More companies join Russia boycott over Ukraine war?

List of global brands shutting down operations in Russia has been expanding since the start of the crisis

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As Russia's war in Ukraine continues, more major brands have joined world governments in isolating Russia over the military invasion.

US and European retailers have been rapidly shutting operations across Russia, which has forced Russians to race and buy imported consumer goods over fears shops will close and prices will rise because of the plunging rouble and sanctions.

One of the biggest is McDonald's, which is temporarily closing 850 outlets across Russia.

A list of the companies that have pulled out of Russia has been circulating over the past weeks, putting the spotlight on chief executives that continue to keep their companies operating in Russia, not prepared to put their profits and market share at risk.

Yale University's Jeffrey Sonnenfeld and his research team put together a “who’s who” list of western companies that operate in Russia and those that were limiting operations, and told the Washington Post that they believed sanctions and boycotts were a way to avert a broader war between Russia and the West.

This is “one step away from open warfare … a last-ditch effort. You are helping those workers by not having [the West] dropping bombs and shooting them”, he said.

The list shows that about 290 companies have announced their withdrawal from the country since it invaded Ukraine, reminiscent of “the large-scale corporate boycott of apartheid South Africa in the 1980s”.

About 30 multinationals are still on the list of companies with significant exposure to Russia. Mr Sonnenfeld said that they have been contacted by a number of chief executives of companies named on the list and asked how companies can clarify their stance or demonstrate a tougher stance.

Companies may be hesitant to leave because they think they can mediate, or because they make essential products such as pharmaceutical ingredients, Tim Fort, a professor of business ethics at Indiana University, told AFP.

“Any one company leaving the country isn't going to tip the balance … but there is a cumulative effect,” Mr Fort said.

Here is a round-up of major businesses that have suspended product shipments, shut down or severely limited operations.

McDonald's

The fast-food retailer announced that it will temporarily close 850 outlets, but will continue to pay its 62,000 employees in Russia “who have poured their heart and soul into our McDonald’s brand”.

“Our values mean we cannot ignore the needless human suffering unfolding in Ukraine,” McDonald’s president and chief executive Chris Kempczinski said in an open letter to employees.

“Through this dynamic situation, we will continue to make decisions that are true to our mission and values and communicate with transparency,” Mr Johnson wrote.

McDonald’s said on Tuesday that it had donated more than $5 million to its employee assistance fund and to relief efforts.

A Ronald McDonald House Charities mobile medical care unit has been sent to the Polish border with Ukraine, and another mobile care unit is en route to the border in Latvia, the company said.

Apple

After Ukraine's Deputy Prime Minister Mykhailo Fedorov tweeted a letter to Apple chief executive Tim Cook on February 25, pleading with the technology company to pull out of Russia, Apple closed its outlets and paused product sales in the country.

It has yet to shut down its local App Store.

Coca-Cola

Coca-Cola Co announced it was suspending its business in Russia, but provided few details.

Its partner, Switzerland-based Coca-Cola Hellenic Bottling Co, owns 10 bottling plants in Russia, which is its largest market.

The soft-drink company has a 21 per cent stake in Coca-Cola Hellenic Bottling Co.

Starbucks

Starbucks said that it was donating profits from its 130 shops in Russia, owned and operated by Alshaya Group, to humanitarian relief efforts in Ukraine.

However, the company changed course on Tuesday and said it would temporarily close those outlets.

Alshaya Group will continue to pay Starbucks’ 2,000 Russian employees, Starbucks president and chief executive Kevin Johnson said in an open letter to employees.

PepsiCo

Pepsi said it will suspend sales of beverages in Russia, as well as any capital investment and promotional activities.

The company said it will continue to produce milk, baby formula and baby food, in part to continue supporting its 20,000 Russian employees and the 40,000 Russian agricultural workers who are part of its supply chain.

“Now, more than ever, we must stay true to the humanitarian aspect of our business,” PepsiCo chief executive Ramon Laguarta said in an email to employees.

PepsiCo also announced that it is donating food, refrigerators and $4 million to relief organisations.

