Some Multinational Companies Continue Operations in Russia

Allen Smith, J.D. By Allen Smith, J.D. March 17, 2022

​While many multinational companies have halted or suspended operations in Russia, some are choosing to continue business there. We've gathered articles on the news from SHRM Online and other media outlets.

Koch Industries Defends Decision to Stay

Koch Industries said it would not exit its Russian operations because doing so would put its "employees there at greater risk and do more harm than good." Dave Robertson, the company's president and chief operating officer, said, "The horrific and abhorrent aggression against Ukraine is an affront to humanity. Principles always matter, and they matter most when they are under pressure." He noted that Koch "will not walk away from our employees there or hand over these manufacturing facilities to the Russian government so it can operate and benefit from them." The company is complying with sanctions, he said, and will continue to provide financial assistance to employees and their families from Ukraine along with humanitarian aid to those affected in neighboring countries.

(The Washington Post)

Subway Stays Open

Subway isn't closing any of its locations in Russia. The company explained it has no corporate operations in the country and its approximately 450 restaurants are all independently owned and operated by local franchisees. Subway said it would "redirect any profits from operations in Russia to humanitarian efforts supporting Ukrainians who have been affected by the war." Subway also is working with its franchisees across Europe to provide meals to those fleeing the war.


Burger King Says Franchisee Refused to Close Restaurants

Burger King's parent company, Restaurant Brands International Inc., said it hasn't been able to close its 800 restaurants in Russia because its independent operator there refused to do so.


Nationalization of Businesses That Leave Russia

Russian President Vladimir Putin has endorsed a plan to nationalize foreign-owned businesses that leave the country over its invasion of Ukraine. During a meeting with government officials, Putin said Russia must "introduce external management" on departing companies "and then transfer these enterprises to those who want to work." He endorsed a legislative proposal that would create a pathway for the government to take over and eventually sell businesses that exit the country.

(The Washington Post)

Pressure on Companies to Make a Definitive Choice

Companies that have paused operations or announced limited pullouts are coming under pressure to make a more definitive break: all or nothing, in or out. This has led some to revise their plans, raising questions about the long-term implications. Some corporate withdrawals, such as Procter & Gamble's, are partial. Other companies that initially said they would remain in Russia, including Deutsche Bank and the retailer Uniqlo, have backtracked.

(The New York Times)

Companies' Suspensions or Exits

Companies reducing, suspending or exiting their operations in Russia include Adidas, Airbus, American Express, Apple, BP, Boeing, Canada Goose, Coca-Cola, Cogent, Dell Technologies, Deloitte, DHL, Ericsson, Exxon Mobil, EY, FedEx, Ford, H&M, IBM, Ikea, KPMG, Mastercard, McDonald's, Microsoft, Netflix, Nike, PepsiCo, PwC, Shell, Sony, Starbucks, TJX, Unilever, UPS, Visa, Warner Bros., The Walt Disney Co. and Yum Brands. Yum Brands is closing 70 company-owned KFC restaurants and all 50 franchise-owned Pizza Hut restaurants.

(SHRM Online)

Four Categories of Companies

The Yale School of Management has drafted a list of companies that have withdrawn from Russia, or have suspended, scaled back or are continuing operations in Russia. It notes that since the invasion of Ukraine began, more than 400 companies have announced their withdrawal from Russia.

(Yale School of Management)

How can you help?
The International Committee of the Red Cross remains active in Ukraine, saving and protecting the lives of victims of armed conflict and violence. Its neutral and impartial humanitarian action supports the most vulnerable people, and your donation will make a huge difference to families in need right now. Donate here.



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