Heineken, Universal Music Group Join List of Companies Leaving Russia
Dutch brewer Heineken and Universal Music Group have become the latest companies to pause business in Russia in response to its invasion of Ukraine.
Heineken announced Wednesday it also will suspend operations in Russia, including the sale, production and advertising of its popular beer, and said it would “step up support and donations for NGOs [non-government organizations] operating in Poland, Hungary, Romania and Slovakia” assisting Ukrainian refugees.
Heineken already had announced plans to end all new investment and exports to Russia.
Universal Music group announced its decision in a statement on its website, saying it was suspending all operations in Russia and closing its offices there effective immediately. Universal — the world’s largest music label — said it has been working with groups from a range of countries to support humanitarian relief efforts to bring urgent aid to refugees in Ukraine.
Fast food giant McDonald’s, which opened its first Russian location in Moscow’s Pushkin Square in 1990, said Tuesday it was closing all 850 restaurants across Russia while continuing to pay its 62,000 employees.
The decision will cost McDonald’s millions of dollars in lost revenue, as it directly owns 84% of the restaurants in Russia, as opposed to its normal business model of licensing them to independent franchise operators. But president and chief executive officer Chris Kempczinski said in a letter to McDonald’s employees that “we cannot ignore the needless suffering unfolding in Ukraine.”
Seattle-based Starbucks then made a similar move, announcing it was temporarily shutting down 130 coffeehouses across Russia that are owned and operated by Kuwaiti-based franchisee Alshaya Group. Starbucks CEO Kevin Johnson said in an open letter that the company will halt all shipments of company products to Russia, but he said Alshaya will continue to pay its 2,000 local employees.
Also shutting down or curtailing their operations in Russia are iconic U.S. soft drink rivals Coca-Cola and Pepsi. Coca-Cola gave few details about the suspension of its operations. Pepsi — which has been operating in Russia since the early 1960s at the height of the Cold War — said it was halting all sales of its sodas, including its flagship brand, but would continue to manufacture milk, baby formula and baby food in order to keep tens of thousands of Russian workers employed.
McDonald’s, Coca-Cola and Pepsi have been under increasing pressure to close or curtail operations in Russia since the start of the Ukraine invasion on February 24. The companies have been the target of a boycott campaign on social media, while New York state Comptroller Thomas DiNapoli, whose office oversees the state’s employee pension fund, sent each company a letter urging them to stop doing business in Russia. The fund invests in all three companies.
Meanwhile, U.S.-based Yum Brands, the parent company of KFC, a chain of fried chicken restaurants, and Pizza Hut, said Tuesday it will close 70 company-owned KFC restaurants in Russia and is in talks with a franchisee to close all Pizza Hut restaurants.
Numerous Western companies across a wide variety of sectors have announced plans to suspend or curtail their operations in Russia over the invasion, including British-based oil giants BP and Shell; Japanese automakers Toyota, Nissan and Honda; aviation giants Boeing and Airbus; financial services companies American Express, Visa and Mastercard; and tech and entertainment giants Netflix, Apple, Google and TikTok.
Additionally, U.S.-based internet provider Lumen Technologies announced Tuesday it was disconnecting its network service in Russia “due to increased security risk inside Russia.”
Some information for this report came from The Associated Press and Reuters.