Renault

Renault says it will suspend operations at its plant in Moscow while it assesses options on its majority stake in Avtovaz, the country's number one car manufacturer.

Bombardier

Bombardier has cancelled plane orders because of western sanctions on Russia, chief executive Eric Martel said.

Canada's Bombardier is one of the biggest suppliers of jets to Russian owners, according to analysts and brokers.

“We need to ensure when we deliver spare parts who’s going to be the end user,” Mr Martel said.

Mr Martel would not say how many specific orders were cancelled or put off but said there are not that many. Bombardier has said it has stopped selling parts to buyers who would register or operate planes in Russia.

"The market is so strong that we can redeploy these aircraft in other regions," said Mr Martel. He said the company's parts sales in Europe "are going very well".

Netflix

The on-demand video-streaming company suspended all future acquisitions in Russia after the invasion and then suspended all operations in the country.

“Given the circumstances on the ground, we have decided to suspend our service in Russia,” the Netflix representative said.

TikTok

Video clip social media site TikTok also suspended operations in Russia over “circumstances on the ground” but specifically appeared to be pointing to Russia's move to outlaw, with hefty jail terms, what the government deemed as fake news.

“TikTok is an outlet for creativity and entertainment that can provide a source of relief and human connection during a time of war,” the company said.

“In light of Russia's new ‘fake news’ law, we have no choice but to suspend live streaming and new content to our video service while we review the safety implications of this law.”

It said in-app messaging would not be affected.

Alphabet Inc's YouTube and Google Play store

Alphabet Inc, which runs YouTube and the Google Play store, has suspended all payment-based services in Russia, including subscriptions.

Google and YouTube had earlier stopped selling online advertisements in Russia after similar measures were adopted by Twitter and Snap due to Moscow's invasion of Ukraine.

"As a follow-up, we are now extending this pause to all our monetisation features, including YouTube Premium, Channel Memberships, Super Chat and Merchandise, for viewers in Russia," YouTube said on Thursday.

Intel Corp

US chipmaker Intel Corp said it has suspended business operations in Russia, after suspending shipments to customers in Russia and Belarus last month.

"Intel continues to join the global community in condemning Russia's war against Ukraine and calling for a swift return to peace," the company said.

Nestle, Mondelez International, Procter & Gamble and Unilever

Nestle, the world's biggest packaged foods group, and Mondelez International, followed actions by rivals Procter & Gamble and Unilever.

The four companies that monopolise the packaged foods industry have suspended investment activity in Russia but will continue to provide essentials, with Mondelez aiming to help to maintain continuity of the Russian food supply.

British American Tobacco, Japan Tobacco, Imperial Brands and Philip Morris

Cigarette maker Imperial Brands suspended operations in Russia while Philip Morris said only that it would scale down manufacturing. British American Tobacco, maker of Camel cigarettes, said its business in Russia continues to operate, even though it had suspended capital investment.

Japan Tobacco, which controls about a third of Russia's tobacco market through brands such as Winston, said its subsidiary there would suspend investment, marketing activities and the planned release of a heated tobacco product.

Sony

Sony, whose movie studio has already stopped releases in Russia, took additional action on Wednesday, saying its PlayStation gaming unit would stop shipments and operations in Russia.

“Sony Interactive Entertainment joins the global community in calling for peace in Ukraine,” it said.

Qualcomm

Chipmaker Qualcomm Inc said on Wednesday it has stopped selling its products to Russian companies in compliance with US-imposed sanctions.

The company's action was made clear through a tweet posted by its senior vice president of government affairs, Nate Tibbits, as a reply to Ukrainian Vice Prime Minister Mykhailo Fedorov's comment.

Mr Fedorov had said that Qualcomm products are still available in Russia and that it "inadvertently enables this country to kill thousands of Ukrainians.@ He urged Mr Tibbits to stop supplies to Russia.

In his reply, Mr Tibbits said, "This is incorrect. Qualcomm has called for a peaceful resolution to Russia's aggression in Ukraine, made direct donations to relief organizations & match employee contributions."

Mr Fedorov subsequently suggested that the chipmaker can send its satellite phones for Ukrainian rescuers if it wants to help.

