Some of the Biggest Brands Are Leaving Russia. Others Just Can’t Quit Putin. Here’s a List.

from NYTs

In the latter half of the 1980s, roughly 200 American companies withdrew from South Africa, partly in protest against its apartheid system. As businesses fled the country, South Africa’s segregationist president, P.W. Botha, came under increasing economic pressure. The corporate exodus contributed to the end of apartheid, and was a remarkable display of the power that companies have. When they’re courageous enough to use that power for good, it can help topple repressive governments.

Over the past six weeks, we’ve witnessed a similarly extensive response from the private sector to Russia’s war in Ukraine. Hundreds of American companies have announced that they are voluntarily curtailing or halting their business in Russia, according to data compiled by our team of 24 researchers at the Yale School of Management. While it’s impossible to say whether all of these companies are motivated by purely moral concerns, they’ve all gone above and beyond what is legally required by international sanctions.

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9 Comments

  1. The topic presented in this article is a great learning opportunity and I believe it shows some hope on companies and the ones who lead it. I use the word hope because in the recent past and present there has been an extensive amount of companies that took terrible ethical decisions and were involved in illegal actions but that would bring profit to the company. With that considered, seeing hundreds of companies leaving Russia’s market because they don’t want to support a leader who believes war solves problems is positive and shows that some people still have some ethics left in them.
    The article does a great job at classifying companies withdrawal levels and having more than 600 out of 800 being analyzed to be considered withdrawals is impressive. But the main outcome of this article is the idea companies are leaving the market.
    On the other hand, it is possible to take some hypothesis into consideration. For example, a CEO who withdrew from Russia could be against the decision but he did because the brand equity would lower a lot and customers would stop buying if they realized the company did nothing about it. In this scenario, of course we have to consider the power of the media. The media is so powerful that if the main sources of news posted that Putin was actually doing good things, I strongly believe the market would shift completely and everyone would go back to the Russian market, even if it were fake news. Of course this is all hypothetical but I believe it is always important to remember people in power rarely care about anything but their money and image, which definitely makes them take good and bad decisions in order to achieve those.

  2. Ever since we saw Vladamir Putin and his Russian army invade Ukraine on February 24th we have seen the Russian economy pumble in weeks. One major reason is that companies are discontinuing their business in Russia in an attempt to protest against Putin’s actions. Hundreds of American companies announced that they are voluntarily curtailing their business in Russia. These companies are going above and beyond what is legally required by international sanctions. Many countries including the United States are putting down sanctions which limits what the Russian economy can do. It messes with their cash flow and day to day life. Russian citizens can not even go down to their own bank to withdraw money anymore. The main thing that I have seen around our country when this first started was bars taking out Russian liquor and dumping it out of the bottle onto the ground. They have also been removed from stores. I have to say I do not agree with that though. For example, Svedka, a Russian vodka company came out and publicly said that they do not support Vladamir Putin and what he is doing. They have also been donating some of their money to Ukraine. Even though something is Russian that does not mean that they support what is going on. I do not believe we should be dumping and just getting rid of Russian products just because it is Russian. However, if a company is still staying in Russia and continuing their business there to fund them, we the people should be doing everything we can to defund that company. Anyone who is on Putin’s side like businesses, governments, etc should be punished in some sort of way when this is all over. If a business is strictly from Russia and is currently still doing all of their business there they do not know the truth to what is actually going on. Russia is full of communism and controls what news people can see. Since the invasion took place the Russian government has been lying to their citizens on what is actually happening through the news. They do not know the full truth to what is going on.

  3. I think we can all agree that Vladamir Putin and his army have caused an extreme amount of chaos these past two months with more to come. Rumors have said that there might even be a world war 3. Hopefully there is not and the Ukraine can be left alone and can come back stronger after this traumatic event. Since Putin’s chaotic episode countries across the globe have been effected. For example, oil embargos that get their oil from Russia have been cut off forcing them to outsource. Due to this, gas prices have gone up extremely because supply for oil has decreased as the demand for it increased. Putin’s chaos doesn’t just end there, many other companies have cut ties with the country because they do not support Putin and his doings. Finally, if companies are seen doing business with the country they will lose costumers by the minute.

  4. There have been many debates and controversies regarding the significant power and ethical practices that private corporations and businesses contain. We have discussed many on the blog channel the effects of the implementation of monopolies and the epidemic of mandatory arbitration. This article provides hope that companies have righteous morals since they halted their businesses in Russia. This is a direct protest against the recent actions of Vladimir Putin and his declaration of war against Ukraine. Combined with various countries having applied international sanctions against Russia, these companies removing their market will have a crippling effect on Russia’s economy. In addition, Russian stock markets have crashed and the pressures on the financial system are increasing. Furthermore, shipping companies have curtailed cargo bookings which will lead to product shortages.
    Russia is already spending an immense amount on the war with Ukraine. According to the Centre for Economic Recovery, Civitta, and EasyBusiness estimate that the war with Ukraine costs the Russian military more than $20 billion every day. The economic sanctions imposed on Russia are also having a huge result. “The Russian ruble has become almost worthless in the last couple of weeks,” said Christopher M. Herrington, Ph.D., an associate professor. Along with these outcomes, private companies including Starbucks, McDonald’s, and Coca-Cola are also isolating their enterprises from Russia. Millions of employees will lose their jobs and the retail market will go down. Vladimir Putin and the Russian legislation have to in the near future take steps to combat the economic crisis. Continuing the war will have adverse effects on their nation.

