Aramark

Aramark Corporation

Type	Public
Traded as	NYSE: ARMK
Industry	Managed services
Founded	1959 (as Automatic Retailers of America)
Headquarters	Aramark Tower Philadelphia, Pennsylvania, U.S.
Key people	Davre Davidson, Founder Eric J. Foss, Chairman, President, and CEO
Products	Managed services
Revenue	US$ 14.415 B (2016)[1]
Operating income	US$ 746.31 M (2016)[1]
Net income	US$ 287.81 M (2016)[1]
Total assets	US$ 10.582 B (2016)[1]
Total equity	US$ 2.161 B (2016)[1]
Number of employees	265,500 (2015)[1]
Website	www.aramark.com

Aramark Corporation, known commonly as Aramark, is an American foodservice, facilities, and uniform services provider to clients in fields including education, healthcare, business, corrections, and leisure. Its core market is North America (United States and Canada) and supplemented by an additional 19 countries, including United Kingdom, Germany, Chile, Ireland and Spain. The company is second in North American food, facilities, and uniform services based on total sales in fiscal year 2015.^[1]

The company is headquartered at the Aramark Tower in Center City, Philadelphia, Pennsylvania.^[2] Aramark's revenues totaled 14.329 billion USD in 2015, and the company was listed as the 21st largest employer on the Fortune 500. Its revenue in 2013 was $13.945 billion, and $14.832 billion in 2014.^[1][3]

History

Aramark was founded as Davidson Brothers in 1936 by Davre and Henry Davidson.^[4] Davidson Brothers began by providing vending services to plant employees in the aviation industry in Southern California.

In 1959, Davre Davidson partnered with William Fishman to establish ARA (Automatic Retailers of America), which became publicly traded a year later in 1960. In 1968, ARA provided services at the Mexico City Olympic Games, the first of 16 Games they have serviced, including Athens in 2004 and Beijing in 2008.^[5]

In 1969, ARA officially became ARA Services, to reflect its growing range of businesses. In 1983, Joseph Neubauer was elected CEO of ARA Services and a year later, in 1984, Neubauer led a group of executives to fend off a hostile takeover bid by coordinating a management buyout.^[6]

ARA Services changed its name to Aramark in 1994.^[7] In 2001, Aramark returned to the New York Stock Exchange as a public company under the RMK ticker.^[8] In 2006, a group of investors led by Neubauer (and including CCMP Capital, Goldman Sachs Capital Partners, Thomas H. Lee Partners, and Warburg Pincus) proposed the acquisition of all outstanding shares of the Aramark Corporation, which was approved by shareholders. The merger was completed in 2007.^[9][10]

In 2004, Aramark acquired a 90% stake in the Irish catering company Campbell Catering. In 2006, Aramark acquired Seamless. Aramark spun off its majority shares in Seamless in 2012.^[11]

In July 2009, Aramark and the Colorado Rockies opened what is believed to be the first gluten-free concession stand in major league baseball.^[12] By 2010, Aramark made gluten-free foods available at all 12 of its major league baseball accounts.^[13]

On August 29, 2011 Green Mountain Coffee Roasters sold Van Houtte USA (Filterfresh) to Aramark for $145 million.^[14][15]

In May 2012, Aramark announced that its Board of Directors had elected Eric J. Foss as CEO and that Joseph Neubauer would remain the company's Chairman.^[16] In December 2014, Joseph Neubauer announced his retirement and Foss was elected as the company's next chairman.^[17]

Ethical history

In recent years, Aramark has made several moves to boost its social responsibility image. In 2015, Aramark aligned with the American Heart Association to reduce the amount of calories saturated fat and sodium by 20 percent and increase by 20 percent the amount of fruits and vegetables and whole grains in the 2 billion meals it serves annually by 2020.^[18]

In 2015, the company also worked with the Humane Society of the United States on a comprehensive new animal welfare policy that includes purchasing only cage-free eggs by 2020 and eliminating all pork from animals bred using gestation crates by 2017. The company also eliminated the purchase of Foie gras in 2011.^[19][20]

In addition to the animal welfare supply chain commitments in 2015, Aramark also announced a complete transition to sustainably sourced canned skipjack and albacore tuna in the U.S. by April 1, 2016.^[21]

In 2008, Aramark Building Community, a company-wide volunteer initiative, was created to help neighborhoods rebuild community centers as well as provide support for job readiness programs, nutrition and wellness education, and basic human needs for families and neighborhoods. Since 2008 the company has invested more than $9 million in expertise, financial and in-kind resources to strengthen communities. More than 30,000 employees have dedicated their skills through hundreds of volunteer projects, impacting millions of people in dozens of cities through its annual Aramark Building Community Day activities.^[22]

A spring 2009 survey of over 92,000 students supported the company's concept of trayless dining, which was developed to reduce the amount of campus waste.^[23]