General Electric

General Electric said in a Twitter post that it was partially suspending its operations in Russia.

GE said two exceptions would be essential medical equipment and support for existing power services in Russia.

Equinor

Norwegian state oil company Equinor said on Monday it will stop trading in Russian oil and will shut down operations in Russia.

"When we said we wanted to start exiting the (Russian joint venture), we also stopped from that date trading with Russian oil," Equinor's chief executive, Anders Opedal, told Reuters.

Equinor added that it had contractual commitments which it struck prior to Russia's invasion of Ukraine, and is scheduled to receive four oil cargoes in March.

BP

BP announced on February 27 that it would withdraw its 20 per cent stake in state-controlled Rosneft, a move that could result in a $25 billion write-off and cut the company’s global oil and gas production by a third.

Shell

Shell said it would end partnerships with state-controlled Gazprom, including the Sakhalin-2 liquefied natural gas plant and its involvement in the Nord Stream 2 pipeline project, which Germany has blocked.

As an immediate first step, the company will stop all spot purchases of Russian crude oil. It will also shut its service stations, aviation fuels and lubricants operations in Russia.

The two projects are worth about $3 billion.

“We will commit profits from the limited, remaining amounts of Russian oil we will process to a dedicated fund. We will work with aid partners and humanitarian agencies over the coming days and weeks to determine where the monies from this fund are best placed to alleviate the terrible consequences that this war is having on the people of Ukraine,” said Ben van Beurden, Shell's chief executive.

Exxon Mobil

Exxon Mobil said it would discontinue its Sakhalin-1 operations.

Rio Tinto

Rio Tinto became the first mining company to announce it was cutting all ties with Russian businesses.

“Rio Tinto is in the process of terminating all commercial relationships it has with any Russian business,” a Rio spokesman said in a message sent to Reuters.

It was not immediately clear with which companies Rio has done business in Russia.

Yum! Brands

Yum! Brands, with about 1,000 KFC restaurants and 50 Pizza Hut locations in Russia, announced on Tuesday that it was suspending operations at company-owned KFC locations.

The business said it was “finalising an agreement” to do the same with its Pizza Hut restaurants, and that all profits from operations in Russia will be redirected to “humanitarian efforts”.

Burger King

Burger King said it is redirecting the profits from its 800 Russian restaurants to relief efforts and donating $2 million in food vouchers to Ukrainian refugees.

PayPal

PayPal said on Tuesday it is suspending services in Russia, although it cannot “reasonably estimate the total potential financial impact that may ultimately result from this situation”.

Heineken

Heineken has stopped the production and sale of its eponymous beer in Russia, the company said on Wednesday.

“Heineken will no longer accept any net financial benefit derived from our Russian operations,” the company said. The company said it is also assessing the strategic options for the future of its business in Russia, where it has operated for two decades.

The company is also taking steps to ring-fence the Russian business from the wider group to “stop the flow of monies, royalties and dividends out of Russia”.

Carlsberg

Carlsberg, Russia’s largest brewer through its ownership of Baltika Breweries, said last week that it is suspending new investment in Russia and stopping exports to the country from other Carlsberg companies.

Uniqlo

Uniqlo owner Fast Retailing Co said on Thursday that it will suspend operations in Russia

Earlier, founder Tadashi Yanai told Japanese media that the company would continue to operate its 50 stores in Russia because "clothing is a necessity of life".

However, Fast Retailing did an about-turn on Thursday and said: "While continuing our Uniqlo business in Russia, it has become clear to us that we can no longer proceed due to a number of difficulties. We condemn all forms of aggression that violate human rights and threaten the peaceful existence of individuals."

Levi Strauss & Co

The popular jeans brand suspended commercial operations in Russia, which generate about 2 per cent of its sales.

The “enormous disruption occurring in the region” has made it “untenable” to conduct business as normal, the company said on Monday.

“Any business considerations are clearly secondary to the human suffering experienced by so many.”

Samsung

Samsung Electronics Co, the leading smartphone seller in Russia with more than 30 per cent of the market, stopped the export of all its products to Russia.

