	N/A
International Developmental Licensed Markets (IDL)	$(353) million

2019 PRSU Adjustments

In determining EPS and ROIIC results for 2019-2021 PRSU awards, the Committee adjusted performance consistent with the above pre-established guidelines, adjusting performance for the same items that applied to STIP awards for the respective performance years. In addition, the Committee adjusted performance to exclude certain tax benefits recognized by the Company in connection with changes in UK tax law. In the aggregate, the Committee’s adjustments decreased 2019-2021 PRSU payouts.

Other Compensation Elements

Retirement Savings Arrangements

We believe a competitive retirement program contributes to the recruitment and retention of top executive talent. We do not have any supplemental executive retirement plans. Our NEOs participate in the same tax-qualified defined contribution retirement savings plan and non-tax qualified deferred compensation retirement plan that is applicable to U.S.-based employees, except Mr. Borden who participates in the Company’s Canadian retirement program.

Perquisites and Other Benefits

The Company provides certain limited perquisites to NEOs, including a car allowance, financial planning, physical examination (which are also available for the NEOs’ spouses), life insurance and matching charitable donations. Mr. Kempczinski is permitted to use the Company’s aircraft for personal travel; however, the Company requires full reimbursement of costs associated with personal use of the corporate aircraft once the Company’s cost reaches a predetermined threshold. In certain circumstances, Mr. Kempczinski may permit other executives to use the aircraft for personal travel or to be joined by their spouses on the aircraft for business travel. The safety and security of our employees is a priority for the Company; accordingly, we provide risk-based executive security for select NEOs. The Company does not provide any tax gross-ups on the perquisites described above.

2022 Proxy Statement 73

Executive Compensation

NEOs also participate in the broad-based benefit and welfare plans available to Company staff. The Company maintains a Global Assignment Policy, covering employees who temporarily relocate to another country but remain subject to their home country’s terms of employment; a Localization Policy, covering employees who transition from a global assignment to local employment in another country; and an International Relocation Policy, covering employees who relocate to another country and immediately transition to local employment. These policies provide certain relocation and expatriate benefits, which are intended to equalize cost of living differences between the home and assignment country, as well as to facilitate the transition associated with an international assignment. During 2021, Messrs. Borden and Erlinger received benefits under these policies.

Please refer to footnote 4 to the 2021 Summary Compensation Table beginning on page 76 for additional details on the costs of the benefits provided to the NEOs.

Severance and Change in Control Arrangements

The Company has a U.S. severance plan that covers all U.S.-based officers, including our NEOs except Mr. Borden. Benefits under the U.S. severance plan are described under “Potential Payments Upon Termination of Employment or Change in Control” beginning on page 82. In the event of Mr. Borden’s departure, he may be entitled to receive payments and benefits, as required by local law.

The Company does not have any change in control agreements. Further, we do not provide for any single-trigger change of control benefits or Section 280G tax gross-up payments.

New Hire Compensation

In April 2021, the Company hired Ms. Ralls-Morrison as Corporate Executive Vice President, General Counsel and Corporate Secretary. In connection with her hiring, the Committee granted Ms. Ralls-Morrison PRSUs, RSUs and options. The PRSUs and options have terms consistent with the annual grants that had been made to our other executives in February 2021. In addition, as an inducement to join the Company and to replace compensation she forfeited with her former employer, Ms. Ralls-Morrison received RSUs that are scheduled to vest between 2022 and 2023 (subject to continued employment) and a cash sign-on bonus in the amount of $150,000.

Compensation Policies and Practices

Policy Regarding Management’s Stock Ownership

The Company maintains stock ownership requirements because it believes executives will more effectively pursue the long-term interests of shareholders if they are shareholders themselves. Executives have five years to achieve their required ownership level. This five-year period restarts when an executive is promoted to a position with a higher ownership requirement. An executive who is not on track to meet his or her ownership requirements following the third year (of the five-year period) is required to retain the lesser of 50% of the net after-tax shares received upon the vesting of an RSU or PRSU award or such percentage of net after-tax shares necessary to satisfy the applicable requirement. If an executive has not achieved the requisite stock ownership within five years, they must retain 100% of the net after-tax shares received upon the vesting of an RSU or PRSU award and/or a stock option exercise until the required ownership level is attained.

The following table illustrates our stock ownership requirements.

Stock ownership requirements	Multiple of salary
President & CEO	6x
Other NEOs	4x

The Committee reviews compliance with these stock ownership requirements annually. Based on the most recent annual evaluation, all NEOs are in compliance.

