These companies continue to do business in Russia

Business News / By /

The list of companies continuing to operate in Russia is shrinking by the minute, but dozens of corporations, including multinational manufacturers and hotel chains, still do business in the country despite strong public pressure to leave because of its invasion of Ukraine.

McDonald’s was among the high-profile companies that announced on March 8 that it would temporarily close 850 of its restaurants in Russia. Cola-Cola and PepsiCo quickly followed suit, as did Papa John’s and others the next day. However, more than 30 large companies “remain in Russia at significant risk,” according to current estimates updated daily by Yale University management professor Jeffrey Sonnenfeld.

Large enterprises that have decided to maintain their presence in Russia include a Japanese chain of clothing stores. Uniqlo. According to a March 8 report from Nikkei Asia, the CEO of its retail holding company, Fast Retailing, promised to keep the brand’s 50 retail stores open across Russia, calling “clothes a life necessity.”

The list also includes Illinois-based Abbot Labs. Among companies condemning the war, Abbott on March 4 said it would donate $2 million to humanitarian groups helping Ukraine. The multinational medical equipment and health products company did not mention Russia or its activities in the country in its statement.

Also on Sonnenfeld’s list is a Tokyo-based tire and rubber manufacturer. Sheena Bridgestone. He has manufacturing facilities in Russia, but the extent of his business in the country is unclear.

U.S. agricultural trading giant Cargill receives 1.1 dollars of income from Russia, where 2,500 people work. “The events unfolding in Ukraine are heartbreaking,” he tweeted on February 27. “It is difficult to know what challenges our employees, customers and their families in the region will face in the coming days and weeks. Our top priority is their safety, which is the reason why we closed some places.”

Russia generates 8% of revenue for Caterpillar, or roughly $4 billion, according to Sonnenfeld. A construction and mining equipment company based in Peoria, Illinois, opened its first office in Russia in 1973 and now also operates a parts center in Moscow and a manufacturing plant in Tosno, near St. Petersburg.

banking giant Citygroup according to a February 28 regulatory filing, domestic and international risk in Russia is $9.8 billion. “Citi continues to monitor the current geopolitical situation and economic conditions in Russian-Ukrainian relations and will mitigate its risks and risks as necessary.” New York-based Citi said it provides institutional and consumer banking services in Russia but is working to exit the latter.

Multi level marketing company Nutrition Herbalife receives 2.7% of its revenue from Russia and Ukraine.

Hotel chain Hyatt On March 9, she announced that she was suspending development activities and new investments in Russia and “will continue to evaluate the activities of hotels in Russia.” Hyatt said in a March 4 statement that the company is “heartbroken over the devastation” in Ukraine and has set up a fund to help colleagues in the region need emergency supplies and relocation assistance. According to Sonnenfeld, the company has six offices in Russia.

Offering words like this Marriott On March 8, he updated his statement expressing concern about the humanitarian crisis in Ukraine and neighboring countries, saying he was working with charities to help. The international network has at least 10 points of sale in Russia.

The exclusion list is circulating on social media, prompting calls to boycott Hyatt and other companies.

“The Russian invasion of Ukraine has highlighted the intersection of risk, reputation and reward,” Paul Washington, executive director of the ESG Center at The Conference Board, said in a report. “For many companies, the decision to end a relationship can be relatively simple. Given the size of the Russian economy, this could result in little income. The reputational damage of continuing a business—and the benefit of announcing a termination—can be significant. .”

A united front of cryptography?

Some crypto companies are also resisting pressure to close Russian accounts despite the Feb. 27 ban. address from the Vice Prime Minister of Ukraine “with a request to all major crypto exchanges to block the addresses of Russian users.”

kraken CEO Jesse Power responded that “despite his deep respect for the Ukrainian people,” his company cannot freeze the accounts of Russian clients unless required to do so by law.

The world’s largest cryptocurrency exchange, Binance, blocks the accounts of Russians under Western economic sanctions, but not Russians in general. “We are not going to unilaterally freeze millions of innocent user accounts,” CEO Changpeng Zhao wrote in a March 4 blog post.

Coinbase CEO Brain Armstrong tweeted on March 4 that “ordinary Russians are using cryptocurrencies as a lifeline.” However, the company will comply with any restrictions imposed by the US government, he added.

Coinbase’s position matches that of other crypto exchanges, including Kraken, KuCoin, and Coinberry.

More