Samsung said it will donate $6 million to humanitarian efforts in the region, including $1 million in consumer electronics products.

Amazon

Amazon.com’s cloud-computing unit announced in a blog post that it will stop accepting new customers in Russia or Belarus.

The company said its Amazon Web Services unit had “no data centres, infrastructure or offices in Russia, and we have a long-standing policy of not doing business with the Russian government. We have also stopped allowing new sign-ups for AWS in Russia and Belarus”.

Ikea

Home-furnishing retailer Ikea announced that it was pausing all Ikea-brand retail operations in Russia.

It has also stopped exports from Russia and Belarus and imports into the two countries, as well as deliveries from sub-suppliers.

Ikea said it was seeking to provide “income stability” for its 15,000 employees for the short term.

A statement on the Ikea Russia website said it was suspending sales in shops and online immediately, and that only orders placed and paid for before March 3 would be fulfilled.

The company said that its Mega Family Shopping Centres, which are malls with grocery shops and pharmacies, will be kept open.

H&M

The Swedish clothing retailer has temporarily paused sales in Russia, where it has 155 shops across the country.

Mango

Spanish fashion retailer Mango is closing its 55 company-owned shops in Russia, suspending online sales and stopping deliveries to the country.

Its 65 franchisees are being allowed to stay open, subject to product availability. The company has 800 employees in Russia, according to Reuters.

Nike

Footwear retailer Nike is temporarily closing company-owned-and-operated shops in Russia.

However, the company told Bloomberg that it will continue to pay shop employees during the closures. It is also suspending e-commerce sales in the country.

Marks & Spencer

British retailer Marks & Spencer Group suspended shipments to its Turkish franchisee’s Russian business.

Richemont

The owner of Cartier and Vacheron Constantin watches has suspended commercial operations in Russia, after earlier stopping business operations in Ukraine.

Swatch

Swiss watch company Swatch Group told Bloomberg it will be closing its shops in Russia.

Under Armour

Sports apparel company Under Armour has stopped all shipments to sales channels in Russia.

Asos

Fast-fashion retailer Asos said that it was stopping sales in Russia. In 2021, Russia and Ukraine accounted for about 4 per cent of sales revenue. The company suspended sales in Ukraine after the invasion.

Boohoo

UK online clothing seller Boohoo Group Plc has suspended operations in Russia.

Burberry

British fashion house Burberry Group Plc has halted shipments to Russia but still has shops open in the country.

Chanel

Luxury brand Chanel suspended online sales and deliveries to Russia and will close its shops there.

Hermes

French luxury brand Hermes International said it will temporarily close its shops in Russia and pause all commercial activities.

Inditex

Spanish fashion retailer Inditex SA, the owner of Zara, is temporarily closing its shops in Russia and suspending online sales. It has 502 outlets in the country.

JD Sports

UK sportswear retailer JD Sports Fashion has ceased business operations in Russia across its brand websites and wholesale channels.

Kering

The owner of Gucci and other luxury brands said it will temporarily close its directly operated shops in Russia because of “growing concerns regarding the current situation in Europe”.

LVMH

French luxury group LVMH said it is temporarily closing its 124 stores in Russia, where it has 3,500 employees.

Nestle

Nestle, the world's largest packaged food group, has suspended all capital investment in Russia after its invasion of Ukraine.

The Swiss maker of Maggi and Nescafe said it would continue to provide Russia with infant food and medical nutrition aid, but halted non-essential exports and imports from Russia and stopped all advertising.

Nestle said it would continue to pay Russian employees.

“We stand with the people of Ukraine and our 5,800 employees there,” Nestle said

Unilever

The global consumer product maker suspended shipments to Russia and will halt advertising and capital investment as well.

Anheuser-Busch InBev

Brewer Anheuser-Busch InBev said on Friday it was seeking to suspend sales of Bud beer in Russia and will forfeit all financial benefit from a joint venture that operates in the country. The company also sent 500,000 cans of mineral water from its brewery in Leuven to the Ukrainian border.

Updated: April 06, 2022, 7:06 AM
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