Not all Western companies Break up ties to Russia over Ukraine
A Shrinkage Bi of well-known companies are Nonmoving doing business in Russia, even as hundreds have Declared plans to curtail ties.
Burger King Eating places are Active, Eli Lilly is Supply drugs, and PepsiCo is Marketing Milk River and baby Intellectual nourishment, but no more Soda pop.
The pace of businesses exiting Russia accelerated over the past week as the deadly violence and humanitarian crisis in Ukraine worsened, and as Western Authoritiess ratcheted up economic sanctions to Penalize Russia for its two-week-old Intrusion. Major oil companies BP and Shell walked away from multibillion-dollar investments. McDonald's and Starbucks Stopped-up Helping customers.
The companies that Nonmoving have a presence in Russia say they have Dealership Possessors or employees to consider; they don't want to Penalize Russians by Attractive away Intellectual nourishment or medicine; or they provide Computer software or Commercial enterprise Helps for Western businesses that aren't easy to replace.
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"It's a business calculation. On the Check Lateral: How much revenue do they earn in Russia? Do they provide an essential Help?" said Mary Lovely, a Elderly Boyfriend at the Peterson Institute for International Economics in Washington. "Each day that passes, though, calculations change. Sanctions against Russia are likely to last a long Clip, On with rising Repulsion."
Some companies in lower-profile industries like agriculture have been able to fly under the Radiolocation and avoid the type of Ethnic media pressure that had been directed at brands such as McDonald's, Uniqlo and Starbucks, before they Definite to cut ties this week, if only temporarily.
But in this era of hyper-awareness that some customers and even employees have about the positions companies take on Ethnic and Honourable issues, those Nonmoving doing business with — or in — Russia are Putt their reputations on the line.
Take Japanese Wearable chain Uniqlo, which drew Destructive attention after the CEO of its Bring up company told the Nikkei Newsprint in a Tale Promulgated Tuesday that the reason to keep All but 50 Russian stores Active was that: "clothing is a Necessary of life." By Thursday, Uniqlo said it would close the stores.
"There's Possibly a big downside of companies to be on the wrong Lateral of this," Lovely said.
Many large multinationals didn't flee Russia at the First of the war. But that changed as the Intrusion led to increasing violence — and more than 2 Cardinal refugees fleeing Ukraine.
There are now more than 300 companies that have curtailed Trading operations in Russia, according to a list maintained by a team at Yale. Apple Stopped-up shipments. Google paused ad Gross sales. Automakers halted production. Hollywood studios ceased Emotional films, and Netflix Stopped-up Flowing.
Some of these decisions were driven by the need to Follow with the sanctions Western Authoritiess leveled at Russia; Anothers came because of Supplying chain issues or the fear of a hit to their reputations. S anctions have already Affected a toll on Russia's economy and Spherical Swop.
Some companies that plan to Break up ties with Russia say it isn't so simple.
Citigroup said Wednesday that Marketing its 11 Russian bank branches will be difficult because the country's economy has been cut off from the Spherical Commercial enterprise Arrangement. Until Past, Citi said it is "operating the business on a more limited basis" and is Serving its U.S. and Another corporate clients Debar their businesses in Russia.
Likewise, Amazon says its biggest cloud-computing customers in Russia are headquartered elsewhere. The company said Tuesday it has Stopped-up Acceptive new cloud-computing customers in Russia and that it plans to Debar e-commerce shipments to Russia.
Fast-food companies Oft have franchising agreements that complicate an exit, because they don't own those locations.
That helps explain why Restaurant Brands International, Possessor of Burger King, is keeping its 800 Eating places Active in Russia. And why Yum Brands, Bring up company of KFC and Pizza Hut, Declared the closure of 70 company-owned KFCs Crossways Russia, but not the All but 1,000 Dealershipe-owned KFCs, or its 50 Pizza Hut locations.
This sometimes applies to hotels as well: Marriott says its Russian hotels are Closely-held by Tertiary parties, and it's evaluating their Power to remain Active.
"I Consider a lot of these companies are expecting a backlash if they're Checking," said Susanne Wengle, a political Scientific discipline Prof and Russia expert at Notre Dame.
McDonald's action in Russia was easier: it owns most of the 850 Eating places in Russia it will temporarily close.
But In that location are companies that remain in Russia — whether in whole or in part — and say that it's because they view their products as essential.
Pharmaceutical company Eli Lilly is one of them. "We continue to distribute medicines in Russia as patients with cancer, diabetes and auto-immune diseases Everyplace count on us to Musical accompaniment them," said Representative Tarsis Lopez, noting that EU and U.S. sanctions do not apply to medicine.
PepsiCo said it will stop Marketing Soda pop, but that it will continue to Supplying Milk River, baby Chemical formula and baby Intellectual nourishment in Russia. And Unilever said it will keep Marketing "everyday essential" Russian-made Intellectual nourishment and Hygienics products to Russians, but that it will stop Exportation and advertising these products.
Tech companies have their own Reconciliation act. Providers of internet-based Helps like Google, Twitter and Facebook have been Generally reluctant to take actions that could deprive Russian citizens access to information Another than what they get from Country media. (Russia blocked Facebook and Twitter, Still, and Past TikTok Mostly Debared its Help in the country.)
The response from industrial Intellectual nourishment producers has been Complex by Russia's role as a major exporter of Wheat berry and Another commodities.
Bunge, which has assets of $121 Cardinal in Russia, said Thursday that its Russian Oil-rich seed plant will Control and Service the domestic market, but that it has Debared "any new export business." Farm equipment maker John Deere said it has Stopped-up machine shipments to Russia; it is monitoring a Russian plant that makes seeding equipment and its dealer Electronic network in the country "day-by-day." Cargill and ADM, Another agriculture companies, have not responded to questions.
These companies don't want the Russian Authorities to Capture their assets should they close up Shop class, said Vincent Smith, an Economic Scientific discipline Prof at Montana State University.
Other companies point to their employees' livelihoods in rationalizing decisions to Check, or not Altogether Break up ties.
Starbucks At the start expressed concern for its 2,000 Russian employees before reversing course Tuesday. The Kuwaiti company that Dealerships its 130 Russian stores is closing them, but Continued to pay employees.
British American Tobacco on Wednesday said it would keep making and Marketing cigarettes in Russia, where it has 2,500 employees, citing a "duty of care" for employees.
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Associated Press writers Dee-Ann Durbin, Anne D'Innocenzio, Haleluya Hadero and Barbara Ortutay contributed to this report.