74 McDonald’s
Corporation

Executive Compensation

Policy Regarding Prohibition on Pledging and Hedging

The Company has adopted restrictions that prohibit executives and directors from engaging in pledging and/or derivative transactions to hedge the economic risk associated with their Company stock ownership. Further, executives and directors may not enter into an agreement that has the effect of transferring or exchanging economic interest in any award.

Compensation Recoupment and Forfeiture Provisions

The Company’s STIP awards and equity grant agreements for executives provide that the Company may terminate awards and/or recapture previously paid awards if a participant engages in willful fraud that (i) causes harm to the Company or (ii) is intended to manipulate performance goals either during employment, or after employment has terminated.

Furthermore, executives are required to have executed restrictive covenants as a condition to receiving equity awards. An executive who violates the restrictive covenants to which they are subject will forfeit outstanding equity awards, whether or not vested, and may be required to repay awards that have previously been paid.

The Company’s equity grant agreements also contain a repayment/forfeiture provision that triggers repayment of any benefits received in connection with such grants as may be required to comply with (i) NYSE listing standards adopted in accordance with Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (regarding recovery of erroneously awarded compensation) and any implementing rules and regulations of the SEC adopted thereunder, and (ii) similar rules under the laws of any other jurisdiction, as well as pursuant to any policies adopted by the Company to implement such requirements, in all cases to the extent determined by the Company to be applicable to the award recipient.

Policies and Practices Regarding Equity Awards

The Company does not grant equity awards when in possession of material non-public information. The Company generally makes broad-based equity grants at approximately the same time each year following our release of full-year financial results; however, the Company may choose to make equity grants outside of the annual broad-based grant (e.g., as part of a new hire package or as a retention or promotional incentive). Stock options may be granted only with an exercise price at or above the closing market price of the Company’s stock on the date of grant.

Mitigating Risk in Executive Compensation

Our compensation program is designed to mitigate the potential for rewarding excessive risk-taking that may produce short-term results that appear in isolation to be favorable, but which, in fact, may undermine the successful execution of our long-term business strategy and erode shareholder value. In particular, our executive compensation program has the following design features that help mitigate risk, as described throughout this Proxy Statement:

	balance of short- and long-term incentives;
	mix of both cash- and stock-based awards;
	objective performance metrics related to various measures of operational performance;
	performance targets closely aligned with the Company’s business plans;
	diverse time horizons for incentive awards;
	caps on all incentive payouts;
	recoupment and forfeiture provisions; and
	significant stock ownership requirements to align with shareholder interests.

Each year, FW Cook reviews the Company’s global incentive compensation programs, including both broad-based programs and its executive compensation programs, taking into consideration the factors described above. Based on this review, the Committee agreed with FW Cook’s assessment that the risks arising from its compensation program are not reasonably likely to have a material adverse effect on the Company.

2022 Proxy Statement 75

Executive Compensation

Compensation Tables

2021 Summary Compensation Table

The table below summarizes the total compensation earned by our NEOs in 2021 and, if required, 2020 and 2019.

Name and principal position (a)	Year (b)	Salary ($)(c)(1)	Bonus ($)(d)	Stock awards ($)(e)(2)	Option awards ($)(f)(2)(3)	Non-equity incentive plan compensation ($)(g)	All other compensation ($)(i)(4)	Total ($)(j)
Christopher Kempczinski President and Chief Executive Officer	2021	1,302,500	0	7,000,179	7,000,002	4,368,745	356,706	20,028,132
	2020	963,506	0	4,750,129	4,750,011	0	383,386	10,847,032
	2019	867,500	0	1,250,129	1,250,022	1,707,478	154,026	5,229,155
Kevin Ozan Corporate Executive Vice President and Chief Financial Officer	2021	905,000	0	3,500,198	3,500,001	2,018,562	84,372	10,008,133
	2020	774,179	0	1,800,180	1,800,015	0	156,847	4,531,221
	2019	841,667	0	1,625,078	1,625,011	1,236,750	128,072	5,456,578
Ian Borden(5) President, International	2021	791,133	0	2,125,213	2,125,001	1,532,408	1,702,035	8,275,790
	2020	587,601	0	950,211	950,002	0	2,296,449	4,784,263
	2019	561,329	0	750,078	750,003	714,631	470,856	3,246,897
Joseph Erlinger President, McDonald’s USA	2021	808,333	0	2,250,034	2,250,001	1,767,484	369,552	7,445,404
	2020	686,209	0	1,125,055	1,125,020	0	1,727,232	4,663,516
	2019	712,500	0	850,088	850,022	1,132,819	1,232,877	4,778,306
Desiree Ralls-Morrison(6)	2021	548,718	150,000	4,187,589	562,504	911,590	29,601	6,390,002
Corporate Executive Vice President, General
Counsel and Secretary

