McDonald’s replaces CEO Thompson after poor sales

The decision to replace Thomson as CEO came five days after McDonald’s reported a 2.4% decline in revenues last year and a 19% drop in earnings per share, with falls in store traffic in all regions

 

Fast-food giant McDonald’s has replaced president and chief executive Donald Thompson, after the company turned in another poor quarter of sales and earnings last week.
 
McDonald’s board of directors said Wednesday that it had chosen senior executive vice president Steve Easterbrook to replace Thompson, voicing confidence he “can effectively lead the company to improved financial and operational performance.”
 
The decision came five days after the company reported a 2.4% decline in revenues last year and a 19% drop in earnings per share, with falls in store traffic in all regions.
 
With 36,000 outlets in over 100 countries, the burger chain has been challenged by changing consumer tastes, agile new fast-food chains and a slump in sales in China and Japan after supplier issues sparked a scare over food safety.
 
It remains the world’s largest burger chain, with $27.4 billion in revenues last year, and net income of $4.6 billion, down 15% from 2013.
 
But after aggressively investing and expanding in numerous markets to fight back against rivals, McDonald’s said last week that it would reduce capital investment and cut back on store openings this year “to regain business momentum” and improve profitability.
 
The board said in a statement that Thompson, a 25-year veteran of the company in his third year as chief executive, was retiring effective 1st March.
 
“I am truly confident as I pass the reins over to Steve that he will continue to move our business and brand forward,” Thompson said in a statement.
 
Andrew McKenna, McDonald’s board chairman, called Easterbrook, also the company’s chief brand officer, “a strong and experienced executive who successfully led our UK and European business units.”
 
“McDonald’s is an outstanding company with talented employees and these management changes are aimed at speeding the company’s movement to its next phase of innovation and growth,” he said.
 

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Jaishankar replaces Sujatha Singh as foreign secretary

Before his sudden appointment as foreign secretary, Jaishankar was India’s Ambassador to the US and played a key role during PM Modi’s visit to the US in September and US President Obama’s just concluded visit

 

S Jaishankar on Thursday took charge as foreign secretary, replacing Sujatha Singh whose tenure was abruptly curtailed late Wednesday night.
 
“Government’s priorities are my priorities,” said Jaishankar, a 1977-batch IFS officer, describing his new position as an “honour and a big responsibility“.
 
Singh was not present when Jaishankar took charge at the South Block office.
 
He will have a two-year tenure as per rules.
 
Before his sudden appointment as foreign secretary, the 60-year-old diplomat was India’s Ambassador to the US. He had also been posted as Ambassador to China, Singapore and Czech Republic.
 
The decision to appoint Jaishankar, who played a key role during Prime Minister Narendra Modi’s visit to the US in September and US President Barack Obama’s just concluded visit, was taken by the Appointments Committee of the Cabinet chaired by Modi.
 
Singh had taken over as the third woman Foreign Secretary in August, 2013 and had eight more months to serve.
 
Jaishankar, son of late K Subrahmanyam, one of India’s leading strategic analysts, was a key member of the Indian team, which negotiated the landmark Indo-US nuclear deal.
 

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Promise, Performance and Public Policy
Buyers should take utmost care because post-contract agonising is futile
 
In a perfect world, two plus two always equals four. Yet, in everyday lives, two plus two can be three plus one, or six minus two, or any of a myriad other combinations. Some judicial decisions, besides giving finality to a dispute, often, focus attention on little-known, or variedly understood, facts. This exercise helps in demystifying and, indeed, defogging of the law. It also adds another building block to the edifice of interpretation.
 
Recently, the Supreme Court ruled in an interesting case that could affect any of us. It decided in the matter of the Zoroastrian Cooperative Housing Society Ltd V/s District Registrar of Cooperative Societies (Urban). This case involved cooperative housing societies (CHS) and their members’ rights. The ever-shifting limits of ‘public policy’ also came under scrutiny. Like the never-ending debate on what constitutes ‘offensive’ material, ‘public policy’ was again under the scanner.
 
The concerned member had used the armour of ‘public interest’ to protect his contention. Wisely, the Court decided to be “… cautious in trying to ride the unruly horse of public policy.” The CHS was formed for ‘Parsis only’ and the managing committee had apprehensions that one member may alienate his share to a non-Parsi. The CHS had already litigated, to prevent such an occurrence, but had lost and appealed to the Supreme Court. Its contention was that the member had voluntarily become a member of the CHS and, therefore, he was duty-bound to follow the rules governing it.
 
Until now, the member had successfully invoked the secular provisions of the Constitution to argue his case—the ‘public policy’ gambit. He maintained that a restriction based on religious affiliation was violative of his fundamental right to do whatever he wanted to do with his property. If he could not do that, his ownership and enjoyment of the property was curtailed and his rights infringed upon.
The Supreme Court differed. It held that if a person enters into a contract, knowingly, willingly and of free choice, he must adhere to the rules of the CHS he has sought to join and which has accepted him. The Court “considered it a fallacy on the part of the member to challenge his voluntary surrender” at a later date. In other words, the member could not have the cake and eat it too.
 
The lesson here is that it becomes imperative for a prospective buyer to proceed with utmost care because post-contract agonising is futile. Study of specific bye-laws is a must. When one deals with property worth a few lakh rupees, professional advice, clear thinking and lack of haste will prove immensely valuable. To buy in haste and repent at leisure is not an option.
 
The Court has specifically held that “it is open to that community to preserve its culture and way of life” and, therefore, the issue here was neither one of Parsis nor of Bohris nor of Christians. Neither was it one of orthodoxy nor one of reformism. In the context of the judgement, the issue was simply one of the ‘law of the land’. One that would apply, notwithstanding the nature of the legal entity, be it a cooperative society or a limited company. It was purely one of a contract that had to be performed.
 
To sum up, one must understand that similar agreements and covenants imposing restrictions will stand the test. Many communities have taken advantage of concessional rates for land, to build houses and colonies for their members. The covenants between the authorities and the community members, especially the minority communities like the Parsis, Bohris and Christians, have been challenged periodically. With this judgement from the apex Court, such covenants will hold and, therefore, purchasers need to walk in with their eyes wide open.
 

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