McDonald’s, Coca-Cola pause operations in Russia amid rising backlash
McDonald’s Corp., Coca-Cola Co. and Starbucks Corp. are temporarily halting business operations in Russia amid intensifying backlash since the invasion of Ukraine started nearly two weeks ago.
The iconic U.S. brands announced their decisions in a flurry of announcements Tuesday afternoon, joining hundreds of other global companies that have halted work in Russia since the war began. PepsiCo Inc. said it would suspend soda sales in Russia but would continue to sell daily essentials such as milk and baby formula.
Most private companies aren’t legally bound to exit Russia, but the PR is terrible if they stay.
After days of criticism on social media, companies with larger or more entrenched operations in Russia are starting to relent as the death toll rises in Ukraine and millions of refugees flee. The moves to step back from Russia will further isolate the nation of 144 million people, which is the world’s 11th-largest economy.
Some companies’ withdrawal makes it easier for others to do the same, given interconnected supply chains, said Gene Grabowski, a partner at communications firm Kglobal. Coca-Cola, for example, is a supplier for McDonald’s, so the action by McDonald’s deprives it of a major client in the country.
“What you’re seeing is a confluence here. Now it makes business sense,” said Grabowski, who has more than 30 years of crisis management experience. “Now there’s a business argument as well as an argument of conscience.”