Many Americans have united and are urging to boycott brands still operating in Russia, on Twitter hashtags like #BoycottPepsi, #BoycottCocaCola and #BoycottYumBrands are trending.
Companies doing business in Russia could face “significant and growing legal, compliance, operational, human rights and personnel, and reputational risks.” Thomas DiNapoli, said.
While American sanctions already prohibit investments in many Russian companies, it is prudent to freeze purchases in all Russian companies due to the situation’s unpredictability and the likelihood that conditions will deteriorate.
Coca-Cola, last week announced it was donating more than $1 million to Red Cross operations to help Ukrainian refugees in Poland and other countries, but made no mention of its extensive business operations in Russia. The company said in the statement: “Over the last few days, everybody at Coca-Cola has been following the news from Ukraine with heavy hearts. Our thoughts are with those affected.”
Other companies like Apple and luxury retailers like Hermès have either paused sales, imposed restrictions or closed stores in Russia in response to the invasion of Ukraine. So have retailers like H&M and entertainment giants like Disney and Warner Bros., which last week announced it was “pausing the release of its feature film ‘The Batman’ in Russia.”
Starbucks’ Kevin Johnson said in a letter Friday to the company’s partners that they have 130 shops in Russia but none in Ukraine. Still, Johnson wrote, Starbucks condemns the “unprovoked, unjust and horrific attacks on Ukraine by Russia.”
“First, we will donate any royalties we receive from our business operations in Russia to humanitarian relief efforts for Ukraine,” Johnson wrote.
At the moment, McDonald’s seems to be reluctant to speak against the invasion of Ukraine by Russia, it is suspected that this is related to the fact that 84% of all restaurants in Russia are operated directly by the company. McDonald’s opened its first fast-food restaurant in Russia about 32 years ago when it was the Soviet Union and now has 847 restaurants in Russia and 108 in Ukraine. Those restaurants account for 2 percent of McDonald’s sales, about 9 percent of its revenue, and 3 percent of its operating income, according to the company.
Yum Brands, whose chains include KFC, Taco Bell and Pizza Hut, has more than 1,000 restaurants in Russia. “Like so many across the world, we are shocked and saddened by the tragic events unfolding in Ukraine, and we’re focused on the safety of our employees, franchisees and partners in the region”.
In contrast with McDonald’s, most of Yum Brands‘ Russian stores are franchises run by local operators, so the money Yum makes from these restaurants accounts for just 2 percent of the company’s sales, the other 98% comes from licensing fees.