(1)	Annual base salaries as of December 31, 2021 for our NEOs were as follows: Messrs. Kempczinski: $1,313,000; Ozan: $910,000; Borden: $815,000 (CAD$1,045,000); and Erlinger: $815,000; and Ms. Ralls-Morrison: $800,000. The base salary amount for Ms. Ralls-Morrison reflected in column (c) above is pro-rated based on her start date in April 2021.
(2)	Represents the aggregate grant date fair value of performance-based restricted stock units (PRSUs) granted under the McDonald’s Corporation Amended and Restated 2012 Omnibus Stock Ownership Plan (Equity Plan), based on the probable outcome of the applicable performance conditions and excluding the effect of estimated forfeitures during the applicable vesting periods of PRSUs, as computed in accordance with Accounting Standards Codification (ASC) 718. Values generally are based on the closing price of the Company’s common stock on the grant date. Except as otherwise described herein, PRSUs vest on the third anniversary of the grant date and are subject to performance-based vesting conditions linked to the achievement of earnings per share (EPS) growth, return on invested capital (ROIC), and a relative total shareholder return (TSR) modifier over the performance period (as described beginning on page 71). PRSUs are subject to a cap of 100% of target if the Company’s absolute TSR for the three-year performance period is negative. The fair value of PRSUs that include the TSR modifier is determined using a Monte Carlo valuation model. Assuming the highest level of performance is achieved for the 2021 PRSU awards, the maximum value of these awards at the grant date would be as follows: Messrs. Kempczinski - $14,000358; Ozan-$7,000,396; Borden-$4,250,426; and Erlinger-$4,500,068; and Ms. Ralls-Morrison-$2,250,022. This column also includes certain time-based restricted stock units (RSUs) granted to Ms. Ralls-Morrison in 2021, as described in footnote 6 below, as well as in the 2021 Grants of Plan-Based Awards table on page 78 and the Outstanding Equity Awards at 2021 Year-End table beginning on page 80. A more detailed discussion of the assumptions used in the valuation of RSU awards (including PRSUs) may be found in the Notes to Consolidated Financial Statements under “Share-based Compensation” on pages 48 and 58 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
(3)	Represents the aggregate grant date fair value of options granted under the Equity Plan, excluding the effect of estimated forfeitures during the applicable vesting periods of options, as computed in accordance with ASC 718. Options have an exercise price equal to the closing price of the Company’s common stock on the grant date and vest in equal installments over a four-year period. Values for options granted in 2021 are determined using a closed-form pricing model based on the following assumptions, as described in the footnotes to the consolidated financial statements: expected volatility based on historical experience of 21.8%; an expected annual dividend yield of 2.4%; a risk-free return of 0.7%; and expected option life based on historical experience of 5.7 years. Additional information about options is disclosed in the 2021 Grants of Plan-Based Awards table on page 78 and the Outstanding Equity Awards at 2021 Year-End table beginning on page 80. A more detailed discussion of the assumptions used in the valuation of option awards may be found in the Notes to Consolidated Financial Statements under “Share-based Compensation” on pages 48 and 58 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

76 McDonald’s
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Executive Compensation

⁽⁴⁾ “All other compensation” for 2021 includes the Company’s contributions to the (i) 401(k) Plan and Deferred Compensation Plan, except for Mr. Borden who participates in our Canadian retirement plan and Ms. Ralls-Morrison who was not yet eligible for Company contributions in 2021 and (ii) Canadian retirement plan for Mr. Borden, as follows:

Christopher Kempczinski	$	79,382
Kevin Ozan	$	55,144
Ian Borden	$	11,412
Joseph Erlinger	$	49,250
Desiree Ralls-Morrison	$	0

