MCDONALDS CORP MCD

37% shingled-prose overlap between the two filings.

2025: 160,002 chars · 2026: 153,834 chars

• Committee Report:26% overlap (1,177 → 431 chars)
• Pay Ratio (Item 402(u)):23% overlap (944 → 3,239 chars)
• Say-on-Pay proposal:0% overlap (25,000 → 406 chars)

• newTable of Contents Our 2025 Year in Review 53 2025 Direct Compensation Elements 58 Named Executive Officers 53 Other Compensation Elements 62 Compensation Guiding Principles 53 Compensation Policies & Practices 63 Aligning Compensation with Business Strategy Mitigating Risk in Executive Compensation 64 55 Compensation Setting Process 55 Performance-Based Compensation Metrics 58
• newCompensation Committee Report
• newOur Compensation Committee (the “Committee”) has reviewed and discussed the CD&A with management.
• newBased on this review and discussion, the Committee recommended to our Board that the CD&A be included in this Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2025.
• newThe Compensation Committee
• newLloyd Dean, Chair
• newAnthony Capuano
• changedKareem Daniel 1e.
• changedJennifer Taubert 1i.
• changedMiles White !
• new52 2026 Proxy Statement
• changedOur 2025 2024Year in Review
• newDespite a challenging QSR industry backdrop, McDonald's value leadership is working.
• newIn 2025, the Company delivered global Systemwide sales growth of 7% and global comparable sales increased 3.1%.
• changedThe Company's consolidated operating income also grew 6% 1%in 2025. 2024.
• newWhile our 2025 performance did not meet our full expectations, the Company remains confident that we have the right strategy to drive sustainable long-term growth.
• changedThe Company’s 2025 2024operating income and Systemwide sales results were performancewasbelow target, resulting in a Corporate STIP payout factor for NEOs of 76.4%. 27.6%.
• newRelated to the PRSUs awarded to our executives that vested in early 2026, ROIC performance finished above target, while annual EPS growth and relative TSR finished below target and below median, respectively, resulting in a 82.2% payout factor.
• newThese payouts underscore the Company’s strong pay-for-performance alignment across both the respective one- and three-year performance periods, with our executives held accountable to achieve rigorous performance targets despite a challenging external environment.
• changedFor more detailed information on our incentive plans and the calculation of our payout factors, see “Performance-Based Compensation Metrics” and “2025 “2024Direct Compensation Elements” beginning on page 59. pages57and58,respectively.
• newOUR NEOs FOR 2025 ARE LISTED BELOW:
• newChristopherKempczinskiChairman, Presidentand Chief ExecutiveOfficer (“CEO”) Ian BordenExecutive VicePresident and Global Chief Financial Officer(“CFO”) Gillian McDonald(1)Executive Vice President, Global Chief RestaurantExperience Officer Joseph ErlingerPresident, McDonald’s USA Manuel JMSteijaert(1)President, InternationalOperated Markets (1) Ms. McDonald served as the Company’s President, International Operating Markets prior to her appointment as Executive Vice President, Global Chief Restaurant Experience Officer, effective May 1, 2025.
• newMr. Steijaert served as the Company’s Executive Vice President, Global Chief Customer Officer prior to his appointment as President, International Operated Markets, effective May 1, 2025.
• newThe Company follows three long-standing principles in designing our executive compensation program:
• newThese principles inform the design, operation, and risk profile of our executive compensation program.
• new2026 Proxy Statement 53
• newKEY 2025 METRICS STIP§ Operating Income Growth§ Systemwide Sales Growth§ New Restaurant Openings§ Strategic Scorecard PRSUs § Earnings Per Share Growth§ Return on Invested Capital§ Total Shareholder Return
• changedIn order to incentivize long-term value creation, we have delivered approximately 78% 75%of our CEO’s compensation opportunity in the form of long-term incentive awards that vest over several years.
• changedFurther, the performance-based compensation programs are designed to require growth over prior-year prioryearresults to yield any payout.
