The Big Cheese

McDonald's GC Gloria Santona has ketchup running through her veins

Published in Corporate Counsel Edition® - 2008 — April 2008

When Gloria Santona started out with the McDonald's legal department in the 1970s, there was a space-age-style room at the company's Oakbrook, Ill., headquarters known as the "think tank." Soundproof and enclosed with a hatch, it was a distraction-free place where executives could unwind, cook up big ideas or tangle with complex business problems.

Today the think tank is long gone, but Santona is still there. Unlike that trendy piece of '70s corporate chic, she has grown with the company and thrived in a high-profile job overseeing the legal functions of one of the most recognizable brands in the world.

"There is no typical day," says the 57-year-old executive vice president, general counsel and secretary of McDonald's Corporation. "If I had a typical day, I wouldn't still be here."

Her first days as general counsel were something of a trial by fire. Named to the position in 2001, she was hit with two urgent matters. First was Sarbanes-Oxley, the broad piece of legislation passed in the wake of the Enron, Tyco and WorldCom scandals, aimed at overhauling the accounting and financial reporting practices of public companies. It was Santona's job to integrate those changes.

"Legal took the lead in recommending enhanced government processes and ensuring that we were in full compliance," says Santona. "We were fortunate to have good governance processes in place, but it was a long and involved process to ensure that all of the myriad requirements were met."

Around the same time, a scandal broke relating to the company's popular Monopoly game. McDonald's had hired an outside contractor to help promote the game, and one of its employees stole the most valuable prizes by having a third party redeem them. The conspirators collected roughly $13 million.

"I hadn't even had a chance to figure out what my job was yet," says Santona, who worked with the Department of Justice and FBI to implicate the guilty. "I hate being in reactive mode."

Then came the sudden deaths of Chairman and CEO Jim Cantalupo and his successor, Charlie Bell, who was diagnosed with cancer shortly after his appointment and passed away within nine months. While suffering the personal loss of two close colleagues—and the challenge of working for three bosses in two years (today she reports to CEO Jim Skinner)—Santona advised the board on succession and the reporting of delicate personal matters.

"We needed to disclose the circumstances of one CEO's death and the other's illness within the constraints of the Sarbanes-Oxley rules that required quick reporting of matters involving the CEO," she says. "And we had to respect the privacy that these gentlemen and their families were entitled to.

"As difficult as these circumstances were, both personally and professionally, it's good to know that our investors' interests were appropriately addressed at the same time we dealt with our executives and their families in the dignified manner that they deserved."

Throughout this turmoil, Santona proved she could roll with the punches.

"She's an excellent lawyer and she has common sense," says Skinner. "Those two things don't always go together."

That combination helped Santona turn an early disappointment into a gigantic success.

The daughter of a steel mill employee and a medical office receptionist, Santona grew up in Merrillville, Ind., wanting to be a doctor. She became the first member of her family to graduate from college, with a biochemistry degree from Michigan State University. But her plans were upended when she didn't get into medical school.

With no plan B, the 22-year-old took a job in human resources with the federal government, and worked closely with a lawyer who thought she'd make a good attorney. So she took the LSAT. After a year at Valparaiso University Law School, she transferred to the University of Michigan, where in 1977 she saw a job listing for a position in McDonald's corporate legal department. Santona received an offer within 24 hours of her interview and has been there ever since. The decision to forgo medicine for law is one she has never regretted.

"When I was 14, being a doctor was how you helped people. But did I really want to be a doctor? Or did I want to interact with people and help them solve problems?" she says, nodding her head in assent to the latter. "Failing to get into medical school was the best thing that ever happened to me."

When she arrived at McDonald's, she joined a legal department where her gender and ethnicity didn't make her a rarity. Though "diversity" wouldn't become a buzzword for at least a decade, she was the fourth woman and fourth minority among 13 attorneys. It was as a transactional attorney that she stuck out.

