McDonald’s to Temporarily Close Restaurants in Russia; Facing Backlash

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McDonald's in Russia
McDonald’s said the move to close its restaurants in Russia was in response to the “needless human suffering unfolding in Ukraine.” Credit: Sandra Cohen-Rose and Colin Rose, via Flickr/CC BY-SA 2.0

The McDonalds corporate office announced on Tuesday that it will temporarily close its roughly 850 restaurants in Russia, in response to the country’s invasion of Ukraine.

The fast food chain said the move was in response to the “needless human suffering unfolding in Ukraine.” The company, which has had a presence in Russia for more than 30 years, said it was “impossible to predict” when it would reopen, adding that it was also experiencing supply chain issues in response to the conflict.

McDonald’s says it can’t ignore Ukrainians’ “needless human suffering” amid conflict

“Our values mean we cannot ignore the needless human suffering unfolding in Ukraine,” McDonald’s chief executive Chris Kempczinski said in a memo to staff, which was shared publicly.

McDonald’s, which owns a majority of its restaurants in Russia, will continue to pay its roughly 62,000 staff in that country. Combined with Ukraine, the restaurants in both countries account for about 9% of the firm’s revenue and about 2% of global sales.

#BoycottMcDonalds, other efforts pressure companies to act on Russia-Ukraine conflict

Prior to their Tuesday move, McDonald’s had been under pressure for not taking any steps to distance themselves from Russia.

 

Coca-Cola has also been criticized on social media for failing to speak out about the conflict and continuing to operate in Russia.

#BoycottMcDonalds and #BoycottCocaCola hashtags were trending on Twitter on Monday and over the weekend, as users complained about what they saw as a lack of action among leadership.

Deborah Meaden, a Dragon’s Den investor, spoke out on social media against the soft drink company, urging people to stop using its products.

The criticism comes amid calls for other well-known Western companies, such as Pepsi and Starbucks, to close their stores in Russia.

Coca-Cola and PepsiCo operate large bottling plants in Russia.

Coca-Cola announced last week it would be donating nearly $1.1 million to support the Red Cross in Ukraine and a further $600,000 to support refugees in neighboring countries.

In a statement issued on Thursday, on its website, Coca-Cola said everyone at the firm had been following the news from Ukraine.

“Our focus is on our people and supporting humanitarian relief efforts in Ukraine and the region. Our actions are coordinated with our bottling partner, Coca-Cola HBC,” the statement said. “Together, our priority is the safety and wellbeing of our employees and their families. We remain in constant contact and are doing everything we can to support them and our communities.”

NY pension fund suggests companies pause, end operations in Russia amid Ukraine conflict

New York state’s pension fund, which is a shareholder in Coca-Cola and PepsiCo, has urged them and others to consider their operations there.

In a letter, New York State Comptroller Thomas DiNapoli urged companies to review their businesses in Russia because they face “significant and growing legal, compliance, operational, human rights and personnel, and reputational risks.”

Pausing or ending operations in Russia “would address various investment risks associated with the Russian market and play an important role in condemning Russia’s role in fundamentally undermining the international order that is vital to a strong and healthy global economy,” DiNapoli said.

Several Ukrainian supermarket chains, including Novus, have announced they would be boycotting Coca-Cola products.

“Our supermarket chain no longer cooperates with the Coca-Cola company, which continues to operate in the territory of the aggressor,” Novus said in a Facebook post.

Starbucks responds

In a recent statement, Starbucks CEO Kevin Johnson described the attacks on Ukraine as “unprovoked” and “unjust.” Most of the coffee giant’s stores in Russia remain open, according to its website, although most of these franchises are run by the Kuwait-based Alshaya Group.

“I want to express deep care for the livelihoods of our 2,000 green apron partners in Russia,” Johnson said. “In times like these, as a company and as partners, we strive to never be a bystander. Partners’ perspectives continue to help inform the actions we will take.”

“We will donate any royalties we receive from our business operations in Russia to humanitarian relief efforts for Ukraine,” Johnson said. “The Starbucks Foundation has contributed $500,000 to World Central Kitchen and the Red Cross for humanitarian relief efforts for Ukraine.”

Boycott of Russia continues amid Ukraine conflict

Dozens of well-known Western companies, including Netflix and Levi’s, have already suspended sales or stopped providing services in Russia in response to the Russia-Ukraine conflict. Major technology companies, such Apple and Microsoft, and businesses, such as PayPal and Visa, have also shuttered operations or cut ties with Russia over its invasion of Ukraine.

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