Easterbrook was dismissed from his position after the McDonalds board of directors determined that he had violated company policy after it was discovered that he had been engaging in a consensual relationship with a subordinate. The dismissal of Easterbrook demonstrates a change in the views regarding workplace relationships, and whether it is indicative of a more extensive, potentially industry-wide attitude remains to be seen.
Easterbrook, who took the helm of McDonald's in 2015, led McDonald's on a path of modernization to target a new generation of consumers that would result in the company's stock price doubling and McDonald's previously falling same-store sales recovering strongly during his tenure. Easterbrook was considered by experts to be a true pioneer in his field. Based on his reputation, it is no surprise that McDonald's has faced immediate and robust blowback for Easterbrook's dismissal.
Days after the announcement of Easterbrook's dismissal, McDonald's stock price tumbled 2.3%. The timing of the firing also coincides with a slump in McDonald's expected earnings growth; while it is concerning that the firing could have adverse effects on the company's growth in the near future, whether or not the firing has affected the recent slump remains unclear.
Scrutiny has already been heaped upon Easterbrook's successor, Chris Kempczinski, who noticeably lacks any stock in the very company he now leads. The lack of stock places Kempczinski in a precarious position; it is common practice for large companies like McDonald's to require that senior executives possess shares so that their financial success is tied to the success of the company. While Kempczinski currently lacks ownership of any McDonald's stock, he has many avenues available to him to acquire it.
Kempczinski has also been left with some of the consequences of Easterbrook's decisions, such as the complaints of some franchisees concerning the costs of implementing Easterbrook's changes, such as store renovations and order kiosks. Kempczinski, in general, may be a contentious choice for franchisees, as the new CEO has a reputation for being hard on them.
There remains a fair number of unknowns around Kempczinski, however. While Kempczinski was instrumental in implementing Easterbrook's decisions, he has mostly stayed out of the public eye. Investors looking to his past see mixed results, and it will be up to Kempczinski to prove that he can continue Easterbrook's practices or that he can innovate the company in his own unique way in the coming months.