Those businesses are in good company, joining the ranks of tech companies such as Apple and Google, banks and a whole host of other industries all keen to play their part in bringing the death and destruction in Ukraine to an end.
Some have taken the decision to completely withdraw from Russia, simply accepting whatever losses they may incur. Others have decided to suspend business there.
Where do you stand?
In the case of KFC, owner Yum! Brands announced last week that the division was suspending its Russian operations. The statement followed the company’s previous decision to suspend all investment and restaurant development in the country.
In a similar vein, McDonald’s has temporarily closed its restaurants in Russia and paused all operations there. The company has noted that it has understood the impact that its action would have on its Russian employees and so is continuing to pay their salaries.
Both Yum! Brands and McDonald’s would appear to be keeping their options open for a return to business if things return to normal, but if you think that their actions are not causing them pain, consider that McDonald’s decision is thought to be costing it US$50 million per month.
Few companies, however, are able to fully claim any moral high ground, often responding to investor and consumer pressure rather than immediately taking a stand. Similarly, many governments have been quick to condemn, but somewhat slower to act, but it is never too late to change.
Take, for example, the case of Deutsche Bank. The company stated on March 10th: “We are often asked why we are not withdrawing completely from Russia. The answer is that this would go against our values.”
This statement was far from well received in all quarters and, on March 11th, the company said: “Like some international peers and in line with our legal and regulatory obligations, we are in the process of winding down our remaining business in Russia while we help our non-Russian multinational clients in reducing their operations. There won’t be any new business in Russia.”
For those that continue to put profits before people, I would like to share the following that we received from a contact in Ukraine before fighting significantly intensified:
“We all terrified and scared. Fourth day we are forced to live in basement without normal conditions. We are hearing the sounds of rockets and shots. Russian soldiers kill civil people here. A lot of cities are ruined. All Ukrainians are praying. We want this war to be stopped asap.”
An army marches on its ….
Yet there are still those who argue that trade - and food - should know no borders, and who will continue to trade with Russia. One would hope, at least, that they are fully conscious of their actions, prepared to live with them and the risk of reputational damage.
The Russian economy may be bincreasingly starved of everything from designer handbags to airline parts, smartphones to payment cards, but for those that choose to continue to ship food to the country, it may be worth remembering that an army marches on its stomach.