This past Tuesday, both Coca-Cola and PepsiCo made the choice to join the long list of companies that have officially announced that they would be taking steps to suspend all business across Russia in the wake of Putin’s decision to launch a full-scale invasion of neighboring Ukraine.
“The Coca-Cola Company announced today that it is suspending its business in Russia,” stated Coca-Cola in an official release. “Our hearts are with the people who are enduring unconscionable effects from these tragic events in Ukraine. We will continue to monitor and assess the situation as circumstances evolve.”
The fallout of this decision for each company will be felt across different levels.
As read in a report from CNBC, “In a regulatory filing, Coke said its business in Ukraine and Russia contributed about 1% to 2% of its consolidated net operating revenue and operating income in 2021. Pepsi, on the other hand, generates roughly 4% of its annual revenue in Russia, though it is not halting all business in the country.”
CEO Ramon Laguarta stated, in a memo to all PepsiCo associates, “given the horrific events occurring in Ukraine we are announcing the suspension of the sale of Pepsi-Cola, and our global beverage brands in Russia, including 7Up and Mirinda. We will also be suspending capital investments and all advertising and promotional activities in Russia.”
“As a food and beverage company, now more than ever we must stay true to the humanitarian aspect of our business,” highlighted Laguarta, going on to say that the company has “a responsibility to continue to offer our other products in Russia, including daily essentials such as milk and other dairy offerings, baby formula and baby food.”
Quite a few companies around the globe have issued responses to the events taking place in Ukraine. A list, which was created by Yale Professor Jeffrey Sonnenfeld, has seen quite a bit more attention due to the fact that it keeps track of the stances and status of various companies’ business dealing in Russia.
As discovered on Tuesday, this list highlighted the fact that Coca-Cola was suspending “certain operations in Russia.”
Recently, McDonald’s also put out an announcement that it would also be temporarily shutting down the entire suite of its 850 Russian locations, citing “the needless human suffering unfolding in Ukraine.”
As read in a letter put out to McDonald’s employees and franchisees, CEO Chris Kempczinski stated, “McDonald’s has decided to temporarily close all our restaurants in Russia and pause all operations in the market.”
He continued, “the Company has provided immediate financial support to our team in Ukraine. We are continuing to pay full salaries for our Ukrainian employees and have donated $5 million to our Employee Assistance Fund, and continue to support relief efforts led by the International Red Cross in the region.”
He also highlighted that the salaries of the employees would continue to be paid. Also, the Ronald McDonald House Charities (RMHC) located in Russia would continue to carry out its operations as normal, “just as RMHC Ukraine is partnering with local hospitals and providing humanitarian aid throughout the country.”