In response to First Lady Michelle Obama's childhood obesity Let's Move campaign in February 2010, Aramark, along with other major food service providers, pledged to reduce the amount of fat, sugar and salt in their meals over the next five years.^[24] In an effort to help fight childhood obesity, in 2014, Aramark partnered with the Children’s Hospital of Philadelphia on a program geared to nutrition education in disadvantaged neighborhoods.^[25]

Aramark has received recognition for its ethical performance, diversity and inclusion efforts, veteran hiring practices and its employee recognition and healthy lifestyle commitments.^[26][27][28]

Labor law violations

In April 2010, Aramark and the Coalition of Immokalee Workers reached a resolution that called for a 70−80% increase in wages for tomato pickers.^[29]

Aramark has also been the subject of a number of scandals regarding labor practices and business ethics. These include firing workers for reporting unsanitary food conditions, paying fringe wages, not paying for all hours worked, not paying backpay, and firing or eliminating the positions of those who file Equal Employment Opportunity Commission (EEOC) claims.^{[30][31][32][33][34]}

Food safety issues

In 2013, an investigation by Pulitzer Prize–winning journalist Chris Hedges discovered that the food provided to inmates at Burlington County Jail in New Jersey was substandard and spoiled, and often made prisoners sick with diarrhea and vomiting.^[35] Maggots found in the food preparation areas at Parnall Correctional Facility in Jackson, Michigan may have been the source of an outbreak of food-borne illness.^[36][37] Maggots were also found in Aramark food products at Michigan's Charles Egeler Reception & Guidance Center^[38] and two Ohio prisons, the Ohio Reformatory for Women and Trumbull Correctional Institute.^[39] Aramark, however, was cleared by the Michigan Department of Corrections of any responsibility for inmate illness and for pests in Michigan.^[40] Ohio and Michigan fined Aramark $270,000 and $200,000 respectively.^[41]

In April 2015, the managing board of The Cavalier Daily, a student-run newspaper at the University of Virginia, reported that Aramark literally "served garbage" to inmates in the Saginaw Correctional Facility in Freeland, Michigan. It also noted that Aramark has in the past "underfed inmates and fed them dog food, worms and scraps of food from old meals" and argued that the University should reconsider its relationship with the food services contractor in light of these ethical issues.^[42] Michigan's oversight of Aramark's performance was criticized as inadequate in a report released in August 2015 by the group Progress Michigan after Michigan moved to end the contract.^[43]

Likewise, Aramark has been criticized for skimping portion sizes, food safety issues, and overcharging state governments (Michigan, Kentucky, and Florida) that have used their food in prisons; a Kentucky prison riot is reputed to have been caused by the low quality of food Aramark provided to inmates.^[44][45]

Notable clients

Chicago Public Schools

Aramark has been criticized for the "filthy conditions" in Chicago Public Schools following the privatization of janitorial services and Aramark receiving a $260 million contract for their management. Responding to these reports, Chicago Mayor Rahm Emanuel said "Aramark's job is to clean the schools, so our principals and teachers can focus on their fundamental responsibility: education. They will either live up to that contract and clean up the schools or they can clean out their desks and get out."^[46]

Wichita Falls Independent School District

Aramark was hired for $2.65 million per year to provide janitorial services on 28 schools and three administration buildings by the Wichita Falls Independent School District in 2015. The district cancelled Aramark's contract and hired another firm due to numerous complaints about bad service. A report issued by the Wichita Falls-Wichita County Public Health District determined that one high school was infested with rats and mice. Janet Powell, the district's director of support services said, "Everyone on the committee felt lied to and deceived (by Aramark)."^[47]

Ohio Department of Rehabilitation and Correction

Since 2013, numerous Aramark employees providing food services in Ohio prisons have been fired or otherwise disciplined for inappropriate behavior towards prisoners such as sexual relations, letter writing, and smuggling contraband. At least 204 Aramark employees have been banned from entering Ohio prisons for such violations. On December 1, 2015 inmates working in the kitchen under Aramark management held a strike because they were required to cut meat with pan lids instead of being allowed to use meat slicers. An Aramark employee was given a written reprimand over the incident.^[48]

Since the state start using Aramark in 2013, the Ohio Civil Services Employee Association has been trying to regain control of the food services contract. A bid submitted by the union in spring of 2015 failed after a state review found it did not properly reflect projected costs. Aramark's contract was renewed. The head of the union said Aramark “continues to violate their contract every day with food shortages, health and safety violations, bad employee conduct, low food quality.” As of late 2015, the union was pursuing arbitration against the state over this contract.^[48]

In 2014, Aramark was issued two fines totaling $272,200 for contract violations. The state offered to credit money spent on additional employee training towards the fines. The same year nine Aramark employees were fired for contraband violations and 15 were fired for "security violations."^[48]

See also

• Prison–industrial complex

References

External links

• Aramark corporate website
• Aramark Uniform & Career Apparel website
• Aramark Uniform & Career Apparel Direct Sale website
• Aramark Refreshments Website
• Aramark National Events Promotional Services Website
• Aramark Canada Website
• Aramark SEC Filings