	The incremental cost of perquisites is included in the amounts provided in this column and based on actual charges to the Company. This also includes the following categories of perquisites: car allowance; financial planning; annual physical examinations for the executives and their spouses; executive security (for select executives); matching charitable donations and Company-paid life insurance. In addition, this includes personal use of the Company’s aircraft by the CEO. The Company requires full reimbursement of costs associated with personal use once Company costs reach a predetermined threshold. In 2021, the costs for Mr. Kempczinski’s personal flights were $241,957, including fuel, on-board catering, landing/handling fees, maintenance costs and crew costs attributable to personal flights and excluding fixed costs, such as pilot salaries and the cost of the aircraft. In certain circumstances, the CEO may permit other executives to use the aircraft for personal travel or to be joined by their spouses on the aircraft for business travel. In 2021, Mr. Erlinger was permitted to use the Company’s aircraft for one personal flight at a cost to the Company of $25,243. The Company does not provide any tax gross ups on the perquisites described above.
	In addition, Mr. Borden is based overseas and, in 2021, he received certain benefits in connection with his international assignment. This included Company-provided housing in the amount of $349,262, which includes rent, utilities, rental furniture and storage; a cost-of-living adjustment; global health insurance; children’s tuition; family and home leave allowances; shipping services; Company-provided vehicle; tax preparation fees; a global banking allowance; and tax equalization in the amount of $1,144,177. As Mr. Erlinger was previously based overseas, he received tax equalization in the amount of $239,622, tax preparation services in the amount of $26,586 and shipping and storage services in 2021. Ms. Ralls-Morrison received certain benefits in connection with her relocation to Chicago, including shipping and transportation costs, and tax equalization.
(5)	Certain amounts for Mr. Borden were paid in non-U.S. currency and, when information is available, reflect the exchange rate on the date the respective payments were made. When information is not available, the amounts reflect the average monthly exchange rate for the reporting year.
(6)	As an incentive to join the Company and to replace compensation she forfeited with her former employer, Ms. Ralls-Morrison received a cash sign-on bonus of $150,000, a sign-on incentive equity grant of $2,500,000 in time-based RSUs vesting equally on the first two anniversaries of the grant date and an equity grant intending to align with the 2021 annual equity grant for the Company’s executive vice presidents. The latter grant was valued at $2,250,000, consisting of (a) 25% of the grant value in time-based RSUs vesting on the third anniversary of the grant date, (b) 25% of the grant value in stock options vesting equally on the first four anniversaries of the grant date and (c) 50% of the grant value in PRSUs vesting on the third anniversary of the grant date, subject to the achievement of performance conditions (which are the same as for other NEOs). For more information, please see the 2021 Grants of Plan-Based Awards table on page 78 and the Outstanding Equity Awards at 2021 Year-End table beginning on page 80, as well as the discussion in the CD&A on page 74. Ms. Ralls-Morrison’s 2021 STIP payout was prorated to reflect her Company service during 2021.

2022 Proxy Statement 77

Executive Compensation

2021 Grants of Plan-Based Awards

			Estimated future payouts under non-equity incentive plan awards(1)			Estimated future payouts under equity incentive plan awards			All  other stock awards: number of shares of stock or units (#)(i)	All other option awards: number of securities underlying option (#)(j)	Exercise or base price of option awards ($/Sh) (k)	Grant date fair value of stock and option awards ($)(l)(2)
Name (a)	Plan	Grant date (b)	Threshold ($)(c)	Target ($)(d)	Maximum ($)(e)	Threshold (#)(f)	Target (#)(g)	Maximum (#)(h)
Christopher Kempczinski	STIP	2/16/2021	0	2,363,400	4,726,800
	Equity Plan(3)	2/16/2021				0	32,247	64,494				7,000,179
	Equity Plan(4)	2/16/2021								226,464	215.03	7,000,002
Kevin Ozan	STIP	2/16/2021	0	1,092,000	2,184,000
	Equity Plan(3)	2/16/2021				0	16,124	32,248				3,500,198
	Equity Plan(4)	2/16/2021								113,232	215.03	3,500,001
Ian Borden(6)	STIP	2/16/2021	0	896,500	1,793,000
	Equity Plan(3)	2/16/2021				0	9,790	19,580				2,125,213
	Equity Plan(4)	2/16/2021								68,748	215.03	2,125,001
Joseph Erlinger	STIP	2/16/2021	0	896,500	1,793,000
	Equity Plan(3)	2/16/2021				0	10,365	20,730				2,250,034
	Equity Plan(4)	2/16/2021								72,792	215.03	2,250,001
Desiree Ralls-Morrison	STIP	5/17/2021	0	493,151	986,302