"In the capital markets there were very few women, let alone Hispanic women," Santona says. "But it never bothered me. I'd been in traditionally male-dominated places before. I was only one of two women in the biochemistry department at Michigan State."

During those early years Santona learned the art of making deals.

"When you're a transactional attorney, getting a deal done is fabulous. You made a special contribution that only you could have made," she says. "I also learned that to succeed you need to create win-wins and positive outcomes for everyone. It's much easier to solve problems if no one loses."

Santona starts her workday by reading the news online to find out what the press is saying about McDonald's. "You have to know," she says. Then she talks with other in-house attorneys to find out what's "hot"—things legal or otherwise.

"I spend a lot of time with the people who report to me," she says. "But my job isn't to micromanage them. I have a great team. Any general counsel of a company like this needs to build a strong team first. It's what I'm most proud of."

Skinner agrees, saying that one of Santona's greatest accomplishments has been her overhaul of the legal department, creating a team that reflects both the values of the company and the diversity of its customer base. More than 50 percent of the company's attorneys are female and more than 20 percent are minorities.

"She brought the legal department into the 21st century," Skinner says. "[Santona has] done a great job of developing talent beneath her, globalizing the department and tying it all together."

Santona seeks lawyers who are not only talented and technically proficient, but also problem solvers. They must adapt to a McDonald's culture where, as she once joked, "we all have ketchup running through our veins." (Almost literally—Santona dines on Mickey D's five days a week; her favorite menu item is the double cheeseburger.)

Global talent reviews are also a Santona hallmark. At least once a year, executive team members from around the world evaluate each in-house lawyer. This is no easy task. Her department of 13 in 1977 (some 27,000 McDonald's restaurants ago) now includes 140 attorneys around the globe. With base offices in Singapore, London, Miami and Oakbrook, McDonald's lawyers work in 19 countries. The group is held together by one thing.

"Understanding the brand. That's what we're all about," she says. "We have lawyers in 19 countries, but we all speak the same language. We're all rooted in the same value system and the judgment flows from there."

As proof of her faith in her legal team, Santona's management style is to give her staff as much autonomy as possible. "It's a matter of communication as opposed to right versus wrong," she says. "I'm rarely mad when someone makes a mistake. It's far better when they come to me [and explain the decision]. It's about dialogue and the right grounding."

Because the media keep a close watch over McDonald's, legal issues can have a big impact on business. Thus, while the infamous child obesity lawsuit is still moving through the courts, McDonald's is careful about advertising to its most impressionable consumers. The company promotes an active lifestyle with "activity points" for kids and offers healthy alternatives to cheeseburgers and McNuggets, such as fruit and grilled-chicken salads.

"It's a reflection of the culture. We were only selling fries and shakes in the mid-1950s," Santona says. "But over time we've realized that we have responsibilities over and above. We clearly realize that we have a role to play in this debate. We're not the answer, but we want to be part of the solution."

The nuts and bolts of getting that done are often complicated. Because McDonald's centralizes its purchasing procedures in Europe, the company had to figure out a way to make its nutrition labels pass muster in 42 countries.

"One country rounds up [on labels] and another rounds down," Santona says, smiling. "That's a day in McDonaldland."

Throughout it all, Santona's approach is fairly simple. She wants to be prepared for any eventuality.

"A large part of my time is spent with senior management looking at broader corporate issues, where I can get in on the front end and have the greatest impact," she says.

As an executive at an international company, Santona can't avoid the inevitable question about balancing work with family. The mother of an 11-year-old boy, she says that having a child later in life has helped. Armed with a BlackBerry (even at midnight or during a soccer game), Santona has made it work. But it hasn't been easy.

"There is no such thing as work-life balance," she says, quoting Michele Coleman Mayes, general counsel for Allstate. "It's a dance and someone has to lead."

Although there is one aspect of her life in which no amount of common sense, preparedness or proactivity can save her.

"Sixth-grade homework is doing me in," she says. 

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