How Companies Refusal to Halt Business in Russia Hurts Ukraine

Individual freedoms pivot on the right to be informed and the right to make judgments and choices based on open access to the realities of this world.

In this post, PissedConsumer.com wants to emphasize this right to be informed.

As consumers, we base the decisions we make on a variety of factors. Cost and convenience often take the lead, with ethical considerations following.

Yet, the globalized world is changing, increasingly, the way we consume has to knock on effects that influence the lives of people across the globe. Now, more than ever, it is crucial to be aware of where your money is going, where it ends up, and what it is funding. In particular, when it concerns war and civilians being hurt.

Providing Fuel That Perpetuates Ukraine-Russia Conflict

When an international company conducts business outside its home nation, it is subject to the taxes of the country in which it operates.

How this tax revenue is spent is determined by the priorities of the state in which the company conducts business. It could contribute to education, national infrastructure or, indeed, fund military production and war.

On the 24 of February 2022, after amassing on the border for months, the Russian military entered Ukraine. This action was anticipated by the government but still came as a shock. The Russian invasion quickly prompted an international response in the form of sanctions on Russian banks, businesses, and individuals.

Why Impose Sanctions on Russia?

The purpose of sanctions is to either bring Russia under sanction to the negotiating table or to strengthen domestic opposition to its government and compel the population to force regime change.

In addition to sanctions imposed by states, hundreds of Western and international companies have withdrawn their operations from Russia.

Yet, despite the Russia-Ukraine war, many world brands continue to conduct business in Russia.

US consumers have voiced multiple complaints about international brands that have yet to pull out of Russian markets. A growing number of online reviews left by regular consumers on PissedConsumer.com express concern at this ‘hall of shame’ and advocate a ‘Russia boycott’.

With such growing calls for a boycott, it remains to be seen how large international brands can maintain a presence in Russia without severely damaging their global reputation and revenue. At the same time, it is up to consumers to make a choice to either support such brands by buying from them or to boycott them in a response to their decision to financially support the country of aggressor and the killing of people during this war.

What Western Companies Currently Do Business on the Russian Market?

Nestle

Ukrainian President Volodymyr Zelenskyy recently called out Nestle for remaining in Russia, whilst Ukrainian PM, Denys Shmyhal, took exception to Nestle CEO Mark Schneider:

“Unfortunately, he shows no understanding. Paying taxes to the budget of a terrorist country means killing defenseless children and mothers. I hope that Nestle will change its mind soon.”

Whilst Nestle has ceased supplying many consumer goods to Russia, items such as baby food, cereal, and pet food continue to enter the country.

In response, the company stated, “We are doing whatever we can in Ukraine and neighboring countries to help alleviate this humanitarian catastrophe,” the spokesperson added. “We are still one of the few active food companies in Ukraine and sometimes even manage to distribute food in Kharkiv.”

The Swiss company has a long history of being on the receiving end of boycotts, and this isn’t the first time that Nestle has been caught in a controversy over questionable activities. The most well-known being the baby milk controversy, whereby Nestle aggressively marketed infant formula to parents in regions where breastfeeding was a safer choice due to poor water supply hygiene.

Nestle has continued to be accused of placing profit over responsibility to human life and scientific accuracy.

Renault

Automobile manufacturer Renault has, after a brief pause, fired up its factories in Moscow and, with the approval of its largest shareholder, the French government, will continue production after temporarily halting proceedings last month due to logistical disruptions faced at the beginning of the Russia Ukraine war.

Renault has an approximate 2/3 share in Russian automobile manufacturer, AvtoVaz, which produces approximately 400,000 vehicles per year.

A representative of the company stated, “Renault Russia has confirmed the restart [of production] on Monday, but only for three days,” yet was not forthcoming with details of Renault’s long-term plans in Russia.

However, on March 24, 2022, following criticism in a statement made to French lawmakers by President Zelenskyy, the car manufacturer is now halting operations at its Moscow plant and is reconsidering the future of its stake in the AvtoVaz.

Burger King

Following the outbreak of the war, Restaurant Brands International, which own the Burger King brand, announced a closure to its franchises in Russia.

However, 800 Burger King restaurants are still trading in Russia. The company claimed that legal complexities prevent them from taking the previously stated action.

Marks & Spencer

Despite halting supply to its 48 franchises in Russia, stores in the country are still trading and continue to do business. The UK government stated that businesses must “do nothing that could potentially support Putin’s regime and indeed do everything to put pressure on him to change course”

A representative of the Mark & Spencer stated: “We suspended deliveries to our franchisee licensee’s Russian business two weeks ago and have no plans to reinstate them. We are actively discussing the future of the business with our franchise licensee.”

Subway

The US fast-food chain currently still has around 450 franchises open in Russia. Also citing a lack of control over independent franchises as the reason for this continuation. The company states that, even though it continues to operate in the country, it is donating profits made in the country to humanitarian causes.

Pepsi

PepsiCo, one of the world’s largest multinational snack food and beverage monopolies and the first Western brand to be manufactured and sold in the Soviet Union, declared that it will be ceasing the sale of its most popular soft drink brands in response to the Ukraine conflict. The company will continue to sell milk and baby food, however.

Updated lists of businesses and their current status with regard to Russia can be checked on the Yale website here or accessed on the Reuters website here.

Originally published at https://www.pissedconsumer.com on March 24, 2022.