  5. On February 24, Russia declared war on Ukraine. Since then, their economy has nearly collapsed making their country financially unstable. Many Russians cash out stocks, crypto, and sell a lot of their assets in the uncertain events in which they don’t know when the war will end. To this day, citizens are not allowed to withdraw cash or money from their banks as it is merely unavailable at their banking institution. Many countries and companies have cut Russia off in hopes to support Ukraine and to protest against Russia in the way they are taking a violent approach towards another country. For example, Mcdonalds, a fast food restaurant chain, has shut down all of its restaurants in Russia to protest against Russia’s actions. The US has limited Russia’s ability to perform certain tasks to combat their actions as well. During these crucial times, it is necessary as a just citizen to show your support against wrong ideas and actions. But, I don’t agree with condemning Russian companies especially if they publicly say they don’t support Vladamir Putin or his actions. I think this hurts businesses who are caught in the crossfire and are condemned for being Russian, which in other words, is low. I think we should be focused on protesting and condemning Russia for their violent actions. Overall, Russia is a communistic country which is full of propaganda and spreading nothing but false news. They try to rile their country with hate and fake news so they can support Russia’s actions and the war. It is truly unfortunate and disheartening to see this kind of news spread and russian citizens filled with lies.

  6. For once in the existence of Capitalism companies have done what is morally right. After Russia’s unethical invasion of Ukraine, multi-billion dollar companies are exiting the lands run by Putin. Companies should have exited Russia from the first invasion of Ukraine back in 2014. Putin has shown his tyrannical practices. He does not care for the Russian people. He knew there would be repercussions from his action and his people would face the majority of the blow. This is the saddest part of the invasion in 2014. There were a bunch of U.S and European sanctions on Russia during the invasion of 2014, but Russia came out stronger than ever. Mr. Putin deflated his currency, sold his oil in U.S dollar and conferred it back to rubles. He then ended the invasion and spent the better half of 2014-2019 building the strength of the ruble to gain massive amounts of money on his dirty scheme. The people of Russia, however, did not come out of the invasion so lucky. Poverty increased drastically after the Russian invasion in 2014. Russians were barely able to get back on their feet recently after facing another challenge in the pandemic. Mr. Putin put his own people through the wringer again to try and do his conversion scheme. Luckily this time around the economic sanctions has been harsher on Russia. Allied countries have received help from multi-billion-dollar companies by them leaving operations in Russia. This time around the ruble is as good as useless and Putin can not conduct his scheme anymore. The unfortunate part of this is the innocent Russian people are going to have an even harder time recovering from the economic blow. Putin’s actions single handily ruined his whole country and I firmly believe that Russia will cease to exist in the upcoming future.

  7. The world has not been the same since Vladimir Putin, president of Russia, decided to invade Ukraine. In Putin’s mind, Ukraine still is part of Russia and should be officially taken back. The whole world saw on their televisions what the Russians were doing to the soldiers, families, and children or Ukraine. This article talks about some companies leaving Russia due to their actions against peace. This situation is something the US and the world population will not forget soon. This will stay in the mind of consumers all over the country and world. The stance a company has on a real-world issue can either help or hurt their business. Russia is the largest country in the world by area and has many resources that other countries could never have. The potential to make money and build businesses in Russia is intriguing to major corporations. However, keeping your business in Russia can be seen as siding with Putin in this war. This would be devastating to any company with this image. The sales would decrease drastically, and the public image would be negative. The business could be ruined by their decision to stay or leave Russia.

  8. With Russia’s invasion on Ukraine, The Russian economy has gone down tremendously because of it. With the unethical attack that Puttin put on Ukraine caused a problem within all the coutries and caused problems in the economy. Vladimir Puttin is the one who was in charge of all of this with the mess he has caused. Now, many of the biggest brand companies are leaving Russia. This shows how some of the big companies and their CEO has decided that they did not want to be in a country that was led by Vladimir Putin. This article is very interesting and gives a lot of great point. They give a great example of where this has happened before in history where in the 1980s nearly 200 withdrew from south Africa in protest of their in apartheid system. Years later we are seeing this happen again. Putin’s action are getting bad and people are starting to realize they are at jeopardy. American businesses are discontinuing their business which is why the Russian economy has gone down so much causing the cash flow to crash. I believe people who are leaving Russia have some risk of doing so which can lead to less money, but doing the smart thing that will prevent any issue and not wanting your business over a ruthless leader in Putin who can out your company in danger. As a result of losing connections with russia gas prices have gone up significantly and oil have been very limited because of it. This shows how much of an impact Vladimir Putin and Russia has made on other countries nearly costing a world war 3 which would have been an awful thing for society in this period of time. Countries were preparing for the worst possibility which was way and were forced to spend billions of dollars to prepare. All allies were of lost becasue of this.
    Overall, Putin’s actions as Russian leader was a start of Russia losing allies and some of the biggest brands are leaving Russia. 253 companies left such as shell, reebox, bp, american airline, ebay , and much more big companoes. These are huge companies that will cause a big drop in the economy. This does not include the 248 companies that hav suspended activity in Russia such as nike, burger king, mcdonalds, and more. We will see how this will affect Russia and other countries in the future as the economy has gone down tremendously and will continue to do so. Sanctions from Ukraine’s allies have already shaken Russia’s economy. The country’s stock market is on an IV drip

  9. Russian Invasion on boarding Ukraine has sent numerous shock waves around the world as different horrendous acts unfold. As these acts unfold, It is also having a very large affects on the world’s economy which is making prices of normal goods skyrocket. The world simply has not been the same Vladimir was put into office in Russia. His time in power has not only resulted in hardship for the people of Russia but has also given struggle to the rest of the world. The scare of a world war 3 has never been higher and the world stays on high alert for the time being. So with all of these factors at hand, companies are starting to pull away from Russia which hurts them economically. This helps a few things like decreasing fund fund from Russia’s war efforts but do we really think it’s enough to stop Russia invasion. My opinion unfortunately it’s a no.

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