• newFirst Principle: Pay for PerformanceOur executives’ compensation opportunity is predominantly performance-based.
• changedAs shown detailedin the graphic to the right, 93% of our CEO’s whichshowstarget total direct compensation opportunity for 2025, which consists of 2024,usingsalary, target STIP payout and grant date fair values for long-term incentive awards granted in 2025, 2024,92%ofourCEO’stargettotaldirectcompensationopportunityfor2024was performance-based.
• changedFor our NEOsother NEOs, thanMr.Kempczinski,approximately 85% 84%of the target total direct compensation opportunity for 2025 2024was performance-based. performance-based.​
• changedCEO’s total direct compensation opportunity is performance-based Our STIP short-termincentiveplanis based on atwo strategic financial metrics that are aligned with our key measures of long-term sustainable growth.
• changedIn addition, given the importance of restaurant development in driving top-line growth, the STIP includes a new restaurant opening metric, as well as a strategic scorecard thatisdesigned to hold executives accountable for efforts towards advancing the Company’s values, driving employee engagement and executing its franchising strategy.
• new54 2026 Proxy Statement
• changed2025 Short-Term Cash Incentive (STIP)
• changedThe design of our executive compensation program for 2025 2024was generallyconsistent with 2024, 2023,which the Committee believes was closely aligned with the Company’s Accelerating the Arches growth strategy strategicprioritiesand motivates our executives to produce strong business results.
• changedFor the 2025 2024STIP, the Committee retained operating income, Systemwide sales, and new restaurant openings (which together account for 85% of the award) as core metrics and addeda strategic scorecard designed to hold executives accountable for efforts towards advancing the Company’s values, driving employee engagement and executing its franchising strategy (accounting for 15% of the award).
• changedRefer to “Short-Term Cash Incentive” Incentive(STIP)”beginning on page 59 58for more information.
• changed2025 Performance-Based Restricted Stock Units (PRSUs)
• changedThe Company’s 2025 2024PRSU design is also closely tied to the Accelerating the Arches growth strategy and drives long-term, sustainable growth.
• changedConsistent with the 2024 2023PRSU design, the 2025 2024PRSU design includes EPS growth and ROIC as core metrics, as well as a relative TSR modifier.
• changedRefer to “Long-Term Incentive Compensation” beginning on page 61 60for more information.
• changedThe following highlights the Committee’s annual compensation review process.
• changedThe Committee considers peer data and market benchmarking pay data obtained from various survey sources.
• new2026 Proxy Statement 55
• changedMr. Kempczinski, while not a member of the Committee, attended portions of each Committee meeting in 2025 2024to contribute to and understand the Committee’s oversight of, and decisions relating to, executive compensation.
• changedThroughout 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 “Proxy Summary” beginning on page 6). 7).
• changedAt the 2025 2024Annual Shareholders’ ShareholdersMeeting, our shareholders continued to show strong support for ofour executive compensation program.
• changedThe Committee considered the 2025 2024voting results as part of its annual review of the program and determined that our compensation guiding principles and compensation program design continued to be appropriate and aligned with our Accelerating the Arches growth strategy.
• new2025 Say-on-Pay-Vote
• changedIn October 2025, 2024,the Committee concluded that Semler Brossy is independent and that its work for the Committee did not raise any conflicts of interest.
• new56 2026 Proxy Statement
• new§ The Coca-Cola Company§ Colgate Palmolive Company§ The Kraft-Heinz Company§ Marriott International, Inc.§ Mastercard Incorporated§ Mondelēz International, Inc.§ NIKE, Inc.§ PepsiCo, Inc. § The Procter & Gamble Company§ Starbucks Corporation§ Target Corporation§ Visa Inc.§ Wal-Mart Inc.§ The Walt Disney Company§ Yum!
• newFor 2025, the Compensation Committee, in consultation with Semler Brossy, modified the 2024 peer group by removing Johnson & Johnson and Walgreens Boots Alliance, Inc. because they no longer meet the criteria set forth above.
• newThe Walt Disney Company was added to the 2025 peer group based on the above criteria.
• new2026 Proxy Statement 57
• changedOur 2025 2024compensation program included 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 following graphic:
• changed40%30%15%15% Operating Income GrowthSystemwide Sales GrowthNew Restaurant OpeningsStrategic Scorecard § The ●TheCommittee takes a holistic approach to establishing performance targets under our incentive compensation plans.§ The plans.●TheCommittee recognizes the importance of achieving an appropriate balance between rewarding executives for strong performance over both the short- and long-term and establishing motivating but rigorous targets.§ The targets.●TheCommittee focuses on the need to motivate and retain executives, without encouraging excessive risk-taking.§ In risk-taking.●Insetting these objective performance targets, the Committee considers our financial objectives and the macro economic economic,and competitive environments.
• new75%25%+/- 25 EPS GrowthROICRelative TSR Points 100% Share Price Increase
• changed2025 2024Direct Compensation Elements
• newIn early 2025, the Committee approved increases to the base salaries of Messrs.
• changedBorden and Erlinger, Inearly2024,theCommitteeapprovedincreasestothebasesalariesofourNEOs,focusing on more closely aligning their compensation relative to executives with comparable roles and tenures within the peer group.
• newIn connection with Mr. Steijaert’s appointment to the role of President, International Operated Markets (“IOM”), the Committee approved the base salary listed below.
• newNamed Executive Officer 2024 Salary ($)(1) 2025 Salary ($)(1) Christopher Kempczinski 1,550,000 1,550,000 Ian Borden 950,000 975,000 Gillian McDonald(2) 901,000 929,600 Joseph Erlinger 875,000 900,000 Manuel JM Steijaert(3) — 903,000
• new(1) Salary information is annualized and amounts are effective March 1 of the applicable year, except for Mr. Steijaert’s approved salary in connection with his appointment, which was effective May 1, 2025.
• changed(2) **Ms. McDonald’s base salary is paid in British Pounds (“GBP”), with an annualized salary of 650,000GBPfor2023and705,000 GPB for 2024 and 2025. 2024.
• changedThe amounts reflected in the table above are based on the average monthly exchange rate for 2024 2023of 1 GBP = 1.27 USD 1.24USDand for 2025 2024of 1 GBP 1GBP= 1.32 1.27USD.
• new58 2026 Proxy Statement
• new(3) Effective as of May 1, 2025, Mr. Steijaert’s base salary is 685,000 GBP.
• newThe amount reflected in the table above is based on the average monthly exchange rate for 2025 of 1 GBP = 1.32 USD.
• newMr. Steijaert's 2024 base salary is excluded from the table above because he was not an NEO in 2024.
• changed2024Short-Term Cash Incentive (STIP)
• newIn early 2025, the Committee considered these factors and determined not to increase the STIP target for the NEOs as compared to 2024.
• newIn connection with Mr. Steijaert’s appointment to President, IOM, the Committee approved a STIP target at 120% of base salary, effective May 1, 2025.
• newNamed Executive Officer 2024 STIP (%) 2025 STIP (%) Christopher Kempczinski 200 200 Ian Borden 130 130 Gillian McDonald 120 120 Joseph Erlinger 120 120 Manuel JM Steijaert(1) — 120 (1)
• new(1)Mr. Steijaert’s target 2025 STIP payment was pro-rated based on the target opportunity in effect during the year, resulting in a pro-rated target opportunity of 113% of base salary.
• newMr. Steijaert's target STIP opportunity for 2024 is excluded from the table above because he was not an NEO in 2024.
• changedFor 2025, 2024,the STIP design was aligned with our Accelerating the Arches growth strategy and rewarded growth in operating income, Systemwide sales, new restaurant openings and performance against a newstrategic scorecard.
• changedSystemwide sales is an important metric in a franchise business as income generation is closely correlated to sales growth and serves as itisa measure of the financial health of our franchisees.

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